Business contracts can be complicated for a small business owner, even when it comes to things like terminology. For example, in everyday speech, the word consideration means that you are giving something careful though. However, in business, it has a very different connotation, especially when it comes to business contracts. Let’s discuss the legal definition of consideration and why it is a good idea to have a business lawyer help draft or at least review your business agreements before you sign them.
What Is Consideration?
In business, consideration means one of two things. It’s either synonymous with compensation, or it is a contractual exchange of mutual promises that benefit both parties in a contract. That second definition is the one we are discussing today.
Consideration in this sense has to have tangible value. For example, you can’t make a contract with a business competitor saying that you both agree to “play fair” or “be nice” to each other. You can set a contract that agrees one person will avoid soliciting the other person’s clients in exchange for something of monetary value such as cash, assets, trade secrets, or the like.
Getting Help for Business Contracts and Agreements in San Diego
Did you know that consideration is necessary in order for a contract to be valid? This is just one of several things that must be included in any contractual business agreement. Pokala Law can help small business owners to construct legally binding contracts without getting burned. To learn more, call 1-844-695 1487 today.