Write. It. Down.

I’m a commercial litigator. Fighting over contracts is what I do almost every day.

It still amazes me how often I see smart, successful business people making simple mistakes in their transactions that end up costing them thousands of dollars in damages, settlements, and legal fees. Over the next several months, I’ll be offering tips that you can use in your everyday business that will help you avoid these pitfalls.

In this first installment, I’ll start simple: Write. It. Down.

I’m not trying to suggest you need to have a full-blown thirty-page agreement every time you order your monthly supplies from your distributor or hire an IT contractor to spruce up your webpage. But you do absolutely need to write something down with the general details of every agreement you reach as part of your business.

Don’t try make this too complicated. It can literally be two words on a cocktail napkin, or a short email to yourself. It would be better if it included a date and time, as well as all the key details. Even better if it was something (like an email) you sent to the other party, and best yet if they responded and confirmed. But for now, you don’t even have to go that far. You just need to develop the habit of creating something in writing you can point to when a dispute arises (and a dispute will arise), that will support your side of the story.

Now, this isn’t to say that simply writing down, “ordered 10,000 business cards from Jennifer,” will automatically mean you’ll prevail in a lawsuit against Jennifer if there is a dispute over your order. It’s not always that simple. But in every case in which a dispute arises, you will be exponentially better off if you can point to something that was written down at approximately the same time as the agreement and that supports your view.

Many times – especially if the other side doesn’t have anything in writing that they can point to – you can avoid the necessity of lawyers and lawsuits all together. After you tell them you wrote down the agreement when it was made, and it lines up with your story, they’ll usually back down. But if you don’t have anything to defend yourself, it’s their word against yours and they’ll have no incentive to move on.

The bottom line is this simple tip will save you money and heartache in the long run. This issue most frequently arises when the disputed amount is big enough to create a huge burden for you, but not big enough to justify paying a lawyer. Unless you can get out early (which “writing it down” will help you do), you’ll be stuck paying someone money you don’t owe, or paying a lawyer to defend a dispute that is worth less than the legal fees.

So, the message is simple: just write it down.

Jared SuttonJared Sutton is in the commercial litigation group in the Phoenix office of Lewis Roca Rothgerber, LLP, which is a proud corporate partner with NAWBO’s Phoenix Chapter.

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