Agency and Consulting Agreements

Agency Agreement

What is an Agency Agreement?

An Agent is a person who has the authority of the Principal to legally bind the Principal and a Third Party. An Agency Agreement regulates the way in which an Agent can act on behalf of the Principal and how the Principal will remunerate the Agent.

Why do I need one?

Because an Agent can contractually bind a Principal, it is imperative that the Principal set out all of the conditions and limitations of the Agent, so that the Agent doesn’t operate beyond the scope of their retainer, at the Principal’s cost.

An Agent wants to ensure that they will be properly remunerated for acting on behalf of the Principal and will want to know the exact extent of their role as an Agent.

What should be included?

- The Term of the Agency,
- The Scope of the Agency, including; exclusivity, functions, powers (for example, to negotiate, or sign documents), retention of rights of final approval, amongst other issues.
- The Territory in which the Agent can act,
- The Payment (usually commission) structure and its calculation methodology,
- How the Agency can be terminated and what happens in the event of disputes,
- What accountability factors must the Agent comply with, including accounting practices,

- Who undertakes the insurance risk and cost.

Contact us to draft or review your Consulting Agreement

Consulting Agreement

What is a Consulting Agreement?

Consulting Agreements are used when an independant company, or person, is engaged to perform a particular function, such as; a manager, an expert, a builder, an Agent, etc.

A Consulting Agreement may be a Management Agreement (for example, between two companies, one the owner of a business, the other a management service), it may be a Service Agreement (for example, between a homeowner and a security firm) or it may be a specialist agreement (for example a Hyrdaulic Engineer providing plans for a developer’s project, or a Business Advisor providing accounting and financial advice to a company and its subsidiaries)

Why do I need one?

Consultants generally have specialised skills in specialised fields and as such can charge a “premium” for their services. If you are engaging a consultant you might not fully understand the “ins and outs” of their field and expertise and engage them for a service you don’t need, rather than one you want. Alternatively, you might be paying more money for additional services you didn’t know you were getting.

You need to be able to set parameters for the Consultant to contain costs and compare outcomes, as envisaged at the outset of the engagement.

What should be included?

Initially you need to detail the parties to the Agreement and what the objectives of the Agreement are. These objectives will then determine the relevant clauses to be incorporated into the Agreement.

These clauses may include the following;

- The Duration and any Option to Renew,
- The confidentiality of information exchanged,
- The control of stock and re-ordering,
- The liability for business stoppages,
- The repairs and maintenance of equipment,
- The need for a license to occupy premises,
- The area of business in which the Consultant can act,
- The staffing requirements for the operation/project,
- The payment structure and and terms and the calculation methodology,
- How the Agreement can be terminated and what happens in the event of disputes,
- Effect on any existing contractual arrangements with others,
- What accountability factors must the Consltant comply with,
- Who undertakes the insurance risk and cost,
- Compliance with the legislation.

Contact us to draft or review your Consulting Agreement