Facts About Business Consulting Agreements

While the name implies an informal tone, business consulting agreements are a form of contract. Most are written contracts, signed by both parties. The laws governing such business contracts vary from one state to another. Certain provisions are universal, regardless of legal jurisdiction. 

A business consulting agreement is a contract between a business and an independent consultant. They provide for the independent consultant to advise a particular organization in areas of the consultant's expertise. The specifics of the agreement depend on the nature of the relationship, terms negotiated by both parties and applicable contract law. Basic facts for consulting agreements include:

• Outline the services to be performed, payment terms and schedules, as well as any conditions required of either party.


• Provisions governing any future modifications.


• According to the Electronic Signatures Act of 2000, electronic contracts, including those signed with an e-signature, carry legal weight as a traditional hand-signed contract.


• Contracts, including business consulting agreements, are subject to contract law. However, both parties have the option, known as choice of law, to determine which laws apply to the agreement. This includes choice of jurisdiction and methods of dispute resolution. 


• Typically, a written agreement will supercede verbal agreements or verbal adendums to the agreement. In other words, if there is a written contract, only those terms written into the contract are deemed enforceable.

Before entering into a business consulting agreement, both parties should negotiate terms of jurisdiction, choice of law and written provisions. Both parties must stipulate expectations in the written contract, and neither party can sign until the final written contract terms are acceptable.