While in most cases an oral contract will be valid, the proof of the existence and, especially, of the content of an oral agreement can be extremely difficult. By entering into a written contract, the parties facilitate the enforcement of its performance and provide certainty of its terms. They may also address many items that are not likely to be addressed unless a formal contract is entered into. This is of even greater importance when the parties are in different jurisdictions, where many more special considerations arise, such as choice of law and choice of jurisdiction.
While common wisdom is that you should seek to have your own laws apply, ensure that your own courts have jurisdiction or select arbitration as the mechanism of choice to resolve disputes, these assumptions are not valid in all cases. For example, your own laws may be preferable to those of your counterparty in some respects but not in others and reference to international instruments can offer neutral ground. Moreover, reliance on a standard arbitration clause as a panacea to the question of courts is not a good idea. Arbitration may be safer and faster but not necessarily less expensive. A careful review of each party’s obligations, methods and timing of payment, customs clearance and delivery obligations, and exceptions to the performance of the contract, is essential. At HazloLaw – Business Lawyers, we have experience in many jurisdictions as well as relationships in many others to obtain local assistance if needed.