When a security professional is presented with a contract drawn up by a company's legal department, which allows them to "hack" the company's network, they should proceed by performing what precautionary step?

The answer is : He must consult with a lawyer.

Hacking is considered illegal and in other countries, it is punishable by law. Hacking is gaining unauthorized access to a network. Even when someone is giving you permission to do it, it is still wrong and illegal. Therefore, you must know of your rights and make all the party involved to signed an agreement to save yourself.