The American Enterprise Institute states that independent contracting can add to workforce flexibility while reducing costs for the entire American economy. Many other types of contracts can benefit the economy in various ways, from employment contracts and commercial lease agreements to insurance policies and non-disclosure agreements. Commercial contracts help establish connections between businesses, customers, suppliers, manufacturers, and all the other moving parts of our economy. Business law helps ensure that these contracts are effective, enforceable, and properly drafted by the relevant parties. Although there are many possibilities when it comes to commercial contracts, they all must adhere to the same universal rules and regulations in Florida. An experienced business attorney in Florida may be able to help entrepreneurs understand these regulatory concerns while drafting and personalizing their contracts. Consider continuing this conversation by contacting Clearwater Business Law at (727) 502-6874. We serve entrepreneurs throughout Pinellas County.
What Is a Commercial Contract?
A commercial contract is an agreement that exists in the business world, formalized in writing and signed by at least two parties. A contract requires the relevant parties to commit to certain obligations. These parties are “contractually obliged” to follow through on these obligations, and the document is legally binding. In other words, an aggrieved party could potentially take legal action against another party who failed to carry out their contractual obligations.
The most obvious commercial contracts exist between two businesses. However, these contracts might also involve government organizations, nonprofits, and even individuals. Different regulations may apply based on the specific type of contract at hand, although all commercial contracts follow several universal rules. First, a contract is only valid if it was signed by parties free from duress. In other words, no one should feel pressured, manipulated, or tricked into signing these documents. If an aggrieved party can prove they were under duress when they signed a commercial contract, the document becomes unenforceable. Secondly, a contract is unenforceable if a party signed it while mentally incapacitated. To learn more about when a commercial contract could be unenforceable, consider contacting Clearwater Business Law.
When Might an Entrepreneur Need a Business Contract?
Entrepreneurs might need to draft business contracts under various circumstances. These individuals often have innovative new ideas, and these ideas can be extremely valuable. To protect this intellectual property, it may be necessary to create non-disclosure agreements (NDAs). These agreements allow entrepreneurs to collaborate with others without worrying about other people stealing their ideas. With an NDA, it is possible to sue a collaborator for stealing an idea.
When collaborating with others to start a new business, entrepreneurs might also want to create partnership agreements. These partnership agreements often form the foundations for new companies, and they ensure that everyone receives a fair share of the profits when the company becomes successful. Many of the most successful businesses were started by a handful of close friends or colleagues. A partnership agreement not only helps organize new businesses, but it might also reduce the chances of disputes in the future. If entrepreneurs want to work together but a partnership is not ideal, they may consider a “joint venture agreement” instead.
How to Approach Commercial Lease Agreements
Although many new businesses today operate almost entirely in the digital space, there is still a strong demand for storefronts, warehouses, factories, and other business operations that require physical space. New entrepreneurs may need to sign commercial lease agreements to secure this physical space for future operations. Note that these agreements are distinct from residential lease agreements in many ways, and entrepreneurs should consider many potential concerns when negotiating them.
Research is important, and it may be necessary to look into the surrounding area and how it might affect business operations. Entrepreneurs should pay particular attention to the termination clauses and the conditions of these agreements, as an early termination could severely impact business operations. On the same note, renewal conditions could be just as important if entrepreneurs are searching for long-term locations.
How Are Commercial Contracts With Government Agencies Different?
Many Florida businesses enter into contracts with government agencies. These contracts can be extremely lucrative and stable, and there is considerable competition for them among the business community. A contractual agreement with a government agency is distinct in many ways. As one might expect, these contracts are usually subject to much greater levels of regulatory oversight and public transparency. Each government agency may have its own unique procurement process and regulations when approaching commercial contracts. These include the Florida Department of Education, the Florida Department of Management Services, the Florida Department of Transportation, and many others.
The procurement process may be much more complex compared to normal commercial contracts, and an experienced business law attorney may be able to assist with this process. Once these contracts are in place, entrepreneurs should avoid violating them in any way. While violating a typical commercial contract dispute can lead to lawsuits, violating a government contract may lead to more serious penalties.
Alternative Dispute Resolution Is Often Preferable to Litigation When Resolving Contractual Disputes
Many new entrepreneurs may assume that litigation, or going to court, is the only way to resolve a contract dispute. However, alternative dispute resolution (ADR) is almost always preferable to litigation. This involves processes like mediation or arbitration to reach positive outcomes in private. Many commercial contracts have arbitration clauses that force parties to arbitrate their disputes before going to court.
Learn More About Commercial Contracts With Clearwater Business Law
While some business laws apply to all commercial contracts, specific regulatory concerns may apply only to certain types of agreements and contract clauses. Because there are almost limitless possibilities when it comes to different commercial contracts, entrepreneurs may want to discuss their specific concerns and goals with an experienced commercial contract attorney in Florida. Once an attorney understands exactly what an entrepreneur is trying to achieve with their new contract, they may be able to provide more personalized guidance. Of course, business law attorneys may also be able to help resolve disputes over commercial contracts already in existence. A consultation with Clearwater Business Law may be the logical next step after conducting online research. We serve clients in Clearwater, Dunedin, Largo, New Port Richey, Oldsmar, Palm Harbor, Pinellas Park, St. Petersburg, and Tarpon Springs. Consider contacting us at (727) 502-6874.