Frequently Used Contract Clauses

An Irvine Business Lawyer Explains Boilerplates

In this short blog, an experienced Irvine business attorney explains the meaning of some standard business contract clauses.


A boilerplate is a protective clause inserted into a business contract. It serves to safeguard the interests of both parties. Some of these boilerplates include:

Non-Waiver Clause: This clause means that if part of a contract is breached and the other party takes no action, the contract is still in force.
Entire Agreement, or Merger and Integration Clause: This clause states that everything that has been agreed upon between the concerned parties is fully and clearly expressed in the document, and that nothing can be added, altered or reinterpreted.
Acceleration Clause: This clause permits one party to demand that a breaching party be liable for complete fulfillment of the terms of a contract once a breach is made. This means that if Party B borrows money from Party A and fails to make a payment by the due date, Party A can require that Party B repay the loan in its entirety.
Severability Clause: This clause protects the whole of a contract if part of it cannot be put into effect due to an error of some kind. The rest of the contract is not rendered worthless, and the mistake can be taken out or corrected.
Liquidated Damages Clause: This clause stipulates that if one of the parties fails to meet the terms of a contract, the other has the right to charge a reasonable fee to help recoup any financial loss resulting from the breach.
Time is of the Essence Clause: This clause imposes a time limit on the performance of the terms of the contract and stipulates that failure to meet the time limit constitutes a breach.
Indemnification Clause: In this clause only the party whose actions result in damages can be held responsible for those damages. Neither side can be held liable for harm caused by the other.

Be Careful

Your Irvine business lawyer can help you ensure that you fully understand the terms and implications in a contract before you sign it. Contact Daily Aljian LLP by calling 949-861-2524 today.

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