We all encounter contracts day in and day out in our personal lives.  Often, such as with the iTunes terms and conditions, we do not even bother to read them before we hit “I accept”. The importance of clear and carefully drafted contracts cannot be overstated.

What should I be looking for in my contracts?

1. The Parties being bound by the contract are clearly defined.

2. The roles, or promises, of each Party are clearly stated.

3. The contract clearly sets out how to tell if a Parties isn’t fulfilling their end of the bargain.

i.e. What constitutes a “breach” of the contract?

4. The contract clearly states what will happen if a Party “breaches” the contract.

5. The “Term” of the contract is clearly defined.

How long will the contract last? This can be based on the completion of a certain task, or the termination of a certain event or be a set amount of time.

6. The contract clearly describes how, and for what reasons, a Party can terminate the contract before the “Term” is over.

7. The contract states what laws govern the contract.

For example, if you are from Toronto contracting with someone in Montreal, does the contract state whether the laws of Ontario or Quebec govern the transaction?

What are some of the pitfalls of bad contracts?

The contract may not be enforceable.

The point of a contract is to:

  • clearly set out the intention of the Parties; and
  • to make sure that the Parties do what they are supposed to.

If your contract turns out to be unenforceable, then you lose half the utility of your contract!

Expensive Litigation.

Ambiguous terms and conditions in a contract, where it becomes difficult to determine what the Parties intended, can lead to a breakdown of the relationship between the Parties as time goes on.  This can lead to expensive and time consuming litigation.

Conclusion

As you can see, you can incur significant legal fees trying to correct a badly drafted contract or trying to enforce a poorly  drafted contract. As small business advisors at Erudite Law LLP, we consistently try and stress this to our clients. By having a contract correctly drafted by a lawyer, you may save yourself the time, stress and money of trying to correct something that should have been doing correctly from the start.

If you wish to have your contract reviewed, contact the lawyers at Erudite Law LLP by email at info@eruditelaw.com or call us at 905-471-6161.

 

Bill 59, lovingly called the “Putting Consumers First Act (Consumer Protection Statute Law Amendment)” will make some sweeping changes to the Consumer Protection Act of Ontario on March 1st, 2018.

A quick summary of the Ontario Consumer Protection Act

The Consumer Protection Act covers most common consumer transactions and provides specific rules and regulation that protects a consumer against unfair business practices. Some examples include:

  • Providing a cooling-off period that allows you to cancel some agreement without reason or penalty
  • Providing specific rules with regarding misrepresentation to what product or services that a business offers.
  • Providing specific requirements for towing and storages services, car repairs, and credit agreements.

Ontario Door-to-Door Sales Ban

On March 1, 2018, the amendments contained in Bill 59 that speak to door-to-door sales will come into effect.

Most importantly, the amendments will prohibit some suppliers (the person selling you something) from soliciting or entering into agreements at the customer’s home, unless the customer has specifically requested for the supplier to attend.

  1. What does that mean for the supplier?

If you are in the business of selling heating, ventilation, and air conditioning (HVAC) goods and services, like water heaters, furnaces, and air conditioner units, you can no longer arrive at your target customer’s home unrequested to sell or offer your services in person.

Leaving marketing materials at the customer’s home is not considered to be “solicitation” and is currently still an acceptable practice.

      2. What does that mean for the consumer?

If, after March 1, 2018, you are a customer that entered into an agreement with a supplier at your home without sending an initial request, the agreement that you have entered into is considered to be void. Any related agreements with the supplier, such as guarantees, security agreements, and credit agreements provided by the consumer will also be considered to be void.

As such, you may be able to return all the goods you accepted from the supplier and ask the supplier to reimburse you for all the charges you have incurred from the solicited agreement.

If you feel like you have been unfairly treated by a business and are looking for legal options, the lawyers at Erudite Law LLP may be able to help. Please drop us a line at https://eruditelaw.com/#contact. We look forward to hearing from you! 

By: Jimmie Z. Chen