It is not unusual for a business contract to end up being “unfinished” or incomplete in its final form. This is particularly true with longer contracts that might have been subject to extensive negotiation. An example might be when the finished signed contract calls for various items to be listed on “Exhibit A” but “Exhibit A” is blank (and not intentionally left blank). Sometimes an unfinished or incomplete contract is the result of mistake or accident, but more often, it is the result of time deadlines. You can retain an experienced San Diego corporate attorney to help avoid the problem of unfinished contracts. However, if you find yourself with an unfinished contract, here are some top solutions on how to “fix” the problem.

Agree to finish the contract after-the-fact:

If the contract was signed recently — say, in the last 12 months or so — it may be possible to get the contract finished after-the-fact. This may be easy to do since, presumably, both sides of the contract want a complete contract for their files. The best practice is to contact the other side — and their attorneys — and discuss what is missing. Often, rough drafts of the missing parts were created so it might not be too time-consuming or involve too much negotiation. A simple letter can be sufficient to memorialize what both parties agree should be inserted in the missing part(s).

Send a letter to your contracting partner(s) outlining what the missing parts of the contract:

If the other side is not interested in completing the contract, one solution is to send a letter memorializing what you believe is the language or exhibit or missing terms that will complete the contract. This is a one-sided solution and serves several purposes. One, it puts the other party on notice that you believe the contract is unfinished in some way. Second, it places the onus on the other side to respond in some manner. This might “jump start” an agreement. Third, if the contract ends up being litigated, you have written documentation with respect to the missing terms that can be presented as evidence to the court. Further, if the other side did not respond, then that enhances the credibility of your evidence since, if the other side disputed your letter, they should have responded. Silence might also be seen as a form of ratification by the other side of what is written in your letter. This is particularly true if your contracting partner(s) act in a manner consistent with what is written in your letter.

Memorialize in writing the missing parts of the contract:

Another solution is to memorialize in writing internally what are the missing parts of the contract. This is a less optimal solution than either of the foregoing, but sometimes sending off a letter can cause unnecessary friction in a business relationship. If this is the case, then make sure that your internal contract file contains all notes of meetings and conversations and all drafts of the contract. There should be full and complete copies of what you believe to the correct versions of any missing parts of the contract. All correspondence — including emails — should be retained too. Under this solution, you need to have an “eye” for litigation. You want to think in terms of what must be proven in a court of law. Under some circumstances, previous versions of a contract are admissible in court to explain contract terms.

Contact San Diego Corporate Law

For more information, contact attorney Michael Leonard, Esq., of San Diego Corporate Law. Mr. Leonard has been named a “Rising Star” by SuperLawyers.com for four years running. Mr. Leonard focuses his practice on business law, transactional, and corporate matters, and he proudly provides legal services to business owners in San Diego and the surrounding communities. Mr. Leonard can be reached at (858) 483-9200 or via email. Like us on Facebook.

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