PICTURE the scene. It's several years before your organization's big meeting. You've just received the hotel's signed contract proposal incorporating all of the issues that you've negotiated with the property. All you have to do is counter-sign and you'll have the deal you've been working on for months. But, there are a few small problems. The hotel forgot to specify that the opening and closing ceremonies would be in the Grand Ballroom instead of the International Ballroom. Also, the final room rate was supposed to be a 20 percent discount off the rack rates established one year-out. The proposal says ten percent. What do you do now?
There are a number of ways to make changes in hotel contract proposals, any of which are legally binding. First, it's a good idea to contact the hotel and make sure they know you need some changes. That contact can be in person, in writing, or by telephone. The key is to determine whether there is a genuine disagreement (the hotel has backed off its decision to give a 20 percent discount) or if there simply has been an error. To the extent possible, work out those issues through follow-up discussions with the hotel.
Change It Right Assuming you can come to an agreement, it's time to fix the contract. With word processing, it may be possible to have the hotel produce a clean, revised contract proposal and send it to you for your signature. Alternatively, you can mark changes on the original contract by hand, initial those changes, and return the contract to the hotel. The hotel must then confirm the changes, also by initialing them. Please note: the initialing method is best used when no one has yet signed the proposed contract.
Another method for making changes is to send a letter to the hotel that explains and confirms changes to the contract. The hotel must then sign a copy of that letter acknowledging those changes. For example, such a letter could end with:
Please indicate your agreement with the above changes by signing and returning a copy of this letter.
Sincerely,
Jane Smith
Agreed to and acknowledged
this ____ day of _____, 1997.
By:___________________
Sally Jones
Director of Sales
After receiving a returned copy of such a letter, the organization would then sign and return the original agreement.
Of course, the need to change an agreement can also arise after it is signed-maybe even years later. As with contract proposals, agreed upon changes to signed contracts can be easily memorialized. Once a contract is signed, it's not a good idea to try to make changes on the contract itself by initialing changes. Instead, organizations should consider sending confirmatory letters as described above. Or, a better solution is to prepare a written amendment to a contract.
Essentially, such amendments state the new or revised contract terms just as they would be stated in an original contract, but with two key additional provisions: first, a statement that the amendment is making changes to a previously agreed upon contract, and second, a provision that nothing else in the contract changes. Typically, the second stipulation is stated in these terms:
Except as expressly provided herein, all other terms of the Agreement dated __________, 19__ between the parties remain in full force and effect.
If the parties decide to make major, wholesale changes to the contract, they also may want to consider negotiating and signing a whole new agreement, which would substitute for the earlier one. In that case, the new contract would state that it supersedes all previous agreements on the subject matter between the parties.
Implicit in the above-and important to understand explicitly-is that changes must be documented in some form of acknowledged writing. A revision agreed to in a telephone conversation is, by itself, simply not a sufficient means to assure one's contract rights.
Jed R. Mandel is a partner in the Chicago-based law firm of Neal, Gerber & Eisenberg where he heads the firm's trade and professional association practice. Mandel is a frequent lecturer and author on association- and meeting-related topics.