Having a contract in place can make the difference between making money and losing money. Just like insurance on your vehicle, if you don't have a contract in place inevitably it can come back and hurt you at the hip pocket.
Just take a look at the world of professional sport where elite sportspeople supply their services to a club in return for a fee. In this day and age it is in both parties' interests to have a contract in place binding each of them to fulfil their obligations. Without this where would they be?
Where would Robbie Farah be right now without the appropriate contractual documentation in place with the Wests Tigers? Perhaps still playing park football, but I'm certain it would be for a lot less money!
The services sector including Construction, IT, Education, Finance, Tourism and Professional Services are a major part of the Australian economy. Just like the world of professional sport, most businesses enter into agreements for the supply of services every day. Whilst most people appreciate that there are detailed laws regulating businesses and consumers in relation to the supply of goods, few give much thought to laws relating to the supply of services and how this can impact on them receiving payment and minimising their risk. Under the Australian Consumer Law, suppliers are required to provide certain guarantees for the services they provide to consumers. In order to obtain the benefit of such statutory protections, the services typically need to be under $40,000, or services which are normally used for personal, domestic or household purposes. Some industries have their own codes (both mandatory and voluntary) that may serve to set out specific standards of conduct for an industry including how to deal with members and customers. The starting point in any dispute relating to the provision of services is to look at the contract between the parties. In any â€œbattle of the formsâ€, a customer needs to be in a position to leverage their negotiating position to ensure they are protected. Conversely, a service provider will typically want to minimise their liability to the extent that they are legally able to do so and ensure they are paid the agreed fee for their services. The war is typically won by the party that has the best contract and legal advice. Courts don't generally show a great deal of sympathy for businesses that operate on a handshake, failing to adequately protect their own interests and comply with legislative requirements. Nor do they show much sympathy for a customer who has clearly breached their contractual obligations towards a business who has supplied a service and not paid them.
The bottom line is to ensure you put appropriate documentation in place to protect your interests before supplying any services. If you don't, the law may not be able to assist later.