Getting proactive with contracts: A guide for school principals

As a Principal you engage with many individuals and organisations for the supply of goods and services to your school. Almost invariably, these agreements are governed by a contract or binding agreement. We have previously outlined the basics of contract lawthe enrolment contract and what happens when a contract is breached. The purpose of this article is to support and encourage you to seek proactive guidance before you enter into any agreement, to ensure that you are making fully informed decision and that you and your school are protected.

Getting proactive 

Before you sign any contract or agreement, be it in your personal or professional capacity, you should always thoroughly read and review it to ensure you understand all obligations and any potential liabilities that arise under it. When you are acting as the head of your school your actions not only affect you but also your school.

We have assisted principals who have found themselves in disputes with third party service providers over the terms and effect of contracts and agreements. These disputes could have been avoided if the principal had sought legal advice prior to entering into the agreement.

Examples of the issues that have given rise to disputes for principals include:

  • A clause that automatically renewed the service provider for a further 3-year term.
  • A clause limiting liability of the service provider, even where they fell short of their obligations under the contract.
  • Unclear terms regarding price increases during the life of the agreement.
  • Oppressive termination costs or ‘buy-out’ clauses.
Why should I be proactive?

Lawyers are often seen as the “rainy day” solution. We are working with you to change that. We are here to support you in your role as principal. This support includes helping you make informed decisions and to negotiate on terms that best suit the school so as to save you stress later.

Five reasons why you should be proactive and reviewing contracts before you sign them (rather than trying to sort it out if something goes wrong):

  1. It’s hard to get out of a contract – A contract that has been correctly executed is almost impossible to exit. If it were easy there would be no benefit to any legally binding document! To get out of a contract a breach or other illegal or improper behaviour must have taken place. If you fail to discharge your duties under the contract, you could be liable for damages.
  2. Negotiating terms – When considering an agreement you have the right to negotiate your terms. Simply because a service provider puts a standard  form contract before you does not mean you have to accept it in its entirety. Legal advice can ensure you are including relevant, and excluding unfavourable, terms.
  3. Ensuring it includes what is discussed – Sometimes an agreement is signed on the basis of a verbal discussion yet this particular clause is not included in the written document. Whilst an oral agreement may also be binding it is always best to ensure that everything that was agreed to is included in the signed document. Furthermore there may be an ‘entire agreement’ clause limiting the affect of any oral or other agreement.
  4. Reputation of your school – In a modern world information sharing is easy and news travels fast. Schools, like any other organisation, don’t want negative publicity by disgruntled  service providers. As such it is always advisable to be clear on any arrangement at the outset of a relationship.
  5. Termination – Depending on the nature of the agreement there may be ‘deal breakers’ such as delivery time. For example, there is no good contracting for books due to arrive by the start of term 1 only to find they are delivered by term 3. A contract can allow for this with ‘time is of the essence’ clauses that enable you to terminate the contract if the goods or services aren’t provided in a reasonable time.

Before signing any contract or agreement you should seek legal guidance as to its content, clauses and any possible risks it may pose to you. There may be hidden clauses that expose your school to something unintended or the contract may miss what your purpose is in the performance of delivering any goods or services.

How can Brennan Law Partners assist?

Brennan Law Partners can assist you to be proactive in protecting against contractual disputes. It is easy to sign a contract without understanding the terms and implications, it is much harder to get out of it. If contracts are negotiated and reviewed properly, the risk of future disputes is reduced. Contact us before you sign any agreements or if you are considering entering into a new agreement. If you are currently in a dispute, we can help you take the appropriate next steps.

If you have any questions regarding any information in this BLP Brief, we welcome you to contact us at any time.

This is meant as a guide only and should not be taken as legal advice.

Question? Comment? We’re here to help so talk to us!