What is a Contract Review?
When contract lawyers complete a contract review, the goal is to ensure that their clients benefit from the terms of the legal contract. Lawyers typically have a process they follow which can be in the form of a contract review checklist. A contract lawyer will read each line of the document to make sure the terms are fair and there are no loopholes.
Contract review also confirms the legal validity of all terms of the legal agreement and includes an in-depth analysis. If you choose to forego the recommendation to review a contract, you could find yourself locked into an agreement that you’re not happy with.
Here is more about contract review.
What is the Contract Review Process?
Completing a contract review is a vital process any time you need to make a new agreement. Making sure you follow the right steps to the contract review process is the only way to ensure that the terms and conditions of the contract are in your best interest. Since contract reviews can seem intimidating, you might be surprised that the process is simpler than you might think.
Here is a quick rundown of the contract review process:
- Evaluate and understand contract terms
- Ensure legal validity
- Capture full understanding of any risks
Check out this article to learn more about the contract review process.
Contract Review Checklist
If you’re looking for an easy way to perform your next contract review, we have a solution for you. Coming prepared with a contract review checklist is a great way to make sure you complete all the necessary steps of the process. It also helps you stay organized, which helps save time and eliminate any careless mistakes along the way.
Here are six quick steps you can take to perform a thorough contract review, with or without the assistance of a contract review lawyer.
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Step One: Examine Important Terms and Clauses
You need to go through the entire contract with a fine-tooth comb, but the first step to any thorough contract review is examining key terms and clauses throughout. This is because certain portions of the contract are more important, such as:
- Terms and conditions – the basic rules of a contract
- Indemnification clause – also known as a liability clause; defines who pays for losses and damages
Ensuring these terms are clear and that you are in agreement with them helps protect your interests in the agreement, which is why this step is vital to any contract review.
Step Two: Check Termination and Renewal Rules
Contracts typically encompass an agreement for a certain, predetermined amount of time. This means that there will be rules and regulations for termination of the contract or renewal of the terms. Make sure you agree and understand these rules during your contract review.
Step Three: Audit Contract Language
Contracts can contain some tricky language and sometimes, that can make the terms confusing. Set some time aside to read the entire contract in full, paying attention to any confusing or misleading wording that might be included. Keep a list of these items to discuss with the other contract parties and don’t be afraid to request revisions – that’s what the contract review process is all about.
Step Four: Review Default Regulations
What happens if a contract party doesn’t hold up their end of the bargain? Contract default regulations answer this question. Review the rules surrounding default occurrences. This helps to ensure that you not only understand what could happen if you fail to perform your duties, but also what legal recourse you might have if someone else does.
Step Five: Confirm Key Dates
Timelines, deadlines, and any other important dates should be clearly stated in your contract. It’s essential that you are aware of what these dates are and that you are confident that the schedule works for you. Carefully review these dates to make sure they work with your schedule before signing anything.
You should also make sure that there is a specific procedure to follow if there are any changes in key dates or schedules. Unexpected events are bound to occur, so having that flexibility built into the contract protects all parties involved.
Step Six: Look for Blank Spaces
Whether you are using a contract template to help you draft your agreement, or you’re reviewing an agreement that someone else has drawn up, you must look for any blank spaces throughout. This could lead to an incomplete contract, which could result in a contract that is not legally sound.
Check out this webpage for a complete checklist that you can use to make your next contract review job a breeze.
4 Requirements of a Valid Contract
A huge part of the contract review process is ensuring that all the terms needed are present to make the agreement valid. Contracts are legally binding agreements, and must include certain key aspects in order to be legally valid.
Here are the top four most important requirements every contract needs to be valid:
- Offer and acceptance : an offer must be made by one party and accepted by another
- Consideration : something valuable must be exchanged, and both parties to the contract must have some sort of obligation under it
- Capacity : both parties must be of sound mind and able to consent to the contract
- Legality : contracts cannot contain clauses that require any unlawful acts and must abide by state and federal law, no exceptions
Learn more about the characteristics of a valid contract by checking out this article.
Contract Review Fees
Contract review cost varies based on a few different factors. One of the biggest things that impacts the cost of a contract review is who completes it. If you decide to complete the checklist on your own, for example, you will incur a much smaller fee than you would hiring a contract review lawyer.
Even though doing a contract review on your own can have less of an impact on your pocketbook, it could have detrimental effects. Since professional contract lawyers are well-versed in the language that valid contracts must have, it is much easier for them to decipher whether a contract is in your best interest.
They also possess valuable knowledge about state and federal law, so it is easier for them to spot a clause or requirement that could make the entire contract void.
Who Does Contract Review?
Contract review services are typically provided by experienced lawyers that specialize drafting and review contracts. Sometimes these lawyers are known as transactional lawyers. Their main job is to help their clients through transactions, which typically involves negotiating contracts to make sure their clients get the best deals.
If you are considering how to find a lawyer to help with contract review, we would recommend finding a lawyer with experience in your industry that has helped negotiate transactions for similar clients. You can use ContractsCounsel’s marketplace to help you find a lawyer as well.
Post a project on ContractsCounsel today to get connected with contract review lawyers who are experts in helping their clients sign favorable contracts. All lawyers are vetted by our team and reviewed by users on the platform.
