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With so many different sorts of contracts out there, you can expect to be doing contract reviews on whole host of different agreements.

All contracts will have some effect on your business. Some big, some small.

If you haven’t read it or don’t understand it, you’re exposing your business to unknown risks. Missing them means that you are putting your business at risk. Exposure to financially costly events cause unnecessary or fatal strains on your business and your relationships.

Where do you start with your contract review process when you’re confronted with a beast of a contract?

Starting from the very beginning and going through it one page after another is a mistake. You’ll 10x the time you need to get into it, understand it, find the gaps and fix them so that it works for your business.

There’s a better way.

Implement a structured process to do it.

Here’s how:

The law takes legally binding contracts seriously. It is difficult to escape liability for performance, even when something happens that makes it difficult, more expensive or onerous to perform.

Whether a contract has been frustrated or not can mean the difference between:

1. a claim for serious breach of contract, or
2. relief from performance of the contract.

What is Frustration of a Contract?

Frustration of contract is the general law’s method of allowing parties to be relieved of their legal obligations.

Sometimes, what’s not in a contract is more important than what is.

You read a contract. Reading only the express terms, you might not get the full story.

There may be implied terms.

Terms implied into contracts can change what you’re reading. They can re-balance one-sided business agreements. They can address behaviour that frustrates performance of the contract.

In fact, implied terms can put you – or your contracting partner – in serious breach of contract.

Client lists, research and development, plans and strategies, pricing models, source code, what customers will pay for a product or service, product testing, and a whole host of other information.

It’s all sensitive information. Businesses can’t function without it. It can all be protected by confidential information.

The same principles apply in commercial, employment and non-employment situations with small differences.

It applies to a wide range of information.

That’s regardless of the media that it is recorded. Or whether it is just kept in people’s heads and never written down.

What’s more, confidential information can protect information before other forms of intellectual property come into existence, or never will.