Every legal contract is not the same, and the substance will differ depending on the arrangement and purpose of the document. However, there are common legal terms that you should look for in every document.

Whether you are a business owner, or if you are entering into a legal relationship with a company, we run through some of these terms below. By remembering these points, you can better understand whether the contract you have received is appropriately drafted.

1. Substance

As mentioned, the substance of the legal contract will always differ for every arrangement. For example, if you engage a building contractor, the questions you should ask include:

  • What will the building contractor be doing for me?
  • How long does the contractor have to complete the work described?
  • Will the contractor assist with anything else that they confirmed verbally, but is not written in the contract?

You should adopt a similar thought process no matter what the good or service is, and if you are the business owner who is providing the goods or services, your customers will be thankful that your legal documents have outlined everything that both parties discussed. 

2. Consideration

Consideration is a legal term used to define what is exchanged between both parties in a legal arrangement. If the business owner has outlined what good or service they are going to provide to you in the legal contract, the legal contract should also include details of what the customer or client will provide to the business owner. Simply put, what will you pay the other party? How will you be invoiced? What are the payment terms, e.g., can you pay a deposit at the outset? 

3. Indemnity

Indemnity refers to the form of security or protection provided by one party to another in the case of any losses or damages that they may incur. This is an important clause as it can have heavy consequences for the party that is offering the indemnity.

In most cases, it is inevitable and difficult to contract out of an indemnity clause. However, they can be drafted in various ways so that it is reasonably fair to both parties. For example, one party will only indemnify the other party for a particular task. Indemnity clauses are often drafted broadly and can be confusing to understand so if you are concerned about this term in a legal contract you receive, a lawyer can help you negotiate. 

4. Confidentiality

Many business contracts will have a clause relating to confidentiality and the obligation of one party to keep the details revealed in the business relationship completely confidential. If you are a business owner who is engaging an employee, contractor or partnership this clause is essential to ensuring that the details you provide will be dealt with appropriately.

5. Governing Law and Dispute Resolution

The governing law, jurisdiction, and dispute resolution clauses are necessary in any legal agreement as it will determine not only which rules apply, but also which courts you will have access to. The dispute resolution provisions will, in particular, establish a clear-cut way to resolve matters, especially when there is tension between the parties. If you are reviewing or getting a legal contract drafted, it is recommended that you have a dispute resolution clause that refers parties to mediation as this can save a lot of costs and legal fees later down the line. 


It’s important to know that not every legal contract is the same. However, it doesn’t hurt to be commercially savvy when reviewing the document or when you’re engaging a solicitor to get one drafted for you. If you have any questions, ask our contract lawyers on 1300 544 755. 

COVID-19 Business Survey
LegalVision is conducting a survey on the impact of COVID-19 for businesses across Australia. The survey takes 2 minutes to complete and all responses are anonymous. We would appreciate your input. Take the survey now.

About LegalVision: LegalVision is a tech-driven, full-service commercial law firm that uses technology to deliver a faster, better quality and more cost-effective client experience.

The majority of our clients are LVConnect members. By becoming a member, you can stay ahead of legal issues while staying on top of costs. For just $199 per month, membership unlocks unlimited lawyer consultations, faster turnaround times, free legal templates and members-only discounts.

Learn more about LVConnect

Kristine Biason
Need Legal Help? Get a Free Fixed-Fee Quote

If you would like to receive a free fixed-fee quote or get in touch with our team, fill out the form below.

  • By submitting this form, you agree to receive emails from LegalVision and can unsubscribe at any time. See our full Privacy Policy.
  • This field is for validation purposes and should be left unchanged.
Our Awards
  • 2019 Top 25 Startups - LinkedIn 2019 Top 25 Startups - LinkedIn
  • 2019 NewLaw Firm of the Year - Australian Law Awards 2019 NewLaw Firm of the Year - Australian Law Awards
  • 2020 Fastest Growing Law Firm - Financial Times APAC 500 2020 Fastest Growing Law Firm - Financial Times APAC 500
  • 2020 AFR Fast 100 List - Australian Financial Review 2020 AFR Fast 100 List - Australian Financial Review
  • 2020 Law Firm of the Year Finalist - Australasian Law Awards 2020 Law Firm of the Year Finalist - Australasian Law Awards
  • Most Innovative Law Firm - 2019 Australasian Lawyer 2019 Most Innovative Firm - Australasian Lawyer
Privacy Policy Snapshot

We collect and store information about you. Let us explain why we do this.

What information do you collect?

We collect a range of data about you, including your contact details, legal issues and data on how you use our website.

How do you collect information?

We collect information over the phone, by email and through our website.

What do you do with this information?

We store and use your information to deliver you better legal services. This mostly involves communicating with you, marketing to you and occasionally sharing your information with our partners.

How do I contact you?

You can always see what data you’ve stored with us.

Questions, comments or complaints? Reach out on 1300 544 755 or email us at info@legalvision.com.au

View Privacy Policy