Insight Close-Up: Service Agreements + Terms and Conditions
Written by: Gabrielle Andersen | Canny Insight
Welcome to our Insight Close-Up series, where we delve into the most common commercial and business law services we offer our Canny Group business clients.
To give you a bit of a sneak peak, this series will focus on the following topics relevant to most business owners, and will be released monthly throughout this year – starting this month:
- Service Agreements and Terms and Conditions
- Independent Contractors and Subcontractors – What Is The Difference?
- Employees and Employment Agreements
- Protecting your IP and business know-how
- Do I need a policy for that? What exactly is compliance?
- Do we need a business Pre-nup?
- What is the PPSR and how can it help my business?
- Dealing with disagreements with customers
If all or any of that sounds interesting, stay tuned as we’ll be letting you know when each Insight Close-Up instalment drops. But if you simply can’t wait or need advice on any of these topics now, contact our Canny Insight team today.
For now, find somewhere comfy, sit back and enjoy our first Insight Close-Up Topic #1:
Service Agreements + Terms and Conditions
What Are Service Agreements?
Those astute Canny Blog observers may have noticed that we have previous articles on Service Agreements and also Terms and Conditions. You can find them here:
As these agreements and T&Cs are something all businesses deal with on a daily basis, we wanted to remind you exactly what we mean when we say “Service Agreement” or “terms and conditions”. Particularly, why it is important to have a lawyer draft these for your business – something you grab off the internet just doesn’t cut it!
They are any contract between a provider and their client for the provision of goods or services.
Sometimes you might be the provider and the agreement will outline the terms and conditions by which you will provide a certain service, or deliver certain goods, to your client.
And sometimes you might be the client, and the contract will outline services being provided to you or your business, or goods being delivered, or perhaps even equipment being rented or hired between you and another company.
Service Agreements come in all shapes and sizes and cover an infinite number of circumstances. For you, they might be important to confirm the scope of your agreed services or delivery, or they might protect your from liability, or you might simply want to outline your payment or exchange terms.
Who Needs Service Agreements?
Any and all businesses will need to put the terms and conditions relating to their goods or services in writing.
There are many reasons for this – most importantly so you and your client or supplier are clear on exactly what you have agreed you will provide and/or be receiving. This means if the service or goods aren’t exactly what you envisaged, or someone refuses to pay, or some other dispute arises, you have a clear document outlining exactly what was promised – and what wasn’t!
We want to give a special shout out to any NDIS Service Providers as we have paid special attention to the National Disability Insurance Agency’s (NDIA)recommendations that providers have written service agreements with their NDIS Participants. We are now please to offer our new special service in preparing template NDIS Service Agreements to any NDIS Service Provider client of Canny Insight.
As the NDIA has pointed out:
Service Agreements help make sure the participant and provider have the same expectations of what supports will be delivered and how they will be delivered.
Direct guidance from the National Disability Insurance Scheme (NDIS) Website: Service Agreements l NDIS
But it isn’t just NDIS Providers who should take note of this advice.
Any and all service providers – both individuals and businesses – should have written agreements with their clients in order to be clear on exactly what their service entails, and what it doesn’t.
What Should Service Agreements Cover?
Service Agreements will usually contain the following provisions, which can be simplified or expanded on, depending on the services or goods being provided and the circumstances of who you are contracting with.
- The names of the parties: this is important as it confirms exactly who is being bound by the agreement, and each party’s contact details.
- A description or scope of the service being provided: this is where the actual service being supplied is specifically outlined, however some Service Agreements may refer to a previous quote or invoice specifying the services.
- The timeframe for the provision of the services: such as whether there is a period within which the service must be supplied, or the Service Agreement may be for a one of supply, or specify an extended or ongoing period of time, depending on what exactly is being supplied.
- The fee/s for the service: the agreement should state the exact fee payable and how this will be charged, such as whether there is a one-off fee or invoicing occurring in instalments.
- Payment terms: these will usually address how and when the supplier of the service must be paid, whether any deposit is payable, and what will occur if the payment isn’t forthcoming.
- Terms of the engagement: such as whether the business or person supplying the service is engaged simply for the supply of the service. For consultancy agreements, these will usually specify that an individual or entity is being engaged by a business as an independent contractor.
- Limitations of liability or waivers: these specify the extent of any liability in relation to the provision of these services and who may or may not be reasonable if anything goes wrong. Businesses will often desire provisions which have very clear terms limiting their liability, as well as specific waivers by the client in accepting the provision of the services.
- Termination provisions: these will set out the process that either party must take in wishing to terminate the agreement. An example could be – by provoking seven days’ notice in writing, or you may wish for there to be provisions specifically that the agreement may not be terminated unless a breach of one of the terms of the Service Agreement occurs.
- Provisions covering confidentially and restraints on poaching any other clients, or suppliers: these may be important if in supplying the service the client will be privy to the businesses confidential information, trade secrets or know how, or may be introduced through the supply of services to employees, other clients or the wider network involved in the businesses contracts and suppliers.
- Intellectual property protections: in supplying the service the business may also be providing access to their intellectual property, so it is important that the agreement confirms that this intellectual property remains with the supplier. These terms will be particularly important if a business ever discovers that there has been unauthorised use of their intellectual property and wishes to take legal action against such use.
- A very clear dispute resolution process: this will specify the process to be followed if there is ever a disagreement in relation to the provision of the service, or any other matter covered by the Service Agreement.
Not all of those matters need to be covered in your agreement, and it will heavily depend on the particular circumstances the agreement is required for.
Our experienced commercial lawyers at Canny Insight will specifically tailor an agreement that is simple, straightforward and meets your needs.
Don’t Forget About Unfair Contract Terms!
Even if you already have your service agreements or terms and conditions covered, new laws came into effect in November 2023 which impose penalties on certain businesses who continues to have any unfair contract terms within their standard agreements.
We covered these new laws in our previous blog posts: Reviewing Your Standard Agreements: Unfair Contract Terms + Unfair Contract Terms: What Do The New Laws Mean For You or Your Business
This means it’s crucial to have your standard service or supply agreements and terms and conditions reviewed by a commercial lawyer to ensure they don’t have any terms which breach these new laws.
How Canny Insight Can Help Your Business.
Canny Insight is a customised legal service that meets the specific needs of your business. If you’re a start-up, or gearing up for growth and expansion, we’ll come up with a legal services package aimed specifically at your business and commercial law needs.
Whether you need a new agreements or T&Cs prepared, or think it’s a good idea to have your old ones reviewed to make sure they cover everything you need and aren’t in breach of any of the new Consumer Laws, our business law focused Insight team will provide you with straightforward and reliable advice.
Get in touch with our Canny Insight team today to see how we can help your business!
The content of this article is for general guidance purposes only. Specialist legal advice relevant to your circumstances should be sought if required.