Review a contract for things to ask about
A practical way to use AI for this job in a small business, with a prompt you can copy.
A supplier sends you a 12-page agreement and asks you to sign by Friday. You skim it, it seems fine, and you sign. Six months later, you discover the auto-renewal clause.
The prompt
Here's a contract I've been sent: [paste, remove names if you like]. In plain English, summarise what I'm agreeing to, list anything unusual, auto-renewals, cancellation terms and costs, and give me questions to ask before signing. You're not giving legal advice.
Replace everything in [square brackets] with your own details. Don't paste in anything you wouldn't want stored by the AI provider.
Steps
- Paste the contract.
- Run the prompt.
- Take the questions to the other party.
- Get a lawyer for anything big.
A worked example
A Gold Coast gym owner gets a three-year equipment lease agreement. She removes the company names and pastes it into Claude, asking: summarise in plain English, list anything unusual or one-sided, and give me questions to ask before signing.
It flags an automatic renewal with a 90-day notice period, a clause making her responsible for all repairs, and an early termination fee. She takes the list to the supplier, negotiates the repair clause, and asks a lawyer to check the final version. Total legal cost is lower because she knows exactly what to ask.
Where it goes wrong
AI can miss things, misread clauses or confidently explain terms wrongly. It can also make normal clauses sound alarming. Use it to prepare questions, not to decide whether to sign. Personal guarantees, indemnities and termination clauses always deserve a closer look by a lawyer.
Time saved
Reading and understanding a contract can take an hour or more. AI gets you a plain-English summary in 10 minutes. It doesn't replace legal advice. These are my estimates for a typical small business, not measured results.
What it costs (AUD)
Free plans handle short contracts. For long ones, a paid plan helps with document length. A lawyer's review costs extra, but it's worth it for big commitments.
The free plans of ChatGPT, Claude and Gemini handle this fine. If you end up using AI every day, the paid plans are roughly: ChatGPT Plus approx. A$30 a month, Claude Pro approx. A$29 a month billed monthly (US$20, or about A$24 a month if you pay yearly), and Google AI Pro approx. A$33 a month through the App Store. Prices approx., October 2026. Some are billed in US dollars, so your bank may add a foreign transaction fee. Check the vendor's pricing page before you buy.
Australian notes
Australia has unfair contract terms laws that protect small businesses in standard form contracts. Some one-sided terms may be unenforceable, and since late 2023 there are penalties for using them. AI can spot terms worth asking about, but only a lawyer can tell you where you stand.
Privacy: the Privacy Act and the Australian Privacy Principles (APPs) cover most businesses turning over more than $3 million, plus some smaller ones such as health providers. Even if you're under the threshold, treat customer details with care: strip names, phone numbers and addresses before you paste anything into an AI tool.
My verdict
Great first pass. Not a substitute for legal advice.
Common questions
Can AI tell me if a contract is fair?
It can flag terms that look one-sided, but it can't give legal advice.
Is it safe to paste contracts into AI?
Remove names and confidential details, and check the tool's data settings.
When should I see a lawyer?
For anything long-term, expensive, or where you're giving personal guarantees.
Do this today
Find the last contract you signed without reading properly. Run it through the prompt and see what you agreed to.
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