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Sample report — freelance design agreement
Real analysis output. Every real scan looks exactly like this.
freelance-design-agreement.pdf
Risk Score
This freelance agreement significantly favors the client. Unlimited liability exposure and a full IP assignment with no portfolio rights are critical issues that must be negotiated before signing. The auto-renewal opt-out window is unusually long and the non-compete may be unenforceable under California law.
Risk Flags (4)
Unlimited Liability — No Cap on Damages
HighThe contract imposes unlimited liability on the contractor with no cap. A single mistake could result in damages far exceeding the total contract value — potentially wiping out months of income.
“The Contractor shall indemnify and hold harmless the Client from any and all claims, damages, losses, costs, and expenses of any nature whatsoever arising from the Contractor's performance of services under this Agreement.”
Negotiation Tip
Negotiate a liability cap equal to the total fees paid under the agreement. Standard freelance language: 'Contractor's total liability shall not exceed the total compensation paid by Client in the 3 months preceding the claim.'
Full IP Assignment — No Portfolio or Attribution Rights
HighAll work product is assigned to the client upon creation (not just upon payment), with no right to display the work in your portfolio or use it for self-promotion. This is unusually one-sided.
“All work product, deliverables, designs, code, and creative materials produced under this Agreement are works-for-hire and shall be the sole and exclusive property of Client from the moment of creation.”
Negotiation Tip
Request two additions: (1) IP transfers upon full payment, not upon creation; (2) a display license clause: 'Contractor retains the right to display work in their professional portfolio with prior written approval from Client, not to be unreasonably withheld.'
Auto-Renewal with 90-Day Opt-Out Window
MediumThe contract auto-renews for 12-month periods unless written notice is given 90 days in advance. This is twice the industry standard and creates a significant lock-in risk.
“This Agreement shall automatically renew for successive twelve (12) month periods unless either party provides written notice of non-renewal no less than ninety (90) days prior to the end of the then-current term.”
Negotiation Tip
Push to reduce the opt-out window to 30 days, which is standard for freelance engagements. Also request a shorter initial term (6 months) before the auto-renewal kicks in.
Non-Compete Scope May Be Unenforceable in California
LowThe 18-month non-compete covers 'any substantially similar services in the technology sector.' Under California Business & Professions Code §16600, non-competes are generally void — but enforcing this elsewhere could be an issue.
“During the term of this Agreement and for eighteen (18) months thereafter, Contractor shall not perform any substantially similar services for any competitor of Client operating in the technology sector.”
Negotiation Tip
If you're based in California, note this is likely unenforceable under Cal. Bus. & Prof. Code §16600. Still worth negotiating narrower scope (specific named competitors only, shorter duration) before signing.
Action Items
Key Terms Extracted
Acme Technologies Inc., a Delaware corporation
Sarah Williams Design, sole proprietor
May 1, 2026
April 30, 2027 (12 months, auto-renews)
$4,500/month
Net 30 from invoice date
California, USA
30 days written notice, with or without cause
60 days written notice required
All work product assigned to Client upon creation
None — no display license granted
Unlimited — no cap specified
18 months, technology sector, post-termination
Binding arbitration, San Francisco, CA
Jurisdiction Analysis — California, USA
California, USA
Governing law per §14.2 of contract
Your 18-month non-compete clause is generally unenforceable under California law. You are free to work for competitors unless a court finds a narrow exception.
Any penalty clause in the contract may be unenforceable if the damages are disproportionate to the actual harm. The unlimited liability provision faces scrutiny here.
California AB5 requires scrutiny of contractor classification. If Acme controls how, when, and where you work, this relationship may be deemed employment.
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