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This presentation addressed hotly negotiated commercial contract terms and common challenges faced by in-house counsel when working with business teams and internal stakeholders, drafting, reviewing and operationalizing commercial agreements. This session looked at risk mitigation steps that can be taken throughout the contract lifecycle with particular focus on representations and warranties and termination provisions, best practices and market trends when drafting indemnity and limitation of liability provisions, and effective dispute resolution provisions.

Download a copy of the presentation slides.

Key takeaways:

1. Preparation and contract initiation – Engage legal counsel early in the process to ensure key questions are addressed and proper alignment with business objectives is achieved. Getting business “buy-in” is the key challenge and this can be addressed by (1) building trust between legal and business; (2) speaking their language; and (3) reminding them of instances when there were adverse consequences of not assessing risk; and (4) assessing the potential dollar amount of the legal risk.
2. Drafting and negotiations – Open and honest conversations with the business is critical to help parties appreciate and navigate hotly negotiated issues effectively. It’s a matter of asking the “what-ifs” and understanding the business’ risk tolerance. Often disputes arise relating to the legal terms of an agreement – they require attention in addition to the commercial terms.
3. Approval and execution – Understanding the approval process and timing constraints ensures smooth and timely contract execution.
4. Contract performance and management – Ongoing relationship management is essential for success. Governance frameworks can help memorialize parties’ intention to work partners and negotiating a well thought out stepped dispute resolution clauses can help deescalate disputes and avoid litigation. Special attention should be given to managing key contract provisions including exclusivity clauses and most favoured customer clauses. Failure to track contract performance can pose as significant legal and business risk.
5. Amend, renew or terminate – At the draft stage, it is important for parties to consider how a termination will work in practice, what lead time will be necessary for a smooth transition, and what cooperation will be needed. Termination dates should be diarized and enough lead time given to any renewal or amendment negotiations, including to address any changes to market terms.

Speakers

• Chloe Snider, Partner, Litigation and Dispute Resolution, Dentons Canada LLP
• Vivian Poon, Senior Associate, Corporate, Dentons Canada LLP
• Sharon Seung, Chief Legal Officer, Pizza Hut Canada

Accreditation

LSBC: This session is registered for 45 Substantive minutes with the Law Society of British Columbia.
LSO: This program is eligible for up to 45 Substantive minutes with the Law Society of Ontario.
Barreau du Québec: In our view, this session would meet the CLE requirements of the Barreau du Québec. Please email Annie Girard to receive a confirmation of attendance.

Questions

Please contact toronto.events@dentons.com if you have any comments or questions.