In today’s Freedom Friday blog and email newsletter, I want to begin a short series on small business contracts, and some different issues that don’t come up often enough when I am asked to draft, review, or revise contracts for small business owners. In today’s Freedom Friday blog and email newsletter, I’m talking about deadlines, and what kind of deadlines should be in your small business contracts. In today’s Freedom Friday blog and email newsletter, I’m answering the question, “What kind of deadlines should be in your small business contracts?”
Many contracts already include various deadlines, some that are less formal than others, and some that are more formal. In this week’s Freedom Friday blog and email newsletter, I’m talking about more formal deadlines. If you have a formal deadline in mind, it’s important to include it in your small business contract. Here are five (5) different types of deadlines to consider including as appropriate in your small business contracts:
1. Completion Deadlines
The first type of deadline to consider including in your small business contract is a completion deadline. This is the deadline by which services should be completed or products should be delivered. This type of deadline also includes conditional completion deadlines, e.g., a consultant must complete his services within 120 days after the company provides him with the data that he needs to fulfill his contract.
2. Payment Due Dates
The second type of deadline to consider including in your small business contract is a payment due date, or dates when a payment is due. Many contracts require payment to be made by a certain date, or the purchaser is in default. Notwithstanding a grace period, it is important to include a payment due date in most small business contracts.
3. Commercial Landlord Delivery and Related Deadlines
The third type of deadline to consider including in your small business contract, specifically if you’re dealing with a commercial lease, is a commercial landlord delivery deadline. This type of deadline requires the landlord to deliver commercial property for the tenant’s possession within a specified period following the effective date of the lease. Similarly, some commercial leases include a deadline for the tenant to be open for business, for example, within 180 days of the landlord’s delivery of the premises.
4. Notice of Termination and/or Renewal Deadlines
The fourth type of deadline to consider including in your small business contract is a notice of termination and/or renewal deadline. Many contracts require deadlines for termination, either in lieu of automatic renewal, or for early termination. Some contracts require notice of termination, or the contract will automatically renew for a given period, but other contracts will terminate automatically and will require notice in advance if a party wishes to renew the contract. Also, many contracts require advanced notice if a party wishes to terminate a contract early before the agreed termination date.
5. Cure or Grace Period Deadlines
The fifth type of deadline to consider including in your small business contract is a cure or grace period deadline. If a party has breached a contract, for example by missing a payment, many contracts have a short period of time (sometimes 10 days or longer) for the breach to be cured. This is also called a “grace period”. Not only is this common for breach of contract due to lack of payment, but it is also very common in construction contracts for breach of contract due to performance issues. For example, if a contractor is in material breach of the contract, once the owner gives them notice, they have ten (10) days to cure the material breach and fix the problem(s) at issue.
Thinking about starting a small business? Or maybe your small business is having issues with contracts, leases, business partners, collection issues, or experiencing other barriers to growth? Please contact me at Jonathan@libertylegalok.com to schedule a FREE strategy session.
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