Boilerplate clauses in contracts — what they do and how to get them right

You've received a draft contract. The commercial terms look fine — price, scope, timeline. Then there are several pages of dense clauses at the back under headings like "General" or "Miscellaneous." This is the boilerplate.

It's easy to treat these clauses as standard filler, but they are not. Boilerplate clauses are the operating rules of your contract — they control what happens when something goes wrong, who bears the risk, where a dispute gets heard, and whether key obligations survive after the contract ends. They don't describe the deal; they govern how the deal is enforced. The commercial terms tell you what the parties agreed to do. The boilerplate determines what it costs when one of them doesn't.

Governing law and jurisdiction

This clause nominates which state or territory's law governs the contract and which courts have jurisdiction to hear disputes.

The choice matters practically, not just technically. If your business is in Queensland and you sign a contract that specifies New South Wales law and courts, any dispute will involve NSW rules, NSW filing fees, and quite possibly travel. The same applies in reverse if a national supplier insists on its home state.

Watch for:

Overseas forums. Some templates, particularly those adapted from international precedents, nominate a foreign jurisdiction. An overseas court judgment may be difficult or expensive to enforce in Australia.
Split governing law and jurisdiction. The applicable law and the court that hears disputes should match. A contract governed by Victorian law but heard in a Queensland court creates unnecessary complexity.
"Non-exclusive" jurisdiction clauses. These allow either party to sue in multiple forums. If you're the smaller party, non-exclusive jurisdiction usually benefits the larger one.

Where you have negotiating room, push for the governing law and courts of the state or territory where you operate. If the counterparty insists on a different state, assess whether the practical cost of that concession is worth the deal.

Entire agreement

Sometimes called a "whole agreement" clause, this provision states that the written contract is the complete agreement between the parties and supersedes all prior negotiations, representations, and correspondence.

Its function is protective in both directions. Neither party can later claim that a pre-contract promise — made by email, in a pitch, or over a call — adds to or overrides what's in the document. If it's not written in, it's not part of the deal.

The trap for small businesses is signing after a sales process full of promises. Before you execute:

Re-read proposals, decks, and email chains for any commitment that isn't reflected in the signed document.
If a representation was important to your decision to contract, make sure it appears in the body of the agreement — not just in an attachment or a side letter.
Be sceptical of verbal assurances given at the signing stage that "the written terms are just standard."

Amendment and variation

This clause sets out how the contract can be changed — typically requiring written agreement signed by both parties.

Done well, a variation clause prevents two common problems: one party claiming the scope changed based on a phone call, and unsigned changes being used in a later dispute to argue what the parties "really" agreed.

Drafting considerations:

Match the process to how you actually work. If your team approves scope changes by email, an amendment clause requiring wet-ink signatures on a formal document will be ignored in practice. Ignored variation clauses generate disputes. Consider allowing email variation from nominated addresses.
Define who can approve a variation. If any employee can purportedly agree to a variation, your exposure can grow without the right people knowing.
Keep a record. When changes are agreed, document them consistently and file them with the original agreement. Even minor scope creep should be recorded under the variation process.

Notices

This clause specifies how formal communications must be sent — for events like breach notices, termination, price changes, or exercise of options — and when a notice is taken to have been received.

The notices clause is the one most likely to fail not because it was badly drafted but because it was never updated. An email address that no longer exists, or a physical address from the company's old premises, can derail an otherwise valid termination or price-change notice.

Practical traps:

Stale contact details. Review the nominated addresses when you execute and build a reminder to check them before serving any formal notice.
Method mismatch. If the clause requires registered post but you operate entirely by email, confirm in writing that email will be treated as sufficient — or update the clause before signing.
"Business day" timing. Where a notice is deemed received a set number of business days after sending, confirm how "business day" is defined in the contract. Public holidays vary by state; a generic definition may not reflect your operations.

Counterparts and electronic execution

A counterparts clause allows each party to sign a separate copy of the document; together, those copies form one binding agreement. Electronic execution clauses extend this to signatures applied digitally.

These provisions exist to remove friction from the signing process. Without them, parties may debate whether email exchanges or DocuSign outputs have the same effect as a "traditional" wet-ink signature.

