3 Ways to Avoid Legal Issues
Being proactive is generally better than being reactive, right? You’d rather proactively manage your health than end up sick. You’d rather proactively manage your finances than end up bankrupt. Even though no amount of preparation can protect you from every bad thing on Earth, being proactive CAN protect you from a lot. It’s the same with legal in your business. It’s 100% a better idea to be proactive than reactive—full stop.
We’ve put together our top three tips for being proactive about the legal side of your biz, and they all have to do with contracts!
Top 3 Tips to Stay out of Legal Hell
Use lawyer-drafted contracts.
Include relevant and necessary information within contracts.
Send contracts with invoices.
Let’s Talk Contracts!
Ok, why are we harping on the importance of contracts? Because contracts are seriously the most critical tool in your toolbox as a business owner to avoid legal issues down the road. Contracts are good for everyone. They protect both you AND your clients.
Contracts:
✔️ set boundaries and manage expectations
✔️ protect your IP (intellectual property)
✔️ protect your confidential biz info, like your frameworks
✔️ lock in where geographically a dispute would take place if one arose
✔️ communicate a refund policy
✔️ lay out how you can get the F out if you need to
Now that you’re convinced, let’s tackle those three tips.
First, make sure your contracts are drafted by a lawyer. Lawyers are trained to think about all the “what-if” scenarios and account for them. Let’s be real, this kind of thinking is not your realm of genius as an entrepreneur. You’re looking out for possibility and opportunity, and that’s great! Let the lawyers think about all the risk and liability. (We’ve seen it all!)
Second, contracts include a lot more than just payment and refund terms. Each of those clauses lawyers put in contracts has a specific purpose, and each one is important. By including ALL the relevant and necessary information and not just what you think may be relevant or necessary (usually biz owners see payment terms as the main point of a contract), you’re truly being proactive, setting boundaries, and managing expectations.
Finally, we highly recommend sending out contracts WITH invoices. Don’t put the cart before the horse and have people pay first and then sign a contract. You’re exposing yourself to undue risk if you do it that way!
Remember, contracts protect your clients too! Just like YOU want to avoid legal hell, your clients do too. Almost everyone you’re going to come across just wants to have a seamless, conflict-free experience, and the best way to ensure this is the case is to make sure everybody knows everything upfront.
Real Talk
If you aren’t using contracts for your offers, services, digital products, collabs, hires, and websites, are you even a legit business? Start acting like the CEO you are and get your biz the contracts that are going to protect you from most legal issues! Stay the hell out of legal hell!
Need some contract help from a lawyer? We’ve got lawyer-drafted contract templates!