The contract sitting in your inbox could be the most important document you sign this year — or a source of costly disputes down the road. Here is what a BC business lawyer looks for, and why review before you sign is always worth it.
## The Contract You Did Not Read Carefully
Most business disputes in BC trace back to a contract — specifically, to terms that one party did not fully understand when they signed. A supplier agreement that seemed straightforward. A client retainer that did not specify what happened when the project changed. A commercial lease with a personal guarantee buried in clause 18.
Having a lawyer review a contract before you sign is not about distrust or formality. It is about understanding what you are actually agreeing to — and making sure it reflects the deal you think you are making.
## What a Contract Review Actually Involves
A thorough commercial contract review by a BC business lawyer goes well beyond checking for typos. Here is what matters:
### Are the Core Terms Clear?
The most fundamental question: does the contract accurately capture what each party is supposed to do, when, and for how much? Ambiguous language in a commercial contract almost never gets resolved in your favour by a court. If a term is unclear, it needs to be clarified before you sign, not after a dispute arises.
### Payment Terms and Consequences
When is payment due? What happens if payment is late? Are there interest provisions? Is there a right to withhold payment if you are dissatisfied with performance? Many standard contracts favour the party who drafted them — often the larger company — and payment terms are where this imbalance is most pronounced.
### Scope of Work and Change Orders
In service contracts, the scope of work definition is critical. What exactly is included? What triggers additional charges? Many disputes arise not because one party failed to perform but because the parties had completely different understandings of what was in scope.
### Limitation of Liability Clauses
These clauses cap how much one party can recover from the other in a dispute. They are common in supplier and service provider contracts and are often weighted heavily in the supplier's favour. In some cases, they are unconscionable or unenforceable — but you need to know they are there and what they say.
### Indemnification Provisions
An indemnification clause requires one party to compensate the other for specified losses or liabilities. A poorly drafted or one-sided indemnification clause can expose your business to liability well beyond what you anticipated. These clauses deserve careful reading.
### Intellectual Property Ownership
Who owns work product, software, designs, or creative content produced under the contract? In many standard contracts — particularly with tech vendors — the vendor retains ownership of everything. This may or may not reflect what you intend.
### Confidentiality and Non-Disclosure
What information is treated as confidential? For how long? What are the consequences of disclosure? If you are sharing sensitive business information with a supplier or partner, the confidentiality provisions must actually protect it.
### Termination Rights
Under what circumstances can each party terminate the contract? Is there a notice period? Are there early termination penalties? Can you terminate for convenience, or only for cause? Understanding your exit rights before you sign is far easier than trying to get out of an unfavourable contract later.
### Dispute Resolution
Does the contract require mediation or arbitration before litigation? Which jurisdiction's law governs? Where must disputes be heard? A contract with an out-of-province arbitration clause can make dispute resolution prohibitively expensive for a small BC business.
### Personal Guarantees
If you are signing as a business, does the contract also require your personal signature as a guarantor? A personal guarantee means your personal assets are on the line if the business cannot pay. This is common in commercial leases, equipment financing, and supplier agreements — and it is one of the most significant provisions many business owners overlook.
### Auto-Renewal Clauses
Many commercial contracts — software licences, supply agreements, service contracts — include auto-renewal clauses that lock you in for another term unless you give notice within a specific window. Missing that window by a day can bind you for another year or more.
## Common Red Flags in BC Business Contracts
Unilateral amendment rights — the other party can change the terms without your consent.
Exclusivity without clear carve-outs — you agree not to work with competitors, but the definition of "competitor" is very broad.
Liquidated damages clauses — predetermined damages for breach that may be disproportionate to your actual exposure.
Governing law outside BC — you may be required to litigate in another province or country, making enforcement costly.
Vague performance standards — "reasonable efforts" and "best efforts" are not equivalent in BC law, and neither is as clear as specific, measurable obligations.
Missing milestones and acceptance criteria — in construction, software, and professional service contracts, the absence of defined milestones and acceptance criteria is a reliable predictor of disputes.
## Standard Form Contracts: Proceed with Care
Many businesses use standard form contracts — the ones drafted by the other party that are presented as "non-negotiable." While some terms genuinely are standard, many are not. A review identifies which terms carry real risk for your business and which can be negotiated.
BC courts have increasingly scrutinised unconscionable standard form contracts, particularly where there is a significant power imbalance between the parties. But litigation is expensive and slow — it is far better to negotiate the contract upfront than to rely on a court to fix it later.
## The Cost-Benefit Case for Contract Review
The cost of a legal review of a commercial contract is typically a small fraction of the value of the contract itself — and an even smaller fraction of the cost of a dispute that arises from a problematic term. For significant contracts, the review almost always pays for itself.
For smaller, repetitive contracts — your standard client agreement, your supplier terms, your subcontractor agreements — a one-time review and refresh of your templates gives you protection on every contract you sign going forward.
## Contracts That BC Business Owners Most Often Bring for Review
- Commercial leases (especially those with personal guarantees)
- Franchise agreements
- Supplier and distribution agreements
- Client service agreements and retainers
- Technology and software licences
- Employment and independent contractor agreements
- Partnership and shareholder agreements
- Equipment financing and leasing agreements
- Business purchase and sale agreements
## How Sea to Sky Law Can Help
Andrew Liggett has 35 years of experience advising BC businesses on commercial contracts across every practice area — family law, business law, estate planning, and real estate. He can review your contract, explain the provisions that matter, identify the risks specific to your business, and help you negotiate better terms before you sign.
A contract review is an investment in avoiding future disputes — and it is always easier and less expensive than resolving one after the fact.
A straightforward contract review typically takes one to three business days, depending on the length and complexity of the document. More complex agreements — franchise agreements, shareholders' agreements, business purchase and sale agreements — may take longer. Contact us with the contract and we can give you a realistic timeline.
It depends on the contract. Many written contracts include 'entire agreement' clauses that say the written document is the complete agreement and verbal modifications are not binding. Even without such a clause, proving the terms of a verbal amendment can be difficult. It is always better to document changes in writing.
Yes. Even after signing, a lawyer can help you understand your rights and obligations, assess whether you have grounds to dispute the other party's conduct, negotiate a resolution, or advise on your options if the matter proceeds to mediation, arbitration, or litigation.
A contract review examines an existing document and advises you on its terms, risks, and any recommended changes. Contract drafting starts from scratch to create an agreement that accurately reflects your intentions and protects your interests. Many businesses benefit from both — having their standard template agreements drafted by a lawyer and then having significant new contracts reviewed before signing.