Free General Contract for Services

An "assignment" of a contract occurs when one party to a contract transfers its contract rights and obligations under the contract to a new third party. For various reasons, the non-assigning party may not feel comfortable dealing with a stranger to the original contract. Therefore, it is common for the parties to prohibit assignments without the prior written consent of the non-assigning party. This option allows the non-assigning party the opportunity to evaluate the proposed new party and the risks involved in allowing the assignment.

If a party to a contract fails to meet its contract obligations, usually to perform an act or deliver prescribed goods or make a payment by a prescribed deadline, that party is in "breach" or "default" of the contract.

When one party defaults under a contract for the first time, or in a non-material way, that default does not necessarily entitle the non-defaulting party to immediately terminate the contract. Rather, it is recommended, and often required by the contract, that a notice of default be given and an opportunity to cure. If, after a reasonable period of time, the problem is not corrected, then a notice of termination, due to the default, may be given. What constitutes a "reasonable" period of time within which to cure the default varies according to the circumstances. If the cure period is not specified in the contract, then the time period given must be long enough to reasonably allow the defaulting party a chance to correct the problem.

The Contact provides that in addition to any other rights provided by law, a party may terminate the Contract if the other party has failed to fully perform the obligations under the Contract. The non-breaching party may provide the party in default with written notice of the breach and state the number of days that the breaching party will have to cure the default. A typical period to cure is thirty (30) days. If the party in default fails to remedy the situation in the specified number of days, the non-breaching party may elect to terminate the Contract.

The General Contract for Services documents the terms of the sale of services by one company (the "Service Provider") to another company or an individual (the "Service Recipient"). This document should not be used if the Service Provider is an individual. A Work for Hire, Consulting Agreement, or Subcontractor Agreement documents can be used for that purpose. This document only deals with services purchased from a business, and therefore, does not address issues related to independent contractor status.

The basic elements of a contract to purchase services are:

1. Identification of the parties.

2. A description of the services to be performed.

3. The dates or scheduled dates for performance of the services.

4. Any conditions or limitations placed on either of the parties or warranties related to the performance of services.

5. Payment terms.

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A Contract for Services should include provisions that (i) make it clear that the document contains the entire agreement of the parties; (ii) require any changes to the contract to be in writing and signed by the party affected by the change; (iii) preserve the remainder of the contract if one of its provisions is unenforceable; and (iv) specify which state's laws will govern any disputes between the parties.

Because the Service Recipient will frequently be the owner of the goods being produced or worked on, or the property to which the services are being provided, it is possible that the Service Recipient could be liable to a third party who is injured by the Service Provider. For example, if the Service Recipient has retained the Service Provider to build a garage on the Service Recipient's property, a person injured on the work site by the Service Provider may sue both the Service Provider (as the negligent party) and the Service Recipient (as the owner of the property where the injury occurred). In order for the Service Recipient to avoid paying for the negligent acts of the Service Provider, it is common for the Service Provider to agree to indemnify the Service Recipient for any damages or injuries caused by the Service Provider. Thus, in the above example, such a provision would provide that if the injured party recovered a judgment against the Service Recipient in a lawsuit, the Service Provider would have to repay the Service Recipient for any amount of the judgment paid by the Service Recipient, plus the Service Recipient's other related costs such as attorney fees.

Payment terms vary depending on the services provided and the parties involved. Often, the Service Recipient agrees to pay for the services in a lump sum upon completion of the services. This program provides the option of making payment installments on specific dates, such as monthly or quarterly, or after a specific event has occurred, such as completion of various stages of the project.

Another option is to pay for the services based on an hourly fee and the number of hours required to complete the services. If the contract is for services to be provided on an ongoing basis, installment payments may be preferred.

The General Contract for Services includes an option that obligates the Service Provider to protect and not disclose the Service Recipient's proprietary or confidential information. "Confidential information" is information that is unique to a specific business or individual, and is not available from other sources. Additionally, information is confidential if unauthorized disclosure could result in harm to the owner. Some examples of "Confidential information" might include customer lists, trade secrets, products, business plans, financial statements, and manufacturing processes.

You can choose to include an option in the Contract that requires the Service Provider to return the Service Recipient's records and other property upon the completion of the service.

1. The General Contract for Services should be signed by authorized representatives of both parties and becomes effective as of the date specified in the Contract. It is not necessary that the signatures be witnessed or notarized.

2. It is advisable to sign two copies of the Contract so that each party will have a copy with original signatures. Original copies should be kept in a fireproof and safe location.

3. A lawyer should be consulted regarding any legal questions about this document.

The length of the Contract should be clearly stated. Options for the term include upon the completion of the services, upon a specific event or occurrence, on a specific date, upon written notice by either party, or some other basis. However, certain provisions of the Contract will survive the termination of the Contract. For example, if the Contract includes a confidentiality provision, the Service Provider must continue to keep the Service Recipient's protected information confidential beyond the stated term of the Contract.

This document includes an option that allows the Service Provider to provide a warranty that the services provided under the Contract will meet the local standard of similar service providers in the community. This provides a minimum level of performance that the Service Provider must meet to fulfill the terms of the Contract. This provision should not be included in the Contract if the Service Provider will not provide a specific warranty.

If a product is created as a result of the service, it is important to specify which party will own the rights to the work product. The Service Recipient generally has an expectation to be the owner of any work product resulting from the services. This provision confirms this expectation and obligates the Service Provider to cooperate in documenting the Service Recipient's ownership rights.