Subject matter: Overview, definition, and example
What is subject matter?
Subject matter refers to the specific topic, goods, services, or obligations covered by a contract. It defines the focus of the agreement and establishes what each party is agreeing to. A well-defined subject matter ensures that all parties have a clear understanding of the contract’s purpose and scope.
For example, a contract between a software company and a client may specify that the subject matter is the development of a custom mobile application. This means the agreement focuses on designing, building, and delivering the app, rather than any unrelated services.
Why is subject matter important?
Subject matter is important because it determines the scope of the contract and prevents misunderstandings. Without a clearly defined subject matter, disputes may arise over what is included or excluded from the agreement.
For businesses, specifying the subject matter ensures that expectations are aligned and that the contract is enforceable. It also helps courts interpret the agreement if a dispute arises, ensuring that contractual obligations are clearly established.
Understanding subject matter through an example
Imagine a construction company enters into a contract with a real estate developer. The subject matter of the contract states that the company will build a 10-story office building, including design, labor, and materials. If a dispute arises over landscaping or interior furnishings, the company can argue that these were not part of the contract’s subject matter.
In another example, a freelance graphic designer agrees to create a brand logo for a startup. The contract clearly defines the subject matter as the design and delivery of a high-resolution logo file. If the client later requests website development, the designer can refer to the subject matter clause to clarify that this was not included in the agreement.
An example of a subject matter clause
Here’s how a subject matter clause might appear in a contract:
“This Agreement pertains to the provision of [describe goods, services, or obligations] (‘Subject Matter’). The Parties agree that the scope of this Agreement is limited to the Subject Matter as defined herein, and no additional obligations shall be inferred unless expressly agreed upon in writing.”
Conclusion
Subject matter defines the core focus of a contract, ensuring that all parties understand the agreement’s scope and purpose. By clearly outlining what is covered, businesses can avoid disputes, establish enforceable obligations, and create legally sound agreements.For any contract, a well-defined subject matter is essential for setting expectations, managing risks, and ensuring clarity in business transactions.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.