Commercial contracts govern the relationship between trading parties. They cover a multitude of issues from simple terms such as the parties, the price and delivery details to more complex issues such as intellectual property rights, termination rights and compensation in the event of breach of contract.
For larger deals, the parties will usually negotiate a bespoke contract appropriate for the specific subject matter of the deal.
Day-to-day business arrangements, like supply agreements, are often covered by standard terms and conditions (T&Cs). (You can read more about T&Cs here.)
Recording your agreements in writing
Contracts made orally can still be binding on the parties but can lead to problems in the future:
- your recollection of what was agreed may differ from the other party's recollection;
- if you have not recorded your agreement in writing, it will be harder for you to prove that your recollection reflects the original agreement;
- it might not be clear whether your T&Cs are incorporated into the contract;
- you may not deal with certain key terms in your oral discussion. The lack of a key term could mean that there is no binding contract; and
- there will be no procedures on how to end your relationship or resolve disputes.
It is far better to ensure the terms you have agreed are recorded in writing and agreed by the other party. Written contracts are more cost effective in the longer term too: they set out what should happen in various scenarios thereby reducing the scope for expensive and time-consuming disputes.
For contracts involving significant sums or crucial business arrangements, a negotiated, written agreement signed by the parties will set out the obligations of the parties and provide suitable protection of each party's rights.
How can we help you?
Our team of commercial lawyers can:
- draft and negotiate all manner of commercial contracts, including licensing, distribution, manufacturing and non-disclosure agreements;
- advise on the implementation of new contracts;
- review your current contracts and standard terms and conditions to: (1) ensure that they are up to date, (2) assess your rights, duties and obligations in any particular set of circumstances; and (3) ensure compliance with the latest regulations in an ever-changing regulatory landscape;
- advise on complex areas of the law such as the Commercial Agents Regulations 1993; and
- advise on dealing with software development and licensing agreements.
Your business, the trading environment and the law are constantly evolving and changing. It is important to ensure that your contracts remain appropriate for your particular business and are kept up to date.
It is also important to learn from mistakes or mishaps in the past. For example, if your business has been involved in a dispute or it has become clear that a term of your contract leaves your business exposed to future disputes, now is the time to redraft the relevant provisions in the contract.
Our commercial team also offers contract reviews tailored to your specific requirements. That might mean, for example:
- explaining what your obligations are when terminating a contract; or
- advising you on how to enforce contractual obligations against the other party (or parties) to the contract.
Pre-sale contract reviews
We also carry out reviews of key contracts in advance of a sale of your business. This service:
- identifies any weaknesses or gaps in your contracts;
- allows such weaknesses to be remedied in a controlled environment – before any subsequent buyer can discover them during their due diligence investigations; and
- can lead to significant costs savings. For example, we have, when acting for a buyer, seen many deals fail because the seller's key contracts were not in a suitable state. We can help prevent this sort of situation from happening.
We advise on a wide range of commercial contracts including franchise, licensing, construction, manufacturing, supply, distribution and Information Technology (IT) procurement agreements. We act for clients in diverse sectors including those in telecoms, IT, manufacturing, technology, software and media.