Commercial Contract Checklist for Pakistani Businesses

Most contract disputes in Pakistani courts come down to the same handful of things: vague payment terms, no dispute resolution clause, missing governing law, or conditions precedent that nobody tracked.

Here's a practical checklist for any commercial agreement governed by Pakistani law. It's not exhaustive — every deal has its own complexity — but it covers the clauses that most commonly cause problems.

Parties & Authority

• [ ] Full legal names of all parties (not trade names)
• [ ] Company registration numbers for corporate parties
• [ ] Confirmation that the signatory has authority to bind the entity
• [ ] For companies: board resolution or power of attorney if required

Pakistani courts have invalidated contracts where signatories lacked proper authority. Don't assume.

Consideration & Payment

• [ ] Exact amount or clear calculation mechanism
• [ ] Currency specified (PKR vs. foreign currency matters for exchange risk)
• [ ] Payment timeline and conditions
• [ ] Late payment consequences (mark-up rate and when it kicks in)
• [ ] Tax treatment — who bears GST, withholding tax, etc.

Conditions Precedent

• [ ] Every CP listed with clear, objective satisfaction criteria
• [ ] Responsible party for each CP
• [ ] Deadline for CP satisfaction
• [ ] Consequences of CP failure (termination right? extension? renegotiation?)

Representations & Warranties

• [ ] Accuracy as of signing AND closing (if different)
• [ ] Material adverse change carve-outs defined
• [ ] Seller/provider reps vs. buyer reps — are they balanced?
• [ ] Knowledge qualifier — "to the best of X's knowledge" vs. absolute

Indemnities

• [ ] Scope: what losses are covered?
• [ ] Exclusions: consequential loss, loss of profit, etc.
• [ ] Cap on liability (typically linked to contract value)
• [ ] Survival period after contract end
• [ ] Notification requirements for claims

Force Majeure

• [ ] Defined events (check if pandemic/epidemic is included — it wasn't in most pre-2020 agreements)
• [ ] Notice requirements and timeframes
• [ ] Mitigation obligations
• [ ] What happens if force majeure continues beyond a set period

Confidentiality

• [ ] Definition of confidential information (broad vs. narrow)
• [ ] Exclusions (already public, received from third party)
• [ ] Duration — does it survive contract termination?
• [ ] Permitted disclosures (regulatory, legal, affiliates)

Termination

• [ ] Termination for cause: what triggers it? Notice required?
• [ ] Termination for convenience: is it allowed? Notice period?
• [ ] Consequences of termination: payment obligations, return of materials, survival clauses
• [ ] Step-in rights if applicable

Dispute Resolution

This is the most frequently missing or poorly drafted clause.

• [ ] Governing law: should be Pakistani law if the parties are here and the contract is performed here
• [ ] Dispute resolution mechanism: negotiation → mediation → arbitration / litigation
• [ ] For arbitration: LCIA, ICC, or domestic arbitration? Seat? Number of arbitrators?
• [ ] For litigation: which court? Karachi, Lahore, Islamabad?
• [ ] Is arbitration clause separable from the rest? (It should be)

Miscellaneous (Don't Skip These)

• [ ] Entire agreement clause (supersedes prior negotiations)
• [ ] Variation clause (changes only in writing)
• [ ] Waiver clause (waiving one breach doesn't waive future ones)
• [ ] Severability (invalid clause doesn't void whole contract)
• [ ] Notice provisions (email sufficient? Registered post required?)
• [ ] Counterparts clause (can parties sign separately?)

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Drafting vs. Reviewing

This checklist works both ways — use it when drafting to make sure nothing is missing, and when reviewing to spot what the other side left out (often intentionally).

LawyerUp can help with both. The AI assistant can generate first drafts of any of these clauses in Pakistani legal format, or flag missing or unusual provisions in contracts you upload.

Try the contract drafting tool — upload a contract and ask it what's missing.