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Let’s take a moment to celebrate! Give yourself a pat on the back (or crack open a bottle of champagne) for taking the prudent, strategic, and legally-sound next step in your business.
It’s time to customize your contract. If you haven’t downloaded your template yet, you can do so from your Lifetime Access Portal.
About those lifetime updates
One of the biggest perks of our legal templates is that with every purchase you get Lifetime Updates.
As someone going out and making things happen, keeping on top of recent legal changes can be far down on the to-do list.
Lifetime updates mean that if a country decides to create a new privacy law or another pandemic hits, you won’t have to update all that legal language alone. We keep on top of these changes and update your template accordingly so you’re always in the know.
To learn more about our Lifetime Access Portal and see some FAQs about it, click here.
Video Tutorial
We recommend editing your contract in Microsoft Word or Google Docs. See how to access your Lifetime Access Portal and edit your contract template via Google Docs in this video tutorial.
Feel Confident
You should feel as equipped as you are safe. Purchasing a legally sound, legally binding contract is half the battle
The other half? Using it as a tool to your advantage with every client. After all, nobody wins if your client doesn’t feel comfortable signing the agreement.
If you’re nervous about presenting your contract to your client or aren’t sure how to best handle the difficult conversations that may arise in the process, this e-book will help with some of our best advice around the topic.
Our goal with this e-book is to equip you with the knowledge to confidently manage the contract presenting, negotiation, and signing process.
Use code CLS10 for 10% off.
Why your contract template is so long (and why that’s a good thing)
A detailed contract is a professional contract. When it comes to contracts, every detail matters.
Many contracts, especially the free ones from a quick Google search, can be poorly written, too generic, and miss vital information.
Our contract templates are written thoroughly and plainly so you can take ownership of each clause, know exactly what everything means, and make sure you’re working to protect your business at all times.
While we’ve ensured your contract is clear and well-written, you’ll notice that it is still lengthy with a lot of legalese. This is intentional.
Many times, specific words, provisions, or paragraphs can “make it or break it” in a contract and could be the difference between whether or not your contract stands up in court. Making sure all the details are covered will save you time, money, and most importantly, your *sanity*.
Let’s work through the key provisions
Paragraph One
Tips for getting paragraph one right
Paragraph 1 of your contract covers the administrative basics. Think the dates, names, of involved parties, their addresses, and signatures. You’ll see in your contract template that these fields are highlighted so you know they need to be amended.
Now you’re ready to start modifying your contract template so it’s specific to you, here are our best tips on how to get a liability-proof first paragraph.
Tip 1—It’s very important that you’re signing on behalf of your business, not as an individual. Sign as an individual and you could carry personal liability for the actions contemplated by the agreement. Our lead attorney Paige got a client out of a $50K lawsuit based on this alone.
Tip 2—It’s a common mistake to see contracts dated when the contract is sent to the other party. To avoid confusion, ensure the date from which your contract comes into force (also called the “effective date”) is the date on which both parties sign.
Tip 3— To tighten up the contract, make it more business-specific and make it easier to contact you in the case of a legal dispute, list your principal place of business address in the first paragraph.
Paragraph One
Tips for getting paragraph one right
Paragraph 1 of your contract covers the administrative basics. Think the dates, names, of involved parties, their addresses, and signatures. You’ll see in your contract template that these fields are highlighted so you know they need to be amended.
Now you’re ready to start modifying your contract template so it’s specific to you, here are our best tips on how to get a liability-proof first paragraph.
Tip 1—It’s very important that you’re signing on behalf of your business, not as an individual. Sign as an individual and you could carry personal liability for the actions contemplated by the agreement. Our lead attorney Paige got a client out of a $50K lawsuit based on this alone.
Tip 2—It’s a common mistake to see contracts dated when the contract is sent to the other party. To avoid confusion, ensure the date from which your contract comes into force (also called the “effective date”) is the date on which both parties sign.
Tip 3— To tighten up the contract, make it more business-specific and make it easier to contact you in the case of a legal dispute, list your principal place of business address in the first paragraph.
