Be Certain to Carefully Review Your "Standard" Contracts

A building contractor recently came to my office seeking assistance to enforce the terms of a written contract for construction services that were rendered but never paid for by his customer.  The client was very proud of the “standard contract” that he had drafted utilizing a boilerplate document obtained from the internet through a contractors’ trade association.  Indeed, he professed great pleasure at having avoided the need to incur attorneys’ fees in the preparation of his standard business contract documents.

After carefully reviewing the documents, I advised the client that I would not be able to assist him in enforcement of his creditor’s claim as the contract that he had downloaded from the internet provided, in pertinent part, that, “All disputes arising under this agreement shall be litigated in the State of Delaware, pursuant to Delaware substantive and procedural law….”  I was obliged to advise this individual that I was not admitted to practice law in the State of Delaware and that he would need to retain counsel in that state to file and litigate his claim, even though the contract was entered into in San Luis Obispo County for work performed in its entirety here on the Central Coast.

The lesson to be learned from this example is that while “boilerplate” or “form” legal documents may be of some assistance in drafting a situation-specific contract, they are rarely a substitute for competent legal advice.  When assisting business professionals, trades people, entrepreneurs or merchants in the drafting of their business agreements and documents, I begin by obtaining the client’s list of priorities and expectations, which are ultimately used to make the agreements user-friendly for that business.  As legal counsel, my office then has the further obligation to insure that the contract is in compliance with all statutory requirements for that business or trade and that the contract contains appropriate guidance as to how disputes or disagreements among the parties will be resolved and the procedures that will be utilized to do so. 

For example, most of my Central Coast contracts contain language providing that all disputes arising under the agreement (whether resolved through mediation, arbitration or litigation), will be adjudicated in San Luis Obispo County pursuant to California law.  On occasion, those provisions are modified to meet the needs of clients with a national or international customer/client base.  In these situations where a contract is required to formalize an agreement or where someone is asked to sign a contract involving a substantial financial commitment, it is always wise to have a knowledgeable individual review both the large and fine print to be certain that the document is both fair and meets the specific needs and expectations of the contracting parties.

Jeffrey D. Stulberg, A Law Corporation, offers a free initial consultation on all civil and criminal matters in a confidential setting.  Contact our office today for an appointment.