You know better than to sign your name blindly to any contract , but do you know exactly what problems you should really be looking for when you start your review?
Eventually, reviewing a business contract will be something that you can do easily. When you're still fairly new to the process, remember to ask the following questions.
1. Is it complete?
A contract isn't enforceable in court unless it is clear, completely addresses the understanding between the two parties involved and addresses potential complications and what happens if the contract isn't performed (penalties for noncompliance). In addition, remember that a contract isn't valid unless both parties sign the agreement.
2. Are all terms defined?
Are there any words in the contract that could lead to confusion (and a lawsuit) later? If so, get clarification before you sign and write it into the contract.
For example, if a contract states that you'll pay your company representative's travel expenses, what exactly does that mean? Is that limited to gas and lodging? Is mileage included? Is travel time paid as well? Are meals covered? What about entertainment? Time spent clarifying these details now is money saved later in legal fees.
3. Does it include standard clauses that don't fit?
Many contracts have clauses in them that are just lifted from one business contract to the next. Read them. Don't be afraid to negotiate something other than what's already there. Boilerplate language can be clarified, altered or even removed if the parties agree to do so. If you simply accept the terms as written, however, you could be stuck with some that puts you at a decided disadvantage if something goes wrong.
4. Do you need advice before signing?
Finally, if you aren't that sure of your ability to spot a problem in a contract (or know what's missing), consider getting a legal opinion. A business law attorney can review your contract and point out potential problems or at least reassure you that everything is fine before you sign.
Source: The Balance, "5 Tips for Reading a Business Contract," Jean Murray, Feb. 28, 2018