Steve Jobs said "[e]xecution is worth
millions". He was talking about implementing ideas,
but his words neatly apply to contracts. Even after maximum
effort has been exerted to negotiate a deal and draft a contract, a
slip at the final hurdle could cost millions. Failing to
execute a contract correctly, particularly a deed, can result
in:
- An unenforceable
contract. Deeds are often used if one party is not
providing consideration. Consideration is something of
value brought to the deal (e.g. payment or supply of services) and
is an essential ingredient for any contract. If there is
no consideration and the deed has not been executed correctly, it
is not binding.
- Confusion about whether an agreement
has been reached, resulting in expensive, time-consuming arguments
about whether there is a contract and, if so, what terms apply.
This rather defeats the point of having a contract to provide
certainty.
