Before you sign…

Before you SIGN on — the dotted line!

If a rift or misunderstanding occurs in a business arrangement usually the last line of defence you have is a duly “signed” and dated legal agreement.

However, whether you “legally” come out on top or not ALL depends on how well the legal agreement was drafted in the first place.

The new Breakthrough LegalGuide™ (by R. P. Emery & Associates) reveals one of the most common areas where an agreement can let you down is when it contains “double meanings” or “ambiguities.”

One of the safest ways you can avoid having your agreement legally torn-apart is by including clauses, which ONLY embody clear and concise meanings. In other words, an agreement must contain well-defined clauses that cannot — “in any way, shape or form” be interpreted as ambiguous.

By having a general understanding of agreement clauses and the “crucial” part they play in a legal and binding agreement can help you AVOID falling victim to putting your signature on an agreement that is not worth the paper it’s written on.

How to co-own real estate as tenants in common

AGREEMENTS BETWEEN TENANTS IN COMMON

How to co-own real estate as tenants in common.

Whenever a person wants to buy a home, commercial lot or other piece of real estate, they might want to do so as part of a group of similar investors. There are many ways to do this, with the buying as tenants in common one of the most often considered. A form of co-ownership, ‘tenancy in common’ is a term used to describe how the property is owned and which party is responsible for what. Most commonly found among time-share or similar agreements, tenants in common is a way to divide the practical use of property easily and without complications.

• WHAT IS A ‘TENANT IN COMMON’? Anyone who buys a real estate property and who chooses to be a partial owner can be a tenant in common. When entering an Agreement between Tenants in Common, each party can agree to certain responsibilities (usually some cost and upkeep expenses) in return for the exclusive right to use the property at certain agreed times.

• WHAT IS THE DIFFERENCE BETWEEN TENANTS IN COMMON AND JOINT TENANTS? The biggest difference between tenants in common and joint tenants is the manner in which the property rights continue in the event of a death of one of the co-owners. In a joint tenancy, when a co-owner dies their share of the property passes to the other owners. In a tenancy in common, the share of the deceased co-owner will pass along to according to their last will and testament, or if they die without one, according to the rules of the state. The Agreements Between Tenants in Common will usually state the co-owners have the sole right to decide how their share will be passed on after they die. This is the main reason why tenancy in common is much more often found than joint tenancy.

• HOW DO I MAKE A TENANT IN COMMON AGREEMENT? To be sure your Agreements Between Tenants in Common is legal and valid, you must state clearly your wish to enter such an agreement. Each party who buys a part of the property must agree to the terms, and the agreement must be in writing. You will also need to ensure the specific portions of parties responsibilities and commitments to upkeep and maintenance are also spelled out clearly.

• CAN I SELL MY OWNERSHIP INTERESTS TO OTHER PEOPLE? Yes and no. The Agreements Between Tenants in Common allows co-owners to sell or otherwise dispose of their portion of the property, but not without first offering the existing co-owners a chance to buy out their interest. This ‘right of first refusal’ is often included in such agreements to allow the co-owners a chance to match the price the seller would get from the prospective buyer. The conditions of notice and acceptance of these offers is clearly stated and described in the agreement.

Time-share agreements and other co-owned properties can be fun, and often are a worthwhile investment. But before you enter such an agreement, you should be clear what the conditions and terms are. A tenancy in common often comes with responsibilities, and you need to be sure the agreement is satisfactory to all involved before you sign.

Tenants in Common Agreements

How to choose a Franchise and getting the right Franchise Agreement

HOW TO CHOOSE A FRANCHISE?

Choosing a franchise that is right for you is one of the best actions you can take to ensure a successful business venture.

If you’ve made the decision to buy into a franchise, the next step is to determine what franchise you want to buy. There are many different types of franchises, ranging from a coffee shop to electronic retailers and everything in between. Before you start a franchise, you’ll have to decide what kind you want. A lot of research, thought and deliberation has to go into making the right choice, as this decision can make or break your chances at success.

1. What do you love to do? Unlike starting an original business where you can decide everything, a franchise comes pre-made, and is a turn-key operation. This means the product or service you are going to sell is already decided for you. Selling something you absolutely hate isn’t a good idea and a pretty sure way to meet with failure. On the other hand, if you already love something and find a franchise that sells it, you may have found your ideal business and the road to success.

2. How much profit? Even if you love a product, service or business but the franchise isn’t going to make you enough money, you’re not going to be very happy. If you stand to make a much larger profit with a product you aren’t excited about, you’ll have to decide which franchise is more appealing to you. Making a lot of money doing something you hate may not be worth it to you. On the other hand, doing what you love and barely being able to get by isn’t an appealing option either.

3. How much can you invest? Starting a business costs money, and franchises can often cost a lot more than an independent. You need a good idea of how much funding you can secure before you decide upon a franchise. If a certain franchise opportunity is outside your price-range, you’ll have to reconsider your choice.

4. How much help do you need? Along with product and name recognition, franchises offer different levels of support. Some are very active with help for their customers, while others have less support available. You want to find a franchise that matches your needs. If you are new to the world of business, a franchise with a lot of support will be better than one that isn’t able to offer you much help. On the other hand, if you are an experienced business owner, you’ll have a wider range of franchises to choose from.

