The touchstone for the development of a good contract or agreement is absolute clarity on everything covered by the document. In the case of a contract, this means properly describing who, how, when and where the exchange, as well as: the purpose of an agreement could be to display the goodwill of both parties or to help them keep an overview of what they have agreed. The agreement can help to clarify the relationship between two organisations and to clarify the services for which each is responsible in the Community. As a general rule, you won`t go wrong by being too detailed. The trick is not to limit the activity so that no innovation or flexibility is possible. The contract should not be seen as a micro-management opportunity, but should at the same time be specific enough for all parties to do what they should do and for each party to have a conscience if there is a problem. A contractual agreement is less binding than a contract and can be used to outline the terms and details of the agreement before the contract is concluded. It can be used in court if a party does not fulfill one or more of the obligations covered by the agreement. Even if the amount is small, it is important to have a treaty rather than a memorandum of understanding or no document at all. It is reasonable to assume that more professional partnerships, collaborations and other organizational and individual relationships are ruined by money issues than by the next ten cases.
The reason is often that the parties have different interpretations of what is expected, or that one party simply ignores the agreement between the two, that the other thought has been set in stone. Although these definitions seem quite clear, there are a number of situations where the image becomes blurred. For example, when a Memorandum of Understanding involves an exchange for a sum of money, it is almost always considered a contract under the law. In addition, there are two other legal conditions in which a Memorandum of Understanding or no formal agreement can be treated as a treaty.