Crafting Effective Customer and Client Contracts for Your Business

Optimizing Customer and Client Contracts for Your Business

Many small business owners often overlook the importance of properly documenting their terms of engagement with customers, even though these relationships are critical to their business. Here, we explore key considerations when creating contracts for your customers or clients.

Payment Terms in Customer Contracts

When dealing with payments, it's crucial to be clear about the process. This includes specifying payment due dates after an invoice, addressing late fees or interest charges on overdue payments, and outlining procedures for handling disputes that may require legal action. Additionally, contracts should cover scenarios where services are terminated prematurely, particularly if a "no refund" policy is in place.

Scope of Work in Customer Contracts

Clearly defining the scope of work is essential to avoid misunderstandings. Many businesses opt for a master services agreement that outlines standard terms and conditions, along with a separate scope of work document that details the specifics of each job.

Intellectual property in customer contracts

For businesses involving creative work, such as graphic design or web development, addressing intellectual property ownership is crucial. While creators typically own the rights to their work, clients often require usage rights. Contracts should specify the extent to which intellectual property rights are transferred and should be reviewed by legal professionals.

Confidential information in customer contracts

Sharing confidential information may be necessary for your services, and both parties should agree on nondisclosure terms. This ensures that sensitive information remains confidential and is not used for unrelated purposes or shared with competitors.

Independent contractor status in customer contracts

Contracts should clearly establish that the service agreement does not create an employer-employee or agency relationship between the parties. Standard language should be included to emphasize this point.

Termination provisions

While some agreements naturally conclude, others, like ongoing services or subscriptions, may require defined termination procedures. Contracts should clearly specify how and when the relationship can be ended.

Dispute resolution in customer contracts

Addressing dispute resolution is critical. Contracts can require parties to attempt mediation before pursuing legal action or specify arbitration as the preferred method for handling disputes. Understanding the difference between mediation (non-binding) and arbitration (binding) is essential, and consulting with a business lawyer can help you create an effective dispute resolution provision.

Balancing legal needs and business needs in your contracts

Finally, consider how your contracts appear to potential clients. Excessive legalese and fine print can deter clients. We can assist in crafting contracts in plain, understandable language while ensuring they cover all essential aspects.

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Meet Our Business Attorneys

Emily Smith-Lee is the owner and founder of slnlaw. She is a 1996 graduate of Boston College Law School. She was previously a partner at the Boston office of a large international firm, where she worked for thirteen years with a focus on business litigation. In 2009, she started the firm that since became slnlaw, and has grown it from a solo practice to a five-attorney firm with multiple practice areas. She has been recognized as Massachusetts Superlawyer each year since 2013, and in 2018 earned recognition as one of Massachusetts Lawyers Weekly's Lawyers of the Year. She has written a book on employment law: Rules of the Road, What You Need to Know About Employment Laws in Massachusetts, and helped hundreds of small business owners with contracts, business transactions, employment law advice, business incorporation, and risk management. She has also litigated business disputes in state and federal courts.

Rebecca Rogers: Rebecca is a 2006 graduate of Boston College Law School, and has worked with slnlaw since 2013. She previously worked as an intellectual property litigation attorney for Fish & Richardson in Boston, Massachusetts, and clerked for the Massachusetts Supreme Judicial Court. Rebecca has helped clients with business contracts, employment contracts, and employment law advice.

Jenna Ordway: Jenna is a 2013 graduate of Quinnipiac Law School, and also earned an LLM in Taxation from Boston University in 2015. She has been affiliated with slnlaw since 2011, first as a law clerk and then as an attorney. Jenna has been recognized since 2019 as a "Rising Star" by Massachusetts Superlawyers. Jenna has helped many small business owners with simple and complex business incorporation, contract review, advice and analysis regarding business disputes, employment law advice, and advice about business succession considerations as part of estate planning.

Elijah Bresley: Eli is a 2014 graduate of Seton Hall Law school, and has worked with slnlaw since 2020. He previously worked for a boutique employment law firm outside of Boston, and then for the Labor and Employment department of a large Boston firm. He also spent a year clerking for the judges of the Superior Court in Hartford, Connecticut. Eli has helped our small business clients with employment law advice and defense of employment-related lawsuits in MCAD and state and federal courts.

Sharleen Tinnin: Sharleen is a 2010 graduate of Northeastern University School of Law, and has been with slnlaw since 2023. Prior to joining slnlaw, she worked with King, Tilden, McEttrick & Brink, P.C. on complex civil litigation matters. She previously worked for the United States Department of Justice, and received an "Excellence in Justice" award in 2017. Sharleen has helped clients litigate business disputes in state and federal courts, and advised business owners about succession considerations as part of their estate planning.

How We Can Help

Our experienced team can assist you in crafting clear and effective contracts tailored to your business, ensuring legal protection while maintaining client trust. You can use the button below to schedule a free information call, or simply give us a call at (781) 784-2322.

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