Although most agreements are not legally binding, they are structured similar to contracts with the parties agreeing to certain terms and providing compensation for a service or product as well as remedies in case one of the parties fails to meet their end of the deal.
There are several kinds of agreements ranging from informal documents to complex service agreements. No matter what you may choose to create. The same best practices while creating will apply. Let's take a look at them.
Title: This defines what the agreement is about. For example, “Lease Agreement.”
Identity: This section identifies the parties that are agreeing to the terms that will be set. The parties should be identified using their legal names and then after that titles can be assigned to them. For example, John Smith can eventually be referred to as “Service Provider” or Tenant, depending on the kind of agreement.
Offer: This section is what defines the terms of an agreement. One of the parties makes an offer to the other party and determines what they expect in return. An offer is clear and concise, but also has to be reasonable enough for the other party to accept it.
Acceptance: This clause provides the consent of the other party that accepts the offer. The acceptance section will also describe the action to be taken by the other party to indicate they accept the offer. For example, they would have to return a signed copy of the agreement by a specific date.
Consideration: Include this section to explain what compensation will be provided. For example, “...the service provider will receive X dollars as consideration for the service provided...” This section also states when the payment will be made and how it will be made.
Mutual Consent: The parties need to be willing to leave up to their responsibility stipulated in the agreement. This section states that and indicates no one has been forced to do so. In some instances, it is also important to indicate that the parties are of sound mind and legally able to enter into such an agreement.
Legal Relationship: In some cases, the parties can agree to be legally bound. This section spells out the legal relationship between the parties including the jurisdiction laws that apply.
Signatures: The parties that have agreed will append their signatures to the document. There should also be space for the date the signatures were added to the document.
Agreements need to be clear and concise with all the bases covered. It may be hard for an ordinary person to draft these and so a professional lawyer might be a better option.
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