Apart from confidentiality, exclusivity and non-collection, nothing else written in a “Heads of Terms” should be considered a legal obligation. If you are asked to sign the document for any reason other than the above conditions, ask your lawyer first. In this article, we will explain in more detail why it is advantageous for you and for the other company, what you should include and what legal aspects you need to take into consideration. Sackar J also cited several cases where it was important for the courts to consider the context in which a written agreement was reached. For more information on the terms and how to make them work for you, contact one of our employees today. If you are entering into a commercial real estate agreement and need help negotiating and developing heads of terms, contact O`Neill and Co on 045 856604. If the other party doesn`t seem interested in finding term heads, ask yourself why, as this could indicate that they are not engaged enough to ensure that the transaction takes place. As you can see from the list below, the information contained in an agreement on the terms is quite detailed. Producing the detail and finding the right balance so that negotiations do not drag on is an ability in itself. It is recommended that both landlords and tenants order an expert to act on your behalf. Not only do you deal with heads of Terms every day, but you may also wonder if the conditions are economically correct. An experienced expert will also manage expectations, as some areas, such as the interruption clause, can be challenged if they are not sufficiently detailed during the heads of term phase. Initially, heads of Terms should contain basic information, such as: heads of terms are usually established after some negotiations between the parties in order to agree on headline terms.
The heads of the terms are not legally binding. Even if a legal agreement is never formalized, heads of Term are not legally enforceable. An agreement will only really be reached when both parties have signed formal documentation and the transaction is concluded. Since most aspects of an agreement are not binding, there is little recourse for non-compliance by either party. Indeed, they only apply to the legally binding conditions set out above. Where a party violates these binding terms, the other party may seek an injunction, appropriate remedy, damages or a specific performance.