Category: Business Law

Consider a scenario that’s becoming more common in the cryptocurrency world: A DeFi lending protocol automatically liquidates millions in collateral when Ethereum’s price drops 15% in thirty minutes. 

There’s no issue with the smart contract; it went off without a hitch. But the borrower claims the liquidation was premature, arguing that traditional margin requirements would have given them time to add collateral. In return, the lender points to the immutable blockchain record that shows the contract worked as coded.

Who’s right here? And more importantly for your business: what happens when the gap between “the code worked” and “this isn’t what we agreed to” leads to a million-dollar dispute?

Smart contracts can lead to a legal-technical disconnect

As technology, smart contracts are highly sophisticated, but that sophistication isn’t without problems, especially those of a legal nature. The assumption that “code is law” fundamentally misunderstands how legal systems evaluate agreements, and this disconnect is where disputes originate.

There are several issues that crypto businesses are trying to resolve, often in real time.

Core Issue	Technical Reality	Legal Reality
Automated execution during market stress	Smart contracts execute precisely as programmed, triggering liquidations at exact collateralization ratios	Courts evaluate whether automated execution reflects actual agreement, considering circumstances like market volatility and the borrower’s ability to respond
Decentralized governance claims	Protocol decisions made through token voting and algorithmic processes	SEC examines who actually influences outcomes, as shown in the BarnBridge DAO settlement, where founders retained effective control
Cross-border blockchain transactions	Smart contracts operate identically across all jurisdictions	Courts apply local law and regulations, creating conflicts when automated execution spans multiple legal systems
External data dependencies	Third-party oracle services provide price feeds and data sources	Protocol developers face legal responsibility for oracle selection and safeguard implementation
Algorithmic investment mechanisms	AMMs and yield protocols operate through automated functions without human intervention	Regulators classify based on economic function; automated investment-like returns may constitute securities regardless of technical decentralization

These disconnects create predictable legal vulnerabilities; however, the solution isn’t to avoid smart contracts. It’s implementing them within frameworks that address how courts and regulators operate.

How to implement smart contracts to minimize legal risk

Success requires building legal protections into your technical architecture from day one, not retrofitting compliance after deployment. This involves understanding your risk profile, planning your legal frameworks, incorporating dispute resolution mechanisms, and continually addressing risk vectors. 

Assess your risk profile before implementation

Before deploying smart contracts, evaluate three key risk factors that determine your legal exposure and implementation approach.

1. Transaction complexity and automation suitability

Smart contracts work best for standardized transactions with clearly defined parameters and predictable outcomes. High-value or complex deals requiring discretionary judgment need hybrid approaches that combine automation with human oversight capabilities. The more subjective evaluation your transactions require, the higher your dispute risk.

2. Regulatory classification risk

The SEC’s 2025 guidance requires specific disclosures for smart contracts, including details of security audits and governance mechanisms. Smart contracts involving securities-like features, cross-border payments, or consumer transactions may trigger licensing requirements or disclosure obligations. 

Assess whether your smart contract’s economic function could be classified as a regulated activity.

3. Jurisdictional and enforcement complexity

Cross-border smart contracts raise multi-jurisdictional legal questions, increasing dispute resolution costs and uncertainty in timelines. 

Consider whether your implementation spans multiple regulatory regimes and how you’ll handle conflicting legal requirements when automated execution produces disputed results.

Build comprehensive legal frameworks

Create dual-layer documentation that combines smart contracts with traditional legal agreements, explaining elements like: 

• Business context
• Key terms not apparent from code review
• Dispute resolution procedures

Providing this insight is important because code-only contracts leave it up to courts to interpret intent and circumstances beyond what the automated execution reveals. For cross-border transactions, establish choice of law clauses and dispute resolution mechanisms before the contract is deployed.

Implement built-in dispute prevention mechanisms

Recent cases like Coinbase v. Suski (2024) demonstrate that courts still have control when determining which terms in inconsistent contracts offered by a particular party are enforceable. This means your smart contract code alone won’t determine legal outcomes; courts will look for additional context to understand what parties actually agreed to.

