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Five Benefits of Using Lawyers to Handle Commercial Contracts for Your Company in the UK

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As a business owner, you know that negotiating commercial arrangements with other companies can be as important as attracting new customers. Therefore, it is advisable to record the terms of important commercial deals within written contracts. Failure to do so can result in a dispute over the contractual terms between the parties and cause potential harm to your business. Because of this, many businesses operating under English law use commercial lawyers to draft, negotiate and finalise their commercial agreements. This article will explore five significant benefits of using a lawyer to handle commercial contracts for your organisation.

What is a Commercial Agreement?

A commercial contract records the main terms of a commercial arrangement between parties. Suppose your company agrees to supply a computer maintenance service to another business. The contract should confirm the nature of the computer support, its length and its cost. 

Let us explore five significant benefits of using a lawyer to handle your commercial contracts.

1. Stronger Negotiation Hand

No business wants to end up with an unfair written contract. Unfortunately, poor negotiation usually results in unfair commercial agreements. Examples of unbalanced contract terms can include:

  • one party being able to exit the agreement at very short notice;
  • one party being unable to terminate the contract in circumstances where the other party can do so;
  • being able to withhold payment for unusual reasons; and
  • requiring one party to perform time-consuming and unreasonable acts without a reciprocal obligation on the other.

A lawyer can help your organisation safeguard against the other company by simply putting a contract in place that is strongly biased towards themselves. Whilst parties should expect to compromise, a lawyer can help convince the other side to act reasonably. Thus, your contract will likely contain balanced wording that suits your business needs.

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2. Drafting Skills

A lawyer’s expertise comes to the fore when recording the deal within a legally binding contract. Whilst you may have a great idea of how to sum up the deal verbally, a lawyer can do so through airtight legal wording.

Many business owners ask why contracts contain legal-speak (otherwise nicknamed ‘legalese’). This is mainly because such language ensures only one interpretation of the term. This aims to avoid loopholes and opportunities for potential disputes between the parties.

3. Conflict Resolution

Many business owners trust a lawyer to help formulate and finalise business contracts. Often, lawyers have experience negotiating key terms calmly and neutrally.

Whether the other party has a lawyer or not, your solicitor will quell any opportunities to protest. This is because lawyers can phrase negotiations in formal, neutral language and avoid inflammatory terms. The lack of wild or controversial language also makes it harder for the other side to determine your actual bargaining position within any ongoing negotiation over cost.

4. Ensuring the Contract Contains All Relevant Information

There is little point in negotiating and finalising a commercial contract that does not record all critical information. For example, a contract will be inadequate if it fails to describe the goods you provide.

Suppose a football club orders 200 footballs from a major kit supplier. Accordingly, they would expect any legally binding agreement to contain standard terms relating to the size, brand and type of football rather than simply state ‘200 footballs’.

Unfortunately, many businesses fall into the trap of recording some but not all critical details. This can create a future dispute when the parties look at the contract and find it does not cover a particular issue. In this way, a lawyer can ensure that the commercial agreement mentions everything required to make the contract work in practice.

5. Ensuring a Valid Signature

This should be the most straightforward part of the process. Nevertheless, companies can fail to meet the requisite formal signature requirements. Naturally, an invalid signature gives rise to the possibility that the contract is either not binding or that an implied contract has been unwittingly created through conduct. Both situations are uncertain and can lead to extensive legal battles between the parties. A lawyer can help your company ensure that any signature is valid and legally binding.

Key Takeaways

Having a lawyer on your side can help simplify the negotiation, drafting and finalisation of commercial agreements. Lawyers are also helpful in providing peace of mind and giving you more time to run your business. Many businesses have been stung by seemingly harmless clauses that apply differently in a legal context, which is a crucial area in which a lawyer can help interpret any draft wording.

If you need help negotiating and finalising commercial contracts, our experienced contract lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page

Frequently Asked Questions

What is a good negotiation style for commercial contract negotiations?

Many lawyers advise clients that it is a good idea to go into a negotiation knowing their company’s limits within any particular contract. It is relatively standard legal advice that achieving the right contract is more important than a favourable verbal agreement.

Why do lawyers use neutral language within negotiations and contracts?

Whilst there is a wide range of potential negotiation techniques, it is well-accepted that confrontational, aggressive tactics can ruin contract negotiations. This is because most companies predict the future conduct of a company to be similar to their contract negotiation style.

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Thomas Sutherland

Thomas Sutherland

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