How to Review a Contract, and What to Say
Reviewed 18 September 2026 against primary sources. The rule on counter-offers is quoted from the Restatement and the goods exception from the Uniform Commercial Code. Where a report sits behind a paywall we name the source we actually read. How we research and correct.
Most guidance on how to review a contract stops at the moment you find a problem. You have the finding, and then nothing. This page covers the review, and then the part that actually decides the outcome: which findings are worth raising, the words to use, and a legal trap in the way most people ask.
The advice here is for anyone who has to review a contract they did not draft. It is general information about US commercial agreements rather than legal advice. The counter-offer rule in section 3 has real consequences and a lawyer is the right call on anything significant.
How to review a contract
Four passes, in this order. The order matters, because attention runs out and the expensive clauses are usually at the back.
- Pass one, the parties and the money. Exact legal names on both sides, the amount, what triggers payment, and what sits outside the quoted figure.
- Pass two, the failure clauses, while you are still concentrating. Liability, indemnity, termination, renewal, governing law and forum. These describe what happens when it goes wrong, which is the only part that matters once it does.
- Pass three, the promises. Whether what you were told in the conversation appears in the document, because most agreements say the document is the whole of it.
- Pass four, the silences. Anything the document does not mention is a gap filled by a default that was not written with you in mind.
- Then triage. Sort what you found into raise, accept and walk away, before you write a single comment.
For the full clause-by-clause list, the contract checklist covers 28 items. This page assumes you have done that part and are holding a list of problems.
Seven findings, what each costs, and the words to use. The third column is the discipline.
That table is the part missing from almost everything written on this subject. The finding is not the deliverable. The sentence you send is.
1. When you review a contract, raise two things, not nine
The instinct after a careful read is to list everything. It is the wrong instinct, and it costs you the thing you actually wanted.
A list of nine comments risks reading as a difficult counterparty. A list of two reads as somebody who read the document and has a specific concern. Nobody has published data on how many asks is too many, so take that as judgment rather than a finding, but the credibility you save is what you spend on the term that matters.
Which term matters is reasonably predictable, because somebody counts. World Commerce & Contracting has published a Most Negotiated Terms survey periodically since 2007, and the 2024 edition ranks them: limitation of liability first, price and price changes second, indemnification third, then termination, payment, scope, warranty, intellectual property, delivery and liquidated damages. The top of that list has been stable for years.
Read it as a map of where the movement is. A term that gets negotiated a lot is a term the other side expects to discuss. A term that does not appear at all is one they are more likely to treat as fixed.
A separate study is worth knowing alongside it. The Purpose of Contracts, published by World Commerce & Contracting with Deloitte in September 2024, found that only 16 percent of contract negotiators believe they are negotiating the right things.
What to look for: the one finding that would actually change whether you sign. Raise that, plus anything free like a typo, and let the rest go.
2. How to phrase the ask
The wording in the last column of the figure above follows four rules, and they are worth stating because they generalize.
Lead with agreement. Opening with what works makes the ask read as a final detail rather than a reopening of the deal.
Make it specific and small. “Cap liability at the fees paid” is answerable. “The liability provisions are aggressive” is not, and invites a defense rather than a change.
Give a reason about you, not about their drafting. “That is the level our insurance is written to” is a constraint. “This clause is unreasonable” is a judgment about them, and people defend against judgments.
Ask whether, not demand that. “Is there room to” and “could we” are easier to say yes to than an instruction, and they keep the conversation open if the answer is no.
What to look for: whether your message could be read as an accusation. If it could, rewrite it as a constraint.
3. The counter-offer rule, and why it probably does not apply to you
There is a rule people half remember from somewhere, and it causes more anxiety than it should while hiding the one case that genuinely matters.
The rule is real. Under US common law a counter-offer terminates your ability to accept what was originally offered, and the Restatement states it plainly:
“A counter-offer is an offer made by an offeree to his offeror relating to the same matter as the original offer and proposing a substituted bargain differing from that proposed by the original offer.”
