Contract review checklist: how to review contracts properly

Checking a contract for risks before you sign

How to review contracts properly before signing: party details and the subject first, then money, deadlines, liability, and termination. Signing without a check often leads to financial losses and disputes. Below is a contract review checklist: what to check in a contract, and how to check it before you enter it, so hidden obligations are not missed.

Step 1: Check the parties’ details

First, make sure the contract states every party’s details correctly:

• Full name of the legal entity, or full name of the individual
• INN and OGRN (for legal entities)
• Legal address and actual address
• Contact details (phone, email)
• Bank details

Check the details on official sources (the Federal Tax Service website, EGRUL). Details that do not match can mean you are dealing with fraudsters, or that the contract is invalid.

Step 2: Analyze the subject of the contract

The subject of the contract should be described as specifically as possible. Watch for:

Step 3: Check the financial terms

The financial terms are one of the most important parts of a contract. Check:

• Contract price: fixed, or can it change? On what conditions?
• Payment procedure: prepayment, payment after performance, or payment by stages
• Payment deadlines: specific dates or periods
• Payment methods: cash, bank transfer, electronic payments
• Fines and late-payment interest: amount, when they apply, and whether they are mutual

Step 4: Analyze deadlines and conditions of performance

Make sure deadlines for performing obligations are stated clearly and realistically:

• Specific dates or clear periods
• Conditions under which deadlines can be changed
• Procedure for accepting work or goods
• Criteria for quality and conformity
• Procedure for curing defects

Step 5: Check the parties’ liability

The liability section should be balanced. Pay attention to:

• The size of fines and penalties (they should be reasonable)
• Mutual liability (it should not be that one party is liable for everything)
• Limits on liability (if any, they should be fair)
• Conditions for release from liability

Step 6: Terms for terminating the contract

Check the conditions under which the contract can be terminated:

• Unilateral withdrawal (whether it is allowed, and on what conditions)
• Termination by agreement of the parties
• Termination for breach
• Consequences of termination (return of funds, compensation)

Step 7: Dispute resolution

Check how disputes will be resolved:

• Pre-trial procedure (whether it is mandatory, and the deadline)
• Venue (which court will hear disputes)
• Applicable law
• Arbitration clause (if there is one)

Step 8: Check annexes and additional documents

Make sure every document mentioned in the contract is attached:

• Statement of work
• Specifications
• Work schedules
• Supplementary agreements

Checklist for a quick review

Conclusion

A careful review of a contract before you sign is a necessity, not extra caution. Time spent analyzing every term protects you from financial losses and legal problems. If you have no legal training, it is sensible to consult a lawyer or use a specialized service for an automatic contract check.