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Business Contracts

Business Contracts Lawyer Mike Young has written these articles about terms, conditions, and other legal issues associated with written and verbal agreements.

Attorney Young reveals how contracts can be drafted to favor one party or the other, why a gentleman’s agreement rarely involves gentlemen, how to avoid a lawsuit for breach of contract, and do-it-yourself (DIY) tips.

In addition, these articles show when it makes sense to create a contracts template for re-use in a business and the dangers of borrowing another’s agreement for use with or without permission to do so.

Whether you’re a small business owner, a freelancer, or an executive with a larger privately held company, you’ll find the content of these articles about legal agreements helpful in reducing your liability exposure.

In addition to these helpful articles about written and oral agreements, Attorney Young prepares contracts for qualified clients, often for a flat fee per the firm’s Business Contracts Legal Protection Package.

Does Your Texas Gym Membership Cancelation Policy Violate State Law?

By Business Contracts, Business Lawyer
texas gym membership contract

When you own a Texas gym, it’s important to make sure you comply with state law, particularly the Texas Health Spa Act.

For example, if you have a firm “no early termination” policy, and your gym is covered by the Act, then you’re probably breaking the law.

Why?

Because the Texas law makes it mandatory in some circumstances to let the member end the agreement early.

Not only that, there are certain disclosures you must make in the gym membership contract about membership cancelation rights.

What happens if you violate the Texas Health Spa Act? Every one of your gym contracts can be void.

How long would you stay in business if all your members could walk away today because their membership agreements are unenforceable?

And if there are enough member complaints, you risk a lawsuit from the Texas Attorney General’s Office too for violating the law. Can you afford that?

Now if you’re a Texas gym owner and you need help with your membership contract, it’s time to schedule a phone consultation with Business Lawyer Mike Young. Note that Attorney Young only represents Texas gyms and their owners (not gym members).

3 Mistakes Texas Martial Arts Dojo Owners Make

By Business Contracts, Business Lawyer
texas martial arts dojo

When you own a Texas martial arts dojo, you want to make sure you comply with state law so you don’t lose everything in a lawsuit or government investigation.

Here are three common mistakes made by Texas dojo owners…

Mistake #1 – Violating The Texas Health Spa Act.

If you don’t comply with state’s Health Spa Act, every one of your members’ contracts could be void. And that’s in addition to other penalties you could face for violating the law.

How would you be able to stay in business if you couldn’t enforce your membership agreements?

Mistake #2 – Wrong Waivers & Releases

Most liability waivers Texas gyms and martial arts studios use are (a) at least partially unenforceable and (b) don’t cover everything you need as an owner for protection.

What this means is an increased risk of getting sued for personal injuries or intellectual property rights by a guest or member…and losing that lawsuit.

Mistake #3 – Treating Employees As Independent Contractors

Whether an instructor or someone working at the front desk, it’s a mistake to disguise an employee as an independent contractor in order to save time or money.

Because if you get caught, you can end up paying additional employee compensation, unemployment and worker’s compensation, plus penalties.

Do you need help protecting your Texas martial arts dojo by putting the right legal documents in place? If so, it’s time to schedule a phone consultation with Business Lawyer Mike Young.

Personal Trainer Agreement: What Type Of Contract Should You Use?

By Business Contracts, Business Lawyer
personal trainer agreement

Whether you’re a professional trainer or a gym owner that has trainers working at your facility, make sure you’re using the right type of personal trainer agreement.

Because the wrong contract can land you in legal hot water. For example, you can end up being liable for personal injuries that occur during training, extra taxes, and penalties.

As a general rule of thumb, if a client contracts with you to work directly as a trainer, that agreement will be structured so that you’re doing the work as an independent contractor instead of an employee.

Ideally, you’ll use a limited liability company (LLC) or corporation as an additional protection shield instead of contracting as an individual. That’s a key part of running a business long term.

What about personal training a gym’s members?

The contract between the gym owner and the trainer will either be structured as an employment agreement or as an independent contractor agreement. And the gym’s members aren’t parties to the contract between trainer and owner.

One of the big dangers is having this agreement between personal trainer and gym owner disguise an employment relationship by pretending it’s an independent contractor relationship instead. Because if you get caught by the government, that’s where issues like back taxes, penalties, workers and unemployment compensation contributions, etc. kick in.

