New Delhi | 14 Jul, 2016 (3 years ago)

Contracts and Legal Documentation

How feasible is it for a start-up in India to have an e-contract ?

We are an art start up based out of Delhi and have to constantly sign contracts with artist in different cities and countries. However, the process of sending contracts by mail and waiting for them to be signed and return is time consuming and cumbersome. We wanted to know what are the requirements and fesibility of having an e-contract which will make the process much faster.
Answers
01 Jun, 2017 | 11:30

Selling your art through a dealer, consultant, artist representative, gallery or agent constitutes a business relationship. A successful relationship means negotiating and implementing a contract, agreement or arrangement that works for both you and the seller. Basically, you entrust your art to the seller who in turn, promotes and markets it, sells it, collects the money and then pays you a predetermined percentage of those sales.

This sounds straightforward, but problems arise when either one or both parties doesn't understand the details of an arrangement, one or both parties decides that the arrangement isn't fair or one or both parties doesn't honor the arrangement. Most disagreements can be resolved by simple discussions between artist and seller, but those that can't may require legal intervention and months or even years of litigation and expense. Fortunately, the great majority of problems, legal and otherwise, can be avoided by following a few simple procedures.

For starters, know who you're dealing with. Do not enter into business relationships with people you don't know, no matter how glamorous they seem, what promises they make or how desperate you are to show and sell your work. Artists occasionally get so excited at the prospects of sales and exposure for their art that they send it off into the cosmos never to see or hear from either it or the sellers again.

Always check a seller's references ahead of time, particularly through artists that seller has represented, before entering any negotiations and absolutely before signing any contracts. Learn about the seller's reputation in the art community, how long they've been in business, how promptly they pay, how well they sell, how well they follow through on their promises and so on.


18 Jul, 2016 | 00:26

E-contract are as much recognized in India as the traditional contracts reduced to writing and exchanged between parties. As a start up and given the fact that your clientele is varied and situated in a large geographic area, I would recommend having e contracts to save on time and logistics. It is for you to decide whether you want a click-through, shrink-wrap or browse-wrap agreement. Several provisions of the Information Technology act relating to originator, binding nature on receipt of information, electronic signature etc read with the Contract Act facilitate entering into an e-contract.


16 Jul, 2016 | 13:39

A. Essentials of an electronic contract: As per the Indian Contract Act, 1872, like all other contracts, an electronic contract also requires the following necessary requirements:
1. An offer requirements to be made.
2. The offer needs to be acknowledged - Processes available for forming electronic contracts include E-mail, Web Site Forms, Online Agreements.
3. There has to be legal consideration.
4. There has to be an intention to create lawful relations.
5. The parties must be competent.
6. There must be free consent.
7. The object of the contract need to be lawful.
8. There must be conviction and possibility of performance.

B. In this context it is important to note that the Information Technology Act, 2000 (“IT Act”) provides fortification for the validity of e-contracts.

C. Both the parties have to simply fix their digital signatures to an electronic copy of the contract. These are controlled by the IT Act, 2000 which provides the outline for digital signatures, their issues and verification. The Act thus tries to safeguard that trust between both the parties is maintained through verification of identities and help prevent cybercrimes and ensure cyber security practices.


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