Scope of Work
The what, when, and the how
When writing your scope of work, you’ll want to hit 6 essential points to make sure you’re covered.
Outline the deliverables
What are you agreeing to deliver for the client
State your turnaround time
When can the client expect the service to be delivered?
Define the term of the agreement
Will the project be time-based, project-based, or dependent on a related agreement?
Specify whether the agreement can be renewed
Can this contract be renewed? If so, are there conditions for renewal? If the contract can be renewed, you’ll need to define whether it will be automatic or evergreen.
Define the duties of the service provider
What are you responsible for as you deliver this project?
Define the duties of the client
What is the client responsible for as you deliver this project?
Payment Provisions
Where money is involved, your payment provisions section should cover it.
As a quick reminder, we’ve defined below some of the important terms used in the payment provisions section.
Fees—what you charge for the services. I.e., an attorney charges an attorney’s fee
Costs—any costs in addition to your fees. I.e. insert example here
Expenses—additional expenses that you may pick up in the process of doing business. I.e. insert example here.
Once you’ve decided on your fees, and costs and considered your potential expenses, it’s time to think about the deposit.
Hold onto your seats—this one can be controversial.
Our recommendation: in most cases, avoid charging 50% deposits. Why? If challenged in court, 50% deposits are hard to justify. To learn more about this, click here.
In exchange for a 50% deposit, we recommend splitting your charge into even portions dependant on hitting milestones or the duration of your service.
Intellectual Property
Who owns it?
When you create work for a client, you automatically retain the rights over the work unless otherwise stated.
What does this mean for your business? If you hold the rights, you hold the control. It allows you to do things like resell work you’ve made for one client to another. These rights can also be a useful bargaining chip in contract negotiations.
Over the course of your work, however, it’s likely you’ll encounter a client who wants to hold the rights over the work you create for them. There are multiple reasons for this, the most common being they want work that is unique to them.
You’ll see in your CLS contract that our attorneys have drafted two provisions that cover whether you or your client holds the intellectual property.
If you want to retain the rights, you’ll see a section called the “retention of copyright”. If your client wants to hold the rights over the work you create for them, the section is called “work made for hire”.
After you’ve decided with your client on who will own the rights, keep the relevant clause and delete the text and heading of the other.
When you delete the section that doesn’t apply to you, also make sure that you remove wording like “[Choose Options A, or B,].”
Deciding with your client who will own the rights to your work before you sign the contract will help you minimize potential legal disputes in the future.
When Things Go Wrong
Mediation, Arbitration, Court
Your CLS contract template includes 3 different options for dispute resolution so you can choose which works for you and your client.
Once you and your client have selected the best option for your circumstance, delete the sections that don’t apply to you.
Before you make a decision, here’s a brief overview of each option:
Mediation—a third party who helps find a joint solution. The solution is not legally binding until a settlement agreement is signed (often the cheapest and best option for small businesses)
Arbitration—a third party who helps find a joint solution but the solution is legally binding (can be expensive but means you can avoid having to go to court)
Court—apologies if this one is self-explanatory. This means that should a dispute be raised, you’re off to court to find a resolution (this can be expensive and is public unlike arbitration)
Making Sure Things Go Right
It’s better to prevent disputes from occurring in the first place
The following clauses in your contract do just this.
Before we continue, however, we want to stress one thing. Please don’t modify or remove any of these clauses in your contract template.
They’ve been included to mitigate potential disputes. Modifying them or removing them could create critical gaps causing ambiguity, misunderstandings, or costly legal battles down the road.
Exclusivity—prevents your client from booking another creative for the same task at the same time
Relationship of the parties—answers whether you’re an employee or a contractor
Safe working environment—explains what happens if an unsafe incident occurs while you’re providing your service
Limitation of liability—sets out how much would be on the line in the event of a lawsuit (usually equal to the amount of fees stated by the agreement)
Representations and warranties—promises that both parties are legally able to sign the contract and that you are able to provide the required services
Confidentiality—specifies that any information about the agreement or the service provided is confidential. Is useful to protect addresses or other sensitive information
When a Farewell is in Order
Rescheduling, Termination, and Cancelation
There may be occasions where either you or your client needs to call it quits on your contract, it needs to be rescheduled or there’s been a breach.
