A few days back I received an inquiry from a client that his company had invested a considerable time, money and resources in a venture partnering with a foreign partner, however they had not entered into a clear written agreement with the foreign partner and now the foreign partner is claiming absolute rights over the IP and denying the original understanding that they had
Such complications can be avoided simply by insisting upon and giving priority to signing a well documented agreement defining the logical and foreseeable probabilities emanating from a business idea, a project or a venture and defining things like liabilities , entry obligations and exit rights and liabilities .
However even till date people invest so much in their efforts, physically and financially but tend to cut costs on taking a proper legal assistance in formalizing the real immune system of the business which is a well documented transaction on the foundation of properly executed agreements .
Repercussions of neglecting legal documentation and keeping business understanding and arrangement ambiguous
Unless one of the parties has a deliberate hidden agenda for not reducing the business understanding to writing , the ambiguity will only lead to confusion and chaos . The primary cause of this is open ended terms which result from half baked and ambiguous understanding which may not be because of some deliberate malafides but primarily results from some communication gaps which could easily be avoided with, if proper business terms are negotiated.
Advantages of a well documented legal
Not necessarily when there are human beings , transactions and commercials are involved disputes can happen , but with proper documentation and contracts in place you will recover from the trouble as your business immunity system is strong . Besides when the understanding is well documented in form of agreements chances of friction are minimal.