Contract Review

Contract Review

Analyze legal contracts to identify parties, obligations, risk areas, and problematic clauses. This skill systematically examines contract language for liability exposure, indemnification traps, unfavorable termination terms, IP assignment overreach, and non-compete restrictions. The output is a structured risk report with severity ratings and actionable recommendations.

Workflow

1. Receive and Parse Contract — Ingest the full contract text or relevant excerpts. Identify the contract type (SaaS agreement, employment, freelancer, NDA, MSA, etc.) and establish the reviewing party's perspective (which side of the agreement you represent). Extract metadata such as effective date, governing law, and term length.

2. Identify Parties and Core Terms — Map all named parties, their roles, and the fundamental exchange of value. Extract key commercial terms including payment structure, deliverables, service levels, and performance metrics. Note any definitions section that modifies standard legal meanings.

3. Flag High-Risk Clauses — Perform clause-by-clause analysis targeting liability caps (or lack thereof), indemnification scope and triggers, termination rights and cure periods, IP assignment breadth, non-compete and non-solicitation restrictions, confidentiality obligations, data handling requirements, and force majeure provisions. Assign each flagged clause a severity rating: Critical, High, Medium, or Low.

4. Summarize Obligations — Produce a consolidated view of what each party must do, by when, and the consequences of non-performance. Highlight asymmetric obligations where one party bears disproportionate risk or burden.

5. Generate Risk Report — Compile findings into a structured report with an executive summary, clause-by-clause risk table, overall risk score, and prioritized list of recommended modifications or negotiation points.

6. Suggest Modifications — For each Critical and High severity finding, draft alternative contract language that better balances risk. Provide brief rationale for why the modification is important and what risk it mitigates.

Usage

Provide the contract text and specify which party you represent. Optionally indicate areas of particular concern.

Example prompt:

Review this SaaS agreement from the customer's perspective. Flag any clauses that expose us to unlimited liability or allow the vendor to change terms unilaterally. Here is the contract: [paste contract text]

Examples

Example 1: SaaS Agreement Review

Input: A SaaS subscription agreement where the customer is subscribing to a project management tool. The customer is a 50-person company evaluating a 2-year enterprise commitment. Review from the customer's perspective.

Output:

Executive Summary: This agreement contains 2 Critical and 3 High severity issues that should be addressed before signing. The liability cap is absent for the vendor while the customer faces unlimited exposure, the IP assignment clause claims ownership of customer-created content, and termination requires 180-day notice with no cure period for the customer. Overall risk score: 7.2/10. We recommend negotiating all Critical items and at least the indemnification clause before execution.

Overall Risk Score: 7.2 / 10 (High — do not sign without modifications)

Example 2: Freelancer Contract Review

Input: A freelance development contract from the hiring company's template. The freelancer is a mobile app developer being engaged for a 3-month iOS project. Review from the freelancer's perspective.

Output:

Executive Summary: 1 Critical and 2 High severity issues identified. The non-compete clause is overly broad and likely unenforceable in most jurisdictions, the IP assignment has a dangerous gap tied to payment, and the payment terms heavily favor the hiring company. Overall risk score: 6.8/10.

Overall Risk Score: 6.8 / 10 (Moderate-High — negotiate before signing)

Red Flags:

• Non-Compete (§7, Critical): Prohibits freelancer from working in "any related field" for 24 months globally. This is almost certainly unenforceable in most jurisdictions and signals aggressive posturing. Suggested modification: Narrow to direct competitors, 6-month duration, reasonable geographic scope.
• IP Assignment (§4, High): Assigns IP only upon "final payment" but doesn't define what constitutes final payment in a milestone-based project. Gap risk: disputed milestone could leave IP ownership ambiguous. Suggested modification: Add that IP transfers per-milestone upon each milestone payment.
• Payment Terms (§3, High): Net-90 payment with no late payment penalties. Suggested modification: Net-30 with 1.5% monthly late fee.