Regina Campbell: [00:00:00] [00:00:05] Hi, good morning.

I'm Regina
Campbell and, [00:00:10] proud to bring the, legal zone to you from the
Campbell law group. And, today this is, [00:00:15] season one episode one, and
we're going to be talking about contracts 1 0 1. So this should be really
[00:00:20] exciting guys. it's going to. You know, brief primer on contracts and
something that every business owner and [00:00:25] person should know about
contracts.

So, you know, number one contracts should always be in writing. [00:00:30] I
know that may seem obvious, but you'll be surprised how often that, the
contracts are not in [00:00:35] writing or they'll piece together with texts. You
know, he said this and so, and so said [00:00:40] this, and then if you put it all
together, this is, was our contract and it doesn't mean that's actually a less
[00:00:45] effective contract or, or not legally binding contract in most states
oral contracts. [00:00:50]

Are, honored and basically recognized except for when it deals with land or
lending money or [00:00:55] something related to estates, which has to have
certain formalities of execution. But for the [00:01:00] most part contracts
basically, you know, are an offer and acceptance of certain [00:01:05] terms. So
aside from number one, the contract should be in writing.

Number two. [00:01:10] Also the terms need to be very, very clear. so basically,
if you guys talked, you know, [00:01:15] if you're talking to a party or another
business and you guys have agreed to certain terms, okay, I'll sell you
[00:01:20] a hundred widgets, for $10 a widget. Basically, those are one of the
essential terms that need to [00:01:25] be in the contract.

And. that brings us to number two, which is basically essential [00:01:30]

terms, which might also not just include a price and, you know, you know,
understanding of how [00:01:35] many products you're purchasing or what
services you're purchasing. It also should include, you know, [00:01:40]
information such as when the delivery is going to be.

Who takes responsibility for [00:01:45] delivery upon arrival? Is it, at a location
at a dock? And in which case, the, you know, [00:01:50] liability shifts to the
other person to pick it up in time. What are the terms, as far as who pays
[00:01:55] for delivery, what happens in the events of refunds? So, these are
some examples, depending [00:02:00] on the type of contract that you have,
may be essential terms.
[00:02:05] So step number one, basically you have, of course getting in and
writing. That's very [00:02:10] important. We just discussed that step. Number
two is getting the essential contracts. I mean, essential [00:02:15] terms in
place. Most people think of the essential terms as you know, what you might
have agreed to as [00:02:20] far as, you know, the price of a good, and how
many goods that you want.

Those are normally [00:02:25] considered essential, essential terms. but there
may be other essential terms depending on the type of contract that you
[00:02:30] have. So for instance, you might indicate that you wanna buy a
hundred widgets at $10 a widget, [00:02:35] but some of the other essential
terms may be when the payment is due, is payment [00:02:40] due upon, is it
50, 50, 50% now, 50% upon delivery? [00:02:45]

Is it due next 30 days? Also, in some of the essential terms, maybe with goods
and [00:02:50] service goods contract basically might also be who's going to
deliver the goods. When are they [00:02:55] expected to be delivered? So, these
are some examples that might also of other additional terms that [00:03:00] may
be necessary, in the event, you know, actually as part of an essential term that
should be included in a [00:03:05] contract contracts are really, they're basically
bred from a [00:03:10] necessity of what's going on in the deal.

Those are examples of a, you know, basically as we indicated [00:03:15] first in

the first step, you know, number one, a contract should be in writing. Number
two. [00:03:20] Should be to ensure that you include the essential terms of a
contract actually in [00:03:25] writing. So some examples of essential terms
might be, you know, what, what you're purchasing a [00:03:30] hundred
widgets and at what price are you purchasing the widgets, but specifically let's,
[00:03:35] let's give an example of maybe what might be other essential terms
that you need to know, like in a goods [00:03:40] contract, for instance might
be, you know, when do you expect payment?

Is it 50% [00:03:45] now and 50% on upon delivery? Is it, basically net 30 days,
are you going to [00:03:50] be running basically on credit, something to
consider, you know, and when you're making the arrangement to make sure
[00:03:55] you're understanding that if you're waiting for payment, and also
particularly with the goods contract, you may [00:04:00] want to make sure that
you're actually talking about when delivery is expected.

When are the products supposed to be [00:04:05] delivered? So may seem

basic, but you'll be surprised how many times contracts do not particularly
[00:04:10] goods. Contracts do not include these essential. now not including
certain essential [00:04:15] terms may not necessarily be fatal to enforcement of
a contract. but it's not recommended.

