Most contract disputes start with a small detail nobody noticed at signing: a different deadline in an annex, an uncapped penalty, or a termination right granted to one side only. The list below sets out 12 points to review in every contract before you sign.
1-4: The basics
- Parties and authority: Are names, tax numbers and the signatory's authority to bind the company correct?
- Subject and scope: Is it clear what is delivered or done, in what quantity and quality? Vague wording (“reasonable time”, “as deemed necessary”) causes arguments later.
- Price and payment: Is the amount VAT-inclusive or exclusive? How many days is the term and from when does it run? If invoicing depends on an approval, is there a deadline for that approval?
- Deadlines: What are the delivery, notice, objection and non-renewal periods? For each, who gives notice and how (notary, email, registered mail)?
5-8: Money and liability
- Late-delivery penalty: What is the rate, is there a cap, and on what amount is it calculated? If damages can also be claimed, the penalty is effectively uncapped.
- Termination: Is the right mutual? What is the notice period? Is work already done paid for on termination?
- Liability cap: How are indirect losses, lost profit and gross negligence treated? Is a cap given to one side only?
- IP and confidentiality: Are your designs, tooling or methods transferred to the other side? Is confidentiality unlimited, and are exceptions mutual?
9-12: Structure and gaps
- Annexes: Do you have every annex referred to? If there is a priority rule like “if an annex and a clause conflict, the annex prevails”, read the annexes carefully.
- Term and renewal: Does the contract renew automatically? What is the deadline for a non-renewal notice?
- Disputes: Which court or arbitration has jurisdiction? Is the governing law stated? A distant city raises enforcement costs.
- What is missing: force majeure, transfer of risk, warranty and defect periods, assignment, data protection — are expected clauses absent?
Reading is not enough: turn rates into numbers. “1% per day” sounds harmless as a sentence; on a 2,400,000 TL job it is 24,000 TL per day.
How to use the list
Start with penalty, termination, payment and liability clauses; they have the largest financial effect. Then check annexes and priority rules. For each clause you flag, write two things: why it is a problem and a balanced alternative the other side could accept.
This list is a preliminary aid and does not replace legal advice. For high-value or long-term contracts, getting a lawyer's view before signing lets you negotiate what you found far more effectively.