For companies, execution without a common seal is governed by s 127 of the Corporations Act 2001 (Cth). A company may execute a document by having it signed by two directors, or a director and a company secretary. A proprietary company with a sole director who is also the sole secretary may have that person sign alone. Your execution block must reflect the actual signatories and their roles — a mismatch can create uncertainty about whether the document is validly executed.

If your contract is a deed rather than an agreement, execution requirements are stricter and the company seal rules may apply. Confirm before executing.

Assignment and novation

Assignment is the transfer of one party's rights under a contract to a third party — such as the right to receive payment, or to receive services. Novation goes further: it transfers the entire contract, including obligations, to a new party, and requires the consent of all original parties.

These clauses matter when businesses are sold, restructured, or when a supplier subcontracts work. Without a clear assignment clause, you may find yourself:

Dealing with a party you never assessed or agreed to work with.
Unable to restructure your own business without triggering a contract breach.
Locked into a contract that has no mechanism for a clean handover.

Standard positions to understand:

"No assignment without consent" is the most common position for both sides. The question is whether consent can be withheld unreasonably — adding "not to be unreasonably withheld" significantly narrows that right.
Deemed consent on change of control. Some contracts treat a sale of the business or a change in majority ownership as an automatic assignment event, entitling the other party to terminate. If you're a growing business or in a sector where investment or acquisition is likely, scrutinise this.
Novation requires separate documentation. A novation agreement (often executed as a deed) must be signed by the original parties and the incoming party. Keep a template ready if you anticipate business transitions.

Force majeure

A force majeure clause excuses or suspends a party's obligations when an event outside their reasonable control prevents performance — such as natural disasters, pandemics, or government-imposed restrictions.

The clause should specify:

Which events qualify (and whether the list is exhaustive or illustrative).
What obligations are suspended versus extinguished.
A notification requirement: the affected party must give written notice within a defined period of invoking force majeure.
A mitigation obligation: the affected party must take reasonable steps to minimise the impact.
A right for either party to terminate after a prolonged period of non-performance — typically defined as a number of weeks or months of continuous force majeure.

A vague force majeure clause — one that simply says "neither party is liable for events beyond its control" without specifying duration, notice, or mitigation — provides limited protection when tested and creates uncertainty about when the contract can be ended.

Severability

If a court or regulator finds that one clause of the contract is invalid or unenforceable, a severability clause keeps the rest of the contract intact. Without it, a struck-out clause could, in principle, affect the validity of connected provisions.

A well-drafted severability clause also includes a "read-down" mechanism: to the extent that a clause is only partially invalid, it should be read down to its valid extent rather than struck out entirely. Not all governing law jurisdictions apply this automatically, so express language is cleaner.

No waiver

A no-waiver clause provides that if a party fails to enforce a right immediately — allowing a late payment, overlooking a breach, or not terminating when entitled to — that failure does not permanently extinguish the right. It can still be enforced later.

This clause exists because, without it, courts can sometimes find an implied waiver from a course of conduct. A supplier who repeatedly accepts late payments without objection may find it harder to later insist on strict payment terms.

Drafting minimum: the clause should state that any waiver must be in writing and signed by an authorised representative. Oral or implied waivers should be expressly excluded.

Interpretation

An interpretation clause sets out the rules for reading the contract: singular includes plural, "including" means "including without limitation," headings do not affect interpretation, references to legislation include amendments, and so on.

These provisions are not window-dressing. Courts have found disputes about whether "including" closes a list, whether a definition applies to a particular context, and whether a reference to a repealed statute still carries meaning. A consistent interpretation clause pre-empts those arguments.

If your contract involves multiple documents — a master agreement, statements of work, schedules, and order forms — the interpretation clause should specify the order of precedence if those documents conflict. Without it, a court has to determine priority from context, which is expensive and uncertain.

Limitation of liability and consequential loss

These clauses cap the total amount one party can claim against the other and exclude specific categories of loss — most commonly "consequential" or "indirect" loss such as lost profits, lost revenue, or damage to reputation.

The drafting choices here are among the highest-stakes in any commercial contract.

