A contract is a law that governs the affairs of the agreement.
An agreement is between two or more parties regarding a matter. The term of contract is more specific while the term agreement is more general. Only agreements that have the proper contract have legal implications.
Is it important to have contract with your business partners?
The original purpose of the partnership agreement was to protect both parties from problems in the future. In the early stages of business, you may think this is trivial, and the contract can be drafted by yourself.
However, if an issue arises in the content of the contract in the future, what actions you can take? The issues could include breach of contract between partners, percentage of ownership and distribution of profits & losses and so on.
Hire a lawyer to draft your contracts for you for peace of mind.
5 BASIC THINGS YOU NEED TO KNOW WHEN SIGNING A CONTRACT
1. Signature and date: By signing the document, it binds the party through the contract, even if you not read the document.
2. Do not sign any draft contract: If you have not finalized the contract, do not ever put your signature on any form
of draft contract that you send or
3. Make sure you read all the
attachments: It is better if you
understand all the contents.
4. Always ask for one (1) copy of the contract: Ask for a copy as a
precaution. If only one party owns the contract, there is potential for fraud.
5. Signature of each page: Signature in all pages of the contract is very
important especially if you do not receive a copy of the contract.
Breach of Contract?
An action can be taken against the breaching party under civil law. The claimant can seek damages if the breach of contract and all the elements of the contract can be proven.
The contract must be submitted as evidence if your case is brought to Court. All transactions and other documents related to the contract are also important evidence. ]
If the Company is sued or wants to sue an individual or the Company but unable to appoint a lawyer, can the Company be represented individually?
Generally, no! Rule 5 Rule 6(2) states that a corporation may not initiate or continue any proceedings except through a lawyer.
TERMINATION OF PARTNERSHIP CONTRACT
The partnership contract can be terminated through three (3) ways:
1. Dissolution on its own:
a) By expiration of a fixed term;
b) In the event of death of a partner or a partner is declared bankrupt;
c) When a partner act to allow his shares in the partnership to be mortgaged for payment of debts.
2. Termination by notice.
3. Dissolution by court.
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