When entertaining the idea of making that next big purchase, buying the warranty package, or delving into a new business opportunity, a contract will be involved. Contracts come in many shapes and sizes, including the terms and conditions you may click through on a website, papers that are handed to you at the point of sale, or formal legal papers which require the signing of both parties. Regardless of form, it is important to review the contract to determine your rights under the terms and conditions.
First, understand that no matter what is spoken between the parties, if the contract is put into writing, the written contract is what will be binding. Simply put, all important terms must be included in the document. If problems arise later, it will be very difficult to prove the parties agreed to terms which are absent from the contract. Always read the document to make sure every provision that you negotiated for actually exists in the contract.
Second, look to see if there are any notice periods or strict timeframes which may limit your rights. Often offers appear to be a great deal, until you learn that the opportunity is only available in limited cases or after providing notice in writing within a short period of days. Perhaps after reviewing these terms, the offer is still a great deal, but you will have the foresight and knowledge to take action within the narrow time limits to maintain your benefit to the service or product.
Third, can either party terminate this contract, and if so, in what instances? Notice in writing may be required within a certain timeframe. If the parties decide to terminate, are there any restrictions on their future actions? Is there a non-compete contract hiding within the contract? Being able to exit a contract that has become harmful or burdensome is important, and in many cases it is prudent to know that you have an exit strategy.
Lastly, determine what your remedy may be if one party breaches the contract. Do the parties have the right to bring a claim in a court of law or are they bound to arbitration? What about attorneys’ fees, is either party obligated to pay these if such fees arise? If you terminate early, is the other party entitled to liquidated damages and how high is this cost?
It is best to have the document reviewed by an attorney prior to entering into the contract, so that he or she can advise of the other important terms in your contract and inform you of your rights and obligations. But remember, until it the document is signed, you have the right to negotiate changes to the contract.