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Read Before You Sign

Updated on December 16, 2016
A man in Russia wrote his own terms and conditions for his credit card.  Bank did not read them.  He sued.
A man in Russia wrote his own terms and conditions for his credit card. Bank did not read them. He sued. | Source

Illiteracy and how people who can read and write cheat uneducated people is one of the reasons why Mother India is a classic film.

That problem is still with us and we experience it every time someone at the bank wants our help about money electronic transfers. We can either help or cheat them.

People who did not go to school sometimes sign documents they don't understand. You are educated. Why do you sign on the dotted lines without reading the document?

Apportioning Blame

Contract terms and conditions should be called ‘Don’t Blame Me’ documents and they kick in when something goes wrong. People lose a lot of money and property because they did not have the time to really understand the documents they signed.

Jonathan Speigel, from the law firm Speigel Nichols Fox posted a user-friendly blog about the subject recently. It is user-friendly because people like me, non-lawyers, can understand it.

Long Contracts

Most contracts have many pages. That is why some hip hop stars rely on lawyers and celebrity agents to explain these long documents.

It was announced in February 2015 that musician Pharrell Williams will write four children’s books based on his Happy his popular song.

That might be one long contract with publisher Harlan Coben and Meg Rosoff or four separate ones. It all depends on what the two parties agree upon.

People buying condos might be too excited to read Florida’s or Ontario’s Condominium Act and take what property agents tell them.

That is not advisable. You don’t need a contract to fill up the gas tank, even if you drive a Maserati that kisses the ground. Anything that needs 25 pages to buy costs a lot of money and it will be money down the drain if you do not read contracts before you sign them.


A condo, house, office building or piece of land you bought using a bank loan does not belong to you. You don’t pay the monthly instalments, you lose it. Banks are not the bad guys. You gave them permission when you put your initials on every page of the mortgage/bond pages.

That might not be a problem if you bought the condo cash, like most Canadian ‘snowbirds’. Canada is notorious for its cold weather. That is why Canadians who can afford it have vacation homes in warmer countries.

They like Florida, where they are known as ‘snowbirds’. When it becomes minus 28 degrees, they fly to that U.S. state for sun and sea.

Canadian 'snowbirds' buy condos in Florida to escape ear freezing winters.
Canadian 'snowbirds' buy condos in Florida to escape ear freezing winters. | Source

Let’s hope 'snowbirds' read and understood all the contracts they signed, and the tax implications in Canada and the U.S. That is one example. Read before you sign anything longer than two pages.

Banks employ loan officers that explain conditions of the loan, but they should do more than that. They must give clients extra time to seriously think about ramifications of putting up your house as collateral, to finance a big data technology company.

Banks Can Help

Banks should provide reading rooms with water, tea or juice, where clients can sit and read the 30-page contracts. The business loan consultant is trained to explain every clause in the contract but his or her office is still intimidating, that is why a neutral room should be provided.

Loan consultants should give clients that option to read the contract on their own before signing on the dotted line. Contracts are legal documents. Legal language is designed to make sure that attorneys always have jobs.

They will be out of business if contracts are written in user-friendly German, Italian, Spanish, English or French. Banks should give clients a piece of paper where they can jot down questions when they do not understand Section 2.5.3 (d) of the contract.

Read Slowly

Patience. It is advisable to do the following before you sign documents for a record deal, a joint venture, a bank loan which involves using your home as collateral, rental lease etc.

  1. Sit at a table with no clutter, except a glass of water, tea or coffee.

  2. Have a notepad and pen ready. Forget your computer or tablet for a moment.

  3. Write down Latin words and other words you don’t know. You might regard yourself as a business woman, but you are either a debtor or creditor in a contract, and contract law kicks in.

  4. Understand the relationship between clauses. When Section 6, says if monthly payments are not made, conditions of Section 2 apply, you better understand what Section 2 is all about.

  5. Look out for exclusionary clauses, which literally means, “I’m not to blame if something goes wrong.”

Exclusion clauses are clauses, usually written down, that say that one party to the contract will not be responsible for certain happenings. For example, if you join a gym, it is common for the contract to say that the gym owner will not be responsible if you are injured while exercising. If you arrange to park your car in a public carpark for a fee, the owner will often seek to include in the contract a provision that they will not be responsible for damage to your vehicle, or theft of goods from it, while it is in the carpark.


Contracts are not the only documents that need proper reading. You should read and understand any policy document that affects your salary or the way you make a living.

Kids see basketball as the freeway to fame and fortune. Some are lucky to make the draft and end up being superstars like Kobe Bryant.

It is in their best interests to know the Collective Bargaining Agreement (CBA) between players and the National Basketball Association (NBA), because sooner or later some clause will affect them.

In fact, anybody interested in basketball should read the CBA, so that they can understand the sports segment of television news or ESPN. Why are players traded? What is a free agent?


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