Your client sent their MSA: what to check first
Read a client's MSA in the order that matters: payment, IP, liability, indemnity, termination and acceptance, checked against neutral standard terms.
Start a client's MSA with the clauses that move money and risk: payment, when the client owns your work, the liability cap, indemnity, termination for convenience, deemed acceptance and scope changes. Read it together with the SOW, and find out which document wins when they disagree. Mark what stops you, check it against a neutral standard, and ask for the changes that matter most.
What are you holding when a client sends their MSA?
A master services agreement (MSA) sets the shared legal terms for the projects you run under it with one client. Each statement of work (SOW) then adds a project's scope, fees and dates. A client's own MSA is usually drafted with the client's interests in mind.
An MSA also outlasts the first project: Common Paper's standard version stays in force until 12 months after the last SOW ends. For example, a clause that looks harmless on a $6,000 first project would also cover a $60,000 project under the same MSA next year.
In what order should you read it?
Work through the MSA in this order, money and risk first.
- Collect the whole package. Ask for the MSA, the first SOW and every document either one refers to, such as a supplier code of conduct or a security policy. The MSA may make them part of the deal.
- Find the conflicts clause. Search for "order of precedence," "conflict" and "inconsistency." It tells you which document wins, and so where your project terms need to go.
- Read the clauses in the table below, in order. Money comes first, then ownership, risk and exit.
- Mark each clause fine, ask or stop. An ask is a question or a change you'd like. A stop must be resolved before you sign.
“Hi [Name], Thanks for the MSA. Could you also send the documents it refers to, such as [the supplier code of conduct], and an editable Word version? Best, [Your name]”
What should you check in each clause?
Use this checklist to review the money, ownership and risk clauses in a client's MSA. An indemnity is a promise to cover the client against certain claims; it can include paying for the client's defense, not only damages (Common Paper §9.1).
| Clause | What to look at | What should make you stop |
|---|---|---|
| Payment | Days to pay and when they start; invoice rules such as PO numbers or portals; what happens to a disputed invoice | Net-60 or longer with no deposit or late fee; payment that waits until the client's own customer pays; holding back a whole invoice over a dispute about part of it |
| When intellectual property (IP) transfers | Whether ownership passes on creation or on payment; whether drafts count; how your pre-existing tools are treated | An assignment of templates, code or methods you owned before the project. Ownership on creation is an ask: request transfer on payment |
| Liability cap | Whether there's a cap, whether it protects both sides, what it's based on, and every exception | No cap on your liability; a cap that protects only the client; exceptions so broad, such as "any breach," that little is left under the cap |
| Indemnity | Who covers whom, for which claims, and whether only claims by outsiders count | An indemnity beyond a short list of claims: anything "arising out of or relating to" your work, claims the client brings itself, or no carve-out for the client's own materials |
| Termination for convenience | Who can end a project without cause, on how much notice, and what you're paid | The client can end an SOW at once, with no pay for work done or costs you've committed |
| Deemed acceptance | Whether the client has a deadline to accept or reject, and what a rejection has to say | Acceptance at the client's "sole discretion" with no deadline; payment that waits on acceptance with no fallback |
| Scope changes | How a change gets agreed, and whether it moves the fee and the dates | The client can change the scope by notice; extra work "at no additional cost"; "and related tasks" in the scope |
For payment stops, our Net-60 guide has counter-offers and wording.
What does a neutral version look like?
Common Paper's Professional Services Agreement (PSA) version 1.1 and Bonterms' PSA version 1.2 are free standard forms you can cite clause by clause. Our guide to client redlines compares them on payment, ownership, acceptance and change orders. In short:
- Payment: set in each SOW (Common Paper §4.2), or 30 days from the invoice (Bonterms §10.1). Bonterms adds that undisputed amounts must still be paid during a dispute (§10.7), and fees invoiced more than 120 days after they were incurred needn't be paid (§10.4).
- Ownership timing: Common Paper's SOW picks transfer on creation or on payment (§2.1), and its notes call on payment "a more provider-favorable position." A Bonterms assignment isn't tied to payment (§6.3(a)), so Bonterms is the more client-friendly of the two here.
- Acceptance: silence means accepted after the rejection period (Common Paper §1.4) or a 15-day test period (Bonterms §3.4(b)).
- Change orders: binding only once both sides agree in writing (Common Paper §1.3) or sign (Bonterms §3.3(c)).
