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Don’t Skip Over Boilerplate Language in a Contract

boylanlegal • March 18, 2020

Make sure you read and understand “boilerplate” language before you sign a contract. Many of my clients are surprised to find that they cannot enforce a contract in their home state or have agreed to limit their damages because they did not pay attention to the boilerplate language. Although it may be tempting to skip over these details, these provisions are critically important and can have a dramatic impact on your contractual rights and liabilities.

Boilerplate refers to the standard terms that are usually included at the end of every contract and address such things as how to handle disputes, where to bring a lawsuit and how to make changes to the contract. These provisions are typically the same from contract to contract, regardless of the specific terms of the deal.

There are many boilerplate provisions, but some of the most common will include:

  • Integration.  A good contract will usually have an integration clause or “entire agreement” clause. This means that the written contract is the only agreement between the parties. Any claims, statements or promises made during negotiations are specifically excluded if not made part of the written contract.
  • Amendments . As with the integration clause, any changes to the contract must be in writing and signed by both parties to be enforceable.
  • Jurisdiction and Choice of Law. These clauses will determine which state and county a lawsuit to enforce the contract must be filed and which state law to apply. This is an especially important provision for multi-state businesses that don’t want to be brought to court in multiple jurisdictions.
  • Assignment.  This will allow or deny a party to transfer their rights and obligations under the agreement to another party.
  • Arbitration and Mediation . Obligates the parties to have a mediator or arbitrator resolve a dispute rather than file a lawsuit.
  • Attorney’s Fees. Details which party will pay the attorney’s fees in the event of a dispute or lawsuit.
  • Limitations on Damages. Restricts the amount and type of damages that may be awarded to either of the parties in the event of a lawsuit.
  • Force Majeure. A force majeure clause will temporarily suspend, or completely excuse the parties obligations under the contract due to forces beyond their control, such as natural disasters, war, strikes, flood, etc. that could make contractual performance impossible.  

There are many other boilerplate provisions that may be included, depending on the type of contract and the subject matter. Even though these provisions use standard language, they can still be negotiated like any other part of the contract and written to meet your specific needs.

Make sure to read the boilerplate provisions carefully and have a thorough  understanding of how they affect your contractual rights and liabilities before you sign any contract.

This information is provided for informational purposes only and is not to be considered legal advice. Prior to relying on this information, please contact boylanlegal.com for a consultation.

 

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