5. How established is the franchise? Some new franchises offer owners a great opportunity: being the first one on the block to own the business. There is more risk with new franchises, but also more opportunity. Established franchises, on the other hand, usually have a more loyal customer base to draw upon. They also may be their own worst competition. If a market is already saturated with the same franchise competitors, you may find the going a little tougher securing a piece of the pie.

6. An important factor when choosing any franchise is to secure the proper Franchise Agreement. When this is laid out correctly you are certain of your rights and responsibilities and those of the franchiser. Should anything come into question then with the right signed agreement you can have peace of mind knowing you are covered.

   FRANCHISE AGREEMENT
   

Which Franchise is right for you?

HOW TO CHOOSE A FRANCHISE?

Choosing a franchise that is right for you is one of the best actions you can take to ensure a successful business venture.

If you’ve made the decision to buy into a franchise, the next step is to determine what franchise you want to buy. There are many different types of franchises, ranging from a coffee shop to electronic retailers and everything in between. Before you start a franchise, you’ll have to decide what kind you want. A lot of research, thought and deliberation has to go into making the right choice, as this decision can make or break your chances at success. Also making sure you have the correct Franchise Agreement is vital.

1. What do you love to do? Unlike starting an original business where you can decide everything, a franchise comes pre-made, and is a turn-key operation. This means the product or service you are going to sell is already decided for you. Selling something you absolutely hate isn’t a good idea and a pretty sure way to meet with failure. On the other hand, if you already love something and find a franchise that sells it, you may have found your ideal business and the road to success.

2. How much profit? Even if you love a product, service or business but the franchise isn’t going to make you enough money, you’re not going to be very happy. If you stand to make a much larger profit with a product you aren’t excited about, you’ll have to decide which franchise is more appealing to you. Making a lot of money doing something you hate may not be worth it to you. On the other hand, doing what you love and barely being able to get by isn’t an appealing option either.

3. How much can you invest? Starting a business costs money, and franchises can often cost a lot more than an independent. You need a good idea of how much funding you can secure before you decide upon a franchise. If a certain franchise opportunity is outside your price-range, you’ll have to reconsider your choice.

4. How much help do you need? Along with product and name recognition, franchises offer different levels of support. Some are very active with help for their customers, while others have less support available. You want to find a franchise that matches your needs. If you are new to the world of business, a franchise with a lot of support will be better than one that isn’t able to offer you much help. On the other hand, if you are an experienced business owner, you’ll have a wider range of franchises to choose from. If you establish a support level in the Franchise Agreement then you know that help is on hand should you need it.
   

5. How established is the franchise? Some new franchises offer owners a great opportunity: being the first one on the block to own the business. There is more risk with new franchises, but also more opportunity. Established franchises, on the other hand, usually have a more loyal customer base to draw upon. They also may be their own worst competition. If a market is already saturated with the same franchise competitors, you may find the going a little tougher securing a piece of the pie.

   
   FRANCHISE AGREEMENTS
   

Thinking of buying into a Franchise? Read this first!

IS FRANCHISING RIGHT FOR ME?

Questions you should ask before buying a franchise.

A lot of would-be entrepreneurs spend a lot of time and effort researching what business they want to start. In their search, many consider buying into a franchise. The benefits of this option can be significant, so even if you aren’t interested in opening a franchise, you should at least take some time to consider it. We’ve come up with a list of questions you need to ask yourself before you decide to take the plunge.

1. Are you ready to plan everything down to the last detail? A new, independent business that’s started from the ground up is often the first thing entrepreneurs look for when they want to be their own boss. The very idea of starting a business can be daunting, especially once you do a little research and learn all the varied tasks and responsibilities you’ll have to take on. However, when an entrepreneur buys into a franchise, the vast majority of that work has been done for you. Finding a product to sell, establishing your name in the marketplace, securing your supply chain, all of it is already done. For a would-be business owner, this fact alone is often enough for them to start looking seriously at a franchise.

2. How much are you willing to risk? Whenever a would-be entrepreneur faces the beginning of their first business enterprise, they can often overwhelmed by the complexities. The planning, financing, marketing, accounting and all the other activities a new business owner has to do is tremendous. Is it any wonder then that the failure rate of new, independent businesses is about 75%? However, when a new business owner decides to start a franchise, that number is flipped on its head. Franchises have a 75% success rate. Having a known product, an already established market and a pre-existing organizational structure backing you up is a valuable asset, especially for individuals new to business ownership.

3. How sure are you of your product’s or service’s viability? Starting an independent business requires a lot of time and effort. One of the main reasons for this is the time it takes to establish your business and build its name and create solid recognition and a sound customer base. Even if your product or service is in high-demand, people are much more cautious going to a new business than they are visiting an established one. That’s where a franchise comes into its own.

