Cloud computing has been adapted by various sectors due to its diversified benefits in terms of applications, services, different cloud delivery models, architectures, ease of use, cost, performance, and customized offerings. Cloud vendors are bound to provide the quality of services (QoS) to cloud tenants as promised in the service level agreement (SLA) mutually agreed between both parties. Despite having SLA contracts a wide range of legal issues surface as majority of new and existing cloud tenants "fail to understand the federated cloud functionality and SLA exclusions". The newly formed federated cloud models and vendors lack standardization, performance, reliability, and trust. The authors highlight various SLA and legal based issues with the help of a use-case example in the federated hybrid and multi-cloud ecosystem which may lead cloud tenants into vendor lock-in, operational complexity, security and SLA breaches.