What is a corporate contract?
A corporate contract is any agreement that outlines an offer, acceptance of the offer and the set of promises and considerations which must be fulfilled in order to satisfy the contractual relationship.
Does a contract need to be in writing?
Not necessarily. A verbal agreement is still enforceable as a contract assuming the conditions of offer, acceptance, promises and considerations were met, and both parties have entered into the contract fairly.
It is best practice, especially in business, to have contracts in writing. This mitigates the risk of either party having a different recollection of the agreement and the associated risks of leaving the details to be consigned to memory alone.
What might invalidate a contract?
Whilst courts usually recognise contracts to be valid and enforceable assuming both parties fairly agreed upon the terms beforehand, there are circumstances under which a court can deem a contract to be invalid. these include (but are not limited to):
- Mistakes – There are 3 types of mistake which can nullify a contract or cause it to be reassessed: common, mutual and unilateral. This can get complicated, (but don’t worry, that’s where we come in) essentially when a contract is drawn up which includes a mistake such as in the agreed amount of compensation or in the possibility of the completion of the agreement at all, there is potential for the terms of the contract to become invalidated. The outcome of this may be that a contract is found to be void, or it could be reverted to a previous version, amongst several other remedies depending on the situation.
- Misrepresentation – This can also fall into one of 3 categories, innocent, negligent and fraudulent misrepresentation. This is where one party misrepresents the terms of a contract with one of the varying degrees of prior knowledge about the truthfulness of their statements. This could include selling a product where the seller didn’t know it was faulty (innocent) or making claims one party knows to be false in order to get the other to enter into a contract, such as the structural integrity of a property or financial situation of a business (negligent/fraudulent).
These can not only cause a contract to become invalidated, but depending on which criteria is met (such as outline above) a court could also order damages to be paid to one party in the event of financial losses incurred by entering into the contracted agreement.
Can I keep the terms of my contracts confidential?
Contracts often include very sensitive information, which could be harmful to your business if it falls into the wrong hands. We can help protect your confidential information and keep your valuable information safe by advising and guiding you through the process of employing non-disclosure agreements.