WHAT IS A CONTRACT?
- an agreement or understanding between 2 or more parties
- offer and acceptance
- for some value (even a "Peppercorn")
- can be oral or written, but an oral agreement is harder to prove
If in writing, then it must be:
- express the length (or, "term") of the agreement
- name all parties legally correctly
- signed by all parties
- "Four Corners of the Document" - you must be able to ascertain the full agreement between the parties
from the language in the document itself, without
any outside evidence, or---from the four corners of the document!
Certain types of contracts are REQUIRED to be IN WRITING: (known as "Statute of Frauds"), including:
- deeds (sale) for real property
- assignments (sale) of intellectual property
- exclusive licenses for intellectual property
and many others according to each state's laws...
MINORS: Minors cannot themselves contract, and upon reaching the age of majority, they can cancel (repudiate) a contract entered into on their behalf by a parent or guardian.
LANGUAGE:Certain standard clauses should always be included in any contract, which help to make contracts enforceable and assist in the interpretation of the contracts in court, and which can vary from state to state.
Example: Attorney Fees clause permitting the recovery of attorneys fees in bringing a suit to enforce the terms of a contract.
Example: Seal Clause (in about 15 states) which extends the statute of
limitations, or time left to sue under the contract, and may create other benefits.
Example: Photocopy Clause (if available under your state laws) which permits a photocopy of the contract to be used in palce of the original.
WHAT IS A BAD CONTRACT?
It is either a poorly struck deal, or a poorly drafted document!
Signs of a bad contract:
- one page (there is very little you can do legally in one page)
- typos and bad grammar (a misplaced comma can affect the interpretation!)
- different fonts and styles in the same document ("cut-and-paste" job)
- doesn't make sense
- won't let you take a copy with you or to be reviewed
- poorly worded
- parties' names or titles vary throughout the contract (ex: "Producer" and "Artist"
becomes "Manager" and "You")
Rules of thumb:
- Trust your instincts
- Get legal advice
- Everything is negotiable
- Don't copy someone else's contract (different underlying situations!)
- Ask! The worst someone will say is "no"
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questions and needs.
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