When writing a business contract in the U.S. Virgin Islands, it is important to keep in mind a few simple, but very important, considerations to protect your company and your best interests. By doing so, you can help ensure that in the event of a future dispute, your contract will be considered valid and enforceable in a court of law.
To start, every business contract must include at least two parties, one of which is making an offer of some sort that the other is accepting. Without the acceptance of the offer, the contract does not exist.
If one party needs to take a reasonable amount of time to consider whether or not it will accept the offer, you will want to include an expiration date with the offer to prevent any confusion. The offer has to remain open for the specified period and, if the offer is accepted, the offering party is bound by the contract’s terms even if circumstances change. If the other party makes a counteroffer, this qualifies as a rejection and requires a new contract.
The rules for acceptance vary depending on the contract’s subject matter. When dealing with a contract for services, most courts accept that there will be small, reasonable differences between both parties’ understanding of the contract. However, when it comes to the sale of goods, both parties have to be in complete agreement about the terms for the contract to be valid.
Exchanging something of value
A valid contract requires an exchange of something of value, called a “consideration. This may include goods, services, money or even promises to act — or refrain from acting — in a specific capacity.
Whatever the consideration is, the exchange of something of value does not have to take place immediately. Many contracts specify or allow for the delivery of the payments, goods, services or actions to take place in the future, rather than right away.
In addition, it’s important to keep all of the following basic considerations in mind to avoid any disputes or future problems with the agreement:
- Both parties must demonstrate the intent to make the contract
- The subject matter cannot involve anything illegal, such as stolen property
- There must be an offer and a complete acceptance (rather than an offer still under consideration or an unaccepted counteroffer)
- There must be an exchange of something of value
- Some subject matters require the contract to be drawn up and accepted in writing
- Both parties must perform fully and in exact accordance with the terms of the contract
As long as your contract adheres to these general guidelines, it will likely be considered valid in a court of law. This will allow both parties to avoid tough disputes and settle any differences without having to engage in litigation.
BoltNagi is a well-established and widely respected business and corporate law firm serving clients throughout the U.S. Virgin Islands.