Read The Fine Print, Learn This Lesson The Hard Way

Posted by Benny on Jan 21st, 2010 | no comments

Contracts can be exasperating.  If you’re in business, they’re a fact of life.  Commerce can’t  exist without an understanding of what two parties are supposed to be doing and the obligations between them.

I learned a huge lesson today from a friend of mine who is an attorney about an experience his client who shared an unfortunate story with me today.  You might be familiar with those business phone  directories that show up on your doorstep once a year.  They have been a primary staple of business advertising for decades.  If a portion of your business is found by advertising in those colored pages, it makes a lot of sense that you might consider using that as a way of generating sales.

However, what I learned was a cautionary tale that I took to heart.

My friend’s client was the Vice President of of Sales and Marketing with a company here in town.  He decided to advertise in one of those popular business directories, which seemed like a sensible idea at the time.  As the economy turned south, the company unfortunately went out of business.  While that’s a heavy load to bear on it’s own, you can imagine the surprise when he learned that according to the wording in the contract HE had signed, was a clause on the back side of the contract that  made him personally liable for the advertising should the company he worked for not be able to pay.  The company was out of business but  guess what?  The directory wants their money.

So it looks as though he may be stuck with a $3,000 bill for services from this now closed business.

Be warned, contracts are there for protection, whether it’s your protection or the other parties is up to you.

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