Build dual-layer documentation that combines your smart contract with traditional legal agreements. Include business context that explains why specific automated triggers exist, define key terms that aren’t obvious from code review, and establish dispute resolution procedures for when automation produces unexpected results. 

Without this interpretive framework, courts must guess at your intent when disputes arise.

For cross-border implementations, establish choice of law clauses and dispute resolution mechanisms before deployment. Legal enforcement remains territorial, even when blockchain transactions span multiple jurisdictions, so it is essential to determine upfront which law applies and where disputes will be resolved.

Maintain ongoing risk management

The SEC now requires disclosure of whether smart contracts have undergone third-party security audits, who conducted them, and the results of those audits. To achieve this, establish clear procedures for both technical updates and legal modifications, ensuring changes maintain compliance and don’t create unintended legal consequences.

Additionally, monitor for the high-risk scenarios identified earlier: oracle dependencies, governance centralization points, and cross-chain coordination requirements. The SEC’s shift from aggressive enforcement to structured rulemaking means there may be more transparency around what’s permissible, and more emphasis on proactive risk mitigation than reactionary penalties. 

Each category requires specific monitoring and contingency planning appropriate to your implementation.

The path forward requires integration, not replacement

For businesses currently using or considering smart contracts, improvising isn’t a practical path forward. The technical complexity, regulatory developments, and cross-jurisdictional challenges require experienced counsel who understands both the technology and the evolving legal landscape.

Contact The Law Offices of Andrew Dressel LLC to discuss how smart contract disputes could affect your business and develop comprehensive strategies for both prevention and resolution.

The content in this article is for general informational purposes only. It should not be construed as legal advice or a substitute for legal advice. The information above does not create an attorney-client relationship, nor do prior results guarantee future outcomes. Any reliance you place on such information is therefore strictly at your own risk.

Strategic partnerships can be crucial to the success of a business. Restrictive covenants play a vital role in these agreements, offering valuable protection for your business interests while posing potential challenges—if not handled carefully.

New Jersey has long enforced reasonable restrictive covenants, but state lawmakers are now considering legislation that could substantially limit the scope and enforceability of these covenants. 

Crafting a well-thought-out partnership agreement can be both challenging and rewarding. Let’s take a look at the proposed legislation and its potential impact on businesses in New Jersey.

New Jersey and New York: a shared legal landscape

New Jersey often looks to New York for guidance on employment law. For example, in 2014, New York City enacted the Earned Sick Time Act, requiring private-sector employers to offer paid sick leave. This groundbreaking legislation prompted other jurisdictions, including New Jersey, to explore similar measures.

Following in New York City’s footsteps, New Jersey passed the New Jersey Paid Sick Leave Act in 2018. The New Jersey law closely resembles the New York City law, including provisions allowing private-sector employees to use paid sick leave for their own illnesses, caring for family members, or addressing domestic violence-related issues.

It’s no surprise, then, that New Jersey is now considering legislation to further limit the enforceability of restrictive covenants, something that New York’s proposed Senate Bill S1300 strives to accomplish.

The proposed legislation: Assembly Bill 3715

New Jersey seeks to join the growing number of jurisdictions that have curtailed the scope and enforceability of restrictive covenants with New Jersey’s Assembly Bill 3715 (AB 3715). If passed, the bill would introduce several new requirements and limitations for employers, including:

• Codifying existing common law standards for enforceable restrictive covenants while adding new limitations on their duration and geographic scope
• Requiring a minimum 30-day notice to employees before a restrictive covenant becomes effective
• Limiting restrictions on employees working with customers or clients of their former employer, provided the employee did not initiate or solicit those customers or clients
• Prohibiting choice of law provisions that would allow employers to avoid applying New Jersey law to restrictive covenants
• Excluding certain categories of workers, such as non-exempt employees under the Fair Labor Standards Act, independent contractors, and low-wage employees, from being subject to restrictive covenants
• Requiring employers to pay employees 100% of their compensation during the restricted period, up to 12 months following the termination of employment
• Prohibiting “no-poaching” agreements between employers
• Requiring employers to provide written notice of their intent to enforce a restrictive covenant within 10 days of an employee’s termination
• Mandating employers to post a copy of the legislation or an approved summary in a prominent place in the workplace
• Creating a private right of action for employees to bring a civil lawsuit against employers who violate the act, with a two-year statute of limitations

