Protect Yourself (and your Business)
authored by Alexander Penalta, Esq. and Nino R. Davila, Esq.
- Define the deal with precision
Spell out scope, deliverables, milestones, acceptance criteria, and what’s explicitly out of scope. Ambiguity is where disputes are born. - Make payment terms enforceable
Use deposits or milestone billing, due dates, late fees/interest, and a clear right to suspend work for nonpayment. Include costs and attorney’s fees for collection where allowed. - Control changes in writing
Require signed Change Orders for any shift in scope, price, or timeline. No email “hand-waving”—add a form or exhibit so it’s easy to use. - Own (or license) the IP on purpose
State who owns pre-existing IP, who owns what’s created, and what licenses survive termination. If you need exclusivity, say it. If you need a portfolio license, say that too. - Limit your downside
Add a Limitation of Liability (e.g., cap at fees paid) and exclude consequential, incidental, and lost-profits damages—while carving out fraud, willful misconduct, or IP/confidentiality breaches. - Shift third-party risk correctly
Use Indemnification for third-party claims (IP infringement, bodily injury/property damage, data/privacy). Define defense control, cooperation, and timely notice. - Protect confidentiality & data
Include NDAs, minimum security standards, breach-notification duties, and a clean-up/return-of-data clause at end of engagement. - Set a disciplined exit
State term, renewal, and termination for cause (with a cure period). If there’s termination for convenience, require paid work-to-date + reasonable wind-down/transition assistance. - Choose the battlefield
Pick governing law, exclusive venue, and dispute method (negotiation → mediation → litigation/arbitration). Consider jury-trial waivers and prevailing-party fees where enforceable. - Get signatures that stick
Confirm signers’ authority, use e-sign consent language, require counterparts, and collect required exhibits (SOWs, insurance certs, security addenda) at execution—not later.
Want a second set of eyes on your contracts? We offer a flat-fee Contract Health Check that flags risks, adds protective language, and tailors templates to your industry.
This material is general information, not legal advice. For counsel on your specific agreement, contact our office and we’ll schedule a quick strategy call. For Florida Contract Law contact Alexander Penalta, Esq. and set up a consultation 386.847.5335. For Illinois Contract Law, contact Nino R. Davila, Esq. at 773.252.6805.