4. Will anyone be there to help you? Independent business owners are usually exactly that: independent. They go it alone, usually with little more than a family member, partner or cheering section to back them up. When times get tough, an independent business owner has only themselves to rely upon, but a franchise owner has a whole lot more. Not only does the franchise owner begin with established products, markets and customer, but they also have the benefit of the entire franchise structure behind them. The franchiser (the company that sold you the franchise) will already have all the training and procedures worked out before you even start. And if and when you get into trouble, help is often just a phone-call away. This is one of the primary reasons the franchise model works so well, because all that support allows new franchise buyers to sleep a lot better at night.

Franchise Forms and Contracts

Business Lease Agreements

BUSINESS LEASE AGREEMENT

How to enter a lease so you can rent office, industrial or retail space for your business.

If you are one of the many people who want to get away from the soul-crushing world of the cubicle, starting your own business may have a special appeal to you. Of course, the prospect of building a business can often be a daunting one. Even starting a new franchise will take time and energy to get it to the point where your cash flow will be sufficient. So what if you are not willing to take the kind of chances a new business needs? What if you want the freedom to be your own boss and the security of an already settled job? The answer may lie in leasing an already proven business. When you lease a business, you can have the best of both worlds: the freedom to work for yourself with the stability of an established business. If this is the step you are thinking of taking, here is what you need to know:

• WHAT IS A BUSINESS LEASE AGREEMENT? Essentially, it is a rental agreement between you and business owner. Typically, Business Lease Agreements involve you leasing a pre-existing business as-is, with all the equipment, real estate space, etc. You are acting as a manager, but instead of earning a salary, you lease the business from the owner and pay a monthly rent for the right to run it.

• WHAT KIND OF BUSINESS CAN I LEASE? Any business you want to. No matter if you are a business owner, who wants to turn your business into the steady income of a leased property or a prospective buyer, who wants an established business to run for yourself. You can enter a Business Lease Agreement if the other party is willing.

• CAN I BUY THE BUSINESS OUTRIGHT? Maybe. The option to buy the business can be included in the lease agreement. Depending on the nature of the agreement and the wishes of each party, suitable option clauses may be a part of the Business Lease Agreement.

• WHAT DO I NEED TO INCLUDE IN THE BUSINESS LEASE AGREEMENT? ‘Leasing a business is a lot more complicated than simply renting space for a business. As well as the pre-existing equipment, the lease agreement may contain clauses about properly running the business, the right of the owner to inspect or advise, options to buy, rights to automatic extensions, rights of refusal, etc. An established business needs attention to detail, much more so than a standard lease for real estate.

The wish to go into business for yourself and be your own boss is inherently appealing to a wide range of people. Because of the risks involved in starting a new enterprise, some people prefer the business lease option instead. No matter if you are leasing your business or considering taking on a business lease, you will need to be sure your Business Lease Agreement is sufficiently complete. A well drafted agreement will be the strong foundation on which you can build your business, so be sure to get it right the first time.

Business Lease Agreement

Agency Agreement – Exclusive and Non Exclusive

What is an Agency Agreement?

An Agency Agreement is a legal contract between “the agent” and “the principal” whereby a fiduciary relationship is created that defines the duties and authority of the agents.

The Principal grants the Agent the right to create legal relationships with third parties and to work on behalf of the principal and under his control. Therefore the principal agrees to be bound by the agents’ actions. For example; if the agent negotiates an agreement with one of the principals customers, the principal agrees to honour the agreement as if the principal had himself made the agreement.

With a sales agency the Agent’s role is to find, negotiate and close sales on behalf of the principal. It’s important to understand the agent only has the authority to negotiate and enter arrangements on the principals behalf, to the extent allowed by the terms of the agency agreement. For instance; this may mean that a principal reserves the right to approve or decline all sales negotiated by the agent, before a binding contract is entered.

In most cases the sales agent will be rewarded for his/her efforts based upon performance. This means a well structured agency agreement will provide a win win situation for both parties. The agent usually assumes all of his or her operating costs so its important to remember this when negotiating your agreement.

As a general rule an agent will not be required to hold stock of the principals products, it’s the principals responsibility to ensure he has the resources to deliver the product or service to the customer. Once the product or service is delivered the commission Agent is then entitled to payment from the principal.

Agency agreements also provide flexibility for the parties whereby the Agent may be granted an exclusive or non exclusive territory sometimes called a sole agency. This means the principal is able to ensure if need be all agents acting under his control get a fair share of the market available.

Remember, when negotiating your agency agreement both the agent and the principal will have a legal duty. In particular, the agent is placed in a position where a high-level of responsibility and trust is imposed. This is known as a “fiduciary relationship” and certain obligations are placed on the agent regardless of any contractual responsibilities. The primary responsibility of the agent is to act honestly and in the best interest of the principal.

Agency agreements can be written, verbal or implied by the conduct of the parties involved. The Law and the Tax office may look at the actions of those involved in deciding if an agency can be inferred. If the parties have acted in a way that reasonably infers the agent is representing the principal with the knowledge and approval of the Principal then an agency arrangement is presumed.

Whatever the situation, it is always better to enter any agreement in writing. A written agreement clarifies the terms, conditions and duties of the parties involved and will provides strong legal protection in the event of a misunderstanding.

click here for Agency Agreement Template

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