Contract review guide
Master Services Agreement (MSA) review: what to check before you sign
An MSA sets the legal rules once so each new project only needs a short statement of work. Powerful — but it also means one bad clause infects every future project automatically.
Typical signers: agencies and b2b service providers with repeat clients.
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Analyze my master services agreement →The 5 most common Master services agreement red flags
1. Order-of-precedence traps
If the MSA overrides SOWs, project-specific agreements you negotiate later may be silently void — or vice versa. Know which document wins.
2. Unlimited liability flowing to every SOW
An uncapped MSA liability clause applies to all future work. Cap it once, correctly, at the MSA level.
3. Client-friendly IP defaults
'All work product, including tools and methods' can transfer your reusable frameworks and libraries. Carve out pre-existing IP and generic know-how.
4. Payment terms buried at the MSA level
Net-60 in the MSA silently applies to every SOW, whatever you write later.
5. Termination of the MSA killing active SOWs
Ensure work in progress survives MSA termination, or a client can cancel everything with one notice.
Pre-signing checklist
- Order of precedence between MSA and SOW explicit?
- Liability capped at the MSA level, applying to all SOWs?
- Pre-existing IP and reusable components carved out?
- Payment terms and late fees acceptable as defaults?
- Active SOWs survive MSA termination?
Frequently asked questions
What is the difference between an MSA and a SOW?
The MSA contains the durable legal terms (liability, IP, confidentiality, payment defaults); each statement of work defines one project's scope, deliverables, and price under those terms.
Which document should win in a conflict?
Common practice: the SOW wins for project-specific commercial terms, the MSA wins for legal terms. What matters most is that the contract says so explicitly.
Should small agencies bother with an MSA?
Yes, from the second project with the same client. It cuts negotiation time dramatically and prevents terms from drifting between projects.
Review other contract types
This guide is general information, not legal advice. Laws differ per jurisdiction — for high-stakes contracts, consult a qualified lawyer.
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