Thursday, November 27, 2014, 10:22 AM
Posted by Administrator
Contracts exist to help enforce obligations and to define the parties' rights. Every contract I have ever seen has, I believe, been seriously deficient. Every contract I have ever written (though I don't write many....it does happen....and I tend to write based on what issues I've seen disputed and what I've seen buyers and sellers sued over), I am sure, has in the opinion of the other side, been seriously deficient. My goal is to protect my client and their goal is, to a large extent, exactly the opposite.

If you are selling your business, I want to make sure that you will get paid and that you will not be sued. The contract I write will give the other side no right to complain if what you are selling isn't worth what they are paying; if the equipment doesn't work; if the state comes in and shuts them down the day after the purchase. The buyer wants to make sure that he/she never has to pay; that if anything breaks, burns, or get blown away in a tornado....the cost will be on my client, the seller; and that if someone stubs a toe on the counter, the business buyer will get their money back along with a ten percent premium for the earache they got listening to the injured person scream.

You get the idea.

People think there are forms for everything and that lawyers pull one off the computer and fill in the blank and they are done. But, garbage in/garbage out, so that would result only in garbage.

If I put every possibility into a contract ("and, if it rains on the day of closing then the closing shall be postponed until the next business day at which time all conditions of this Contract shall apply as if there were no delay") and the other side put every possibility into it ("and, if between now and the time of closing, any of the current activities of the business shall become prohibited by law or statute or ordinance or if there is a zoning change as to any property within 1,000 feet....") , the contract for the sale of your dry cleaning storefront will be 2,000 pages long and your attorney's fees bill will be a large multiple of the number of pages. If Microsoft is selling to Ronco (manufacturer, I believe, of the POPEIL POCKET FISHERMAN), a 2,000 page contract makes sense. For you.......faith, a handshake and a few pages of verbiage (crossed fingers and a prayer) is probably the way to go. Also, put something together that hits the high points....put in dates for things to happen...say what it is you're selling and what you're not....disavow any promises you aren't making.

If you happen to be selling your business (whether "you" are Microsoft or the dry cleaner), remember:
-Unless you get paid up front, you'll never get all your money.
-Unless you get paid up front, the sale will...in the end...become a a lawsuit.
-Whether your contract is 2 pages or 2,000 pages long.....something is bound to be left out....
-...or, at least, some lawyer will tell you something was.

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