Small businesses are the backbone of the Essex community, and we want to empower business owners to operate effectively.

Many people do not realise the importance of terms and conditions and might feel that they are entirely optional.

While a good rapport and a handshake may have worked in the past, terms and conditions can protect you from clients who renege on agreements or from unfortunate circumstances.

Some clients may refuse to pay, or you may miss a delivery deadline, and your customer seeks to sue you.

All of which can result in costly disputes that take a long time to resolve, and which terms and conditions can help avoid.

What are terms and conditions?

Far from being just the thing that people skim through and agree to without properly reading, terms and conditions play a vital role in business dealings.

Terms and conditions set the legal foundation for how your business interacts with clients, customers, suppliers, and contractors.

Well-written terms and conditions will outline the rights and responsibilities of each party and determine how the business relationship will function.

The terms and conditions can also specify what can happen if things do not go to plan.

Do terms and conditions need a signature to be legally binding?

Despite many people believing that terms and conditions require a signature, this is not always the case.

Think of how many times you have pressed a button to agree to terms and conditions when signing up for an app.

Terms and conditions are enforceable so long as both parties clearly agreed to the stated terms.

If the matter is taken to court, then the manner in which the terms and conditions were presented will be taken into consideration.

It is essential that your client is given a fair opportunity to read the terms and conditions before the contract is made, as they will lose validity if introduced after the contract is established.

Consider attaching your terms and conditions to a quotation with the understanding that agreeing to the work means agreeing to the terms and conditions.

What should I include in my terms and conditions?

As mentioned, terms and conditions are not something to be disregarded but should be treated as an important defence against legal action.

Your terms and conditions should cover the following:

• A description of goods or services offered or delivered
• Pricing structure, including VAT, discounts, and price revision mechanisms
• Payment terms, including how, when, and the consequences of late payment
• Delivery and risk, including who is responsible, when risk passes, and insurance obligations
• Cancellation and termination clauses
• Limitation of liability, including what you are responsible for and what you are not
• IP ownership and licensing, including who owns what and on what terms
• Confidentiality
• Data protection and privacy commitments
• Jurisdiction and governing law
• Dispute resolution process, such as mediation before litigation

Without terms and conditions, you might be held to unrealistic delivery times, unable to claim interest on late payments, exposed to unlimited liability for consequential losses, and forced to surrender Intellectual Property you intended to retain.

At Palmers, our team is on hand to help you draft terms and conditions that will protect your business.

We want to support the spirit of business in the community, and want to help you avoid the pitfalls that can come with outdated or inaccurate terms and conditions.

Need help drafting or reviewing your terms and conditions? Get in touch with Palmers Solicitors today!