What Should You State In A Business Contract?

Nothing bothers business lawyers more than contracts that fail to state everything required to make an agreement workable. If you're planning to write a contract or enter into one, it's wise to have a general idea of what out to be stated in the paperwork. Here are 7 items your attorney wants you to pay attention to.


The contract needs to list who the parties to the agreement are. List all signatories and their respective roles within the businesses they represent. Include the names of the business and the types of operations they are, such as an LLC or an S Corp. The addresses for the businesses should appear, too.


Write down everything that is to be delivered or performed by either party. Business lawyers will never criticize you for being too detailed in a contract.

If third parties may be contracted to do work, there should be an assignment clause. Folks who don't want this need to expressly prohibit it in the paperwork.

Both parties should have the right to inspect the work. Likewise, a process should be in place to remedy issues. If there are industry standards that define acceptable quality for the work, incorporate those into the terms. Similarly, make sure there is a notice clause that requires both parties to inform the other when there are issues.

Offer and Good Compensation

The exchange ought to be stated in the contract. If one party is to deliver 10,000 widgets to the other party by January 1 of next year, that goes in the agreement. The payment of $100,000 for the widgets should also appear here.

Applicable Laws

All laws the two parties agree to apply to the contract ought to be stated. This should include a venue clause that covers which state's laws will be used to adjudicate disputes. You may also want to add an arbitration clause.


If one party is assuming liability, especially in a form outside standard operating procedures, put it in the contract. For example, a construction company might accept liability as a sweetener to bring on a preferred contractor. Limitations to liability must also be stated.

Warranties and Guarantees

Any warranty or guarantee needs to go into the contract. These should be accompanied by terms explain how long the warranty or guarantee lasts and any procedures for invocation.

Sunset Provisions

Every contract should have a defined end. If it is a one-time agreement, state that. Otherwise, recurring agreements should have sunset dates. If you need to continue after that, either include an option in the deal or simply make a new contract.

For more information on what to state in your business contract, contact a firm like Harris Shelton Hanover Walsh PLLC today.