Chris et al.;
It's good to hear that this issue is being treated professionally and seriously. It does nothing but bring higher regard to the artist's profession. We should remember that these contracts need not be ponderous and full of legalese, although I think most people feel they just aren't "legal" unless they sound like it. The fact is, all they have to be is clear. Judges like nothing better than clarity. Unfortunately, lawyers have worked hard for centuries to make things clear by obfuscating them. A neat trick, but unnecessary.
In any event, the reality of it all is that nothing will probably ever come of it. 99% of the time, no need will arise to invoke this sort of contract. It's like insurance where we do it "just in case". Moreover, most contracts or agreements are questioned by subsequent parties, not by the people who entered into them in the first place. For example, what happens if a sitter gets run over by a bus next week? Then, all of a sudden, they're gone and in their place is their legal estate. You signed a contract with a person, not with an estate, yet there they are, standing in the shoes of the original party to the agreement. You will want to have things clearly set down in writing so there's no mistake as to what the situation is. This is when written documents come in most handy. Otherwise, it can be a nightmare figuring out what's what.
One more tip: if you run into someone who is adamant about only doing business on a handshake rather than on paper, you can do a couple of things. First, you can refuse the job. If that isn't an option, then as soon as you get home, write down exactly what you remember of the conversation; even dialogue if you think it'll help. Write a page starting something like: Today, April 14, 2002, I entered in a handshake contract with so-and-so. We agreed that blah-blah-blah . . .. When you're done, sign and date it at the bottom again.
Then, put it in an envelope and mail it to yourself. (Oh yes, make a copy of it first so that you won't have to steam open the envelope if you forget something that was in the agreement yourself!) When the letter comes back to you via the post, don't open the envelope; just put it the file for that client and leave it. You may never have to look at it again, but it will be helpful if it's there. Verbal contracts are as legally binding as are written ones, but they are more difficult to prove. Taking some notes and this extra small precaution will at least give some weight to your position if it ever comes into question in the future.
Finally, I don't want to be scaring anyone into thinking that we are all in for a mucky legal quagmire. This stuff really can be quite minor and easy-to-do once you get a little boiler-plate phrase such as Chris has (personally, I'd make it a little less legalese-y

). Anyway, it seems that this issue is one that many of you have been aware of for some time and I guess I'm simply trying to reinforce it and to encourage others to do the same.
All the best,
Juan