April 2023

Beware of the Fine Print: The One Clause That Could Leave You Powerless - and How to Avoid It

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Contracts are a fundamental part of doing business, but have you ever considered the importance of the jurisdiction clause in your contract?

A jurisdiction clause specifies the location where legal disputes arising from the contract will be resolved. It might seem like a minor detail, but it can have a significant impact on your ability to enforce the contract if a dispute arises.

Imagine you signed a contract with a company located in a far-off state or even another country, and the contract includes a jurisdiction clause specifying that any legal disputes will be resolved in their local court.

If a dispute arises, you would be required to travel to that location, possibly incurring significant expenses, to defend your rights. Additionally, the company may be more familiar with the legal system in their jurisdiction, giving them an advantage in any legal proceedings.

related: Sign And Get Played: Why Negotiating Your Contract Is a Must

Furthermore, it's not just the physical distance that can be an issue, but the laws and legal system of the jurisdiction as well. You might find that the laws and legal system of the jurisdiction are unfamiliar and not in your favor, which could negatively impact your ability to resolve the dispute.

However, it's not all doom and gloom. By negotiating the jurisdiction clause in your contract, you can ensure that legal disputes arising from the contract will be resolved in a jurisdiction that is more convenient for you and your business. This can include specifying a neutral location, a location close to you, or even including a choice of jurisdiction clause, which would allow both parties to agree on a mutually convenient location for any legal proceedings.

At JRZY, we understand the importance of the jurisdiction clause in a contract and can help you negotiate and revise it to better protect your interests. Our team of experienced deal brokers and attorneys can review your contract, provide valuable insights, and assist in negotiating the best possible jurisdiction clause for your business.

In conclusion, while it's essential to read and understand every aspect of a contract before signing, it's equally important to pay attention to the jurisdiction clause. By negotiating the jurisdiction clause, you can protect yourself from the significant expense and inconvenience of defending a legal dispute in an unfamiliar and distant jurisdiction.

Contact JRZY today to learn more about how we can help you negotiate a fair and reasonable jurisdiction clause for your contracts.

Issa Hall, Esq

Issa has founded multiple ventures, is an author, and founding partner of Hall & Dixon law firm, with over a decade of experience in tech and law.

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