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5 Common Mistakes with Do It Yourself Contracts

A contract memorializes each side’s understanding of the terms of an agreement. Pay special attention to these five common pitfalls when entering into a contract in order to save time and money should the relationship deteriorate.

Mistake #1: Not Having a Meeting of the Minds

Take the time to have an in-depth conversation about what each side expects before the contract is drawn up. Know what it is that you are seeking out of the relationship and aim to have a solid understanding of the other party’s wants so that you can anticipate those elements of the contract that may require later negotiation. This step will result in a well-written contract that addresses the minute details of your specific situation rather than a standard form contract.

Mistake #2: Not Reading the Fine Print

Remember that you will be forced to uphold all parts of the contract, not just those that you read. Neglecting to point out and re-work any confusing provisions may result in that language being used against you at a later date. Pay special attention to any bolded, capped or larger-print block sections. This is generally done because those sections contain language alerting you that you are waiving some sort of right. For example, when signing a lease, you may see block print that discusses the right for the landlord to enter a confession of judgement against you for failure to pay. You’ve potentially allowed the landlord to enter a judgment against you without your having the ability to defend against it, even if you have a valid excuse for not paying.

Mistake #3: Neglecting to Consider Choice of Venue, Choice of Law

Be mindful of language related to the location of any potential dispute resolution. This generally refers to where a trial would be held in the event of a breach. If you are entering into a contract with a supplier to produce a good, you want to be sure that any litigation takes place in your city and state, not that of the supplier. If you live in Maryland and your supplier is located in California, it is not advantageous for you to spend thousands of dollars merely in travel to litigate your claim. Similarly, choice of law provisions dictate which jurisdiction’s laws will apply as to the construction, interpretation and litigation of the contract. If you want to file a suit due to a breach of contract, you have three years in Maryland, but the statute of limitations may be shorter (or longer) in the other party’s state, and that statute of limitations may apply if their state’s laws were chosen in the contract.

Mistake #4: Eliminating Boilerplate Language

Boilerplate provisions are standard in most contracts. They serve several purposes such as: defining the parties’ rights and responsibilities, how the parties may make changes to the contract, how the parties may provide notice and control the remedy in case of a breach. It is important to understand the meaning of each type of boilerplate clause and only choose those that are beneficial for your particular contract. Eliminating them altogether may cost you money and peace of mind down the road.

Mistake #5: Not Hiring An Experienced Attorney

Contracts are written in a language that can be extremely difficult for an average untrained person to understand. Hire a lawyer experienced in reviewing and drafting contracts, particularly one who has practical experience in the area that underlies the basis of the contract. For example, if you are a landlord and need a contract for a new tenant, seek out an experienced real estate attorney. This is especially important if the other side has an attorney who has drafted the contract.

Contracts can be the start of a prosperous relationship, but they can also result in a chain of negative consequences. Avoid the above mistakes in order to benefit from business relationships and to protect your interests.

Information in this article is provided for educational purposes only and not intended to constitute legal advice. Please consult with a licensed attorney in your jurisdiction for help with your specific situation.

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What is Estate Planning and Why It Matters

Estate planning is what some may consider a necessary evil. It can be very uncomfortable to think about, let alone discuss, how you would like your assets distributed after your passing. When you factor in heavier decisions, like who takes guardianship of any minor children, or who takes over your business, it is no wonder many people delay or neglect proper estate planning altogether.

Aside from the overall discomfort, many forego estate planning because they simply do not understand its importance. According to a recent study, only forty-two percent (42%) of Americans have estate planning documents in place.

In this article, we will explain what estate planning is, why it is so important, and how to get started.

What is Estate Planning?

Estate planning is the process of preparing how you would like your assets distributed upon your death or incapacity, and documenting your desires as it relates to end-of-life medical care. It is a fairly common misunderstanding that estate planning is reserved for the wealthy. Actually, everyone who owns property, has money in a bank account or owns personal items has an estate and should plan for its orderly distribution.

Aside from determining who receives what from your estate, an estate plan may also contain crucial components that could keep your loved ones from having to make complex decisions for you, such as:

  • · Naming guardians for any minor children
  • Naming administrators of your estate in the event of incapacity or death

Why is Estate Planning So Important?

Estate planning has many benefits irrespective of estate size or personal circumstance. Almost everyone can benefit from having estate planning documents in place that speak to their personal needs, including, but not limited to the following:

  • Will
  • Power of Attorney
  • Trust
  • Advanced Medical Directive

Having your documents prepared by an experienced Maryland Estate Planning Attorney will greatly decrease the chances that your estate will be subject to the probate process, which can be both emotionally and financially draining.

Business Succession Planning

Not only is comprehensive estate planning important for families, but it is vital that Maryland business owners have a strategy as well. In 2014, Maryland small businesses employed 1.1 million people – which accounted for a little over fifty percent (50%) of the private workforce. With those numbers, it is safe to say that regardless of whether you have been in business for twenty years or two, creating a succession plan is important. When establishing your business’ succession strategy, here are some points you should consider:

  • Identifying your team of core advisors
  • Determining whether family members desire to and are qualified to run the business
  • Identifying key employees to help run the business
  • Determining a schedule of when and how the business will transition to your successor
  • Incorporating your personal estate plan around your business succession plan

Many business owners fail to establish a succession plan in advance. Unforeseen illness or death of an owner can throw a company into an unrecoverable, downward plunge. A solid succession plan can detail what to do in the event of an owner’s untimely death or incapacity.

This article is for educational purposes only, not to provide specific legal advice. It should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

Contact Us

Having an experienced estate planning attorney can ensure that your wishes are outlined appropriately under Maryland law. The Law Offices of Elsa W. Smith, LLC can assist by drafting estate planning documents that secure your assets, honor your wishes, and safeguard against the public Maryland probate process. Contact us today in our Annapolis Office at 410-995-7719, in Laurel at 301-358-4340 or visit our website at elsawsmithlaw.com to learn how we can protect you, your family and your business.

New Office Opening in Annapolis

We are pleased to announce the expansion of our law firm to the city of Annapolis, Maryland.  Our main office is located at 14502 Greenview Drive, Suite 300A, Laurel, MD 20708.  Starting March 1st, our second office will be located at 1125 West Street, Suite 200, Annapolis, MD 21401.

At the Law Offices of Elsa W. Smith, we believe that successfully addressing client needs requires more than just knowledge of the law and a mastery of the multitude of rules and regulations that impact our clients’ interests.  Our commitment to excellence, combined with our mission to deliver outstanding client service, has earned our firm the excellent reputation it enjoys today.  The Law Offices of Elsa W. Smith is a minority and woman-owned business with an honest reputation and a tradition of aggressive representation.

The Law Offices of Elsa W. Smith provides quality legal representation in the areas of Criminal Defense, Family Law (with emphasis in Special Immigrant Juvenile cases) and Personal Injury cases.