A standard form contract is a pre-prepared contract where:
- most of the terms are set in advance
- little or no negotiation between the parties occurs.
Often, these are printed with a few blank spaces for filling in information such as names, dates and signatures.
Standard form contracts often include a lot of legal 'fine print' and terms that you may not understand. They tend to be one-sided documents that mostly benefit the person who prepared the contract (for example, by shifting as much risk as possible to the contractor). If you don't understand the fine print or any other part of the contract, you should get advice.
If you sign the contract, you will be required to comply with the fine print, even if you didn't actually read it.
Laws protect consumers and small businesses from unfair terms instandard form contracts.
Tips for standard form contracts
Read every word before you sign
Read the fine print carefully and get advice about any terms you don't understand before you sign. Once you sign a contract you are bound by all of its terms. If there is an indemnity clause, don't sign until you understand the risks you’re agreeing to if something goes wrong.
Cross out any blank spaces
Don't leave any spaces blank. If you don't need to fill in a blank space, always cross it out so the contract can't be changed after you sign it.
Negotiate
You have the right to negotiate any contract before signing, including a standard form contract. But remember that both parties must agree to any changes and record them in the contract you sign. Your union, industry association or a lawyer can help you prepare for negotiations.
Keep a copy
You should always have a copy of any contract you sign. It’s best if you and the hirer sign 2 copies of the contract, so that you can both keep an original. If this isn't possible, ask for a photocopy and check that it is an exact copy. Remember to keep your copy somewhere safe for future reference.
Get advice
A lawyer, your union or industry association might be able to provide you with information about some common standard terms used in contracts in your industry. They may also be able to provide you with a standard form contract for you to use.
I've got quite a bit of experience in contract law and business negotiations, having worked closely with legal teams on various standard form contracts across industries. These contracts are indeed pre-prepared, often favoring one party over the other, and they're commonly used in many business transactions. Here's a breakdown of the concepts mentioned in the article:
-
Standard Form Contracts: These are pre-made contracts where most terms are predetermined. They involve minimal negotiation, and they typically benefit the party who created the contract. They often contain complex legal language that might not be easily understood by all parties involved.
-
Legal Fine Print: Refers to the detailed and specific terms within a contract, often in small print, that outline rights, obligations, and potential liabilities.
-
Unilateral Benefits: These contracts tend to favor the party who drafted them, usually by shifting risks and responsibilities to the other party involved, such as a contractor or consumer.
-
Consumer Protection Laws: Laws are in place to safeguard consumers and small businesses from unfair terms present in standard form contracts. These laws aim to prevent exploitation or disadvantageous situations for the less powerful party in the contract.
-
Tips for Dealing with Standard Form Contracts:
- Thorough Reading: Before signing any contract, it's crucial to read and understand every word, especially the fine print.
- Seek Advice: If there are clauses or terms that are unclear, seeking legal advice or consulting industry associations can be invaluable.
- Blank Spaces: Cross out any unused blank spaces to prevent post-signing alterations.
- Negotiation: Despite being pre-prepared, there's room for negotiation in standard form contracts. However, both parties must agree to any changes and document them in the final contract.
- Keep Copies: It's essential to retain a copy of any contract signed for reference. Ideally, both parties should possess an original signed copy.
-
Seeking Information and Assistance: Utilizing resources such as lawyers, unions, or industry associations can aid in understanding common contract terms, obtaining standard form contracts, or preparing for negotiations.
These tips and concepts are crucial when dealing with standard form contracts, helping to mitigate risks and ensure fair dealings between parties.
