00:08
Adam Stofsky
I have a question about sort of term and dates in contracts. So I've seen contracts that have some kind of effective date or the starting date. So what does that actually mean? And sometimes the date is, like, before the date I signed the contract. Or it says something like dated as of X, Y and Z date. What does that mean?
00:30
David Tollen
Yeah, the effective date is the date.
00:34
David Tollen
The promises in the contract go into effect. So maybe that's the day I start performing my services for you.
00:42
David Tollen
But maybe the services don't start on.
00:44
David Tollen
That date, but the promise is effective as of that date.
00:49
David Tollen
The weird thing is that doesn't have.
00:51
David Tollen
To be the date of signature. So I think it's probably fair to say in most contracts there's no difference between the effective date and signature. And sometimes you'll specifically say the date both parties have signed is the effective date.
01:06
David Tollen
Or maybe you don't even say anything.
01:08
David Tollen
About it, and it's just clear that the second party signature is the launch date.
01:14
David Tollen
But in some cases you might say.
01:17
David Tollen
Well, we actually started working together three months ago, and we've only now agreed on these provisions that guide our relationship.
01:25
David Tollen
You can set the effective date back.
01:28
David Tollen
In time as of the date you.
01:30
David Tollen
First started performing, so that if it.
01:32
David Tollen
Turns out there was some problem or some issue related to past performance, you've agreed on the rules that will govern it, even though you agreed after the performance happened.
01:44
David Tollen
You can also set the effective date in the future.
01:46
David Tollen
You can say, this doesn't go into effect until a month from now, something along those lines.
01:52
Adam Stofsky
So I hire someone and they start working because we're in a hurry. And then a month later we have some time and I say, we really ought to have an employment contract and we date it. The effective date is a month in the past when we started.
02:05
David Tollen
Yeah, that's right.
02:07
David Tollen
And that's perfectly enforceable. It's not some sort of sleight of.
02:12
David Tollen
Hand like the US. Constitution says. You can't have a retroactive law. Congress can't pass a law that changes what we're supposed to do. Retroactively going backwards, but with contracts, both.
02:24
David Tollen
Parties are agreeing to it.
02:25
David Tollen
It's not someone passing a law. So, yeah, it works.