The potential impact on New Jersey businesses

If passed, AB 3715 could significantly affect businesses in New Jersey. Employers must meticulously review and revise their restrictive covenant agreements to ensure compliance with the new law. Additionally, businesses may face increased costs associated with paying employees during the restricted period and potential litigation from employees challenging restrictive covenants.

Despite these challenges, the proposed legislation is not expected to be retroactive, meaning existing restrictive covenants would not be affected. Nevertheless, businesses should proactively review their current agreements and stay informed about the latest developments in restrictive covenant legislation.

How might AB 3715 affect restrictive covenants in the partnership context?

As New Jersey considers AB 3715 to further limit the scope and enforceability of restrictive covenants, it’s vital to explore the potential implications of this legislation in the context of partnership relationships.

New Jersey, like many other states, has tried to balance the competing interests inherent in restrictive covenants by enforcing only those covenants that are reasonable in scope, duration, and geographic area. AB 3715 aims to codify many of those terms, as opposed to leaving the concept of “reasonable” up to the courts. 

Some benefits of this approach may include:

1. Protecting partners’ rights: By limiting the scope and enforceability of restrictive covenants, AB 3715 seeks to prevent partners from being unduly restricted in their ability to form new partnerships or start new ventures after leaving an existing partnership. 
2. Encouraging innovation and collaboration: By restricting the duration and geographic scope of restrictive covenants and prohibiting no-poaching agreements, the bill promotes innovation and collaboration in the market, allowing partners to contribute to the economy by working with new partners or starting new businesses. 
3. Fostering a healthy business environment: By limiting restrictive covenants in partnerships, AB 3715 encourages a more open and competitive business environment. This can lead to increased collaboration between partnerships, knowledge sharing, and the development of new ideas and innovations. Ultimately, this can contribute to a healthier and more dynamic business ecosystem, benefiting not only individual partnerships but also the wider economy.

However, while AB 3715 is intended to protect employees and promote a healthy business environment, applying it to partnership agreements might be seen as overreaching for several reasons:

1. Distinct nature of partnerships: Unlike the traditional employer-employee relationship, partnerships typically involve individuals who share ownership, decision-making, and responsibility for the business’s success. Partners usually possess valuable proprietary information, including trade secrets, client relationships, and strategies. Restricting the enforceability of covenants in partnership agreements could undermine the protection of these vital interests and destabilize the partnership itself. 
2. Negotiating power: Partners generally have more negotiating power than employees when entering into partnership agreements. They can actively discuss and negotiate the terms of restrictive covenants to ensure they are fair, reasonable, and mutually beneficial. Imposing legislation that limits the scope of restrictive covenants in partnerships unnecessarily interferes with the ability of partners to negotiate agreements that are specifically tailored to their unique circumstances. 
3. Impact on partnership dissolution: Restrictive covenants in partnership agreements often play a crucial role in establishing a clear framework for dealing with partnership dissolution or the departure of a partner. Limiting the enforceability of these covenants could create ambiguity and increase the potential for disputes during such transitions, which could harm the partnership’s ongoing operations and the interests of remaining partners.

In light of the ongoing developments surrounding AB 3715 and its potential impact on restrictive covenants in the partnership context, businesses must stay informed and vigilant. While the legislation aims to protect individual rights and promote a competitive business environment, it’s critical to strike the right balance between these objectives and the unique needs of partnership relationships. 

By understanding the nuances of the proposed legislation and its potential implications, businesses can better prepare themselves for any changes that may come, ensuring they continue to thrive in a dynamic, evolving marketplace.

Thriving partnerships, thriving businesses

Partnership agreements can be complex. Each individual involved comes to the table with different expectations and needs, but a well-drafted partnership agreement can provide a solid foundation for growth, profitability, and longevity. 

