It can be very common to come across scenarios where a business has in place it’s terms of business for their customers or clients, but nothing more. However, there are a whole range of other contract types that a business may need to have, particularly if it’s using suppliers, outsourcing manufacturing, consultants, equipment hire – the list can be endless.

These are referred to as third party terms and conditions, which are the legal agreements or terms of service governing the relationship between a business and someone other than its primary customer or end user. Third-party terms and conditions will contain a number of key aspects to help define the rights, responsibilities and obligations of each party involved and ensure that everyone understands their role. If a third-party doesn’t issue you with their terms and conditions, it may be a situation where you should issue your own.

Some typical areas where you might need a third-party contract are:

• Engaging a consultant or contractor
• Suppliers
• Manufacturing
• Equipment hire
• Distribution
• IT or software purchasing or leasing
• Outsourcing
• Facilities management or cleaning
• Warehousing

How could things go wrong?

• Disputed terms: if parties rely on verbal agreements or informal arrangements without a contract, disagreements can easily arise and it can be difficult to prove what was agreed on;
• Unclear expectations: the absence of terms can result in misunderstandings and conflicting expectations of each other, each party could have different expectations about things such as deliverables, time frames, payment terms which could strain the relationship;
• Payment disputes: if payment terms aren’t clearly established it can result in non-payment or disputes over amounts due, timing or method of payment. Without a written agreement it can be challenging to enforce payment obligations or seek legal remedies;
• Difficulty terminating a contract: contracts will usually contain clauses providing for how it can be brought to an end. Without this in place, it may be difficult to end a contract or you may face unexpected liabilities;
• No legal recourse: parties may have limited legal recourse when things go wrong, without terms in place. It becomes very challenging to prove the existence of an agreement or seek remedies for breach.

It is essential to carefully review third-party terms and conditions before accepting them, as they establish the legal framework for your relationship and business dealings. Reading and understanding the terms will help you make a decision about the risks, rights and obligations involved in using a third- party. We can help you by reviewing and advising you on any third-party contracts. Alternatively, if you need to issue your own third-party contracts, we can help by drafting them for you, to ensure you have the greatest legal protection possible.

To learn more about terms and conditions and to make sure you get your legal documents right, contact us today. Call 01302 320621 or email help@switalskis.com