Key terms and conditions in contracts
Key terms and conditions in contracts

The following Commercial guidance note provides comprehensive and up to date legal information covering:

  • Key terms and conditions in contracts
  • General drafting considerations
  • Operative provisions
  • Boilerplate
  • Contracts for goods or services
  • Trading with consumers

This Practice Note considers the key terms and conditions (or T&C, Ts&Cs or T&Cs) in contracts for business-to-business (B2B) transactions. It sets out the general drafting considerations for contracts. It also looks at the key operative clauses in contracts such as price and payment, duration, termination, liability, warranties and indemnities and boilerplate.

See also Practice Notes: Defining terms—The definitions and interpretation clause and Structure and form of the agreement.

General drafting considerations

One of the first issues to consider when putting in place a contract, is to ensure that there is a valid contract which is capable of being enforced. A contract should always satisfy the basic criteria for contract formation, ie it must comprise offer, acceptance and consideration and be executed by parties with the requisite capacity and authority to enter into the transaction. For more detail, see: Formation and interpretation—overview.

It is also fundamental that the written terms clearly and accurately set out the key elements of the contract and address all the material parts of the transaction. When advising a client or drafting a contract:

  1. state obligations expressly

  2. where possible, avoid terms such as 'best or reasonable endeavours', 'material breach' or 'all necessary care or skill' or define them clearly. It is preferable to specifically outline the scope of a term so that all parties clearly understand their