The Law Offices of Andrew Dressel LLC is a boutique business formation law firm with deep experience helping both business owners and partners draft partnership agreements, negoatiate terms, resolve disputes, and more. If you need support w, please contact us online or give us a call at 848.202.9323.

The content in this article is for general informational purposes only. It should not be construed as legal advice or a substitute for legal advice. The information above does not create an attorney-client relationship. Any reliance you place on such information is therefore strictly at your own risk.

Wondering how top business executives negotiate compensation packages that reflect their value and help them achieve their personal and professional goals?  

We’re here to demystify the world of executive compensation with a clear, digestible definition of executive compensation, followed by effective tips for negotiating the executive compensation package you want. 

Whether you aspire to reach the coveted C-suite or you’re simply curious about the inner workings of executive compensation, this overview of the subject will leave you more informed and prepared for the process. 

What is executive compensation?

Also known as “executive pay,” executive compensation is a comprehensive package of financial and non-financial rewards—including salary, benefits, bonuses, and more—that executives and high-ranking senior management receive as payment for their job role. 

Financial elements of executive compensation include the obvious—salary—as well as stocks and bonuses, while non-financial elements include healthcare coverage, vacation time, and other perks. 

What are the goals of executive compensation? 

The central goals of executive compensation are to attract, motivate, and retain top-level executives. 

Executive compensation can be particularly motivating when it is contingent on the achievement of company performance goals. When high-level employees know that they must hit specific targets to receive a certain bonus, they are incentivized to put more effort into their work and help the company succeed.

Which aspects of executive compensation can you negotiate? 

Most aspects of an executive compensation package can be negotiated, including:

• Base salary
• Stock options
• Relocation stipend
• Legal representation
• 401(k) plan
• Annual and long-term incentive plan
• Deferred compensation plan
• Employee benefits, such as medical, dental, vision, disability, and parental leave
• Vesting schedules
• Company vehicles and air travel
• Education funding
• Wardrobe stipend
• Severance package

How to negotiate executive compensation packages

Now that you know what can be negotiated (read: just about everything), here are our top tips for negotiating your own executive compensation package.

(Feeling nervous? Remember that negotiation doesn’t have to be intimidating if you enter the process from a place of adequate preparation. Legal counsel with experience in executive compensation negotiations can help you understand what to expect and how to best position yourself for said negotiations.)

Identify your goals 

Before you can ask for anything, you need to know what it is you’re asking for, so the first step in the process is to set the specific goals that you’d like to achieve through your compensation negotiations.

Take stock of your personal and professional goals as well as your financial objectives. Are you hoping to receive a higher base salary, bonuses based on your performance, stock options, or specific perks like more flexible working arrangements? 

Once you know what you want, contextualize your goals based on the industry and region where you work to determine what kinds of asks are realistic. For instance, when it comes to assessing your goal for base salary, you might want to ask yourself: what is the market rate/average salary for similar positions, both nationally and in your region? 

Find the right time 

Timing can make or break a successful negotiation. Find the right time to initiate negotiations, which is often after an initial offer has been extended to you, but before you’ve accepted it. This can give you a little more leverage.

Another aspect of timing to consider is the state of the broader economic landscape. Negotiating during periods of uncertainty or financial turbulence, either for your company or in the industry as a whole, could be an advantage or a disadvantage, depending on broader trends. 

Know your value

Don’t underestimate what you bring to the table. Starting off with a clear-eyed, realistic sense of your skills, experience, successes and contributions to the company can help you initiate compensation-related negotiations from a strategic position. Stay open to compromise, but don’t undervalue your expertise.

Remember that confidence is key to successful negotiation. 

According to workplace coach Bonnie Low-Kramen, “Confidence is serious business, and the single most important differentiator in the workplace.” 

Use that reality to your advantage by presenting a confident, assured front that communicates your value to the company.

Let the company make the first offer

Staying silent can be a power move in negotiations. 

Letting the company make the first offer for an executive compensation package puts you in a better negotiating position. That’s because it helps you gain a clearer understanding of their valuation of your skills and experience. Companies usually have a range in mind for executive compensation, and their initial offer typically falls within that range.

