Contracts

If you own a business, you necessarily are engaged in the sale of goods and/or services, and almost certainly have to deal with suppliers and other companies on a regular basis.

Any type of exchange necessarily involves the creation of a contract, whether it's written or not. There are a few elements which must be present when making a contract, but the most important one is known as "consideration." This simply means that the agreement involves some exchange which has been bargained for. In almost all commercial transactions, this is a complete non-issue, since it's perfectly clear that an exchange has taken place: products or services are rendered in exchange for money.

What is most often an issue in business law is when one party fails to perform a contract. Few businesspeople want to breach their contracts — most people have an innate desire to do what they've promised to do. However, unforeseen circumstances sometimes make performing a contract difficult. This often results in disputes.

Accordingly, it's always a good idea to consider the worst-case outcome of any contract before you enter into it, and be prepared for the possibility that it might occur.