Agreement Letters
Purpose Of Agreement Letter
Letters of agreement are used to clarify working arrangements between two parties, A homeowner and a contractor; a consultant and a client; a vendor and a customer; a company department and senior management. When the relationship is customer/ vendor, a signed letter of agreement may serve as a contract between the parties.
Element Of Good Agreement Letter
Use plain English — not legalese. The latter is a turn-off, and your reader may not sign because of it.
• If the subject matter is complex and there are a lot of details and clauses, consider hiring a lawyer to write a more formal agreement in the form of a contract.
• Explain all terms, conditions, and contingencies in detail and have everyone review them. Make any necessary changes and then submit a final document to all parties so that there is a written record.
• Add as many paragraphs as it takes to cover conditions likely to arise. For instance, if you are a roofer, and promise to get the job done in 3 weeks, what happens if it rains for 21 days straight and you are not finished by the agreed-upon date?
• Address the subject of expenses. Is the client paying expenses? Which ones? Are there limits, e.g., meal reimbursement not to exceed $50 a day?
• Provide two copies of the letter of agreement. Tell the client to sign both, return one to you, and keep one for her files. Provide a self-addressed stamped reply envelope or return FedEx label she can use to send the document back to you.
• Develop a standard letter of agreement, using the models provided here, and have your attorney review it. Then use that as a template for your other projects.
• If there are more than three to five items in the agreement, separate these items by numbering them. That way, in discussions you can refer to “point 12.”
• Note that the laws of your state govern the agreement. Name the state in theagreement. Know your state laws — ignorance will not protect you in court!
• Require the vendor to provide a federal tax ID number or, if he is an individual, a Social Security number.