Transport Contracts – The Vital Components You Need to Consider

Transport contracts are long-term haulage agreements between a haulier and a client. A well-crafted contract can mean a profitable deal that will keep your business in the black for months or even years to come. A contract poorly crafted, however, will not only be rejected for its unprofessionalism but can be exploited at your expense.

So what should such well-crafted transport contracts contain? Here are some of the more important considerations to keep in mind:


Identification of Parties Involved

This is simply the part where you lay out the full names of each business entity involved in the negotiations followed by information that will define how these entities will be referred to in the contract, for example, as the haulier or client. Make sure that the company names match other legal documents, such as certifications and payment slips just to be sure. Include the date when the contract is to be made effective as well.

Description and extent of services

This is the important section where you write up a quick outline of the services you will provide as a haulier.  Remember to be clear and concise with the information you put down on transportation contracts, like the condition of the goods and the deadlines involved. If you are ironing out a complicated deal, you can write up a separate exhibit that describes the exact services you provide in greater detail. You can then attach this exhibit in the middle and latter portions of the contract, where space is reserved for more technical details.

Rates and terms of payment

This part is relatively simple and involves documentation of what your client is expected to pay upon prompt delivery of services. You can also outline the terms of the payment, like weekly, bimonthly or monthly payments. You can opt to make a blanket payment agreement for a set amount of time or you can include clauses like fuel surcharges based on mileage, although you will need to secure the agreement of the other party if this is to be the case.

Obligations and waivers of all parties

Here is where you talk about the responsibilities of each party in the transport agreement. This includes performance requirements on your part, approval of any personnel changes involved between both parties and the duties of your hauliers as they go about their business of transporting goods and materials. This section will also include a brief description of the rights of both parties to waive the contract should certain conditions be left unfulfilled, like the inability of the client to pay or your inability to deliver the items in a timely manner. You can even include a section outlining the legal consequences a party will face should it default on its obligations.

Indemnification clause

This section of the transport contracts is where you outline when the other party will secure your company from legal harm due to conditions and events that are beyond the terms agreed upon in the transport partnership.

Witnessing of execution

The final part of haulage contracts is where you have a representative of both parties sign and profess witness to the contract. Make sure the representatives include their full names, signatures, titles in their respective companies and dates that they witnessed the execution of the contract. Make sure the contract is signed on or before the date indicating the effectiveness of the contract back in the section identifying the parties involved.

Incorporate these clauses in your transport contracts and you will come out with a much better agreement between your haulage company and the clients you will work with in the long-term!