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Enforceability Issues in Business Contracts

Posted by Chris Peterson | Jun 03, 2013 | 0 Comments

Enforceability Issues in Business Contracts

Viable business contracts are the life blood of a company. Without clearly written and legally sound contracts companies would not be able to engage in dealings with clients and suppliers. It is very important that when contracts are drawn they follow guidelines and are understood and agreed upon by all parties. To ensure that these vital documents are correct and enforceable it is useful to work with an attorney who is knowledgeable in contract law in Conroe, Texas. A number of enforceability issues with contracts are delineated here.

Contracts that Are Vague or Ambiguous

Ambiguity is one of the most common issues among contracts that are found to be unenforceable. Generally this occurs because the language is such that it may be interpreted differently by the various parties connected to it. When an attorney knowledgeable in contract law in Conroe, Texas reviews a contract that is in dispute he will consider what is in the “four corners of the document;” that is to say, he will base his analysis of the contract's viability not on what is meant, but what is explicitly stated. This is how a court will look at the contract, although a judge may also take into consideration:

  • Whether the contract was successfully followed previously
  • Past dealings a company has had with other contracts
  • Trade customs

That said, an attorney knows that if the court determines that a contract cannot be accurately and clearly interpreted it will be deemed unenforceable.

Contracts that Fail to Meet Guidelines

U.C.C. § 2-201 states that a contract under certain conditions needs to be signed to be enforceable. While the will of the contracting parties is paramount, when one of the parties decides that the contract should not be enforced because it is not signed and falls under the guidelines of the code, a judge cannot force it to be followed.

Contracts that Are Void or Voidable

The parties to a business contract can void the document because they agree a mistake or other factor deems it so. While such a voidable contract does not become legally void by this action, for all intents and purposes it is no longer in force because the parties agree that it is not. A void contract is one that was not legally created in the first place because the parties did not agree to its terms.

Other Unenforceability Issues

Contracts may be deemed unenforceable for other reasons as well, including if they were drawn for a purpose outside of the law of if one of the parties was not of sound mind at the time it was created. An attorney who is knowledgeable in contract law in Conroe, Texas can help the parties to a contract draw up terms and include language that will make the document viable and clear.

For Assistance with Contract and Other Business Law Matters

If you need help with a contract that is in dispute, or have another business law concern, speak with a lawyer who is knowledgeable in contract law in Conroe, Texas. Peterson Law Group will provide you with the highest standard in legal representation. Call us today at 936-337-4681.

About the Author

Chris Peterson

Chris Peterson is the owner of Peterson Law Group. He practices primarily in the areas of wills, trusts and estate planning; probate and trust administration; elder law; and business law. Chris is also the owner of Brazos 1031 Exchange Company.


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