The term business law refers to the rules governing the commercial interactions between certified entities or persons. The purpose of these rules is to regulate the entity behavior or the transactions carried out between the concerned. Rules of business law can come from legislation, common law, or agreements evolved through international treaties or conventions. Contractual agreements are important topics between commercial entities entering into a business transaction. Business agreements can control several kinds of commercial transactions like purchase of goods or services from another entity.
Why don’t businesses make verbal business agreement?
Under some circumstances, verbal agreements can create contracts that can bind legally. However, for this to happen, the interaction must have proper legal elements of offer, acceptance and consideration. Written contracts are mandatory when the terms of contract will require more than a year to carry out or when the value of the sale of goods is more than $500. Written contracts make it easy and convenient to settle disputes if they must arise in a transaction. An agreement documented in writing becomes legally powerful, enforceable and provable.
Different kinds of agreements
Also known as a partnership deed, the agreements pertaining to the founder, manager or shareholders depend on the kind of entity formed. They elaborate the responsibilities and rights of the stakeholders in addition to covering the basic details about the company’s operation. Ownership detail will always state what will happen if the owner leaves or the entity is dissolved.
Supplier agreements usually contain the details about price, amount of goods or services and the terms of supply detailing the terms of relationship between the two entities involved in the agreement. The purpose of supplier agreements is to prevent any unwanted situations with the suppliers like failure or withdrawal to supply.
Independent contractor agreements
In the event when a business needs to outsource to independent contractors or temporary employees to perform the services required by the company, independent contractor agreements come in place since the independent workers are not full time employees and hence he contract documents wants to ensure that no complications arise in future.
These are used by entities to make sure that the employees or contractors understand their roles and are aware of what information they can and cannot share during and after their tenure with the company.
Those covered above are some of the most common kinds of legal agreements you will generally come across in the context of business law. However, business contracts can come to cover any number of topics as long as the elements are relevant to any given business relationship and are not prohibited by the law. It is always better to have the contracts and agreements written.
The role of business agreement lawyers
To ensure that a given transaction is properly taken care, the knowledge of business law is highly crucial. When you look forward to make a business agreement with an entity, it is always a good idea to consult a knowledgeable and experienced business agreement lawyer who can document the contract in line with the laws, create room in the contract effectively to safeguard the interests of the entities involved and solve any disputes that might arise during the implementation of the contract.