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Austin TX Business Law Blog

Saturday, October 30, 2021

What to Include in a Service Contract

In your business, you may contract with others to either provide or receive services. It is often a necessary part of doing business. Resist the temptation to enter into a mere oral understanding when you are involved in such dealings. It can result in confusion and needless conflict. Instead, put all of the expectations of the service relationship in a written service contract, otherwise known as a service agreement.

What to Include in a Service Contract

A service contract or agreement can set both parties at ease and manage expectations for the scope of services to be provided or receive right from the start. In order to maximize the many benefits that a solid service contract can offer, there are certain elements that you should take care to include. Your written service agreement should include:

  • Naming the parties involved in the agreement: Name and describe the parties involved in the service contract as well as the addresses of all parties to the contract.
  • Describing the services to be performed: The work that is to be performed pursuant to the contract as well as the responsibilities of the parties for completing that work and receiving payment should be detailed in the agreement. This is the heart of the agreement and the reason you are entering into the relationship in the first place. Be clear on the scope of the services that will be provided. The more specific you can be, the better.
  • Describing the fees and fee payment schedule: Will billing for services rendered be on an hourly or weekly basis? Will there be a flat fee for the project? Whatever the fees and payment schedule, the agreement should also detail what work and other expenses incurred in the course of conducting the service is included in those fees.
  • Stating the start and end date of the contract: Your agreement should explicitly state when the service contract period begins as well as when the contract will end. It should also include a provision for under what circumstances the service contract can be terminated.
  • An indemnification clause: You may want to consider including such a clause in your agreement which will hold the other party liable for paying out on damages and other losses that may be sustained over the course of the service providing.
  • An amendment section: This section should outline how any party to the contract can seek changes to the agreement over the course of the service relationship. Usually, an amendment to the agreement will require written consent from all parties to the agreement.

Also, be sure to include a signature block for both parties to sign. It is also a good idea to have the signatures dated as well as notarized. This can help guard against a party to the contract later saying that they did not actually sign the agreement.

Business Law Attorney

Start your business relationships off on the right foot with comprehensive written agreements in place. To do so, the Kumar Law Firm is here for you. Contact us today.


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