Contracts and energy | Seth’s Weblog

A written contract advantages the celebration with the least energy.

Energy is perhaps within the type of cash, entry to loads of legal professionals or just a willingness to burn all of it right down to the bottom.

Within the second earlier than a contract is signed, the lower-powered celebration momentarily has extra energy. That’s as a result of the opposite entity desires what you’ve got. However as quickly as they’ve it, it’s solely the contract that gives concrete safety in opposition to future occasions.

Handshake agreements are nice when there’s an ongoing, steady interplay. So long as all sides is honorable, the opposite celebration can proceed to do what they stated they have been going to do. However when priorities or outdoors elements shift, an at-will association can find yourself harming the one who can least afford it.

The 2 issues to deal with are:

1. Is the contract particular sufficient in order that there’s little doubt about who is meant to do what, even when the world modifications?
2. Are the cures within the contract clear sufficient in order that if the contract isn’t honored, the lower-power celebration can simply and effectively acquire a good outcome?

This is the reason including a binding casual arbitration clause to a contract is a brilliant concept. Why it is smart for there to be employee and different protections within the legislation. And why we have to reinforce and applaud judicial methods that implement clearly outlined agreements.