The prospect of collaborating with another company is exhilarating. All you can think about is.
The prospect of collaborating with another company is exhilarating. All you can think about is how the project can grow from what you are already planning and how much prosperity the project will bring to you and others. It is fine to ride that wave of optimism for the length of a celebratory lunch with your new collaborators, but do not sign a contract immediately. This is the equivalent of going on a spectacular first date and then driving to Vegas to get married instead of dropping your date off at his or her home and making plans for a second date. You should never sign a business contract based on vibes alone. The next step is to reread the contract carefully when you have calmed down. The next step is to negotiate amendments to the contract.
Contracts that do not need any revisions are as rare as book manuscripts that do not need any revisions; even a masterpiece from the mind of a genius has gone through several drafts. The best way to ensure successful contract negotiations, where you can finalize the contract on fair terms without unnecessary delays, is to contact an Arizona business law attorney.
Send the First Draft of the Contract at Least a Month Before You Expect the Work to Begin
Haste is the worst mistake you can make when signing a business contract. People who get so caught up in the excitement of the moment that they sign a business contract without reading it do not make it very far in business, so that is not the kind of haste that threatens business agreements. Any reasonable businessperson would review the contract without signing. People get too hasty when they keep clauses in the contract that they are not satisfied with or omit clauses that they want to add just because they do not want to delay the project any longer. They worry that they will lose the opportunity and a competitor will get it instead.
The solution to this problem is to start early and build the pauses for negotiations into your schedule. Send the first draft of the contract to the other party at least a month before you want the work to begin.
Be Specific About What Happens if Things Do Not Go as Planned
The fun part about reading a draft of a business contract is the provisions about how much money you will get if the project goes well and how easily you can renew the contract so that you can collaborate on future projects. Your contract should be just as specific about what happens if things do not go well. Which party is responsible for which financial losses? How can you get out of the agreement if it becomes clear that the project is not going to become profitable?
Arbitration is Nice, But it Should Not Be Mandatory
Dispute resolution clauses are among the most important parts of a business contract, but too often, people just skim them or even skip over them entirely in favor of the more interesting parts that talk about how much you are going to get paid. If people spent as much time negotiating about the dispute resolution procedures in business contracts as they do about how much money they get in the best-case scenario, there would be fewer business lawsuits. In their simplest form, a dispute resolution clause in a business contract should say something like, “The courts of Arizona have jurisdiction to rule on disputes arising from this agreement.”
Lawsuits are no fun for either of the parties involved, so the dispute resolution clauses may require the parties to engage in alternative dispute resolution (ADR), such as mediation or arbitration, instead of or as a prerequisite to litigation. A contract that helps you avoid lawsuits is good, but do not agree to mandatory arbitration clauses that require you to waive your right in litigation. You can get a fair decision in a lawsuit, and you can appeal if you do not, but arbitration is almost always biased toward the party with the deeper pockets.
Voice Your Concerns With a Draft Contract in Order From Biggest to Smallest
When you review a draft of a contract, be upfront with the other party about your concerns and start with the biggest ones. This way, if you have to rush through details to sign the contract in time to meet a deadline for beginning work, you have resolved the most serious problems.
Contact Singular Law Group About Business Contract Negotiations
A business law attorney can help you negotiate successfully so that you can finalize your business contract. Contact Singular Law Group PLLC to set up a consultation.
An Arizona business law attorney can help you draft business contracts and engage in contract negotiations.
