Contract Clauses
What are Contract Clauses?
Contract clauses are legal statements, phrases, and sentences that have the purpose of legally binding the elements that can be found in a contract. These clauses need to be clear and precise and describe exactly what their scope is. After all, a contract is based on multiple clauses that back up the agreement the involved parties have agreed upon.
A contract is legally binding between two or more parties that are in agreement. A contract is a safe way in which all the parties promise that certain rights and obligations will be fulfilled by each member who signed the contractual agreement. To put it more easily, a contract is based on a promise, meaning – the clauses that each singing member agrees to satisfy. And, to make sure that every contract delivers the right obligations there are many types of contractual clauses.
The Purpose of Contract Clauses
The purpose of contract clauses is to document the terms and conditions the parties involved in a contract agreed upon. They add stipulations to the already existing terms of the contract and create a safer environment for all the members. Even more so, contract clauses are obligations and conditions all members agree to and respect one signing the contract.
Types of Contract Clauses
To fulfill all the needed conditions and agreements, clauses are divided into more categories such as the ones listed below:
- Sunset clause
- Penalty clause
- Liquidated damages clauses
- Exemption clause
- Confidentiality clause
- Termination clause
- Force majeure clause
- Arbitration clause
- Escalation clause
- Non-compete clause
- Force majeure clauses
- Indemnity clause
- Severability clause
- Cancellation clause