Consulting Contract Mistakes

While consulting agreements seem straight forward, there are frequently some mistakes made when putting them together. These mistakes could end up hurting one or both parties, and could end in litigation. Here are five common mistakes to avoid with consulting contracts:

  1. Scope of Services

Both parties need to be clear on what services will provided by the consultant. It should be clearly outlined in the contract exactly what they will be providing in a closed list. A closed list protects the consultant from being asked to perform extra duties without compensation.

  1. Payment

Not only should the amount of payment be specified in the contract, but how the consultant will be receiving the payment should be indicated as well. Some consultants prefer having a retainer, monthly invoices, etc. Not having this clearly defined in the contract could create confusion and frustration later.

  1. Liability

This covers how much liability the consultant is willing to accept for the performance of their services. For example the consultant might be asked to provide a representation that the performance of their services will not infringe the intellectual property rights of any third party and to protect the client if they do.

  1. Intellectual Property Ownership

If the consultant is creating something like a logo, slogan, website, etc. it should be in the contract who has ownership of the product. Depending on the situation and work being done, the consultant may transfer ownership of the product to the client or decide to retain ownership.

  1. Governing Law and Jurisdiction

This is usually only needed when the consultant and client operate in different locations and are under different governing laws. They will need to specify at which location it will be governed by. Often, many contracts are now including mediation and arbitration clauses, which can help avoid the expense of litigation.

To avoid mistakes while creating consulting contracts, it’s best to have an attorney write it or at least review the contract. InnovaCounsel’s attorneys have years of experience in the areas of business and consulting contracts and can create a contract that will meet everyone’s needs. 


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