Let's put it that way. [00:04:20] so basically, I mean, if a, if a court can tell more
or less what you guys had intended in the [00:04:25] basics, you know, offer
and price or so to speak or terms, as far as the widgets and the [00:04:30] price
are there, sometimes the courts can fill in the gaps, but it's an extremely
expensive process.

So it's [00:04:35] recommended that you're. That is then in the contract. So, it's
clear what the party has had it basically [00:04:40] intended. So, when you're
dealing with service contracts, for instance, we know, give another examples of
[00:04:45] essential terms. You know, what services are included, what services
are not included.

You know, once [00:04:50] again, when is payment expected, what is the
expectation of the parties? And if there's anything [00:04:55] specifically
material or in which a party's relying on that should become an essential term,
[00:05:00] that's clearly defined in a. okay. number three, you may want to also
consider of course, [00:05:05] what state law, you know, applies as far as
governing the contract.

So [00:05:10] depending on if you're dealing across state, a lot of us are dealing

business on the internet. It's better to put a [00:05:15] venue clause and
potentially a personal jurisdiction clause in these contracts. Which you'll often
[00:05:20] see from a res you know, from a personal and a commercial point of
view. You'll often see if Florida law [00:05:25] applies.

The parties agree to basically jurisdiction within the state of Florida and the
[00:05:30] event of a dispute. so, you know, these are things that are maybe be
[00:05:35] important, particularly depending on the type of, you know, contract
that you're entering into some [00:05:40] of these contracts. So for instance, real
estate, you know, purchase of a real estate property, a lot of times [00:05:45]
they're going to be governed by the, the state in which, where the property's
located, or specifically the county, [00:05:50] which is located.

So, some of that blends itself to not have such, such [00:05:55] importance, but
in other types of contracts, these can be important elements, basically. So, one
of the [00:06:00] other things is also consider now we don't always want to get
into a contract and, [00:06:05] and be thinking, well, what happens if it goes
wrong? Obviously, we're all hoping when we get into a contract [00:06:10] that
it's going to go, right.
But unfortunately, there is that side of the equation. That's a [00:06:15]
possibility, and it should be covered in a contract. What happens in the event
that someone does not. [00:06:20] what happened? You know, what are the
remedies for basically a breach of a contract? you know, [00:06:25] do you
want to call something a material breach right off the bat?

For instance, let's say if the goods [00:06:30] are not delivered on by the 30th
day, because maybe you have to turn around and sell to [00:06:35] somebody
else, and it might be an important element in which you need to make sure you
have it. Time may be [00:06:40] of the essence to you. So, you may want to say
that it is the contract is potentially [00:06:45] canceled or considered
terminated.

If it not delivered on the 30th. to give you an example from the original
[00:06:50] widgets sort of essential terms. So, I think you could probably see,
you [00:06:55] know, building a contract is like building a foundation it's and it
basically just describes, you know, [00:07:00] what it is that each one of you
thought goes into this house or enter this project.

So, whether it's for bring our [00:07:05] personal contract or personal use
information or consumer goods, or for, you know, commercial, [00:07:10]
commercial reasons, you can kind of see how these different elements are very
important. [00:07:15] Also very important. And maybe the expectations of
attorney fees. Unfortunately, once again, I noted, we don't [00:07:20] always try
to think about things when, in terms of they don't go well, but it is a [00:07:25]
reality.

So, for instance, in the state of Florida, you're not entitled to attorney fees. If
someone breaches a [00:07:30] contract, you're not entitled to attorney fees
unless it's statutorily permitted [00:07:35] or it's in a contract. So, someone can
breach a contract that might have a value of [00:07:40] let's say for instance,
$30,000. And you have to take 'em to court to enforce the [00:07:45] contract.

Unfortunately, if there's no attorney fees provision, you might spend 10 or

$15,000 [00:07:50] enforcing the contract to be able to get your 30 back. And
again, that's assuming that the person [00:07:55] is, you know, you can actually
execute on your judgment. You win. You can execute on your judgment
[00:08:00] and you can actually get the funds back.

So, it's often important element. [00:08:05] I find one of the most important
ones to have an attorney fees provision that requires, you know, the [00:08:10]
event, this contract has to be enforced, or there's some subject, some issues with
interpretation or anything [00:08:15] of that nature that the prevailing party be
entitled to attorney.

so, and [00:08:20] again, you know, each one of these elements can go, we can
go further into, into depth with each one of them, but I'm just giving [00:08:25]
you an overview of the type of provisions that should be in a contract. And why,
and the basic elements at that minimum, [00:08:30] of course, we also want to
talk about, you know, you know, who's signing this contract [00:08:35]
basically.

making sure that the parties signing it are actually have authority to [00:08:40]
bind that company or that person have authority to act on behalf of that person
that's entering [00:08:45] into illegally binding contract for whether it's services
or goods. [00:08:50] So also you want to take into consideration if you're doing
any international transactions, that can be rather [00:08:55] tricky.

