Service Agreement Checklist: Protect Both Sides of the Deal

Essential Items to Review in a Service Agreement

A service agreement defines the relationship between a service provider and a client. Whether you are providing or receiving services, review these key areas before signing.

Scope of Services

• Are the services described with enough detail to avoid ambiguity?
• Are deliverables, milestones, and timelines clearly defined?
• Is the process for handling out-of-scope requests documented?
• Who is responsible for providing inputs, access, or information needed for the work?

Standards and Warranties

• Does the provider warrant that services will be performed in a professional manner?
• Are there specific quality standards or industry benchmarks referenced?
• Is there a warranty period during which defective work must be corrected?
• Are there warranty disclaimers, and are they reasonable?

Payment Terms

• Is the fee structure clear (fixed fee, hourly, retainer, milestone-based)?
• When are invoices due, and what are late payment consequences?
• Are expenses reimbursable, and is pre-approval required?
• Is there a right to withhold payment for unsatisfactory work?
• Are price escalation provisions included for multi-year agreements?

Intellectual Property

• Who owns deliverables and work product?
• Does the provider retain any rights to use the work (portfolio, case studies)?
• Are pre-existing materials and tools of the provider excluded from the IP transfer?
• Is there a license grant for any proprietary tools or frameworks used?

Liability and Indemnification

• Is there a mutual limitation of liability?
• Are consequential and indirect damages excluded?
• Is the liability cap proportional to the contract value?
• Are indemnification obligations clear and balanced?

Termination

• Can either party terminate for convenience with reasonable notice?
• Is there a termination-for-cause provision with a cure period?
• What happens to work-in-progress, payments owed, and materials upon termination?
• Which obligations survive after termination?

Dispute Resolution

• Is there a dispute escalation process before litigation?
• Is arbitration or mediation required?
• What governing law and jurisdiction applies?

When to Consult a Lawyer

For high-value service agreements or those involving sensitive data, intellectual property, or long-term commitments, consider having an attorney review the terms before execution.

This article is for informational purposes only and does not constitute legal advice. Consult a licensed attorney for guidance specific to your situation.