Service Fee Agreement Template for New Zealand

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Key Requirements PROMPT example:

Service Fee Agreement

"I need a Service Fee Agreement for my IT company based in Auckland to provide cloud hosting services to a government agency, with specific data protection clauses and service level requirements, to commence from March 2025."

Document background
The Service Fee Agreement is a vital commercial document used in New Zealand business operations when establishing formal service arrangements between parties. It is particularly relevant when one party agrees to provide specific services to another for compensation. This document type is essential for businesses operating under New Zealand jurisdiction, incorporating key elements of the Contract and Commercial Law Act 2017 and other relevant legislation. The Service Fee Agreement typically includes detailed provisions on service scope, performance metrics, payment terms, and risk allocation, making it suitable for various commercial relationships from professional services to ongoing business support arrangements. It serves to protect both parties' interests while ensuring clarity in service delivery expectations and financial obligations.
Suggested Sections

1. Parties: Identifies and provides full legal details of all parties to the agreement

2. Background: Sets out the context and purpose of the agreement, including any relevant history or relationships

3. Definitions: Defines key terms used throughout the agreement for clarity and consistency

4. Services: Detailed description of the services to be provided, including scope and any exclusions

5. Fees and Payment: Specifies the fee structure, payment terms, invoicing process, and any additional costs

6. Term and Termination: Defines the duration of the agreement and circumstances under which it can be terminated

7. Obligations and Responsibilities: Outlines the specific duties and responsibilities of each party

8. Performance Standards: Establishes the expected quality and standards for service delivery

9. Intellectual Property: Addresses ownership and usage rights of any IP created or used in providing the services

10. Confidentiality: Protects confidential information shared between parties during the service relationship

11. Liability and Indemnity: Sets out liability limitations and indemnification obligations

12. Dispute Resolution: Establishes the process for resolving any disputes between the parties

13. General Provisions: Contains standard boilerplate clauses including governing law, notices, and assignment

Optional Sections

1. Insurance: Required when specific insurance coverage needs to be maintained by either party

2. Data Protection: Necessary when personal data processing is involved in service delivery

3. Force Majeure: Include when parties want protection from unforeseen circumstances preventing performance

4. Non-Solicitation: Added when there's a need to prevent poaching of staff or clients

5. Service Credits: Include when specific service levels are required with financial consequences for breach

6. Compliance with Laws: Required when services are regulated or require specific statutory compliance

7. Subcontracting: Include when the service provider may need to engage subcontractors

8. Change Control: Necessary for long-term agreements where service scope may need adjustment

9. Audit Rights: Include when one party needs the right to audit the other's performance or records

Suggested Schedules

1. Schedule 1 - Service Description: Detailed specifications of services, including methodologies and deliverables

2. Schedule 2 - Fee Schedule: Detailed breakdown of fees, rates, and payment mechanisms

3. Schedule 3 - Service Levels: Specific performance metrics and service level requirements

4. Schedule 4 - Key Personnel: List of key staff members responsible for service delivery

5. Schedule 5 - Reports and Documentation: Required reports, documentation, and their frequency

6. Appendix A - Contact Details: Contact information for key personnel and authorized representatives

7. Appendix B - Form of Change Request: Template for requesting and documenting changes to services

8. Appendix C - Acceptance Testing Procedures: Procedures for accepting deliverables or completed services

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Clauses
Relevant Industries

Professional Services

Information Technology

Consulting

Financial Services

Legal Services

Healthcare

Education

Construction

Real Estate

Manufacturing

Retail

Hospitality

Engineering

Marketing and Advertising

Environmental Services

Relevant Teams

Legal

Procurement

Finance

Operations

Commercial

Risk and Compliance

Business Development

Project Management

Account Management

Service Delivery

Administration

Executive Leadership

Relevant Roles

Legal Counsel

Contract Manager

Procurement Manager

Business Development Manager

Operations Director

Chief Financial Officer

Project Manager

Account Manager

Commercial Director

Risk Manager

Compliance Officer

Service Delivery Manager

Finance Manager

Chief Executive Officer

General Manager

Industries
Contract and Commercial Law Act 2017: This is the primary legislation governing contract formation, interpretation, and enforcement in New Zealand. It covers essential elements like offer, acceptance, consideration, and remedies for breach.
Fair Trading Act 1986: Ensures fair trading practices and prohibits misleading or deceptive conduct in trade. This is crucial for service agreements to ensure transparency in fee structures and service descriptions.
Consumer Guarantees Act 1993: If the service agreement involves consumers (B2C), this Act provides statutory guarantees for services, including that they will be carried out with reasonable care and skill.
Goods and Services Tax Act 1985: Governs GST obligations for services provided in New Zealand. Important for fee structure and tax implications in the agreement.
Contractual Remedies Act 1979: Covers remedies available for breach of contract and misrepresentation, which should be considered in the agreement's termination and dispute resolution clauses.
Employment Relations Act 2000: Should be considered to ensure the service agreement doesn't create an unintended employment relationship and clearly establishes an independent contractor relationship if applicable.
Disputes Tribunal Act 1988: Relevant for dispute resolution clauses, as it provides a framework for resolving smaller claims in New Zealand.
Privacy Act 2020: Important if the service agreement involves handling personal information of individuals, ensuring compliance with privacy principles and data protection requirements.
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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