Properly Drafted Letters of Intent Can Help Michigan Businesses Avoid Legal Disputes
Properly drafted letters of intent provide an important opportunity for a business to prevent legal problems. However, in the hands of a layperson or inexperienced lawyer, a letter of intent can be a landmine. A good business lawyer can help a company to negotiate contracts that will protect its rights and help avoid disputes with suppliers and customers.
For major equipment purchases or when buying a business, a good business lawyer can help a company prepare a letter of intent that avoids unintended liabilities. Letters of intent are frequently used when negotiations are just beginning to document the basic terms of the business deal and to simplify further negotiations. For Michigan businesses, it's important to have any letter of intent prepared (or at the very least) reviewed by a good Michigan business lawyer. A carelessly drawn letter of intent can destroy a business's bargaining position in later negotiations and even lead to damaging lawsuits.
After negotiations have been completed, it is important to carefully prepare and review contract documents to confirm that they reflect the business deal. It is also important that the contract documents cover contingencies that may not have been discussed during the negotiations. At a minimum the contract should contain "preventive'' provisions like remedies for default, procedures for handling disputes, provisions limiting a your liability, and provisions indemnifying your company against injury and damage claims.
It is important to establish a good relationship with a competent business lawyer so that he or she can help you to review your important contracts and contract forms -- before you sign them -- to assure that they protect your company against legal problems.
