A „tacitly renewed agreement“ is an agreement between two parties that continues to exist and function even though it has not been formally or explicitly renewed. This type of agreement is also known as an „implied agreement“ or „implied contract.“
In most cases, a tacitly renewed agreement arises when the parties involved continue to act as if the original agreement is still in force, even though it may have expired or been terminated. For example, if a company and a vendor have an agreement for the vendor to provide services for a period of one year, but neither party takes any action to terminate the agreement at the end of the year, the agreement may be considered to have been tacitly renewed.
It is important to note that a tacitly renewed agreement is not a legally binding document, as it does not have the explicit terms and conditions that a formal agreement would have. However, it can still be a useful tool for maintaining a positive business relationship between the parties involved.
To avoid any misunderstandings or disputes that may arise from a tacitly renewed agreement, it is important to document the terms and conditions of the agreement in writing. This can be done through a simple email exchange or by drafting a formal agreement that outlines the terms and conditions of the tacitly renewed agreement.
When drafting a tacitly renewed agreement, it is important to include key details such as the duration of the agreement, the scope of the services to be provided, and any changes to the original terms and conditions. This can help to ensure that both parties are clear on their responsibilities and obligations under the agreement.
In conclusion, a tacitly renewed agreement can be a useful tool for maintaining a positive business relationship between two parties. While it is not legally binding, it can still be a valuable way to ensure that both parties understand and agree to the terms of their ongoing relationship. To avoid any misunderstandings or disputes, it is important to document the terms and conditions of the agreement in writing.