Key considerations:

Liability caps. A cap tied to fees paid over a defined period (often 12 months) is common. If you're the service provider, you'll usually push for a cap; if you're the customer with significant downstream exposure, you'll push back. The negotiated figure should reflect the actual risk profile of the engagement.
Consequential loss exclusions. These are heavily negotiated. Excluding consequential loss entirely can be commercially unreasonable from a customer's perspective if the service is critical infrastructure. Common compromises include mutual exclusions, or carve-outs for defined categories of recoverable loss.
Statutory limits on exclusion. Consumer guarantees under Schedule 2 of the Competition and Consumer Act 2010 (Cth) (the Australian Consumer Law) cannot be excluded, restricted or modified by contract where they apply. Liability clauses that purport to override statutory consumer protections are void to that extent. Your clause must be drafted to work within that constraint, not to contradict it. Where the ACL applies, the most a supplier can limit is the remedy — not the guarantee itself.
Gross negligence and fraud carve-outs. Most jurisdictions and courts will not permit exclusion of liability for fraud or deliberate misconduct. Including an express carve-out makes the clause more enforceable and signals good faith.

Survival

A survival clause specifies which obligations continue after the contract ends — whether by expiry, termination, or mutual agreement. Common surviving provisions include confidentiality, intellectual property ownership, indemnities, and accrued payment obligations.

Without an express survival clause, the general position is that the contract's obligations come to an end when the contract does. Some rights survive as a matter of law (for example, accrued rights for breach), but relying on implication creates risk.

The practical drafting approach: list specific clause numbers or headings that survive, rather than using a generic formula. If confidentiality must survive for five years post-termination, say so in the survival clause.

Optional and situational clauses

Depending on the nature of the contract, consider including:

Set-off. Allows (or expressly prohibits) a party from deducting amounts they claim are owed to them from payments they owe the other party. A "no set-off" clause protects suppliers who need clean invoice payment; customers often push for broad set-off rights.
Further assurances. Requires each party to sign additional documents or take further steps reasonably necessary to give full effect to the agreement. Useful for post-settlement or post-acquisition clean-up without reopening the main contract.
Privacy and data. Where personal information will be collected, used, or disclosed under the contract, include a clause cross-referencing the obligations of the Privacy Act 1988 (Cth) and the Australian Privacy Principles, and any applicable privacy policies. This is particularly important in software, outsourcing, and professional services arrangements.
Counterpart execution as a deed. Where the contract is structured as a deed — because consideration is absent or a longer limitation period is needed — include express deed execution language and ensure signature blocks comply with s 127 of the Corporations Act 2001 (Cth).
Order of precedence. If the contract consists of multiple documents, specify which prevails in the event of a conflict. Without it, ambiguity is expensive.

How Artificer Legal can help with boilerplate

When we review a contract's boilerplate at Artificer Legal, we don't treat it as standard. We treat it as risk allocation.

The clauses we push back on most consistently: limitation of liability provisions that are one-sided or that purport to override the ACL; jurisdiction clauses that anchor disputes in an inconvenient or foreign forum; assignment clauses that allow the other party to sell or restructure without consent; and notices clauses that won't actually work in practice.

The order we negotiate in is deliberate: governing law and jurisdiction first (because everything else is interpreted through that lens), then liability and loss allocation (the biggest financial exposure), then assignment and novation (control over who you're dealing with), and then the mechanics — notices, variation, survival, and interpretation.

For clients building a contract template, we also maintain a playbook of acceptable positions on each boilerplate clause, so your team can negotiate commercially without needing to start from scratch each time.

The governing law and jurisdiction clause sets where the fight happens

If there's one boilerplate clause that most often determines the outcome of a commercial dispute, it's the governing law and jurisdiction clause — not because it's the most complex, but because it's the most often signed without consideration.

A poorly negotiated forum clause can make an otherwise winnable dispute uneconomic to pursue. It can shift leverage dramatically before a single letter is sent. And it's almost never revisited after the contract is signed.

The boilerplate, taken together, sets the rules of the game. Governing law and jurisdiction decide where the game is played and under whose rules. Limitation of liability determines the stakes. Assignment controls who's at the table. And survival clauses determine what obligations outlast the relationship. Treating these as standard form is the single most common contracting mistake made by small and medium businesses in Australia.