Contracts are the lifeblood of the business world, but you don’t ever want to sign an important contract without reviewing it closely.
But do you know what you should be trying to spot? There a lot of potential contract problems, from ambiguous wording to contradictory clauses, but here are some of the top unpleasant surprises we often see:
1. Intellectual property ownership clauses
Freelancers are used in many different industries, but that doesn’t mean everyone has the same expectations regarding ownership of their work. If you’re buying someone’s original work, make sure that you know whether or not you’re buying the copyright, as well.
2. Obligations regarding legal fees
If you get into a contract dispute with another business owner, the last thing you want to do is to have to pay the other guy’s legal expenses. That’s exactly what can happen if a hidden clause requires it.
3. Obligations regarding venue
Even sneakier are the clauses that require you to let the other party select the forum or venue in which any legal dispute is resolved. That could easily make it very expensive — if not outright prohibitive — for you to seek redress in a dispute.
4. At-will employment clauses
If you’re working under contract for someone, you need to watch for at-will clauses. While they’re sometimes unavoidable, you don’t want to accept one that could leave you stuck in a far-off place or foreign country if your employer suddenly decides they no longer want your services.
5. Last-minute changes in terms
If you handed a contract over for signature, and it comes back with a lot of text crossed out and overwritten, stop and run — don’t walk — somewhere for help. You need experienced contract advice before you make another move.
