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More Problems With Off-the-Internet Form Contracts: Revisions Affect Validity and Proof

Using off-the-internet form contacts is dangerous, particularly if you are running a business. It is essential to retain an experienced San Diego corporate attorney who can ensure that your business contracts are validly formed and enforceable by the courts here in the Golden State. One of the other reasons to avoid off-the-internet form contracts is the question of revisions. Almost always, the internet form contract is revised by the person downloading the form. However, unless done correctly, revisions can endanger the enforceability of the contract and can affect the mechanisms for enforcement.

In general, you want your business contracts to be enforceable. If the contract is void and unenforceable, then the parties are not getting what they negotiated. Further, if there is a dispute and if litigation is filed, you want your business contracts to be quickly and easily enforced. You do not want to have to spend years and thousands of dollars in litigation expenses to have your contracts enforced.

How do Contract Revisions Result in Invalidity and Prolonged Litigation?

Essentially the problem is ambiguity. Well-crafted agreements are clear and allow a judge or an arbitrator to see within the “four corners” of the agreement the intent of the parties. When the contract is clear, the court or the arbitrator can make a quick decision. Part of writing a clear and easy-to-understand agreement is having definitions of important terms and parties, providing details of what the parties have agreed to and their respective obligations and, often, the mechanisms for resolving inconsistencies within the contract. If the contract is not clear and internally consistent, then the courts must resort to hearing evidence — testimony from the parties and looking at other documents — in order to determine the intent of the parties when they signed the agreement.

This is why revising off-the-internet contracts might lead to prolonged and expensive litigation. If you add a paragraph or mix terminology from several different internet contracts, you may create an ambiguous and unclear agreement. If there is a dispute, likely, the court will have to hear from witnesses. Having witnesses testify is time-consuming and expensive.

Another problem is incompleteness. You may not realize that adding this-or-that paragraph from off the internet implies that some other provision should be added, too. An example here might be adding a simple mandatory arbitration clause. However, requiring that the parties arbitrate means that other arbitration-related provisions are needed such as the place of arbitration, who pays for the arbitration, the powers of the arbitrators, and more. Again, potentially, this causes the revised off-the-internet form contract to be ambiguous and unclear. The courts may deem the contract provisions to be void or may give them an interpretation that you did not want or expect.

Finally, since ambiguity allows the court to hear testimony and consider other evidence, this provides an “opening” for the court to weigh credibility and determine that the contract was never properly formed. Avoid these issues by retaining an experienced corporate attorney to review or draft custom contracts for your business and ensure the terms reflect the intended deal.

Contact San Diego Corporate Law

For more information, contact attorney Michael Leonard, Esq., of San Diego Corporate Law. Mr. Leonard focuses his practice on business law, transactional, and corporate matters and proudly serves business owners and residents in San Diego and in the surrounding communities. Mr. Leonard can be reached at (858) 483-9200 or via email. Mr. Leonard. Like us on Facebook.

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