Four points matter more on a client's own MSA:
| Clause | Common Paper PSA 1.1 | Bonterms PSA 1.2 |
|---|---|---|
| Your pre-existing materials, built into deliverables | Licensed, not assigned, with no list needed; the client may use them only as needed to use the deliverables (§2.3) | In assigned deliverables, they must be listed in the SOW before you include them; then licensed broadly, including rights to modify, transfer and sublicense (§6.3(d), §6.2(a)) |
| Claims outside the cap | The parties choose which claims get a higher cap or none (§8.1, §8.3) | Indemnity obligations; your breach of §8 on the client's materials, systems and facilities; confidentiality breaches; "personal injury or tangible property damage caused by the negligence or willful misconduct of Provider (including its employees, agents or Subcontractors)"; and liabilities the law won't let you limit (§12.5) |
| Indemnity | Both sides, for third-party claims (§9). Your default list: IP infringement by the deliverables, your staff being treated as the client's employees because of your acts or omissions, and your gross negligence, fraud or willful misconduct | Both sides, for third-party claims (§13.3). Yours: IP infringement by the services or deliverables, and any breach of §8. Not to the extent a claim results from the client's materials, its changes to the deliverables, or combining them with items you didn't provide (§13.6) |
| Termination for convenience | Either side can end the MSA for any reason when no SOW is active (§5.2(c)). A running SOW can end early for reasons such as an uncured breach, insolvency, a force majeure event of 30 days or more, or a warranty problem you can't fix (§5.2(a)–(b), §6.4); the cover page can add others | The client can end any SOW on 30 days' notice, unless the SOW says otherwise. Termination takes effect only once fees and expenses to date are paid (§11.2(b)) |
Whatever the client's MSA says, list your own tools and templates in the SOW.
Can you actually change a client's MSA?
You can usually ask for a few changes, especially with wording the client can paste in. How you ask depends on the client.
| Client | What to ask for |
|---|---|
| A small business or a founder | Track your changes in their Word file, with a one-line reason for each |
| A large company with fixed vendor terms | Your stops and the highest-impact asks, or project terms in the SOW, if the conflicts clause lets the SOW win |
Either way, put your stops first and keep the asks short. For a reply email you can adapt, see Your client redlined your contract.
What mistakes do people make with an MSA and an SOW?
Two mistakes are easy to make with a client's MSA.
- Reading only the SOW. The SOW has the price and the dates, so it gets the attention. The cap, the indemnity, ownership and termination usually sit in the MSA. They apply to later SOWs under it, unless an SOW validly changes them.
- Not checking which document wins. Say Tolvenbrook Freight's MSA says it controls over any SOW. You agree Net-30 in the SOW, but the MSA says 75 days. Under that clause, 75 days may be what counts. In Common Paper, each SOW is a cover page, and cover pages control over the standard terms by default. A Bonterms SOW overrides the rest only if it names the provisions it supersedes (§17.5).
When the MSA says it wins, check its amendment clause first. Common Paper's §12.2, for example, requires changes in writing, signed or electronically accepted by each party. Get the signatures it requires, or a signed MSA amendment if an SOW can't override the MSA. Then name the sections the SOW replaces:
“Conflicts. Notwithstanding Section [W] (Order of Precedence) of the Master Services Agreement, this SOW controls over the Master Services Agreement for this project only, as to the following sections, which this SOW expressly supersedes: Section [X] (Payment), Section [Y] (Ownership of Deliverables) and Section [Z] (Limitation of Liability).”
When should you get a lawyer, and where do you find one?
You can usually review a client's MSA yourself when the stops are few and you understand each one. Get a lawyer when:
- The indemnity goes beyond a short list of claims, or nothing caps your liability, on work where a claim could exceed what you could pay.
- The MSA takes ownership of tools or code you use for other clients, or adds a non-compete or exclusivity.
- The client is in another country, or the MSA uses the law of a state or country you don't know.
- The work under it is large for you, such as several months of revenue.
In the US, search for "[your state] bar lawyer referral service." In California, the State Bar certifies these services and lists them in a directory you can search by county, area of law and language. The Bar itself doesn't refer you to a lawyer; the certified services do. Lawyers they refer must be in good standing and carry professional liability insurance, and they offer an initial consultation for a reduced fee or no fee.
Outside the US, check the lawyer's license with the body that regulates lawyers where they practice.
When does reading a client's MSA by hand stop working?
A careful read with a checklist works for a short MSA and a single SOW. It gets harder with a 30-page MSA that links to other terms and comes with several SOWs. It also slips when several clients send their own paper in the same month, or when a client won't explain why a clause is there. That's when it's worth having a tool read their paper from your side and show you what's risky.
DealMate is an AI contract assistant that takes a deal from first draft to final: describe the deal in a sentence and get a draft built from your templates and clauses; when they send their template, review it from your side and see what's risky; when their redlines come back, compare the versions and see every change and the risk it carries.
Sources
- Professional Services Agreement Standard Terms, Version 1.1 — Common Paper
- Professional Services Agreement: Cover Page and annotations (Standard Terms v1.1) — Common Paper
- Professional Services Agreement, Version 1.2 — Bonterms
- Find a Lawyer Referral Service — The State Bar of California
This is general information, not legal advice. For high-stakes or unusual terms, talk to a lawyer.
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