The Importance Of A Written Contract

Employment / Personal Injury / Business

“So let it be written.  So let it be done.”  This memorable quote is perhaps best known from Yul Brenner’s decrees as Pharaoh of Egypt in the classic film “The Ten Commandments.”  However, its simple principle is applicable to everyday agreements between people doing business together.  Write it down.

While an oral contract is enforceable, the problem with oral contracts is proving them.  Let me give you two recent examples.  A client hired a contractor to renovate rented commercial space prior to opening a new business.  The client understood the contractor to quote one price, and even made installment payments during the work, but he had nothing in writing.  When the work was finished, the contractor presented a bill almost $20,000.00 more than what the client had agreed to orally.  The contractor claims some of the work went beyond what they originally discussed, but no change orders were executed.

In another situation, a wedding planner hired a photographer to assist part time.  Again, the parties did not put their agreement in writing, nor did they consider who owned the rights to the finished photography proofs when the relationship ended.  When the photographer left, he wanted the wedding planner to pay him more money for the rights to continue to use the photographs he had taken during their arrangement.  Had the wedding planner simply inserted a sentence or two in a written agreement identifying the photographs as “works for hire” in which he had exclusive ownership, he could have avoided this predicament.

A written contract does not have to be complex.  And every contract should have three basic components:  (1) a brief DESCRIPTION of the goods being sold or the services performed; (2) the PRICE for the goods or services and how and when it will be paid; and the TERM of the contract or the length of time the parties intend to do business together in accordance with their agreement if it is not a single transaction.

Just as some attorneys may be handy with home repairs (I am not one of them), some contractors and business owners may be able to prepare simple contracts that meet their needs.  Anything in writing is an improvement upon an oral contract.  However, the more complex the contemplated transaction, the more professional draftsmanship can spare the parties to the agreement future conflict and legal expense.  Another well-known quote (at least for anyone over forty) comes from an old Fram Oil Filter commercial:  “Pay me now, or pay me later.”

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