The importance of reading the small print: Common provisions in standard T&Cs that all businesses should be aware of

contract terms

We’ve all been there … you need to get a piece of equipment quickly or have some work done urgently and the supplier sends an order form with their standard terms and conditions attached. You don’t have time to read the small print so the contract just gets signed and sent back.

This scenario happens every day, in all kinds of businesses, all around the world and in the vast majority of cases the contract runs smoothly and no one ever looks back at the specific terms. It’s only when something goes wrong that customers look in detail at the terms of the contract that they’ve signed up to and the consequences can be catastrophic.

Rebecca Gardner, Corporate & Commercial Partner at Howat Avraam Solicitors comments: Whilst the small print can be daunting for non-lawyers, there are a few key provisions that business owners and commercial directors should look for before signing up to any standard terms and conditions.  The following are just some examples of why it is important to read the small print.  The key is to remember that there’s no such thing as standard contract terms – everything can be negotiated.

Limitation of Liability: It’s normal in B2B contracts for suppliers to limit their liability for breach of contract. However, customers should consider whether the limit is appropriate given the nature of the services being provided and the potential damage that could be caused by a breach.

Timing of Delivery: If the contract is time critical, customers will want ‘time to be of the essence’. Suppliers will usually seek to avoid this as any failure to deliver on time would then constitute a material breach of contract.

Assignment/Subcontracting: If you’ve appointed a specific supplier on the basis of their reputation or skills, you should ensure that they can’t subcontract or assign the services to a third party without your consent.

Termination: Contracts will usually include a right for the parties to terminate in the event of a breach, but customers may also want a right to terminate for convenience on reasonable notice. This is often left out of standard terms and conditions.

Penalties for early termination: Penalty clauses are unlawful in the UK, but suppliers often include liquidated damages clauses in relation to early termination which can be enforceable if carefully drafted. Customers should look out for these.

CONTACT US

Howat Avraam Solicitors provide Corporate, Commercial, Employment, Intellectual Property and Contract Dispute advice to companies, business owners and individuals.  As business owners ourselves, we have a pragmatic in-house approach to resolving issues before they arise by working alongside our clients, as part of their team.  We are commercial, practical and entrepreneurial in our approach to legal services.

To discuss any Corporate or Commercial matter with us on a no obligation basis, please contact Rebecca Gardner on 020 3735 6700 or email Rebecca at Rebecca.Gardner@hasolicitors.co.uk.  Alternatively, visit our website at www.howatavraamsolicitors.co.uk for more information.

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