CONTRACTS
Contracts are a great pillar in any form business. A contract is a legally binding agreement between two or more parties, and it sets out the rights, responsibilities and obligations of the parties. Contracts govern the relationships between the contracting parties such as seller/purchaser, business owners/ suppliers, developer/property owners, employer/employee, landlord/tenant and shareholders/directors. Properly drawn contracts limit chances of conflict because the rights and obligations of each party is well defined. Although oral contracts can be enforced, having a written contract provides a proper reference record of all the matters agreed between the parties. In case of a dispute, a written contract provides a clear record of all the agreed terms otherwise the parties will find themselves in “my word against yours” unpleasant situation. The Law of Contract however provide that contracts for disposition of an interest in land must be reduced into writing. Most commercial contracts will also have a dispute resolution clause outlining how parties should approach any dispute that may arise. This gives parties liberty to elect the convenient mode compared to situations where the only likely option would be taking the dispute to court. Increasingly commercial contracts are incorporating mediation as a mechanism for resolving disputes compared to the past scenario where parties were either opting for litigation or arbitration.
