Subcontracting agreement : key points before signed

Today, thanks to internet, anyone can easily find standard contracts.

However, we must remain vigilant on these contracts quality, because it is regularly found in the legal field that companies having used this type of template are highly contractually committed because of their lack of prudence.That is why, I propose you below some simple rules to respect, without being exhaustive, before signing a contract.

Subcontracting agreement: discover the main principles

1/Take the utmost care in drafting the preamble of your contract

The preamble of the contract, before going into the writing’ substance, explains the reasons which led the parties to contract. It is therefore a major point in the contract from which the judge will draw information to interpret the agreement if it was poorly written.

2/ Check which Right the contract is subject to

With the Internet, this point becomes very important, there is no digital boundaries. The clause conferring jurisdiction will in certain cases ensure that there is no risk of having to submit a contract dispute, for example, to American or Chinese law.

3/Check if there is a jurisdiction clause

The contract must always be read of in the perspective of a dispute. And if there is litigation, it’s better to make sure that you don’t have to invest on expensive travel in order to defend yourself or being represented by a lawyer.

4/ Take care of the definitions writing

Always in the context of a legal proceeding or a dispute with a contracting partner, it is imperative to be sure having defined all the technical terms or topics for discussion in the contract. Otherwise, the judge will be free to make the decision he considers fair in the referral context.

5/Set a documents hierarchy forming the contractual set

A contract can very often refer to the reading of attachments, other contracts, charter, TOU, or any other document. It is therefore necessary to specify very clearly, in order of importance, the hierarchy of these documents. In case of difficulties or contradiction between the words in the different documents, this will make it possible to refer to the document positioned the highest in the hierarchy to make it prevail. It is in fact to set a coherent reading chart for the contractual agreement in the event of a dispute.

6/Anticipate the management of disputes as soon as the contract is drafted

A good contract is not just a contract that envisages collaboration between co-contractors. He must also prepare the parties for the eventuality of a dispute. We can therefore provide mechanisms to avoid referral to jurisdictions (arbitration clause for example).

7/Don’t forget implications of intellectual property

Right in the event of termination of the contract. Too often in the drafting of contracts, we find that intellectual property code is completely forgotten.

8/Consider Post Contract

A classic mistake is to forget that a contract ends. We will therefore think of arranging the end of this contract, whether it occurs during execution or after the end of the term: confidentiality agreement, non-competition clause, clauses for restitution of documentation, remaining stocks specific to the product, object of the contract. The scenarii are not lacking and better think about it as soon as the contract is written.

9/Review the subcontracting agreement

And we end with a basic advice, probably the most obvious of all, take the time to read the full provisions of the contract.