Contracts should not be read only for price, duration and signatures. The clauses that look secondary at first may later become decisive: penalties, guarantees, termination, liability, notice periods, exclusivity or obligations assumed indirectly.
A useful contract review does not look for problems at any cost. It clarifies obligations, risks and points that should be understood before signing.
A contract should reflect the real transaction. It needs to explain what is delivered, when payment is made, what happens if performance is delayed and how the parties communicate if the relationship no longer works.
When legal assistance may be useful
- a contract is about to be signed and the obligations are not fully clear
- the other party has sent a standard form contract
- penalties, guarantees, liability or termination clauses need to be understood
- a commercial relationship is being negotiated or reorganised
- a notice, addendum or termination document needs legal review
- a debt or contractual breach has appeared and the documents need to be organised
What is reviewed
The review is not limited to whether the contract is “legal”. The practical question is what may happen if one party does not do what was promised.
- the identification of the parties and the subject of the contract
- the obligations of each party and how performance is proved
- payment terms, invoices and consequences of delay
- penalties, damages and liability clauses
- termination, notice periods and obligations after termination
- guarantees, confidentiality, exclusivity or non-compete clauses
- jurisdiction, applicable law and communication rules
Possible directions for review
The direction depends on the stage of the relationship: before signing, during performance, when a dispute appears or when the contract needs to be ended.
- reviewing a draft contract before signing
- redrafting unclear clauses
- preparing or reviewing addenda and notices
- analysing contractual risk before a business decision
- assessing non-payment or breach of contract documents
- reviewing termination or liability issues
- preparing a position before litigation or negotiation
Documents useful for the first review
- the full contract draft, not only the clause that raises concern
- annexes, offers, orders and commercial terms
- emails or messages that explain the negotiation
- company documents, if the matter is commercial
- proof of payment, performance or delivery
- previous versions of the contract, if relevant
Risks to clarify early
Contractual risk usually appears when the document is applied, not when it is signed. That is why unclear clauses should be identified before the relationship becomes tense.
- penalties that are not proportionate to the practical risk
- termination clauses that are hard to use or too broad
- unclear payment or delivery obligations
- unlimited liability or vague damages clauses
- guarantees that cannot be applied in practice
- communication rules that make notices ineffective
- standard clauses that do not match the real agreement
How the collaboration starts
The collaboration starts with the full document, annexes and a short explanation of the commercial context. The purpose is to understand the obligations and clarify the points that may need adjustment or negotiation.
Useful materials
Informational materials that may help clarify the documents and the issues that need careful review.
Contract review before signing
Obligations, clauses and points that are useful to understand before signing.
ReadContract clauses to review carefully
Penalties, guarantees, liability, termination and notices.
ReadPayment notice and debt recovery
How to prepare the review of an unpaid amount.
Read