Key Takeaways

  • A boilerplate contract includes standardized legal language that appears at the end of most agreements and governs enforcement, dispute resolution, and interpretation.
  • Common boilerplate clauses include arbitration, governing law, severability, assignment, and force majeure provisions.
  • These clauses are essential for defining the rights and obligations of all parties if issues arise during contract performance.
  • Though often overlooked, the boilerplate section can dramatically affect dispute outcomes and contract enforcement.
  • Reviewing or customizing boilerplate terms helps ensure the contract aligns with jurisdictional laws and specific business needs.

Boilerplate Contract

A boilerplate contract is needed for any contract to be solid. It consists of legal jargon that enforces certain aspects of a contract so that all parties remain protected.

What Is a Boilerplate?

A boilerplate describes a set of unchanging language that is used on legal documents. It has a fixed and unwavering meaning in the same way that words have not been created individually to describe a legal issue.

What Are Boilerplate Provisions in Contracts?

A boilerplate provision or clause is situated toward the end of a contract. It is also referred to as miscellaneous provisions. There are typically set boilerplate headings, but the information can differ drastically.

Why Boilerplate Clauses Are Important

While often considered “standard” or “boilerplate,” these clauses are critical to a contract’s integrity. They determine how disputes are resolved, which laws apply, and how unforeseen circumstances are handled. Without carefully drafted boilerplate clauses, a contract could become ambiguous, unenforceable, or fail to protect one or more parties in litigation.

Boilerplate clauses:

  • Clarify interpretation: Prevent conflicting readings of the agreement.
  • Define procedure: Specify how notices are delivered, amendments are made, or breaches are handled.
  • Protect from uncertainty: Provide contingency plans for events like force majeure or changes in law.
  • Streamline enforcement: Predefine jurisdiction, venue, and governing law to minimize disputes over where and how to sue.

Courts frequently rely on these clauses when resolving contractual disputes, which makes it vital that parties understand and tailor them instead of copying from templates.

Costs/Attorney’s Fees

The cost and attorney’s fees provision provide a way to move fees from one party in a contract to multiple parties. The costs can get significant during any type of dispute. It is crucial that everyone involved is aware who will be responsible for these fees should arbitration occur.

Arbitration

Arbitration boilerplate terms refer to removing a dispute from court to a method of privately resolving the problem. This clause can waive the party’s right to a jury or bench trial. It is important to understand that arbitrations can be binding. This means that all involved in the arbitration must abide by the decision of the court. They can also be non-binding, which means that one or all parties may reject the decision of the arbitrator and move the issue to court. A binding arbitration is more popular than non-binding.

There are some advantages of arbitration:

  • It is quicker, easier, more effective, and has flexibility when it comes to scheduling.
  • It is a private proceeding and is less hostile in nature than if the dispute had taken place in front of a jury in court.

There are some disadvantages to arbitration:

  • Binding arbitrations cannot be changed or appealed.
  • There is not an automatic right to discovery, referring to the process in which all parties involved must disclose all information about their case to the other party.
  • The costs can be substantial, sometimes surpassing the cost of litigation.

Liquidated Damages

Liquidated damages clauses provide that a certain amount of money, determined ahead of time, be paid in damages should there be a failure to perform within the parameters of the contract. The amount of money should be the best estimate of money lost due to a breach from the parties involved. This information is disclosed at the signing of the contract.

To enforce this clause, the liquidated damages must meet the following specifications:

  • The damages are not hard to estimate.
  • The damages constitute a reasonable amount and not used as a penalty against one party.

Governing Law/Choice of Law

A Choice of Law or Governing Law provision provides that all parties in the contract must adhere to state law, which will be used to enforce the agreement, no matter which state one or both parties reside.

Typically, the state that is listed in the contract is reliant on where the activities pertaining to the contract will be carried out.

Jurisdiction or Venue/Forum Selection

This provision describes where the dispute will be dealt with should one be filed. Jurisdiction pertains to the location where a dispute is solved. The laws in the state where the contract is carried out will be used to judge the dispute.

Severability

Severability clauses let the court or arbitrator know that if any part of the agreement is not enforceable within the law, the remainder of the agreement should still remain enforceable. This prevents the court from deeming the entire contract unenforceable based on a single clause.

Assignment

Assignment clauses provide that you either allow or prevent a party from assigning that person’s rights in the contract to another person involved in the contract.