Here are provisions you’ll need to agree with your client on before either of you put your names on the dotted line.
In your contract, you’ll see where you’ll need to make edits.
Client rescheduling—how much notice does the client need to provide when they need to reschedule and when will the new schedule take effect?
Contract termination—how far in advance do either of you need to let the other know when they need to terminate the contract and when will the termination take effect?
Canceled by the client—the same as contract termination, however, you’ll need to discuss if there are different conditions if termination is caused by factors outside of the client’s control
Breach of contract—this provision allows you to outline how a breach of the contract can be resolved without resorting to termination. It is optional but advisable as it can help either of you find an amicable solution
Incapacitated—this is a provision that covers you if something happens that limits your ability to deliver your service like illness or pregnancy. What will happen if an event like this occurs?
It’s time to sign
You’re so close to being armed with a personalized contract that you can use to impress your clients and protect your creative endeavors.
Before you put that signature on the dotted line, we wanted to highlight some of the most common questions we get about the whos, the hows, and the whens of contract signing.
Who can sign the agreement?
Your client must be over 18. They can be signing an as individual, an LLC, or another entity as long as they have the legal authority to do so.
Who should sign the agreement first?
Best practice: your client.
Does my client need to initial each page or sign just at the end of the contract?
While you can ask the client to initial each page, we recommend asking yourself why you’re doing this.
If you’re worried that the client hasn’t read the contract or the contract is high-value (or both), get the client to initial important portions of the document like the payment provisions section rather than each page.
This way you know they really have read the important parts rather than just sped through initialing like a mad person.
If you’re not worried or the contract isn’t high-value, their signature at the end of the contract will do just fine.
How should you and your client sign your contract?
If either of you are signing as an individual, sign as you would a check or government document.
If either of you are signing as a business, include the name of the signor, their title in the company, the company name, and company designation.
When does the contract become effective?
This one is tricky.
The short answer is when the last party signs, however, it’s not whenever you or your client gets around to signing it. The effective date must be written into the contract so we advise signing on an agreed date with your client.
The good news is you don’t need to be physically with your client for your contract to come into effect which means you can spend the cost on a plane ticket on more important things.
TAKE A DEEPER DIVE
Being the thorough creative business owner you are, you probably have more niche questions about signing your contracts like what should be location of the contract be, can team members sign, privity of contract and more.
Our team has written extensively on these niche questions over on the CLS blog so you have the answers you need without having to scour the interwebs.
Read more about signing your contract on the CLS blog here.
Branding Tutorial
Time to have some fun
How can you “brand” your template? What are you allowed to do to make it look aesthetically pleasing to your client and fit seamlessly with your brand? My graphic designer, Hayley Bigham, is giving us a tutorial on how to do this in Word, Illustrator, and Photoshop.
If Things Change
There will be times when you or your client needs to make changes. Don’t worry, it’s normal and your CLS contract template addresses this.
Some changes require formal documentation and some that don’t. Changes that require formal documentation are called “Modifications” and those that don’t are called “Amendments”.
You can read all about them in our Amendments vs. Modifications blog post.
The more you know
You’re more effective when you’re equipped with the knowledge to back up your business decisions.
If you want to expand your legal knowledge, we recommend our Legal Foundations A-Z Course Bundle.
This course bundle is exactly what our founder and lead shop attorney, Paige Hulse, walks business owners through individually every week in her law firm to ensure they're ticking all the legal boxes in their creative business.
Use code CLS10 for 10% off.
equip yourself
Browse the Free resources
The more you know, the better you’ll be at navigating curveballs that are thrown your way (and protecting your bottom-line). Being the proactive and thoughtful creative business owner you are, you’re continuously looking to deepen your understanding of the law and how it applies to your business.
We recommend starting with these two.