“An offeree's power of acceptance is terminated by his making of a counter-offer, unless the offeror has manifested a contrary intention or unless the counter-offer manifests a contrary intention of the offeree.”
Restatement (Second) of Contracts, section 39
The usual conclusion drawn from this is that sending a redline destroys your deal. That conclusion is wrong in most commercial situations, for three separate reasons, and the reasons are worth knowing because they tell you where the actual risk sits.
First, there is usually no offer to counter. A draft circulated for negotiation is generally not an offer at all. Restatement section 26 provides that a manifestation of willingness to enter a bargain is not an offer where the person it is addressed to has reason to know the other side does not intend to conclude a bargain until a further manifestation of assent. An unsigned draft, and certainly one saying it is not binding until executed by both parties, is the textbook case. Nothing exists for your redline to terminate.
Second, asking inside an acceptance is still an acceptance. Section 61 is the provision nobody quotes:
“An acceptance which requests a change or addition to the terms of the offer is not thereby invalidated unless the acceptance is made to depend on an assent to the changed or added terms.”
Restatement (Second) of Contracts, section 61
So you can agree and ask at the same time. What you cannot do is make your agreement conditional on getting the change, which is the distinction the whole rule turns on.
Third, if they change their mind, the redline was not what cost you. An ordinary offer is revocable until accepted. Section 42 terminates your power of acceptance the moment you receive word that the other side does not intend to contract, whether or not you ever sent a comment. The scenario people fear is a revocation problem, not a counter-offer problem.
And the case that runs opposite to the popular advice: where an offer genuinely is held open, by an option contract or a signed firm offer under UCC section 2-205, section 37 provides that the power of acceptance is not terminated by rejection or counter-offer at all. The one situation where you have a protected offer is the one where you can negotiate hardest.
Two of these end the offer on the table. The last row is the sentence that keeps both doors open.
So where does the rule actually bite? In one place: you are holding something that really is an offer, a signed document sent for your signature or a quote expressed as open for acceptance, and you reply that you will sign only if something changes. That is a conditional acceptance, which section 59 treats as a counter-offer, and section 39(2) then ends your power to take the original.
Section 39(2) does contain an escape, and it is worth understanding precisely rather than loosely. The rule applies unless the counter-offer manifests a contrary intention of the offeree, so stating that you remain willing to sign as drafted preserves your power to accept. Note two limits. It does not hold the offer open, because they can still withdraw it under section 42 or let it lapse. And it is not free: telling somebody in writing that you will sign anyway concedes the ask in the same breath you make it. Use it where you would genuinely rather have the original deal than no deal, and not otherwise.
You will often see UCC section 2-207 cited as reversing all of this for goods. It is narrower than that. It provides that “a definite and seasonable expression of acceptance or a written confirmation which is sent within a reasonable time operates as an acceptance even though it states terms additional to or different from those offered or agreed upon, unless acceptance is expressly made conditional on assent to the additional or different terms”. Official Comment 1 explains that the section addresses confirmations of a deal already struck, and acceptances adding minor riders. A negotiated markup is neither, and the closing words exclude exactly the conditional reply that the common law rule is about. Treat 2-207 as a rule about exchanged forms rather than about redlining. Louisiana has never adopted Article 2 in any event.
What to look for: whether what you are holding is actually an offer, and whether you are about to make your agreement depend on getting a change. If the answer to either is no, the rule is not your problem. If the answer to both is yes, and you would take the original terms rather than lose the deal, that is the moment to think carefully or to call somebody.
4. What to do when they say no
A refusal is information, not an insult, and it is worth treating as the start of the next question rather than the end of the conversation.
- Ask whether it is policy or this deal. “Is that something you hold firm on generally?” A company-wide position is genuinely immovable. A position taken on your deal often is not.
- Try a narrower version. If an uncapped indemnity will not become mutual, ask for a cap on it alone, or an exclusion for consequential loss. A smaller ask after a refusal frequently lands.
