Getting a contract right can sometimes seem like an unnecessary complicated and fruitless exercise. The reality is that most activities do not result in problems, mistakes or claims.

But some do, and it is then that the value of a rigorous approach becomes clear. Like your insurance, getting your terms right should be a key part of any risk management strategy.

A good quality control system demands nothing less. Problems typically arise in one of three ways (1) a mistake (2) a failure to marry expectations (i.e. to clearly record and agree what both parties expect of each other) and (3) unforeseen circumstances the consequences of which have not been agreed. The risk of any of these things happening, and the consequences of them happening if they do, can be minimised; any business with an eye on the future would do well to act accordingly.

This article is the first in a series of three or four. It discusses some aspects of the law relating to the appointment of marine surveyors, particularly where that appointment is subject to the Australian Consumer Law. The intention is to give particular focus to important but sometimes complex issues; the standard of performance required, the actual performance required, the use (and abuse) of indemnities and limitations of liability. The other articles in the series will have a look at:

• additional aspects of contracting for marine surveyors (e.g. force majeure, intellectual property, insurance)
  
• liabilities to third parties
  
• how professions sometimes control (as professions) liabilities for members of the profession
  
• the legislation now applying to marine surveyors and some of the issues arising in relation to that.
  

Generally the appointment or engagement of a marine surveyor is a form of consultancy agreement. By consultancy agreement is meant a contract pursuant to which a person agrees to apply a special skill to address a requirement of the other party to the contract. The key terms found in any consultancy agreement will usually include:

• the standard of performance required 
  
• the actual performance required (i.e. what is to be done for the money)
  
• payment and the terms of payment
  
• warranties
  
• indemnities
  
• limitations of liability
  
• force majeure
  
• requirements for insurance
  
• confidentiality
  
• boilerplate (a term used to describe general clauses found in most agreements, e.g. no waiver and jurisdiction clauses)
  

All and any of these require attention. Not only must the terms of the agreement be read and understood, but anyone making a serious attempt to understand where the risks really are should have an understanding of the laws that apply. The discussion that follows attempts to summarise key issues arising in relation to the standard of performance required, the actual performance required (i.e. what is to be done), indemnities and exclusion clauses. Some of these issues are practical, some are legal.

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