When you allow the company to initiate the discussion, you can use their initial offer as a starting point for negotiating upward. This strategy can help you avoid the pitfalls of either: 

• Undervaluing yourself by naming a figure that’s too low, OR
• Overshooting what they had in mind

Consider professional support

Executives who are negotiating complex compensation packages or who don’t feel 100% confident in their ability to advocate for themselves can seek guidance from experienced professionals, such as attorneys who specialize in executive contracts. 

Attorneys know everything there is to know about this process, including the minutiae of industry standards and trends as well as legal complexities, which means they’re ideally suited to guide you toward that C-suite “Holy Grail”: a competitive compensation package that aligns with your professional and financial goals. 

Not only does professional support help you secure the most favorable possible terms for your compensation plan, but it also minimizes the likelihood of disputes or legal complications that could derail the process (and your professional goals) entirely. 

Consult our New Jersey executive compensation attorneys

If you’re in search of professional support—and specifically, a client-focused, boutique law firm that offers personalized support for executive compensation negotiations—consider The Law Offices of Andrew Dressel LLC. 

Our New Jersey-based team of attorneys assists clients with the development of competitive executive compensation plans, successfully representing clients across numerous industries. 

To assess whether our proactive, problem-solving approach is a good fit for you in your search for the compensation you deserve, contact The Law Offices of Andrew Dressel LLC today to schedule a free virtual consultation with their team.

DISCLAIMER

The content in this article is for general informational purposes only. It should not be construed as legal advice or a substitute for legal advice. The information above does not create an attorney-client relationship, nor do prior results guarantee future outcomes. Any reliance you place on such information is therefore strictly at your own risk.

After four seasons of corporate machinations, failed boardroom coups, mergers and acquisitions galore (and possible securities fraud), the saga of the Roy family has reached, if not an end, a point of departure. 

We’ll leave the post-mortem of the show to the professional critics, but what are some takeaways for lawyers (and their clients) from Succession? (Caution, spoilers ahead.)

1. Plan for contingencies

The first lesson is in the title, Succession. 

The question that haunts the show, especially its most recent season, is what will happen after the founder of Waystar Royco, Logan Roy, passes from the scene. The fundamental source of drama is that at one point or another, Logan promises each of his children that they will take over as CEO. 

Indeed, in one especially clever twist, Logan’s thoughts on his successor are found among his other estate plans with his son Kendall’s name either underlined or crossed out, depending on one’s view. 

Of course, in real life, this is rarely how the selection of corporate officers works out. Corporate officers are usually selected by an organization’s board of directors. Even in the show, where the underlining of Kendall’s name is taken to be an endorsement from beyond the grave, the company’s board ultimately approves of the nomination through an informal vote. 

But the potential for chaos surrounding that vote illustrates the importance of planning for contingencies in corporate documents. What happens if a key executive is suddenly unable to fill their role due to incapacitation or injury? That possibility needs to be addressed in the entity’s formation documents from the outset, and a well-counseled business will be prepared by their lawyer for that possibility.

2. Remember your fiduciary duties

The focus of Succession was on which of the Roy siblings, if any, would be tapped to take the reins of the company, but Waystar Royco was not a family business—it was a publicly-traded company whose executives and directors had a duty to put shareholder interests first.

To the show’s credit, while the protagonists may have often lost sight of this fact, the show’s writers stayed true to that reality. 

The central question of the final season, linked to the question of who would take over Waystar Royco, was whether the board would accept a very generous merger offer for the company, a merger that by all accounts would have commanded quite a premium for shareholders. And the board ultimately chose to put shareholders first, approving the buyout despite heavy politicking from Kendall to keep the company in the family. At the end of the day, Kendall could not win the shareholder value argument.

As attorneys, we too must be vigilant about our fiduciary duties, especially when our clients are institutional. The duty is always to the company first, not the interests of particular executives or directors, even if those are the persons we directly report to on a day-to-day basis. 

