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An agreement is a legal document that is required whenever there is a deal among two or more parties. It is inscribed between the interested parties and defines the responsibilities and liabilities for each party.
Moreover, an agreement declares that in the event of any kind of failure to abide by the terms, a breach of the agreement shall come in effect. Let’s understand the purpose of a legal agreement and its benefit in detail.
What Is a Legal Agreement?
A legal agreement is a written document that includes the set of terms and provisions negotiated by the interested parties. In case of any kind of breach of agreement, the responsible party will be answerable in the court.
After it is signed and approved, it becomes a legally binding covenant. There are several categories of legal agreements:
- Sealed Agreement: A sealed agreement was used in earlier times, though not frequently used nowadays.
- Express Agreement: An express agreement in which parties declare the terms orally or by writing.
- Implied Agreement: An implied agreement is a result of the mutual intent of both parties for fulfilling the provisions that were not written or orally declared.
Why Does a Business Need to Use an Agreement?
Legal agreements in a business are essential for protecting the rights of a company. The importance of using an agreement for business can be understood from the following facts:
Detail And proof
It provides written detail of the negotiated terms. It is proof that the two or more parties agreed on a deal and are legally bound to stay true to the commitments.
Prevention of Misunderstanding
A legal agreement drives out any kind of misunderstanding that could arise regarding the business matter. The agreement serves as a point of reference for the mutually agreed provisions.
Assurance of Confidentiality
Using an agreement protects the confidential information of the parties involved. In certain scenarios, there is a need for the involved parties to share confidential information with each other. The legal agreement binds the parties to not disclose this information to the competitors.
Preventing Litigation Meetings
Both the parties can avoid the expenditure at expensive litigation meetings due to the presence of a legal agreement.
Do I Need a Lawyer to Write an Agreement?
Does a legal agreement require a lawyer for its drafting?
Well, the answer is both, Yes and No! It depends on the situation which can help you decide whether you need a lawyer or not.
A legal document can include any kind of stipulation and offers. If you are carrying out any domestic agreement, you do not need a lawyer to write an agreement. You can easily download the particular agreement templates from CocoSign and modify it as per need.
On the contrary, if two parties indulge in an agreement that involves frequent transactions of money in a corporate environment, it is recommended to proceed in the presence of a lawyer, who might include some clauses in the agreement to be quintessential in case of disputes.
You can find all the types of legal agreement templates for free at CocoSign. Take a glance at our wide range of templates and grasp the required guidance regarding the legal agreements.