Do you believe an oral agreement is always as good as a written one? It's a common misconception about contracts that can lead to significant problems, especially when valuable assets like intellectual property are involved. As the old saying goes, often attributed to Samuel Goldwyn but a truism in law, "An oral agreement is not worth the paper it's written on."
In this critical video, Phil Crowley, founder of Crowley Law LLC and an experienced business lawyer, debunks the myth of relying on verbal understandings and stresses the absolute necessity of getting your agreements in writing. This is particularly vital for intellectual property (IP), which can be complex and hard to define without explicit written terms.
But just having a piece of paper isn't enough. Phil explains what it takes to create a strong contract:
Strategic Foresight: As an innovator or business owner, you must think through precisely what you aim to achieve with the contract.
Anticipate Potential Problems: Consider everything that could possibly go wrong during the course of the agreement.
Provide for Contingencies: Your contract should clearly outline what happens if those anticipated problems arise.
Clear Termination Clauses: Just like a prenuptial agreement defines terms for a potential separation, your business contracts need to clearly state what happens if the agreement must be terminated. How will investments be handled? What are the fair "exit" procedures for all parties, including vendors?
Thinking through these issues beforehand is paramount. As one of Phil's mentors wisely put it, when it comes to entering important agreements without due diligence: "Marry in haste, repent at leisure." Don't let poorly considered contracts become a source of future regret.
If you're an innovator, entrepreneur, or anyone entering into business agreements, this advice on contract diligence is indispensable.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
