NEW ORLEANS — Steve Fellman, general counsel for Textile Rental Services Association of America, added humor to his rundown on Textile Services Contracts and Negotiations, another education session presented on the Clean Show’s first day.
The attorney described what a contract is – a written document describing an agreement between two parties that includes terms and price, as well as a series of what Fellman called “what ifs," and a document that is signed and dated by authorized representatives of both parties.
One point Fellman touched on several times was that a contract needed to be updated periodically, whether or not there was an automatic renewal involved in the terms. A new contract needs to be signed by authorized – and current – personnel from both companies. He illustrated this point with a personal experience involving a contract for a Chinese restaurant that he thought should have been a pizza parlor. After questioning the linen company involved, he discovered that the restaurant used to serve Chinese, but that that restaurant had gone out of business. The company continued to do business with the new restaurant, a pizza parlor, under the same contract. The only problem was, the contract had been signed using Chinese characters, a fact that, Fellman pointed out, would greatly upset a judge if the contract was ever disputed. He advised the linen company to immediately replace the contract.
Fellman’s talk concluded with the statement that litigation is expensive, uses valuable resources, and can take years to reach an end. A better way is for companies to pay closer attention to the content of contracts – and having a contract in place – before disputes can arise.
TRSA makes available to members and non-members a book focused on contracts, which lists many of the typical clauses needed by companies involved in the textile industry. Fellman also offered the sage advice for companies to retain an attorney in each state in which the company does business to ensure the company is covered in any circumstances.
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