Why Should I Get a Contract in Writing?

There are many good reasons you would want a contract to be in writing, not just a verbal agreement. One reason is that depending on the subject of the agreement a legally binding contract can only be in writing.

Pennsylvania's statute of frauds goes back to English common law. It requires that all conveyances of an interest in land, including leases for more than three years, must be in the form of a signed writing to be enforceable in court. Also included are agreements for the sale of real estate, easements and brokerage or listing agreements. The reason for the law is to prevent fraudulent claims being brought against the real estate of another.

The Pennsylvania Uniform Commercial Code (UCC) at 13 P.S. § 2201(a) states that a contract for the sale of goods for $500 or more is not legally valid unless,

· There's a writing sufficient to show a contract has been made, and

· It's been signed by the party against whom enforcement is sought.

There's an exception for a sale between merchants (not consumers) where if there is no signed contract,

· One party later sends a purchase order confirmation clear enough to bind the sender to the deal, and

· The party receiving it will be bound by it unless the recipient raises a timely objection to the terms of the purchase order confirmation.

Even without a statute mandating the kind of contract you may be considering be in writing there are good reasons to get it in writing anyway.

· A written contract clarifies the relationship between the parties.

· Each side is on notice of its rights and responsibilities.

· The act of writing a contract and negotiating it makes both parties think more about what they want and what they're willing to do.

· If there's a dispute as to the agreement or a breach, the contract is far easier to enforce.

· It's far more difficult for a party to add claims as to what the other party should've done or subtract from its own responsibilities.

If you believe a business matter you're involved in should involve a written contact or you believe that such a contract has been breached, contact us if you have any questions about how this could impact you, your legal rights and your interests.


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