Print This. Use It Every Time.
This checklist covers the 10 things every contract signer should verify — whether you're signing an NDA, an employment offer, a rental lease, a service agreement, or a SaaS contract. It takes 10 minutes and can save you thousands.
Check off each item as you go. If you hit something you don't understand, don't skip it — flag it and get clarity before signing.
1. Parties Are Correct
Are you signing as an individual or a company? If your LLC is the contracting party but you sign as an individual, you're personally liable. Verify every name, address, and entity type. A typo can make a contract unenforceable — or worse, enforceable against the wrong entity.
✓ Check: Your name/company name is spelled correctly. Your role/title is accurate. The other party's legal entity name matches their registration.
2. Payment Terms Are Crystal Clear
Vague payment terms are the #1 source of contract disputes. How much? When? What triggers payment? Net-30 or net-60? What happens if they're late? Are there milestones or deliverables tied to payment?
✓ Check: Amount is correct. Payment schedule is clear. Late payment penalties are reasonable. Invoicing process is defined.
3. Scope of Work Is Specific
Scope creep kills profitability. If the contract says 'and other services as needed' or 'any and all related work,' you've agreed to unlimited scope for a fixed price. The scope should list exactly what you'll deliver — and explicitly state what's out of scope.
✓ Check: Deliverables are specific. Timeline is realistic. 'Out of scope' work requires separate agreement. Revisions and changes have a defined process.
4. Liability Is Capped
If there's no liability cap, you have unlimited exposure. For most contracts, the cap should be tied to the fees paid — something like 'total liability shall not exceed the fees paid in the 12 months preceding the claim.'
✓ Check: Liability cap exists. Cap is reasonable relative to contract value. Exclusions (death, fraud, IP infringement) are standard.
5. Indemnification Is Fair (Two-Way)
One-sided indemnification means you cover their losses, but they don't cover yours. It should be mutual — or, at minimum, proportional to fault.
✓ Check: Indemnification is mutual or fault-based. Obligation is tied to your actual negligence or breach.
6. IP Ownership Is Defined
Who owns the work product? If you're a freelancer creating content, code, or designs — does the client get full ownership, or do you retain a license? Does 'work made for hire' language appear? In some jurisdictions, that can transfer all IP rights automatically.
✓ Check: IP ownership is explicitly stated. License terms are defined (exclusive vs non-exclusive). Pre-existing IP is carved out.
7. Confidentiality Goes Both Ways
A one-way NDA only protects the other party. If you're sharing business information, trade secrets, or client data, make it mutual. Also check: how long does confidentiality last? Is there a clear definition of what's confidential?
✓ Check: Confidentiality is mutual (if applicable). Definition is specific (not 'any and all information'). Term is reasonable (2-5 years).
8. You Can Terminate the Contract
Can you exit the contract before the term ends? Ideally: 30 days notice for convenience. Immediately for cause (breach, non-payment, insolvency). If termination for convenience exists only for them, not you — that's a problem.
✓ Check: Termination for convenience exists for both parties. Notice period is reasonable. Obligations post-termination are clear.
9. Governing Law Is in Your State (or Neutral)
The governing law clause determines which state's laws apply and where lawsuits get filed. California law in a California court — fine if you're in California. Delaware law in a Delaware court when you're in Texas — not fine.
✓ Check: Governing law is your home state or a neutral jurisdiction. Venue is convenient. Arbitration vs litigation is a conscious choice.
10. There Are No Hidden Clauses
Scan for buried non-competes, non-solicitation clauses, non-disparagement language, and exclusivity requirements. These don't belong in standard NDAs or service agreements — they're separate, serious commitments that should be negotiated openly, not snuck in.
✓ Check: No non-compete language. No exclusivity requirements. No non-disparagement unless explicitly negotiated.
Double-Check With AI
You've done the manual checklist. Now run your contract through an AI review tool for a second opinion. AI catches patterns you might miss — and it takes 30 seconds. It'll flag every red flag on this list automatically and give you the language to push back.
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