Contracts for the provision of services: 3 minutes to understand everything

In the office rental sector, service contracts are commonplace. This commercial contract formalizes the relationship between a service provider (a coworking space or landlord) and its customer (you). But this type of contract has many other advantages, which we'll cover in this guide. Here's what you need to know about service contracts!

What is a service contract (definition)

Article 1710 of the French Civil Code defines a contract for the provision of services as "louange d'ouvrage".

This contract, concluded for valuable consideration, creates rights and obligations between two protagonists: a service provider and his customer. The contract provides a framework and security for the relationship between the two parties.

Also known as a "service provision agreement", this type of contract can be used in a wide variety of fields:

• building and civil engineering ;
• training ;
• graphic design ;
• web editing ;
• household activities ;
• concierge services ;
• computer maintenance services ;
• and, of course, professional office rentals...

Why draw up a service provision contract?

Forthe service provider, drawing up a service contract clearly defines the nature and price of the service to be provided.

For the customer, it's a way of seeing in black and white what he can expect from the collaboration.

For example, when constructing a building, the customer can expect the work to take a maximum of 3 months. In the event of delay, the service contract can specify the penalties incurred by the service provider.

In the eyes of the law, this contract has the same commercial value as a sales contract. Moreover, its wording is strictly regulated by law.

Service contract: mandatory clauses

The following clauses must be included when drawing up your service contract:

• information on the service provider ;
• information on the customer ;
• the purpose of the service contract;
• the price of the service (or services, if applicable);
• terms and conditions of the service (e.g. schedule for completion of the work, deadlines, participants, etc.);
• the duration of the contract ;
• the obligations of the parties;
• terms and conditions for terminating the contract and penalties in the event of non-compliance with the purpose of the contract or deadlines;
• cases of force majeure;
• the law applicable to the contract;
• the competent court in the event of a dispute.

For companies, it is essential to include the name of the company, its legal status, the amount of share capital, the address of the registered office, the name of the legal representative and the date of signature.ge, the name of the legal representative and the RCS registration number.

The contract must be initialed and signed by both parties. At least one copy is required per party.

Service contract: specific clauses

Depending on the case, other more specific clauses may appear in service provision contracts.

There are, for example :

Confidentiality clause

Whether reciprocal or unilateral, the confidentiality agreement commits the parties concerned to securing information and respecting the confidentiality of processed data.

This can be vital when you're dealing with sensitive information or information that may be of interest to competitors.

The clause may be worded as follows: "the service provider is not authorized to use the information communicated for any purpose other than to carry out the mission entrusted to it."

You will also need to indicate how long this clause is valid. This varies according to the negotiations and the sensitivity of the information.

Obligation of result or means

Also known as the "obligation de résultat atténué", this clause obliges the service provider to complete the assignment. He cannot stop until his goal (clearly defined in the contract) has been reached.

The difference between an obligation of result and an obligation of means is simple.

An obligation of means requires the service provider to make every effort to achieve the objective set out in the contract, without necessarily succeeding in doing so. For example, if a carrier makes every effort to deliver an item on time, but road traffic is too heavy, he will not be held liable.

With the obligation of result, only the result obtained counts.

Rules of professional conduct

Ethical rules apply to specific professions such as law and medicine. Medical secrecy, for example, is one of the ethical rules specific to the healthcare sector.

Transfer of ownership

This specific clause regulates the question of ownership of goods resulting from the service provider's upstream work. If the service involves the production of a vase, pottery or a painting, the transfer of ownership means that once the object has been delivered, it belongs to the customer and no longer to the service provider.

This clause, like the other clauses in a service contract, avoids any disputes between the parties once the goods have been delivered or the service performed.

How do I terminate a service contract?

The procedures for terminating a contract for the provision of services vary according to whether it is a fixed-term or open-ended contract.

Fixed-term service contract

If the end date of a service contract is fixed, it is generally impossible to terminate the contract early.

There are two exceptions: if the parties decide to terminate the contract by mutual agreement, or if one of the parties is at fault.

Open-ended service contract

If the end date of a service contract is not fixed, the parties may in principle terminate it at any time. In practice, an early termination clause specifies how the contract is to be terminated.

This clause specifies the manner in which notice of termination is to be given, the period of notice and the compensation payable to the party who is notified of the early termination of the contract through no fault of their own.

A tacitly renewable service contract is automatically renewed on the expiry date. This type of contract can be terminated if the service provider is at fault on the renewal date, within the period specified in the contract.

Service provision contract: key points to bear in mind

To summarize

• a contract for the provision of services formalizes the relationship between a service provider and its customer;
• this onerous agreement gives rise to rights and obligations between the two parties;
• the drafting and signing of a contract for the provision of services can affect many sectors of activity;
• the procedures for terminating a fixed-term service contract are different from those for an open-ended contract.

And now that this contract holds no secrets for you, discover our guide to the different types of real estate leases.

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