By Priya Raman, Corporate Lawyer. Most contract disputes are decided long before anyone files a claim — by five quiet clauses most signers skim. Here is what to check before you sign, and what each clause costs you if you ignore it.
1. Limitation of liability
This caps what you can recover if the other side fails. A cap set at “fees paid” can turn a $200,000 loss into a $12,000 refund. Negotiate a carve-out for wilful misconduct and data loss.
2. Indemnification
Who pays when a third party sues over the deal? One-sided indemnities are the most common trap in vendor agreements — make them mutual, or at least capped.
3. Termination for convenience
Without it, you can be locked into a failing supplier for years. With it, you keep leverage. Always pair it with a clear wind-down and data-return duty.
4. Governing law and venue
A clause sending disputes to another state's courts can double your litigation cost. For Massachusetts businesses, keep venue local wherever the deal allows.
5. Entire agreement and amendments
Side promises in email mean nothing if the contract says only signed writings count. Get every commitment — delivery dates, service levels, price locks — into the document itself.
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