Table of Contents
- 1- Define the Purpose Clearly
- 2- Select the Proper Type of Contract
- 3- Begin Drafting
- 4- Incorporate Boilerplate Provisions
- 5- Review and Revise
- 6- Seek Legal Counsel
- Conclusion
Every business must navigate its way through contractual commitments. These legally binding agreements delineate the rights, obligations, and protections between parties.
A poorly drafted or mismanaged contract can lead to costly disputes. Therefore, it’s crucial to master the skill of contract preparation.
When entering into a business transaction, your contract is usually the only thing that keeps you safe during a misunderstanding.
1- Define the Purpose Clearly
Every contract should have a clear, well-defined purpose. Whether it’s formalizing a merger, protecting your intellectual property, or setting out the terms of a supply deal, understanding the objective of every contract forms the bedrock of building a robust agreement. This clarity can prevent misunderstanding and mitigate potential disagreements.
2- Select the Proper Type of Contract
Contracts come in numerous forms, including bilateral, unilateral, express, and implied contracts. The choice of an ideal contract form depends on the nature of the agreement, the parties involved, and the extent of obligations. For instance, businesses may prefer bilateral contracts for trade agreements where obligations exist on both sides.
3- Begin Drafting
The drafting process begins with gathering all relevant information. A detailed description of goods/services, payment terms, obligations and responsibilities of each party, duration of the contract, and confidentiality terms, are vital items to include. Here, clarity, conciseness, and completeness form the three Cs that guide effective contract drafting. Avoid using complex legal jargon to ensure the agreement is easily comprehensible for all parties involved.
4- Incorporate Boilerplate Provisions
Boilerplate provisions portray general legal conditions not specifically tailored to the particulars of the contract but instead lay the ground rules applicable to any contract. These provisions include dispute resolution methods, jurisdiction, process of amendments, condition of assignment, and termination clauses among others. Ensure to include these in your contract to serve as a safety net for any contractual uncertainties.
5- Review and Revise
Once the contract is drafted, thoroughly review it for ambiguity, errors, or omissions, and revise accordingly. Verify that all essential elements are present and that the contract complies with applicable laws. Consider receiving input from all stakeholders in this process for a comprehensive revision.
6- Seek Legal Counsel
Even with capable internal resources, contract preparation for complex or high-value deals may warrant the advice of a legal expert. This could prove invaluable in avoiding potential legal pitfalls and ensuring that your business interests are fully protected.
Conclusion
Your understanding of the contract and its polished wording is key to keeping you out of court. We have compiled a quick list for you to ramp up on getting your contract business ready.
1- Get your ducks in a row before you head over to your law office.
2- Write down the terms of the contract.
You can write in the form of an outline, list, mapping, or however, you organize best.
This step will help you focus on the terms of the agreement. As you know, attorneys change hourly – most by the tenth (0.10) of an hour – so the more organized you are and the more time you save, the better.
3- Take a look and collect your prior contracts.
Most of the time you have already done business in a similar fashion, so you may already have what you need.
At the very least, it is good to look at old contracts to remind yourself of provisions that have worked in the past.
4- Get your ducks to a California lawyer.
An experienced attorney is one part writer and one part psychic.
They should be able to ask questions that you did not know to ask. They should be able to predict conflicts and disputes that you have never anticipated.
A good attorney will listen, question, and analyze your answers to give you what you need, not just what you asked for.
At Sutter Law, we have the experienced attorneys and the knowledge to give you more than what you ask for – we give you what you need.
