How much to review an NDA?

[Alan]

As a general rule I say no to NDA's , the sort of clients we services should have no reason to need an NDA. And what we do is create Website, which puts all the information they provide us into the public domain.

But very occasionally a (potential) client waves an NDA at use, and todate we haven't taken on their business.

But, lets say the business opportunity was significant, how much would I expect to pay for a review of an NDA?

 

[Paul_Rosser]

Depends on how complicated and long the NDA is, if it's fairly standard then a solicitor shouldn't charge you more than an hours time.

 

[Steve Sellers]

As Paul says. Some NDA's can be a page long, some can be 20-30 pages. But I don't see any reason why you should be charged more than 1-2 hours for simply reviewing the document (rather than altering in addition).

 

[lellis]

The time involved to advise (properly) on a one page contract is not taken up by advising on what is in the contract, but what is not in the one page contract, while keeping on eye on the purpose of entering into the NDA (ie what is going to be disclosed here, is it trade secrets, or are the parties are "just" going to be disclosing sensitive price information?). Shorter contracts almost invariably present more risk to pone of the parties; in this case the discloser.
Context is everything.
The other factors include how the contract works. For instance, I have come across situations where:
1. if an emerging company had signed an NDA presented by a company (a household name in IT products), the company would have had a licence to make the emeging companies products (a licence of their IP rights); and in another case
2. if the start-up signed the contract, all of their intellectual property rights would have been assigned to the other side.

 

[Alan]

Many thanks for your responses.

In terms of cost, reviewing an NDA then could cost £150-£400 as far as I can establish, which is what I was looking for.

The reason I raised this as I was being asked to sign an NDA from someone who
a) couldn't define what 'The Project' (defined term in the NDA) was in any generic way prior to signing the NDA
b) could not define the approximate commercial value of the work

They said "In order for me to brief you sufficiently in order to quote, some highly confidential information will need to be imparted on behalf of me and/or my clients"

As we build websites for typically £400 , I just couldn't see what they were on about, and despite a protracted conversation, still could get no further information, what is more they failed to understand why I would not be prepared to do £250 of legal review on the chance (undefined chance) of winning some work, which I would charge around £400 for normally.

Bizarrely, the argument they had for me signing was other suppliers sign without issue. Millions of people purchased PPI, it didn't make it right for them (I didn't). I suspect many small suppliers just don't understand the risk or care and sign NDA just because they are asked.

If I knew a deal was worth £10,000 I might have taken a different stance - BUT we don't do £10,000 projects, it is just not what we do.

So I politely told them thanks, but no thanks. Was I wrong?

 

[lellis]

The way it can be done is to get your own precedent NDA prepared fit for the purpose, with a view to tailoring the potential business partner's and the "purpose" in circa 5 minutes. You then use the precedent again, and again and again.
The document is intended to protect the flow of information and discussions (and probably reserve any IP rights in documents exchanged to the disclosing party).
Next step (assuming the negotiations were successful) would be:

1. prepare short heads of terms, then subject to agreement of the heads of terms;
2. prepare and sign formal contracts.

These process can be commoditised, so that minimal changes are required from job to job. It also minimises the potential for disputes down the line.

 

[Alan]

The preemptive strike is a good idea.

Although I think you have to be quick, as soon as the client says 'NDA" you have to say OK I'll send you ours. The other NDA situation I had in recent years was the client sent an NDA (and even to me it was obviously flawed), so I sent them 'mine' - actually an example NDA form the IPO http://www.ipo.gov.uk/nda-mutualagreement.pdf and they then cut up nasty saying they spend lots on legal fees on their NDA and were not prpared to even consider mine. I didn't do business with them either.