How to see if there are loopholes in a contract, mainly in what places?

Key points and methods of contract review The first aspect: decision review process.

1. Grasp the purpose of concluding a contract and set rights and obligations around it.

The purpose of concluding a contract is the soul of the contract. Without it, there would be no contract. Therefore, understanding and concretizing the purpose of concluding a contract is the primary task of drafting a contract. If the purpose is wrong, even if the rights and obligations are set perfectly and the operation process is rigorous, the expected effect will not be achieved, and the contract will completely lose its original meaning.

2. Consider the possibility of change after signing the contract.

Today's society is changing rapidly, not to mention the force majeure of natural events and social factors, which we natural persons or individual organizations cannot resist. Even the changes or changes of the market subject itself are sometimes unexpected and unpredictable. Therefore, when we conclude a contract, we must take into account some factors that may occur in the course of performance after the contract is concluded. Such as force majeure events such as typhoons and floods in natural events, major changes in the situation such as the adjustment of national laws and policies and major fluctuations in market prices in social factors, and micro-problems such as the death of one party to the contract, termination of liquidation, bankruptcy or reorganization and merger of enterprises.

The second aspect: subject review process.

1. Pay attention to the legality and authenticity of the contract subject.

Market economy emphasizes freedom of contract. In order to pursue profits, many organizations adopt various fraudulent means to create the illusion that the subject is legal and true, so as to achieve the purpose of signing contracts (fraud), which seriously interferes with the market order. Although, legally speaking, the contract signed for this motive is invalid, the responsibility can be investigated according to the relevant relief clauses. But it will also bring huge losses in manpower, material resources and financial resources to the organization. Therefore, the legitimacy and authenticity of the contract subject is one of the important items in contract review, and it is also one of the preconditions to realize the purpose of the contract.

2. Pay attention to whether the contract subject has relevant qualifications or licenses.

For some business areas, according to the relevant laws and regulations, one or both parties to the contract must have corresponding qualifications or business licenses before they can engage in it. For example, the design contract of building engineering needs the design qualification issued by the national construction department, the construction contract needs the owner to have a full set of "construction application" materials, the property service management contract needs the property management qualification, some foreign trade or import and export contracts need the special agency qualification or business license, the real estate development business needs the development qualification, and the drug production or operation needs the drug batch number, production or hygiene license.

3. Pay attention to the review of credit ability, performance and personnel.

The credit ability of an organization is an important factor affecting its performance. A large organization with good reputation and outstanding performance may also affect the operation of its specific projects because of the problem of capital turnover, causing losses to both parties, ranging from delay in performance to breach of contract. Therefore, major engineering projects, important projects or large-scale procurement contracts all require the other party to issue a performance guarantee to urge the other party to actively perform the contract from the credit. In addition, in the later warranty period, it is a common and feasible method to ask the other party to issue quality guarantee and letter of guarantee.

The third aspect: the feasibility review process.

1. The agreement of the subject matter of the contract shall be detailed and clear, so as to point to the specific object.

The subject matter of a contract is the core content that can best reflect the purpose and nature of the contract, which is equivalent to the central idea of the article expressed when we write an article. Therefore, when drafting a contract, we'd better state the contents of the "subject matter of the contract" separately, so that people can know the general contents of the contract at a glance.

2. The performance of the contract must be operable.

The performance mode and operation flow set by both parties around the purpose of signing the contract are the key to realize the contract objectives. Different types of contracts have different ways of performance, such as the transfer of goods in procurement contracts; Progress construction of engineering construction contract; Transfer of intellectual property rights in technology development contracts; Installation contract equipment delivery, etc. But there are some similarities in the performance of various contracts. According to the general process of performance by both parties to the contract, it mainly involves the following aspects: the time limit for performance, the place of performance, the way of completion of the target (transportation), insurance, payment method, quality assurance, etc. These contents must be set according to the actual situation of the organization, such as the close cooperation between the time limit and related projects, the principle of convenience in setting the location, and payment.

3. There should be corresponding agreement on the contents of contract-related matters.

Compared with the contract subject, subject matter, technical standards and other important contract contents, some contract contents are easily overlooked or even not reflected in the contract at all, such as force majeure, contract confidentiality, technology development, quality assurance and so on. In fact, these are also extremely important in terms of the feasibility of contract performance. For example, in engineering construction contracts, the probability of force majeure is very high, so the bearing of losses needs to be strictly defined. However, there is no relevant unified standard, which is easy to cause disputes. Therefore, it is necessary to make careful predictions and detailed provisions to improve the feasibility of the contract. In the same way, although the contents of contract confidentiality, quality assurance and technology development are not directly related to the subject matter of the contract, they are contrary to the purpose of contracting, so it is necessary to pay attention to and improve its relevant clauses from the perspective of contracting purpose and later interests.

The fourth aspect: the legality review procedure.

