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Have a Lawyer to Draw Up a Contract So That It Is Legally Enforceable

Business woman and client

Business woman and client

A business needs to operate within the confines of the laws that are applicable in the North Shore area. This requires owners and managers to be constantly aware of commercial laws, which can be quite complex in their application to situations that businesses may find themselves in.  Unfortunately a recurring problem for many businesses is customers not paying their bills on time. To ensure you are paid by your customers, get legally enforceable terms of trade from a North Shore commercial lawyer.

 

In every business, there is a need to fulfil certain obligations which they will pay suppliers for. This often requires contracts and other documents to be signed between the two parties, which can be legally enforceable, in case of any dispute. This is where it becomes necessary for a business to have a lawyer familiar with commercial law, to draw up such contracts and the terms of trade under which the contract will operate. Business deals do involve negotiation and agreements to be arrived at, and even though it is necessary to have trust and confidence in each other, it is always safer to have everything that has been negotiated or agreed to be set down in a legally enforceable document in the form of a contract, that can be signed by both parties involved.

Brandon Cullen - Albany Commercial lawyer

Brandon Cullen – Albany Commercial lawyer

Before any contract is drawn up, all the terms that look after the interest of both parties need to be set out and itemised. These contracts can be with customers, vendors, employees, investors or any other party that has a business relationship. A lawyer may couch contracts in legalese, but it is always better to cut out all the legal mumbo jumbo and ensure that a contract has language that a layman can understand. This makes it easy for the parties, who are ultimately responsible for the execution of the contract to be clear as to their responsibilities and obligations, which will be based on any negotiations or terms agreed to.

A lawyer drawing up the terms for a contract has to ensure that the contract has conditions that both parties to it can fulfil and are authorized to do so. Parties and authorities responsible for execution of the contract must be very clearly specified, while the terms laid down in the contract must include all details agreed to in the negotiation. The trickiest part in most contracts are payment obligations and delivery commitments and these must be spelt out in complete detail, so that there is never any ambiguity in to what each party has to do , to complete their part of the contract.

When contracts are drawn up, a good lawyer will also include conditions that can lead to termination of the contract. Under good business conditions and in 99 percent of the cases, these may be redundant, but once these terms are a part of the contract, it becomes a way for any dissatisfaction on either site to be brought to a culmination. It can also help to have terms that will allow for dispute resolution, legal costs and other issues that may become a bone for contention.

If you operate business in Albany or on the, a highly experienced North Shore commercial lawyer is McVeagh Fleming and Co.  If you need to draw up a trading contract or terms of trade, then be sure to contact McVeagh Fleming.

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How a commercial lawyer can help people buying a business on Auckland’s North Shore

Buying a business is a complex matter and one which can take a number of months to complete.

There are a lot of different activities that need to be borne in mind before you become the legal owner. This article will be a short review of some of those; it is not legal advice so please consult a commercial lawyer on the North Shore before you commit to anything.Woman in suit

Firstly, there are two finance aspects to address – the funding of the purchase and more importantly, the due diligence to make sure you are buying a business at a fair price.

Funding the purchase

Clearly any buyer of a business must have suitable funds available for settlement date of the transaction. Without sufficient finance the deal will not go through.

This will often cost the potential purchase the loss of any deposit, significant legal and financing fees for work done to that date. It will also cause significant damage to your reputation.

That said, there are many ways to fund a business purchase. Using your own cash is one but that is often not a good use of your assets. You can raise finance using other assets as collateral. This is very common with a family home typically used as the collateral. This obviously has some risks for your family in case anything goes wrong with the business.

Another method is to use vendor-financing where the seller agrees stepped payments which you can fund from cash-flow in the business.

Whatever, arraignment you agree with the vendor, you must have it clearly recorded as part of the legal sale transfer. Your commercial lawyer will put this in place for you.

Due diligence

Your accountant will conduct the financial due diligence which verifies that the accounts are correct, that taxes are up-to-date and a range of other financial measures are correct.

A commercial lawyer will check that the vendor is legally able to sell the business, that they are the true owner.

Contracts for buying a business

For the sale of most small businesses in New Zealand, the standard real estate Sale and Purchase agreement is used. This means there are no nasty clauses in the main body of the contract plus it saves you money on having the contract drawn up.

However, you or the vendor will be at liberty to add other clauses which your commercial lawyer deems appropriate. A good North Shore commercial lawyer on the will advise adding these clauses dependent upon the type of business you are buying.

This can include a verified stock valuation, a list of goods and chattels plus details of any machinery you are buying.

Other tasks a commercial lawyer will perform

For many businesses leases may be involved. These can be for premises, vehicles and large pieces of plant or machinery. All of those leases will need to be formally transferred to you as the new owner of the business. Your lawyer will verify that the leases are correct and that you understand your commitments b agreeing to them.

Sometimes they may be able to renegotiate parts of your leases. This is quite common for leases for business premises.

Conclusion

This is a brief overview of a few of the major issues if you are considering buying a business on the North Shore. Commercial lawyers will be able to help you understand these issues as they affect you directly. And they will also be able to carry-out those transactions for you. So be sure to contact a commercial lawyer as soon as possible and definitely before you sign any documents.