As you can probably guess, I started my career in business law. So, though attorneys on TV are always conducting research and going to court, my days were filled with drafting contracts… massive 200 page contracts that we hoped would protect our clients from just about everything under the sun.
So imagine my surprise when I found out that many small business owners bypass contracts and use simple handshake agreements when they conduct business?! Whenever I confront an entrepreneur who does this my question is always the same, “Don’t you want protection?” Yes, I said ‘protection’, because this is the main selling point of a contract. It lays out the actions that must be taken by each party; it uses language that minimizes misunderstanding; it is evidence of your agreement that you can use in court if there is a dispute. Also, as we noted in our Contracts Cheat Sheet, some agreements will not hold up in court unless you use a written contract.
If you are a consultant or independent contractor, as Entrepreneur Press points out, this is especially true because “this is your livelihood at stake, and if something goes wrong, you'll need solid legal documentation to make sure you get paid.” As such they have laid out a fairly detailed list of things to include in your contracts. However, if you want an easier, more comprehensive approach to reading, drafting and using contracts, not to mention our FREE templates, check out our Contracts Cheat Sheet.
