5 Additional Tips for Better Contracts

As a follow-up to my earlier post, “7 Tips for Better Contracts,” here are a few more tips to ensure you’ve covered all your bases and have a complete document evidencing every aspect of your agreement.


1: Confidentiality/Privacy/Data Protection. 

If your contract requires exchanging or obtaining knowledge of proprietary information or requires collection or sharing of data, your contract should include provisions that the parties must keep such information confidential and outline the security measures needed to  limit access to sensitive data and protect the data.


2: Indemnification (aka hold harmless). 

The parties to a contract should consider how to handle claims brought by third parties.  This clause provides process and procedure on how the parties will indemnify each other in situations where a third party brings a claim that is alleged against the actions of one of the parties.


3: Limitation of Liability

Another protective provision to include is a statement limiting the damages that the other party can obtain if there is a breach so that the parties know what remedies are available and what liability they are incurring by entering the contract.


4: Severability.

This clause is to allow a contract to survive if one of the clauses is determined to be illegal, the entire contract is not voided.  Instead, only those terms or clauses that are at issue can be stricken or amended and the parties will still have a valid contract.


5: Entire Agreement. 

This is a statement to confirm that only what is included in the written contract encompasses the parties’ agreement and that any previous discussions, oral agreements, or communications are not relied upon or part of the agreement.


Each contract requires different considerations and you should consult with legal counsel to ensure your contracts contain what you need and are complete.

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