Are You Waiving Your Rights by Signing a Contract?

Image of a contractAt first glance, the terms of the contract seem straightforward. The clauses therein make perfect sense, and, because you want to do the deal, you do not question their inclusion in the agreement. While the underlying agreement or contract may seem straightforward, you need to do a thorough evaluation to make sure you aren’t waiving your legal rights by signing the contract.

Because contract law “charges” you with what you signed whether you read it or not, we suggest reviewing the contract with an understanding of the rights you are waiving and the potential consequence forfeiting those rights can cause in the event of a legal dispute. Once waived, you can not ask the court to reinstate those rights unless it is a clear violation of your right to due process.

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Can You Charge Your Client Compound Interest for Late Payments?

Photo of a calculator to show compound interest.To ensure timely payments from their customers, many companies have clauses in their agreements or invoices with terms of interest for late payments. It is not uncommon for invoices to state they must be paid within 30 days, after which the balance shall accrue at 1.5% interest per month.

There is no set limit in New York for how much interest may be charged, but the amount should be reasonable and not excessive. The interest rate described above has been ruled as acceptable by the courts in New York and is widely used. Beyond said interest provisions, businesses may seek additional remedies. For instance, if a customer defaults in payment but then agrees upon a subsequent arrangement to pay the outstanding balance, the business may want additional interest because of the defendant’s initial default. The business may insist on an agreement wherein the customer must pay the balance plus interest “compounded monthly” at a certain percentage until paid in full.

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