by Toni and Daniel Will-Harris

• If you haven't already done so, read Part I
• Get it all in writing. An oral contract isn't worth the paper it's written on.
• Avoid future problems. It's not that you don't trust the people you are dealing with now, it's that you don't know who you will be dealing with later.
• Write out the process. Deals are about more than just dollars. You need to spell out how work gets done.
• Deal breakers. The things you can't or won't give up.
• Contracts don't have to be legalese. Insist on plain English (or whatever language you speak!)
• Contracts can't protect you from everything.
• Live and learn. 

OK, so your negotiations are in progress. At this point, it's vital to "document" things, to put them down in writing. This helps eliminate the chance of confusion, and make sure that people know precisely what's being agreed to, and stick to it.

Get it all in writing

There's an old joke, "An oral contract isn't worth the paper it's written on." It doesn't matter what someone agrees to in a conversation. It can be binding, but also nearly impossible to prove. Yes, there are legal ins and outs on all of this, but in general, if it's not on the page, it's going to be difficult if not impossible to enforce.

Get in the habit of writing things down from the start. What you want. What you propose. What they counter-propose. What you can do. What you can't. What you are willing to give in on. What you aren't.

If you have an oral discussion, follow it up with an e-mail that spells out what you think was agreed to. Sometimes your recollection of a meeting may be different than theirs. Resolve things as they come up, rather than being surprised when it's in writing later.

A paper trail is a good way to keep from getting off track, and a good record that helps you remember why you agreed to what you did.

Negotiate via e-mail

We find e-mail an excellent way to negotiate because it lets you get your points across clearly with little room for misunderstanding. It's precise and fast, and you and the recipient both have a running record of the process. It also gives you time to consider (and reconsider) your position and where you might be willing to compromise. Basically, it gives you more time to think than a conversation.

However, some people find it difficult to communicate via e-mail and are much better at oral communication. With those people, discuss things, then send an e-mail afterward spelling out what was said.

Ensure the written contract matches your oral negotiations

Finally, make sure every point you agreed to is in the written contract. It's very easy to "conveniently forget" to include something. Sometimes this is unintentional, but often it's not. Most written contracts also say something like, "This written contract is the complete contract. No other written or oral agreements apply," so if it's not there, it doesn't exist.

Avoid future problems

This is important to remember, and to explain to the person you're negotiating with. It's not because you don't trust them; it's because you want to help avoid future problems. If things are discussed and agreed to in advance, the job or project will go more smoothly. So you're simply avoiding problems in the future by dealing with them now.

The person you negotiate with may not be around later

We often negotiate with people we know and trust, but a week, a month, or a year down the line that person may no longer be involved with the project. They may have left the company for whatever reason, or they may have gone to a different job and been replaced by someone you don't know, and may not like or trust.

If you're negotiating with someone you know personally, it's helpful to remind them of this and say, "I trust you, but if you're not working on this in the future, I want to make sure that whoever is knows exactly what we have agreed to."

Watch out for "forever"

Look to the future. Make sure this deal will be good for you, not just in the near future, but in the long term. A deal doesn't always end when the job does—so look far enough into the future to make sure your interests are protected, even when the job is done. And make sure there's something in the contract that specifies when the contract expires, and if it's just for one project, or open ended. If you don't specify a way out of the contract, you may be tied to the deal well into the future, long after the initial work is done.  

Assume liability for your work, but not for others

One thing that companies seem to love to do is make small contractors liable for entire deals. We'll never understand this. Big companies usually have legal departments and lawyers on retainer and they can and should handle legal disputes, including nuisance suits. But inevitably, companies have standard contracts that make you, the small independent, liable for everything. This is great for them, but very bad for you. Cross it out.

Yes, you should be responsible and liable for what you have done, so that it's not illegal, infringing, or criminal in any way. But no, you should not be liable by the context that the other party puts around your work. Be very careful about this. Most companies will be reasonable about this. But we have stopped deals with companies that won't. It can put you at serious financial risk and it's just not worth it.

Write out the process

A negotiation is more than just dollars, deadlines, and deliverables. It's also about how the work gets done, who does what, when, and how. If you have particular work methods, you need to spell them out in advance. For example, you could say, "By December 12^th, I will provide you with a rough outline for you to consider. You will look over this outline and make notes, then get back to me in writing within five working days."

Deadlines are important. If someone misses theirs, it needs to be clear that the time is added to your schedule.

It's also important to spell out how much work is really to be done. Say how many drafts, comps, versions, and revisions are included. Make sure to be specific as to what is a "correction" and what is a "change." If you are doing the work, you must include corrections at any time. But changes are another matter, if someone changes or adds something late in the process, it will cost them, not you, time and money.

If you only spell out the final product, not the whole process, you can end up spending twice as much time as you planned, which means you really only get half as much as you wanted.

Deal-breakers

There are often a few tricky points for both sides of a negotiation. And there are those things called "deal-breakers," which can be difficult to deal with.

