Why it’s a Good Idea to Get Legal Help for a Purchase or Sales Agreement
The substantive terms of a purchase or sale transaction may seem straightforward between the parties, however, it is prudent to seek legal advice on how to put a transaction's material terms into writing. Whether your transaction is on a modest or larger scale, you want to ensure the material terms reflect the intentions of the parties' and are accompanied by standard terms which adequately protect the parties. It is also recommended that all material terms of a transaction be contained within a clearly worded written agreement. Let's review some general areas where lawyers can assist with facilitating smooth transactions.
Potential Hidden or Unanticipated Liability
Lawyers are accustomed to assessing risk and are able to provide guidance to their clients on various potential liabilities which arise on different kinds of transactions. The parties are often aware of and are monitoring certain liabilities associated with their prospective transactions, however, an experienced lawyer can assist with conducting a more robust risk assessment and due diligence process. While certain risks can remain even with a comprehensive due diligence process, it is generally beneficial to narrow the areas of risk as much as reasonably possible.
Review and Confirm the Scope of the Transaction
It is important that parties to an agreement understand the scope of the transaction and the aspects which are and are not addressed in the agreement. If the agreement deals with the sale and purchase of a commercial property:
1. Are the parties clear on whether any existing leases are being assigned to the new owner? Or are the leases being terminated?2. Are any assets or equipment located at the commercial property part of the sale? Or does the transaction contemplate the sale of the land and building only?
The contents of the written agreement generally provide for the entirety of the terms between the parties and a lawyer can assist with ensuring the parties are clear on the scope of the transaction and aspects addressed in the agreement.
Potential Uncertainty of Terms
Certainty is a central general benefit that a written agreement can provide to parties. Certainty, provided by clearly drafted terms of a written agreement, underlies the parties' ability to rely on the binding obligations within a written agreement. When terms of an agreement lack clarity, it increases the risk of parties interpreting contractual obligations differently, potentially leading to contract disputes or litigation. Lawyers are able to assist with drafting clear and effective wording in written agreements.
We invite you to contact us at Prowse Chowne to further discuss how we may be able to assist you with your transaction.