10 Questions to Ask Before Signing a Business Contract in Pennsylvania
In the world of small business, contracts are everywhere—leases, vendor agreements, service retainers, client commitments. But many entrepreneurs in Pennsylvania sign legally binding contracts without fully understanding the implications.
Whether you're entering into a handshake deal turned written agreement, or reviewing a formal document drafted by the other party’s attorney, here are the 10 critical questions every Pennsylvania business owner should ask before signing.
1. Who are the actual parties to the contract?
This may seem obvious, but it’s a common oversight. Are you signing as yourself or as your business entity? If the contract is between “John Doe” and a supplier—but you run an LLC—you could be personally liable. Make sure your legal entity is named correctly (e.g., Doe Design, LLC), and that your signature block reflects your title (e.g., John Doe, Managing Member).
2. What are you agreeing to do?
Read beyond the summary. What are your actual obligations—services, deliverables, payment terms, timelines? Contracts often contain hidden clauses that expand your responsibility, like requiring insurance, reports, or warranties you didn’t discuss verbally.
3. What is the other party agreeing to do?
Equally important is holding the other party accountable. Do the deliverables and deadlines match what you discussed? Are payment terms clear, including method (check, ACH, credit), and is there a clear remedy if they fail to perform?
4. What happens if someone breaches the agreement?
If a dispute arises, what happens next? Does the contract require mediation, arbitration, or litigation? Are there penalties, late fees, or termination clauses? In Pennsylvania, many contracts include "liquidated damages" clauses that pre-set the amount of money owed if the deal falls apart. Know what you’re risking.
5. Is there a personal guarantee?
This is a big one. Even if your business is the named party, personal guarantees can make you responsible if the company defaults. Read carefully—this clause is often buried toward the end or in an addendum.
6. How can the agreement be terminated?
Can either party walk away early? Is there a required notice period (e.g., 30 days written notice)? Pennsylvania courts generally enforce clear termination clauses, so it’s essential to know your exit rights before signing.
7. Is the contract enforceable under Pennsylvania law?
Out-of-state vendors often sneak in choice-of-law provisions that favor their jurisdiction (e.g., New York or Delaware law). Insist on Pennsylvania governing law and venue, especially if you may need to enforce the contract in court.
8. Does it contain non-compete, NDA, or IP clauses?
Many contracts include restrictive covenants that limit your future work or claim ownership over your ideas. Ensure that:
NDAs are mutual
Non-competes are narrow and time-limited
You retain ownership of your intellectual property unless negotiated otherwise
9. Have you reviewed the contract with a business attorney?
A legal review in advance costs far less than fighting a lawsuit later. A small-business attorney can spot ambiguities, one-sided clauses, or unenforceable terms that you might miss. At The Skeen Firm, we review contracts for businesses across Pennsylvania at flat, transparent rates.
10. Are there missing attachments or referenced documents?
Be cautious if the agreement references Exhibits, Schedules, or Addenda that aren’t actually attached. If it says “see Schedule A” and Schedule A is missing, that ambiguity can come back to haunt you in court.
Bonus Tip: Trust Your Gut
If something feels off, ask questions. Never let urgency push you into signing a contract you're not 100% sure about. A rushed signature today could lead to litigation tomorrow.
Protect Yourself. Review Before You Sign.
At The Skeen Firm, we help entrepreneurs across Pennsylvania make smart legal decisions when entering contracts. Whether you're signing a commercial lease, hiring a vendor, or launching a joint venture, we can help you understand every word before you commit.
Call (724) 249‑2439 or Schedule a Discovery Call
We offer flat-fee contract reviews for small business owners in Pittsburgh, Washington, Erie, and beyond.
*Disclaimer: the advice provided is for informational purposes and is not intended as legal advice. It should not be relied on, nor construed as creating an attorney-client relationship.