1. Different types of contracts have different particularities.

According to the nature of the purpose of concluding a contract, the Contract Law classifies the contract into 15 and stipulates the relevant contents, which is the legal basis for the drafter or examiner of the contract. In fact, in the daily specific contract affairs, we can also classify contracts more specifically according to different standards to facilitate transaction operations. Different types of contracts naturally lead to different nature of contracts. The significance of classifying contracts is to fully realize the particularity of different types of contracts, thus reminding us of some contract contents or elements that need special attention when drafting or reviewing contracts, such as subject qualification, effective elements, payment methods, after-sales service, confidentiality matters and so on. In addition, in view of the particularity of the contract, the parties can also make some special agreements on the rights or obligations of each party. These special agreements must be expressed as completely and accurately as possible, and attention should be paid to their legality in order to avoid conflicts or conflicts with existing legal provisions.

2. The accuracy of legal terms is an important content of legality review.

The written contract concluded between the parties is a very serious legal document, and many of its contents need to be defined and standardized in legal terms, so that the contents of the contract are clear and unambiguous, and there will be no ambiguity or objection. In addition, for some places that are prone to disputes, relevant laws, regulations and industry regulations are clearly and meticulously stipulated in legal language. Therefore, when drafting or reviewing the contract, we should follow the writing norms or requirements of some legal documents, including using or popularizing some recognized normative legal and/or educational network legal terms as much as possible to avoid undue ambiguity in understanding the contract. For example, when reviewing the contract, we found some common legal terminology errors, such as "deposit" and "down payment", confusion between "right" and "power", and confusion between "mortgage" and "pledge". In addition, it is found that there are many clauses or expressions in many contracts similar to "one party fines the other party", which obviously violates the principle of "equality of legal subjects of all parties to the contract". In fact, each of the above legal terms has its own special meaning. If abused at will, it may make a joke, and even directly affect the effectiveness of the contract content and the legal responsibility of the parties.

The fifth aspect: the risk review process

1, pay attention to the reasonable responsibility sharing of all parties.

Honesty and credit, compensation for equal value and fair trade are the basic laws of market transactions, which must be embodied in the specific contents of the contract. When drafting or reviewing a contract, we should not only emphasize the rights of one party and ignore its obligations, nor should we only emphasize the obligations of one party and ignore its rights. Because according to the basic requirements of "contract consideration" in contract law, one party's rights must be based on certain obligations, and vice versa. The law prohibits the existence of "unequal treaties" that bully the weak; The Contract Law gives the party bound by unfair terms the right to terminate an obviously unfair contract within a certain period of time. Especially when drafting a "format contract" involving multiple interests, we must pay attention to the rationality of the responsibility sharing of all parties and avoid the "overlord clause" that infringes on the interests of the majority. Because in the contract, if the responsibility sharing of all parties is unreasonable, it not only violates the basic business ethics, but also easily becomes the target of public criticism in the event of a dispute, thus damaging the reputation of the merchant and easily being confirmed as invalid by the court or arbitration institution.

2. Pay attention to the security of transaction realization.

The purpose of concluding a written contract between the parties is to clarify the rights and obligations of both parties to the transaction and better ensure the security of the transaction. Therefore, when drafting or reviewing the contract, we should pay special attention to the terms that can ensure the smooth realization of the transaction. For example, the terms of payment and payment methods selected by the parties, and the guarantee terms of contract performance. Inconsistent with the reality or unable to guarantee the security of the transaction. Especially in the sales contracts of commodities, real estate and international trade, these clauses are particularly important. In addition, how to stipulate the terms such as the place of signing, the place of performance (such as the place of delivery), the location of the subject matter, the jurisdiction of contract disputes, and the way of settlement are also directly related to the smooth realization of the transaction or the security of the transaction. Don't ignore such clauses when drafting or reviewing contracts for both parties.

3. Pay attention to the possibility of contract disputes.

The parties establish a dynamic creditor-debtor relationship by concluding a contract, and the realization of one party's rights depends on the performance of the other party's obligations; In other words, the contractual debt is just a legal credit relationship. If one party to a contract violates the principle of "good faith", the rights of the other party may be lost, although their rights can be guaranteed to be realized through legal remedies. However, as contract right is a kind of private right, the main basis for legal protection of private right is the contract concluded between the parties. Therefore, the personnel required to draft or review the contract must have a "legal mind" and a "business sense". When drafting or reviewing a contract, we must fully consider the legal risks of contract disputes, and clearly stipulate the rights and obligations of both parties and the liability clauses for breach of contract in the contract as far as possible. In this way, even if disputes do occur in the future, it is easier to determine the legal responsibilities of all parties according to the contents of the contract and avoid the abuse of judicial discretion by judges as much as possible.

The sixth aspect: the integrity audit process.

As a very important legal document for all parties, the contract must be logical and consistent, and the contents of the main contract and the annex cannot contradict each other. If the contents of the contract are inconsistent, people will be at a loss in the event of a dispute. Therefore, when drafting or reviewing a contract, we must pay attention to the consistency of the contents of the contract, and make an agreement on the handling principles when there are contradictions or conflicts between the contents before and after the contract, such as "whether the contents of the main contract shall prevail or the contents of the annex to the contract shall prevail", which must be clearly stipulated in the main contract.