Beginning next week, Wagenmaker & Oberly, LLC will be moving to our new office location. Located in the historic and iconic Monadnock building, our new facilities will provide the firm with ample room for its continued development and growth. In addition, the office’s convenient location and excellent facilities will equip us to better meet our client’s diverse legal needs.
As lawyers who regularly advise clients in matters of contract law and real estate, the process of evaluating more than a dozen prospective lease agreements, some good and some bad, emphasized the importance of the most fundamental legal considerations in negotiating any contract. The following are five legal considerations that should be addressed in any contract, whether leases, agreements for provision of services and goods, and or agency, joint ventures.
1. Trustworthiness. More important than the paper on which an agreement is written, the trustworthiness of the other contracting party is critical. Have you done your due diligence to make sure that the other party will deliver as promised? Does the other party have a good reputation? Just in case, what safeguards can or will you take in the written contract to protect your own interests against later problems?
2. Meeting of the minds. Developing a written contract provides an excellent opportunity to check in, identify, and further clarify together what is to be done by each contracting party. Be as specific as possible with deadlines, work to be done, by whom, quality of work expected, suitability of materials or services provided for their intended purpose, etc.
3. Money matters. Make sure that you reach agreement on what amounts will be paid, on what basis, when, and for what.
4. “The best laid plans . . . .” Don’t forget an exit strategy. No matter how rosy the picture may look going in, it is essential that the contract provide for what happens when a party does not fulfill the agreement’s terms or otherwise seeks to end the contract. Decide and agree on consequences as much as possible ahead of time, to minimize costly surprises later.
5. Names and signatures. Make sure that the correct parties are identified. You may want to verify official corporate names (e.g., in Illinois, through the Illinois Secretary of State). The agreement should be signed by all parties, together or through countersignatures. Corporate signatories should be duly authorized agents who specify their corporate capacity in the signature block.