A contract is, of course, a binding agreement,. The parties to a contract have a legal obligation to fulfill their part of the agreement. There are, however circumstances where parties may wish to change a contract, including important terms or indeed end the contract entirely. In such a situation it is important to ensure that the contract in question is amended in a manner which is legal, valid and binding. This article explains the various ways in which you can amend a contract legally.
Amendment or Amendment and Restatement
The first step to amending your document is whether you do it by simple amendment, or by an amendment and restatement. A simple amendment means only making changes to the specific clauses which the parties want amended. An amendment and restatement involves redrafting the entire contract; the prior contract is reproduced with the changes included in it. In general, if you’re only making a couple of changes, you might as well go with a standard amendment. If you’re making a few changes it makes more sense to sign an amendment and restatement of the original contract.
Method of Amendment
There are a number of ways in which you can actually make the required amendment to a contract. They are:
(i) Strikethrough the text to be deleted, and insert new text in redline.
(ii) Replace the clause in it’s entirely
(iii) Describe the amendment.
Our preferred method is to replace the clause its entirety. It avoids confusion and keeps the document clean.
Business and individuals often need to change a contract. It’s important that you make sure that you sign and date the amendment agreement or the amendment and restatement agreement. It’s easy to forget to do this! Call us today to speak with one of our contract lawyers on 1300 544 755.