Why Boilerplate Contract Provisions Matter

Don’t be fooled by the standard-looking provisions at the end of your contract. They are more important than you might think. These so-called “boilerplate” clauses help determine how a contract is interpreted and enforced. Even minor changes to them can create major risks for your startup or small business in Kansas City, Boulder, or beyond.

This post covers 12 common boilerplate provisions and why they matter.

(Related: Make sure you properly identify the parties and use the right signature formats.)

1. Entire Agreement

This provision states that only the final, signed contract governs the agreement between the parties. Any previous emails, discussions, or earlier drafts have no legal effect.

2. Amendment

Most contracts require that any changes must be in writing and signed by both parties. Some agreements may allow only certain stakeholders to approve amendments.

3. Waiver

If one party chooses not to enforce a provision, that does not mean they waive their right to enforce it in the future. For example, if a client allows one late payment, that does not mean they must allow future late payments.

4. Severability

If one part of the contract is found unenforceable, this provision ensures that the rest of the contract remains valid. Some contracts also allow courts to modify unenforceable provisions rather than removing them entirely.

5. Assignment

This provision determines whether a party can transfer their rights and obligations under the contract to another party. Many contracts prohibit assignments, preventing one party from handing off responsibilities without permission.

6. Notices

For formal contract communications, this provision specifies how notices must be sent, where they must be delivered, and when they are considered received (e.g., by mail, email, or overnight courier).

7. Counterparts, Digital Signatures, & Copies

Many contracts allow parties to sign separate copies, known as counterparts, which together form one contract. This provision may also confirm that e-signatures and scanned copies are valid.

(Related: Learn how to properly identify parties and use the right signature formats in this post. Also, learn how to use e-signatures in this post.)

8. Governing Law

This provision determines which state’s laws apply to the contract. A contract signed in Missouri, for example, could specify that Colorado law governs the agreement.

9. Jurisdiction

Some contracts specify where legal disputes must be resolved. Large corporations may require disputes to be handled in their home state, which can be inconvenient for small businesses.

10. Waiver of Jury Trial

Juries can be unpredictable, so many contracts include a jury trial waiver. This means that if a dispute arises, a judge, not a jury, will decide the case.

11. Attorneys’ Fees

Many contracts state that the losing party in a legal dispute must pay the winner’s attorney fees. Consider whether this provision benefits you or if it mainly protects the other party and then decide it you want the provision in the agreement or not.

12. Indemnification (and Insurance)

Indemnification requires one party to cover the other’s legal costs and damages if they are sued due to the indemnifying party’s actions. Many contracts also require liability insurance to ensure that indemnification is financially viable.

Final Thoughts

Boilerplate provisions can significantly impact contract enforcement and risk allocation. Whether you’re negotiating agreements in Kansas City, Boulder, or elsewhere, understanding these clauses ensures you’re not signing a contract that puts you at unnecessary risk.

*This article is general in nature and is not legal advice.