You may want to use letter of credits, other types of forms to ensure payment.
In [00:09:00] addition to. In enforceability, what type of laws you choose? what
[00:09:05] type of law, you know, is that country's law, for instance, depending
on where the goods are coming from or the [00:09:10] services are occurring, or
is that country going to honor the contract?

What are these rules? These are different types of things you [00:09:15] want to
think about this actually also even applies in a family setting. If, some of us
don't think [00:09:20] about it in that manner, but even family contracts, such as
PRS or post ups, [00:09:25] marital settlement agreements are all subject to the
contract.

All subject to contract law, which [00:09:30] for the most part, just to
understand a little bit, most courts are required to enforce a [00:09:35] contract
based on the four corners of what they call the four corners of the agreement. So
[00:09:40] unless the agreement is, ambiguous in some manner, or one of the
provisions are, ambiguous, [00:09:45] the court is not allowed to go outside the
contract to actually look and see what [00:09:50] the parties may have agreed or
not agreed to.

If it's unambiguous, they're required to stay within the [00:09:55] four corners.
so once again, this is another example is why you need to make [00:10:00] sure
that the elements, the essential elements in terms are in your contract. They're
spelled out [00:10:05] clear. I guess one of the other terms I would say for
number four would be make sure your contract is clear and concise [00:10:10]
as, as it can be.
You know, we, of course, you know, you know yeah. You know, [00:10:15]
hindsight, you know, 2020 is, you know, you know, the past is you see sort of in
hindsight, you see things more [00:10:20] clearly, then you do a lot of times
when you're doing the contract at the. , but it's very important to make
[00:10:25] sure you understand what you're writing and that it's clear.

And often in [00:10:30] contracts, I will use examples. for instance, if we're
doing an equation to figure out a termination [00:10:35] provision or how to
figure out a pricing, that might be a little bit more complicated than just a, a per
price [00:10:40] unit. I might give an example, you know, so for instance, in the
event, this occurs, [00:10:45] this is how the parties intend for this to be
interpreted.

And I give an example. Okay. [00:10:50] So these are little tips just to help you
out that actually avoid potentially, your contract [00:10:55] or what you might
have agreed to not being enacted or enforced in, in the way that you guys’ sort
of bargained. [00:11:00] And it's very important because if it's not clear, the
contract doesn't have everything that you need.

[00:11:05] A lot of times you're going to end up with a circumstance that you
did not count on, or unfortunately, in some cases, a lot of [00:11:10] people can
take advantage. so, you know, so for instance, in the example that I was giving
you about an [00:11:15] ambiguous term, if there's an ambiguous term,
potentially the courts can go outside the [00:11:20] four corners and use what
they call parole evidence to be able to review maybe party's [00:11:25] emails
that were not, you know, that contain additional terms or context in which
they're not sort of [00:11:30] contained in the agreement.

Right. But this is actually not permitted in the event that you, have [00:11:35]
an unambiguous term, even if it. Unintentional you didn't mean to actually
[00:11:40] sort, not clarify that or, or fix that provision in the agreement. Most
of the time, the agreement's going to be [00:11:45] upheld in the way that it's
written expressed that are written as the courts would say.

So here's a couple [00:11:50] examples, just a couple tips when you're thinking
of contracts, whether you're writing them or reading them. I know we're
[00:11:55] all stuck, we've all been in both positions, so to speak. So hopefully
this is helpful. And of course, maybe [00:12:00] we'll in another subsequent
series. We'll drill down a little bit more into, for instance, merger, [00:12:05]
clauses, you know, other terms for, for instance, that go with manufacturing,
distribution [00:12:10] agreements and talk about essential terms that exist in
those contracts and other types of contracts.
But this is a [00:12:15] little primer, hopefully it's helpful. And we want to
thank everyone for joining us on our first, you know, season [00:12:20] one
episode, one of the legal zone with the Regina, with Regina Campbell brought
to you by the Campbell law group. [00:12:25] We hope you enjoy this, and we
hope to bring you better content and not better, but more content in the
[00:12:30] future that might be helpful for you.

Thank you for joining us for our first, for our first podcast, season one
[00:12:35] episode, one of contracts, 1 0 1. We hope you enjoyed it. We would
like you [00:12:40] to subscribe to YouTube and follow us on all our social
media accounts. And we look forward to seeing you our next podcast. Thank
[00:12:45] you so much. [00:12:50]