3. Skeletons never stay in the closet

The next lesson is an interesting one because it involves drama and deception. 

One of the major narrative arcs in Succession had to do with a scandal surrounding Waystar Royco’s cruise line. The scandal involved two layers of cover-ups—one to conceal actual crimes that occurred on the cruise ships and a second cover-up of the cover-up in which characters destroyed internal company documents in an attempt to keep the dead buried (quite literally). 

As with most cover-ups, the deception failed. As attorneys, we walk a tricky line regarding company malfeasance. On the one hand, we have a duty to keep client matters confidential, unless directed otherwise. On the other hand, we cannot turn a blind eye to corporate malfeasance and fraud, especially when tolerating that malfeasance would ultimately harm the company. 

While Waystar Royco did ultimately weather the storm, it was subjected to a Congressional investigation, a Department of Justice investigation, and a hefty fine. No one went to jail, but the company was not unscathed.

Imagine if instead of participating in these cover-ups, the company’s attorneys had rooted out the malfeasance at the beginning, explained to corporate decision-makers that the actions would have consequences and pressed for internal changes. Not as thrilling, sure, but that would have been the responsible approach.

As attorneys, we do our clients no favors by being a rubber stamp. That doesn’t protect the company, the real client.

4. R.I.P. to the Old Boys Club

One central theme running through all four seasons of Succession is how poorly women are treated in the corporate world (or at least at Waystar Royco). 

Waystar Royco was rife with inappropriate relationships, whether it was the strange bond between Roman and Gerri, or the tryst between Logan and Kerry. And we saw how it came back to harm the company, not only in how it stifled talented individuals from rising to the top but also by generating millions of dollars in litigation liability. 

Waystar Royco was portrayed as a particularly heinous company in this regard. But we all know that harassment and discrimination still exist, and the individuals that engage in it are breaking the law and putting their businesses and shareholders at risk. Even when it’s uncomfortable, attorneys have to speak out and tell individuals that this behavior cannot be tolerated.

While the series was prized for its entertainment value, Succession also illustrates a number of the challenges facing attorneys of institutional clients, especially large institutional clients with a wide range of stakeholders. 

At The Law Offices of Andrew Dressel LLC, we provide general counsel services to businesses large and small, including litigation services. To discuss the services we can provide your company, call us at 848-202-9323 or email contact@d-mlaw.com. 

This article is not legal advice and you should not rely on it for legal advice. Please contact an attorney if you have a legal question.

Contracts are core documents for business operations. Businesses may rely on contracts to: 

• Conduct transactions with outside parties
• Handle internal functions like employment contracts
• Limit legal liability to protect the company and its owner

To truly serve its purpose, a contract must clearly define the obligations and responsibilities of all parties—and the terms must be laid out in detail so that they are enforceable. 

A New Jersey business contract attorney can help you understand the essentials of business contracts. Business attorneys are equipped to look out for your best interests and help you avoid costly litigation.

You can get a jump start on understanding business contracts today by learning three essential guidelines to follow for effective contracts. That way, you’ll be ready to take full advantage of professional advice from a business attorney.

Three must-have features for your business contracts

1. Make your contract’s language clear and simple

Breaching a contract is more likely when parties don’t fully understand the terms and conditions of that contract. Meanwhile, clearly-written contracts are less likely to be challenged in court if one of the parties fails to meet their obligations.

To be considered legally enforceable contracts under New Jersey law, contracts must contain three specific elements: 

• A definite offer
• Acceptance of the offer
• Consideration

If any of the elements of a contract are missing or questionable, the court could rule that the parties did not have a legally binding agreement.

Offer

It may sound obvious, but for a contract to be valid, the offer must be communicated to the other party. An offeror makes an offer to sell a product or property, perform a service, or engage in a business venture. The person who receives the offer is the offeree. 

An offer is dependent on a specific promise, act, or forbearance (lack of action).

An offer must be definite and clear so that the offeree understands that an offer is being made and that accepting the offer creates a binding contract. 

The offer must also be specific enough to describe what is being offered. For example, in real estate, a legal description of property is more than just a street address, and often includes specific boundaries as measured by a surveyor.