Does this mean a personal trainer should never work as an employee? Of course not. There are times that it makes sense to get a steady paycheck from an employer instead of working as a freelance professional. This is particularly true when you don’t have a bunch of clients when starting out as a trainer.

Yet it does mean you don’t disguise one relationship as another (employee versue independent contractor) if you want to avoid liability dangers.

Whether you’re a gym owner or a personal trainer, if you need help putting the right liability waivers and training contracts, it’s probably time to schedule a phone consultation with Business Lawyer Mike Young.

Are You Adjusting Your Business Contracts For Inflation?

By Business Contracts, Business Lawyer
business contracts and inflation

If inflation is eating away at your personal assets, it’s also taking a toll on your business. So, how do you handle that? Particularly when you rely upon ongoing business contracts with customers?

At the outset, never promise your customers lifetime flat fee pricing for any service. And if you do, include an explicit caveat that you reserve the right to adjust pricing to account for inflation.

In addition, you’ll want to build into your written contracts specific language that gives you the ability to raise pricing based on inflation. And tie it to a readily identifiable measure (e.g. the Consumer Price Index) so that both parties can quickly determine if a threshold has been met that justifies a price hike.

Now an old school method (common in the early 20th Century and before) was to price business leases and other ongoing contractual obligations in gold or silver rather than the U.S. Dollar itself. Payments were either made in the physical precious metal or in dollars based on the value of the precious metal at the time a payment was due.

Tying payments to precious metals hasn’t been popular recently for a variety of reasons, including trading manipulation of the pricing of gold and silver.

However, if inflation continues to be an issue and there’s an objective means to value physical precious metals (not the paper trades of nonexistent metals) that both parties will agree to, then this is an option. Or the parties agree at the outset that payments are to be made in physical gold or silver (or some other store of value) instead of the dollar. For example, an office space lease that provides for monthly rent to be two troy ounces of physical gold.

What about cryptocurrency as a means to protect against inflation? At the present (2022), cryptocurrency appears to be a volatile speculative bet rather than a store of value that could be used as an anti-inflationary tool to protect your business.

Some believe that central bank digital currency (e.g., a digital Euro) could serve as the solution. However, digital is even easier to “overprint” — and devalue in the process — than physical fiat currency.

So, for the time being, the easiest course of action would be to give yourself flexibility by simply acknowledging in your contracts that pricing can change based on inflation.

Tie that to some objective standard for measuring inflationary changes. And make it easy for both parties to know when and how pricing will change to account for monetary devaluation.

If you need help with your business contracts, it’s probably time to set up a phone consultation with Business Lawyer Mike Young.

Texas Gym Membership Agreements: Can Members Legally Stop Paying You?

By Business Contracts, Business Lawyer
texas gym membership contract

When I speak with Texas gym owners, a common question that comes up is…

“What happens when a gym member decides to quit paying?”

Too often the answer to that question depends upon whether the gym owner is complying with the Texas Health Spa Act.

Why?

Because if you own a Texas gym and are violating this particular law, your membership contracts are void. Don’t just take my word for it. Here’s the language from the actual law. 

The membership “contract is void if:

(1)  the contract or an assignment of the contract does not comply with this chapter;

(2)  the seller does not hold a certificate of registration issued under this chapter at the time of contract; or

(3)  the purchaser enters into the contract in reliance on false, fraudulent, or misleading information wilfully provided by, or a false, fraudulent, or misleading representation, notice, or advertisement wilfully made by, the seller or the health spa owner or operator.”

Although there are sleazy sales tactics out there that violate the third provision, most Texas gym owners screw up by (1) not using a membership agreement that complies with the law and/or (2) not properly registering their gym with the state (Health Spa Act registration is separate from setting up a Texas corporation or limited liability company).

So, what’s this mean?

If you’ve had 250 gym members sign void contracts all of them can walk away at any time and quit paying you. And they’ll probably tell other members to do the same thing.

What would you do if even 20% of your members decided to quit and walk? And you couldn’t enforce your agreements to get paid?

Don’t put yourself in this position. Comply with applicable law…and that include the state’s health spa act, biometrics law, and other legal requirements for owning and operating a gym in the Lone Star State.

If you need help bringing your Texas gym into legal compliance, the first step is to set up a phone consultation with Business Lawyer Mike Young.