- Ask for the reason. Sometimes the term is there because their insurer or their own upstream contract requires it, which tells you it will not move and stops you wasting the relationship on it.
- Price the risk instead. If you have to carry an exposure, that is a cost, and it is legitimate to reflect it in what you charge or what you pay.
- Decide on the real terms. You now know what the deal actually is. Sign it or do not, but decide on the document in front of you rather than the one you hoped for.
What to look for: whether the answer changed anything. If the terms are the same after the conversation, the only remaining question is whether they are acceptable.
5. When you have no leverage at all
Much of the advice on this subject quietly assumes a negotiation. Often there is not one. Consumer terms, platform agreements and standard supplier terms are presented whole, and the counterparty has no intention of changing a word for one customer.
The review still has a point, and the point changes. You are no longer reading to negotiate. You are reading to decide whether to proceed, to know what you are carrying, and to know where the exits are. Three things are still worth doing.
Find the term that would actually stop you. If there is one, that is a decision about the deal rather than about the drafting. Find the exit and its notice period, and put the date in your calendar. And keep the version you agreed to, because terms that can be changed unilaterally usually are, and the copy you accepted is the evidence of what you accepted.
What to look for: whether the absence of negotiation changes the answer to whether you should sign. Sometimes it should.
6. What the review will not tell you
It will not tell you whether a clause is enforceable where you live, which turns on your state and the facts. It will not tell you how hard the other side will actually push, which is commercial rather than legal. It will not tell you whether the deal is good. And it will not tell you what a clause means when the drafting is genuinely ambiguous, which is the point at which a lawyer stops being optional.
The short version
Review a contract in four passes, starting with the parties and the money, then the clauses describing failure, then whether the promises you were given are in the text, then the silences. Triage what you find into raise, accept and walk away, and raise two things rather than nine, because credibility is finite and limitation of liability is the term most negotiated in practice. Phrase the ask as a constraint of yours rather than a criticism of their drafting. And do not let the counter-offer rule frighten you out of asking: a draft circulated for negotiation is usually not an offer at all, and an acceptance that requests a change is still an acceptance. The rule bites only when a live offer exists and you make your agreement conditional on getting the change.
If the draft is in front of you now, RateMyContract will read it back in plain English so you know what you are raising. For the review itself, the contract checklist covers 28 clauses point by point, what is a contract covers what makes an agreement binding, and contract review tools covers what software helps with and what it misses.
Where RateMyContract fits in
To review a contract you first have to understand it, and the triage in the first figure assumes you already do. That assumption is where most people are stuck. RateMyContract is a free tool that reads one contract and explains it in plain English, flagging clauses people commonly overlook, which is the step between having a document and having a list of findings.
It does not negotiate, does not draft language for you, does not tell you whether a clause is enforceable in your state, and gives no legal advice. It has not been independently benchmarked and publishes no accuracy figure, here or anywhere. It gets you to the point where the rest of this page applies.
When to talk to a lawyer
Worth the fee where a personal guarantee or an uncapped indemnity is in the draft, where the amount at stake would genuinely hurt, where you are being asked to give up claims, where the drafting is ambiguous enough that two readings are both plausible, and on anything involving real property. Also worth it before you reply to a live offer on a deal you cannot afford to lose, because whether your reply reads as a question, an acceptance or a conditional acceptance is exactly the kind of thing worth ten minutes of advice.
Frequently asked questions about how to review a contract
How do you review a contract?
Review a contract in four passes. Check who the parties are and what the money is. Read the clauses describing failure while you are still concentrating: liability, indemnity, termination, renewal, governing law. Check that what you were promised verbally appears in the text. Look for what the document does not say. Then triage your findings before writing a single comment, because raising all of them spends credibility you need for the one that matters.
What should I ask to be changed in a contract?
