Verbal agreements are binding – but what did you actually agree to?
IF IT’S IMPORTANT PUT IT IN WRITING. In business you will make a lot of agreements, most of which will be verbal. Almost all will be binding on you – there are some exceptions. If an agreement is important to your business, if you intend to rely on the terms of that agreement, the only way to make sure that you and other party both know what the terms of agreement were at the time you made it is to record it in writing. Everyone forgets what was agreed, circumstances and intentions change so do the people you originally dealt with. The only way to protect yourself and your business is to have it in writing
Knowing what is in an agreement you receive is equally important. Unless you understand everything that is in the agreement don’t sign anything without full and proper advice. Remember, this is binding on you and all other parties and many standard form agreements used by your suppliers and/or customers have some nasty surprises.
IMPORTANT POINTS TO NOTE ABOUT AGREEMENTS:
- Verbal agreements are valid and binding on you.
- You need to be sure about the terms of an agreement, if you intend to rely on it, put it in writing.
- Know what it is that your agreeing to and are signing BEFORE you sign it.
- When in doubt don’t sign anything but seek advice from our Accredited Business Law Specialist.
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