Love them or hate them, contracts are a necessary part of doing business. It’s likely that, as a business owner, you encounter multiple contracts during a typical calendar year. While it’s a good idea to read the contract in its entirety, it’s often most important to read anything contained in the fine print. While you can try to understand what’s written in the fine print without any preparation, here are a few pointers to help you sniff out anything that might be questionable.
Contract Termination Terms
While terms for the termination of a contract should be contained in the main body of the contract, there may be addendums to these terms located in the fine print. It could be that there are terms related to time limitations for termination or costs associated with early termination. It’s important to understand the specific conditions under which the contract can be terminated so that you don’t sign something that you can’t reliably commit to.
Arbitration Insight
Another very important piece of information that you might find in the fine print is insight into how the other business expects to handle arbitration. In some cases, the other party to the contract may put forth terms that are more amicable to them if a contract needs to be arbitrated. Given the unique characteristics of each business relationship, it’s best to consult a professional, such as Ian Carter of Carter West Law, to help you understand the terms as they relate to your situation.
Insurance Needs
If there are any insurable assets covered in the contract, there could be insurance coverage information in the fine print. You need to check this information to determine which party is responsible for the insurance coverage and how any claims will be handled. Pay close attention to any insurance companies that are mentioned in the fine print since these companies could be closely associated with the other party, making the terms more favorable to that party.
Changes
Any time there is fine print on a contract that has been amended in any way, it is important to pay close attention. That’s because it’s easy to slip changes into the fine print in a way that is more favorable to the other party. If the original contents of the fine print are not related to the parts of the contract that are being amended, it’s wise to request that the fine print be rolled back to its original version.
Take Your Time
Above all, it’s important to take your time when reading over the fine print in a contract. Don’t let the other party pressure you into signing the contract before you have a chance to read and understand the full terms of the contract. This will save you a lot of headaches down the road and ensure that your business is able to continue to thrive.