Usually one or two things. World Commerce & Contracting's Most Negotiated Terms 2024 ranks limitation of liability first, price and price changes second and indemnification third, so those are where the other side expects a discussion and where movement is most likely. A one-sided indemnity is worth asking to make mutual, which is an easier yes than deletion. Typos and inconsistent dates are free to raise. Governing law does not appear in that top ten, which suggests it moves less readily than the money clauses.
Can asking for a change cancel the offer?
It can, but less often than people fear. Restatement section 39(2) terminates your power of acceptance when you make a counter-offer, and section 59 treats a reply conditional on new terms as one. Three things usually prevent it from mattering: an unsigned draft circulated for negotiation is generally not an offer at all under section 26, so there is nothing to terminate; section 61 says an acceptance that requests a change is still an acceptance unless made to depend on the change; and if they simply change their mind, section 42 ends the offer regardless of what you sent. The rule bites when a live offer exists and you make your agreement conditional on getting a change.
Is sending a redline a counter-offer?
Usually not, because usually there is nothing to counter. A draft circulated for negotiation is generally not an offer under Restatement section 26, particularly where it says it is not binding until executed by both parties. A redline becomes a counter-offer when it responds to something that genuinely is an offer and makes your agreement depend on the changes. UCC section 2-207 is often cited as reversing this for goods, but by its terms and Official Comment 1 it addresses confirmations of a deal already struck and acceptances adding minor riders, not negotiated markups.
What if they say no to every change?
Then you know the real terms and you decide on those. Ask whether the term is firm as policy or only on this deal, since the second often moves. Try a narrower version of the same ask. Ask for the reason, because a term required by their insurer or their own upstream contract will not move. Price the risk you are being asked to carry. Then decide on the document in front of you rather than the one you wanted.
How do you ask for a contract change politely?
Lead with what you agree to, make the ask specific and small, give a reason that is about your own constraints rather than about their drafting, and ask whether rather than demand that. “Is there room to cap liability at the fees paid? That is the level our insurance is written to” is easier to say yes to than “the liability clause is unreasonable”.
How we checked this page
The counter-offer rule is quoted verbatim from Restatement (Second) of Contracts section 39, and the limiting provisions verbatim from sections 26, 42 and 61. UCC section 2-207(1) is quoted verbatim including the confirmation branch that is usually dropped. The Restatement is a scholarly statement of common law rather than a statute, so it is persuasive rather than binding and individual states differ; the page says so in the body rather than only here.
A correction made during review, and it changed the argument. An earlier draft of this page said that returning a redline is a counter-offer that ends your power to accept the original, full stop, and treated that as the finding. The fact-check established that the claim was wrong in the ordinary commercial case, for three reasons the draft had missed: section 26 means a negotiating draft is usually not an offer at all, section 61 means an acceptance that requests a change is still an acceptance, and section 42 means a party who changes their mind ends the offer whether or not you sent comments. The earlier draft had also cited section 61 in its own source list without noticing that it cut against the thesis. The rule is real and the narrow case is worth knowing, which is why the section survives, but the alarming version of it does not.
A second correction. An earlier draft said the Most Negotiated Terms report was behind a member paywall and cited a secondhand summary of it. The landing page is gated but the report itself is freely readable, and this version cites and links it directly, which is where the full top ten comes from. The same draft attributed the 16 percent figure to that report; it belongs to a different one, The Purpose of Contracts, published by World Commerce & Contracting with Deloitte in September 2024, and is now attributed correctly.
What this page does not claim. No figure is given for how often a requested change is granted, because no dataset supports one. The language in the figure is offered as a starting point rather than as tested wording; nobody has run a controlled study on contract negotiation phrasing, and a page that implied otherwise would be inventing a result.
Sources. Restatement (Second) of Contracts, sections 26, 37, 39, 42, 59 and 61. UCC section 2-207 and its Official Comment 1. Cornell Wex, counteroffer. World Commerce & Contracting, Most Negotiated Terms 2024, 21 October 2024. World Commerce & Contracting and Deloitte, The Purpose of Contracts, September 2024. Last reviewed 18 September 2026.