Acceptance

Acceptance is the act of consenting to and approving the terms and conditions of the offer. When an offer is accepted, this creates a legally binding contract between parties. If a party fails to fulfill the terms and conditions of their agreement, the contract provides the other party with legal recourse.

An acceptance only occurs when the acceptance is unqualified and unequivocal. The offeree must agree to the exact terms of the offer as specified by the contract. 

If an offeree states they will accept the offer with changes, there is no binding contract. Instead, the offeree has made a counteroffer which must then be communicated to the offeror.

Consideration

Consideration is an exchange of promises or performance for something of value. Consideration can be money, an item with economic value, or a promise to perform or not perform specific acts.

The consideration does not need a minimum value for a contract to be valid. Both parties must receive something from the agreement. Courts can enforce a contract even if a party receives something of nominal value. An example would be a real estate contract transferring property for “$1 and Love and Affection.”

Without consideration, a contract is not enforceable. Consideration is what distinguishes a gift from an enforceable contract.

2. Provide sufficient detail about expectations and obligations

Contractual obligations are the legally binding promises that make up a business contract. They explain the rights and responsibilities of each party to the contract. Therefore, it is essential that terms and conditions be crystal clear before either party enters into a contract.

It might be tempting to write short contracts to avoid dealing with long and difficult-to-understand documents. However, trying to keep things “short and sweet” could mean leaving out details essential to protect parties from liability. 

Suppose a dispute or breach of contract occurs. In that case, a lack of detail can make it impossible for a judge, mediator, or arbitrator to understand what the parties intended when they signed the contract.

The goal is to draft a business contract that is straightforward and simple enough to understand, but with sufficient detail to avoid ambiguity about the responsibilities and obligations of either party. The terms and conditions of the contract should be clear to anyone reading the contract without either side having to explain what they thought or assumed the contract covered.

Here are some points to keep in mind:

• Avoid acronyms and spell everything out
• Never assume anything when writing a contract—if the reader must assume something, the contract is missing details
• Have a neutral third party review the contract to ensure that the terms are easily understandable, such as a New Jersey business contract attorney 

A contract should include sufficient detail to remove all uncertainty about what is expected and provide a way to assess whether the parties have complied with the contract terms.

3. Get everything in writing

Verbal or oral contracts are enforceable under New Jersey contract law, with some exceptions. 

For example, contracts governed by the New Jersey Uniform Commercial Code, New Jersey Consumer Fraud Act, and the Statute of Frauds and Fraudulent Conveyances must be in writing to be enforceable. 

Other contracts that must be in writing include, but are not limited to, contracts involving employment agencies, home improvement contractors, prenuptial agreements, and automobile sales.

But even though some oral contracts are enforceable, they aren’t the gold standard. A written contract provides the fullest possible protection to all parties involved. 

Reasons to use written business contracts include:

• Increased clarity of responsibilities, obligations, prohibitions, and consequences for breaching the contract  
• Better protection from liability and other adverse consequences
• Financial savings by avoiding disputes and litigation
• Enhanced trust between parties
• Pre-determined strategies for resolving disputes
  

Written contracts are generally more enforceable than verbal ones, but merely signing a written contract does not make the contract enforceable or create protection for your business. Therefore, it is important to seek legal advice from an experienced New Jersey business contract attorney when creating or entering into a business contract.

Need help preparing your New Jersey business contract?

Negotiating, drafting, and reviewing contracts is essential to operating a successful business. A well-drafted contract is a strategic way to protect your business from disputes and costly litigation. 

Our New Jersey business contract attorneys at The Law Offices of Andrew Dressel LLC provide comprehensive legal services to ensure your business is well-positioned with enforceable contracts if things do not go well during a business transaction.

Contact our law firm for a free virtual consultation if you need help preparing or reviewing New Jersey business contracts.

The content in this article is for general informational purposes only. It should not be construed as legal advice or a substitute for legal advice. The information above does not create an attorney-client relationship. Any reliance you place on such information is therefore strictly at your own risk.