Force Majeure

Force majeure is translated as “greater or superior force.” A force majeure clause provides that the agreement will be halted in the event of a disaster. One cannot foresee when such occurrences can happen in the midst of a contract, leading to repercussions. Force majeure examples can include devastating weather events, a labor strike, or war. Because all parties can insert events in the contract that are not truly force majeure, these clauses can be difficult.

Additional Common Boilerplate Clauses

Beyond the clauses already discussed, contracts often include additional standard provisions that shape their practical application:

  1. Confidentiality Clause: Protects sensitive information exchanged during and after the contract term.
  2. Notices Clause: Defines how official communications (such as breach notices or amendments) must be delivered—via email, certified mail, or other means.
  3. Waiver Clause: States that the failure of one party to enforce a right does not waive their ability to do so later.
  4. Amendment Clause: Requires that any changes to the contract be made in writing and signed by all parties.
  5. Counterparts Clause: Allows the agreement to be executed in multiple copies, each treated as an original.
  6. Headings Clause: Clarifies that section titles are for reference only and do not affect interpretation.

These lesser-known clauses are often ignored but help prevent confusion in contract execution and interpretation.

Entire Agreement/Merger Clause

This clause states that a contract is the total agreement among all parties involved. The entire agreement/merger clauses can also be added under the Announcements clause. It will prevent both sides from arguing the fact that oral or additional agreements can officially change the contract.

Risks of Overlooking Boilerplate Clauses

Boilerplate sections are sometimes glossed over during negotiations, leading to significant legal risks. A poorly drafted arbitration clause could strip parties of their right to appeal, while an unclear governing law provision might cause jurisdictional conflicts. Similarly, omitting a force majeure clause could expose a business to liability during unforeseeable crises such as pandemics or natural disasters.

Common risks include:

  • Ambiguous enforcement rules if jurisdiction or governing law isn’t specified.
  • Unintended legal exposure from copied or outdated clauses.
  • Difficulty amending terms if modification procedures are unclear.
  • Inconsistent interpretations when boilerplate language conflicts with specific provisions.

Legal review ensures that boilerplate language reflects current law and the parties’ intentions.

Customizing Boilerplate Contracts for Your Needs

Although many contracts share the same boilerplate provisions, customization is key. Businesses should adapt standard clauses to fit their industry, jurisdiction, and transaction type. For example:

  • Startups may modify arbitration or assignment clauses to maintain control during funding changes.
  • International agreements might adjust governing law and venue to reflect cross-border realities.
  • Technology contracts often expand confidentiality and IP protection clauses.

It’s also important to update templates regularly to reflect legal developments or regulatory changes. Even a small wording change can alter rights significantly. Consulting a contract attorney helps ensure your boilerplate contract aligns with your operational and legal needs.

Benefits of Using Boilerplate Contracts

Boilerplate contracts offer efficiency and consistency across multiple agreements. Their standardized structure reduces drafting time, legal costs, and the likelihood of omitting key provisions. When drafted well, these clauses:

  • Simplify contract creation and review.
  • Promote fairness by setting uniform expectations.
  • Protect both parties from unforeseen risks.
  • Ensure enforceability under applicable laws.

However, overreliance on templates without legal customization can create exposure. A balance between efficiency and precision is essential.

Frequently Asked Questions

  1. What is a boilerplate contract?
    A boilerplate contract is a legal document that includes standardized clauses outlining how a contract operates, resolves disputes, and remains enforceable under law.
  2. Are boilerplate clauses legally binding?
    Yes. Once both parties sign the agreement, boilerplate provisions are legally enforceable and interpreted by courts as part of the contract.
  3. Can I modify boilerplate contract language?
    Absolutely. Although standardized, boilerplate clauses should be reviewed and tailored to fit each party’s business context and state laws.
  4. Why are boilerplate clauses placed at the end of contracts?
    They typically appear at the end to cover general administrative and interpretive issues that apply to the entire agreement, rather than specific deal terms.
  5. Do I need a lawyer to draft or review boilerplate contracts?
    It’s strongly recommended. Even small differences in wording can have major legal implications. You can find an experienced attorney on UpCounsel to review or draft your boilerplate contract for accuracy and compliance.

If you need help with creating a boilerplate contract, you can post your legal need on UpCounsel’s marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.