Checklist to Reviewing a Contract

If you are about to sign a contract, you should get the contract reviewed before signing. Contracts are often changed and edited by other parties before it is signed. Not reviewing it before signing it is a big mistake. So how do you review a contract effectively?

What is a Contract Review?

Contract Review Mistakes

Business owners make different mistakes when dealing with signing a contract.

Some of these mistakes include:

• Thinking a legal review lawyer is a waste of money
• Thinking a contract is non-negotiable or that signing is mandatory
• Signing a contract before reviewing it
• Signing a contract before fully understanding it



Any of these mistakes above can cause you to sign a contract that is not truly in your best interest.

Why get a contract reviewed?

Getting a contract reviewed is important because all of your decisions are made through a contract. Contracts should always be handled correctly to prevent yourself from having a legal problem. This means every single contract drafted and negotiated needs to be reviewed by a contract lawyer before it gets signed.



Here are a few key reasons why you should have a legal review of contracts:

• It prevents people from misunderstanding what they are signing. All terms need to be clear.
• It guarantees that the terms within the contract are legal and lawful.
• It prevents – or at least minimizes – future legal problems.

Why is a contract important?

Contract reviewing is not just protecting your company from signing a troublesome contract. It is also about protecting the relationship between you and the other parties involved. If both parties do not understand the contract, the relationship is going to have issues.



You enter into contracts every day and all of the time. The “Terms and Conditions” are often accepted every day. The companies need to make that contract fair, correctly drafted, and thoroughly reviewed.

Contract Review process

Contract review can be summed up into a four-step process.

1. Drafting- The contract is created
2. Reviewing- The contract is reviewed
3. Negotiating- Negotiate any changes you want to make
4. Signing- Once terms are clear, you can sign the contract



Sticking to this four-step plan helps to prevent you from signing a contract that isn’t in your best interest.

What does a contract review lawyer do?

These lawyers work specifically with contracts. They can create, revise, review, help you understand, and help you negotiate the terms of any contract. A contract is a legally binding agreement between you and another party, in a business or personal instance. Since it is legally binding, it is important to make sure they are done the right way. This alone is the biggest reason why you need a contract attorney.



A contract lawyer has experience in both creating and revising contracts. If you are a landlord, a contract lawyer is who would help you create the lease for your tenants. If you are a singer, your contract lawyer would help you draw up contracts for your career. If you are an employer, this is the person who would help you at a reasonable employment contract review cost to draw up the contracts for your employees to sign.



If you are looking to sign a big contract for a new job, a contract lawyer can also look at the contract. They can explain it to you in a way that you will understand, and then they will help you make any necessary revisions. Having a contract lawyer on your side before you create or sign any contract is a good idea, as they work to prevent you from creating or signing something you wouldn’t normally agree to. 

What are the different types of contracts that should be reviewed?

Employment contracts

An employment contract is something that you have any time you are getting ready to start a new job, a new position, or a new contract. There are many things look for in an employment contract.



Here are 10 things you should consider when signing an employment contract:

1. Job Security- Job security maybe something you would not normally think about that because the contract should be enough of job security. However, the contract may imply job security, you need to ask if you are a fixed-term or an at-will employee so you’re clear about your job security in the future.
2. Start and End Dates
3. Termination Cause- Termination is a big part of the contract because it’s how you can lose your job. As an employee, you want the cause to be required, but your employer may want the ability to fire you without any cause. Read this section carefully and keep this in mind.
4. Compensation and Benefits- This includes base pay, amount or terms to any bonuses, and benefits that the employee is entitled too
5. Job Description- It will have your job description, but it is good to look it over to see any possible surprises and the possibility of accepting a completely new job.
6. Exclusivity- This includes whether you are able to work outside of your current employment (freelance, side hustle, etc.)
7. Intellectual Property- This includes the rights to anything you create or invent while you are employed there. Anything you create on the job or during employment belongs to your employer. If you are already working on something before you sign the contract, let them know.
8. Non-compete- This means you can’t work for a competitor for a specified period after you terminate the contract. Make sure the time and restrictions are reasonable, so you are able to if given the opportunity.
9. Non-solicitation- This prevents you from getting your employer’s contractors, staff, or customers, clients, etc. Typically, after one to two years, you are able too.
10. Sale of company- This is also something that you probably do not think about typically. What this means is knowing what happens to your contract if the company is sold. Do you have job security?



Physician Employment Contracts

Contract lawyers also review physician contracts; thus, you should have them reviewed if you are a physician. However, there’s one important thing for you to remember as a physician: you are dealing with people’s lives and you need to minimize any risk or confusion – get a contract review to make sure you are getting a fair offer that doesn’t jeopardize your career.



Real Estate Contracts

Real estate contracts are documents that you need to sign when you are leasing or purchasing real estate. These are pretty standard, but important that a lawyer reviews the contract, including mortgage loan documents, a plot of land survey, title, title insurance, deed, bill of sale, and the legal description of the property.



Purchase Agreements

Purchase agreements are used to transfer property from one person to another. This may be real estate, vehicles, or any other assets. Similar to real estate contract review, your contract review analysis will include any necessary titles, insurance, deeds, loan documents, and the bill of sale.



Freelancing Contracts

If you are a freelancer working on a contract basis, having a lawyer to review bigger contracts is good to have. Larger contracts or contracts that will be used often should be reviewed. Your freelance contract should include the scope of the work, the ownership of the work, any revisions, deadlines, payment amounts, and termination specifications.

Contract Review Checklist

Having a contract review checklist provides a great tool that you can refer to when you sign contracts.

Here’s what you should look for to review a contract:

• The terms of the agreement- Keep in mind, a contract is just a starting point. Almost everything is open to negotiation. Don’t agree to something you aren’t happy with. Always ask for what you desire. They aren’t going to bite your head off – they might just say no.
• The parties involved- Complete names help avoid confusion. If the person you are working with is married, be sure to specify their name as well to be included in the contract.
• Make sure nothing is left blank
• Clear quantifiable terms like price, duration, square footage, etc.
• Renewal terms- Determine if there is an automatic renewal or not, or if you want that type of renewal at all
• Risk allocation- Detailing what risks will be allocated will prevent you from being left in the dark. You don’t want to be left with a financial problem in the future with no clear guidance on how to fix it or who is at fault.
• Termination- Understand the how, when, and why the contract may end
• Deadlines and important dates- Putting dates in the calendar to make sure you do not forget to take care of a responsibility
• Representations- Do not accept information or give any unless you know it is true.
• Responsibilities and rights- Understand what both parties are entitled to and what obligations they have to fulfill
• Dispute resolution- The contract should tell how disputes would be resolved

Importance of a contract review

A contract review is an important part of any new professional, work relationship, but often not thought of. Having a contract reviewed will prevent you from agreeing to something that you do not want to agree to.

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