Terms and conditions – Why getting them right is vital for your business

Robert Orkney, associate solicitor in the commercial business team at North West law firm Harrison Drury, discusses the importance of getting your business’ terms and conditions right.

As a business owner there will be many important matters occupying your to-do list. Ensuring you have a well-drafted, robust set of terms and conditions may not seem a priority, but they will provide your business and its clients with standardisation, clarity and consistency around your offering and how you intend to sell or supply it.  

Your terms and conditions govern the relationship between you and your clients. In the form of a legally binding contract, they underpin the goods or services you will provide during the course of business.

Having a bespoke set of terms that apply in conjunction with how your business is run will be pivotal for success. 

The scope of a company’s terms and conditions

The content of your terms and conditions will be hinged on who your clients are and the service or goods you are selling. They may differ for business-to-business and business-to-consumer organisations.

A well-drafted set of terms may include:

• clauses dealing with incorporating the terms into the contract
• how the goods or services shall be supplied
• the obligations of the parties
• payment and any data protection considerations. 

Other commercial terms may deal with intellectual property ownership, limiting your liability and what will happen if events arise outside of the parties’ reasonable control. 

Having a standardised set of terms and conditions is favourable to your business on many levels. It avoids additional time and expense in drawing up specific terms for individual arrangements and allows for a streamlining of process for employees across the business. 

It also allows you to introduce terms favourable to your business where substantial negotiation isn’t required. 

Complying within a legal framework

Regardless of what you’re selling, it is likely that there will be specific regulations or legislation underpinning your terms. This could include the effect of the Unfair Contract Terms Act 1977 on limiting your liability, or implied terms under the Sale of Goods Act 1979 i.e. are the goods of satisfactory quality? 

Having a set of terms and conditions shall assist in complying with your legal obligations.

Bring clarity for all scenarios

A well-drafted set of terms and conditions provides clarity should a certain situation arise. 

Relevant clauses can assist parties in understanding their respective rights and obligations. In turn, this will assist in establishing whether a breach of contract has occurred and allow for greater ease of enforceability. 

Certain terms may also include dispute resolution clauses, advising the parties on the agreed process for resolving disputes, precluding any unnecessary litigation. 

Service consistency brings confidence and satisfaction

Ensuring your clients are happy is paramount to running a successful business. Contracting on consistent terms shall provide your clients with the confidence and satisfaction they are entering into a contract free from ambiguity. 

Trading on broadly consistent terms will also assist in meeting client expectations such as price and delivery. 

Harrison Drury’s commercial law team assists business owners in getting the right commercial documentation and contracts in place to protect their business. For more information contact Robert Orkney or call him on 01772 258321.