A deal-breaker is something you cannot or will not give in on. It's one of your bottom line issues that you should have promised yourself you wouldn't compromise. If someone asks you and you say "no" and they ask again, you need to make it clear that "it's a deal-breaker," so they know this point is not negotiable.

Last-minute jitters

In many negotiations, there's a sensitive period right near the point where everyone is supposed to agree on everything. People start to get a "fear of commitment," or they look at what they've agreed to and wish they had agreed to something else.

As we said earlier, it's at this time that people will try to change terms at the last minute. Unless the terms are really good for you, don't be afraid to refuse last-minute changes. If they are good, that's fine, make the changes, but if the deal hinges on letting the other side change its mind in a way that's not to your advantage, this is a pattern they will repeat, which won't be good for you.

Falling apart

You can spend a lot of time agreeing on a lot of things, but until you sign on the dotted line, the deal isn't set. Many times you'll agree on just about everything, then watch as everything falls through.

This can happen for a number of reasons, but the most basic is that after all is said and done, one party decides the deal really isn't good for them.

When this happens, you have two choices: You can try to salvage it, or let it go.

You can only salvage it if the other party really wants to. Ask them what the problem is, and discuss it. But don't give in on your bottom line. Don't get desperate and "do anything" to make the deal work. It's not worth it.

It can be hard to let go of something you were looking forward to, but sometimes there's no other way. If one party was unsure, then the deal wouldn't go well even if it went through. Look at it as being "for the best," learn from it, and find another party to work with.

Contracts don't have to be legalese

Lawyers are useful and important, but not always necessary. Many deals can be concluded with a simple "deal memo" that spells out the terms you agreed to, in plain English. Often lawyers will turn a one-page deal memo into an 11-page nightmare of legalese. This isn't necessary and it can actually cause trouble. If you have it on paper, and both parties sign it, and the points and intent are clear, that's what's important.

Lawyers can write contracts simply and in "plain English" (or whatever language you speak). Request that they do so.

But, since laws differ from place to place, you must take all advice like this with a grain of salt. Only a competent lawyer knows for sure. Check on the laws in your area to see what's required and your own legal council to see what they recommend. Just remember, lawyers charge by the hour, so the longer the contract... well, you can figure out what's to their best advantage. And don't send us nasty e-mail about this. We have siblings who are lawyers.

Written contracts cannot protect you against everything

People are often under the misconception that if they have a legal contract they're safe. The truth is, contracts can be and are broken on a routine basis.

Once one party breaks a contract, it can be difficult, expensive, and downright painful to get legal relief. Having a good contract is your best defense; it outlines what you agreed to. Whether or not you'll get that in the end is another matter. So don't think it's some magic shield that protects you against everything.

The best way to look at a contract is as a tool of agreement and understanding: You're trying to understand exactly what the other party expects, and they're doing the same with you. If you look at a contract as a way to force someone to do the right thing, you're treading on dangerous ground. If they don't do the right thing, then there are two winners and two losers. The winners are your lawyer and their lawyer. If you can't trust someone, a contract won't change anything.

Live and learn

We've spent time with friends e-mailing back and forth about the things we've negotiated and the mistakes we've made. A friend observed, "Every single time, there's something new I didn't think of," and it's true. No two negotiations are the same. There's always something new. That's life.

Realize there may always be at least one little "gotcha"

It seems that every time you negotiate, there will be something new and different and, inevitably, something you either forgot, or more likely, didn't think to include.

Write your own "standard" contract

As you learn, keep a list of the points that were valuable to you, and the things you want to avoid. Even write up your own standard contract with the terms you want, dollars, deadlines, and deliverables. While you may not be able to use this contract verbatim every time, it will be a good starting point so you won't forget important issues.

Possibilities, opportunities, and traps

The trick is to try to think of as many possibilities, opportunities, and traps as you can, in advance, and try to take advantage of the possibilities and avoid the traps. You have to be creative. You have to try to anticipate something you may never have encountered.

Our favorite example of this is Red Skelton, the comedian from movies and early television. He negotiated his own contracts for movies before TV was even invented. And yet he wrote into that contract something about "all mediums, available now or invented in the future." He used this same thing for his TV show—when shows were all live and "repeats" were unknown. This allowed him to own valuable rights to his show when syndication was invented and earn a fortune for decades while other early TV personalities got nothing from all those repeats you watched as a kid.

But remember, you can't think of everything. So if, after you've agreed to the deal, you run into something you didn't negotiate, don't get upset. Just live and learn.

About the authors

Daniel Will-Harris is a designer and author whose design and writing work can be found at his Web site . His site features TypoFile Magazine and EsperFonto, the Web's only typeface selection system. He may be reached via e-mail at daniel@will-harris.com.

Toni Will-Harris is a writer, designer, and naturalist who runs the Point Reyes Chipmunk Observatory and Gardens. She can be reached at Toni@Will-Harris.com. This picture is not recent—or actual size.

Illustrations: Gentleman's Study from www.eyewire.com