Contracts are an essential part of any business venture. Any time you buy or sell goods or services, hire someone, lease office premises or vehicles, sign confidentiality or non-competition agreements, or form a partnership, you are entering into a legally binding business contract.

In order for a contract to be valid and legally enforceable in a court of law, it must include a specific offer that is accepted and freely consented to by both parties.

It is an agreement that involves an exchange of something of value, in which one party promises to do something in consideration of a particular action by the other party. Contracts can take many forms, whether its T-Mobile, Orange, Vodafone sim only or Virgin mobile sim only deals, it’s important to understand the types of legal agreements when you’re deciding what type of business contract is right in any given situation.

Oral and ‘handshake’ agreements are valid and enforceable contracts. They are, however, the most subject to misinterpretation and can be difficult to prove if there is a dispute resulting from a breech of the agreement. It’s inadvisable to use oral contacts for the sale or purchase of goods worth more than £300.

A contract may also take the form of a letter of intent, a series of correspondence including e-mails or the exchange of purchase order forms. A letter of intent is a fast, convenient way to spell out the terms of an agreement in writing. Businesses often use letters of intent as an interim step while the terms of a more formal contract are being negotiated. Other correspondence, including purchase order forms can also form the basis of an enforceable agreement.

For anyone who is conducting an internet based business, electronic contracts and signatures are the most commonly used types of legal agreements. Entering into a legally binding e-contract is as simple as checking an ‘I agree’ box on a business website. As e-signatures can be subject to legal challenge, many internet businesses prefer to obtain a written signature on their contractual agreements.

Some types of contracts, such as those for the sale or purchase of real estate, must be in writing. A well crafted written business contract provides you with the best legal protection in the case of a lawsuit. A written contract does not need to include a lot of legal jargon, but the terms of the agreement need to be spelled out in a very specific and clear manner. To avoid confusion and arguments later on, the language should be simple and concise, with major terms clearly defined. Any conditions or questions of both parties need to be clarified. Never assume that the other party understands your conditions.

Whatever form of contract you have chosen to use, you need to know the laws and regulations that may be relevant to your agreement. You can research applicable laws online or consult a lawyer to ensure that the agreement you are entering into complies with the law. The best way to avoid potential litigation is to make all of your business contracts as clear, concise and thorough as you can. The best contracts are a win-win for both parties.

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