Fundamentals About Effective Contract Drafting

Lawyers require to be highly knowledgeable about all types of laws and skilled in doing everything they do. However, the skills needed to convert a client’s deal (that they closed with a handshake) into a well-drafted, enforceable agreement are often overlooked in legal education. Many lawyers learn these skills with growing experience in the industry, while others seek external help such as third-party legal drafting and documentation services. 

Contract drafting often becomes a challenge for lawyers, specifically those who do not regularly practice private law or transactional law. This may also lead lawyers not getting enough opportunities to draft contracts; however, by using some necessary and appropriate drafting techniques, they can draft contracts for their clients successfully. 

What Does a Contract Include? 

A contract is formed when one party makes an offer, and another party accepts the offer having a legal consideration and several obligations. The contract must include valid legal considerations that make it an applicable agreement. For instance, both parties have to contribute to the agreement defining labor requirements, service/product costs, a guarantee of return, etc. In order to produce a legitimate contract, all parties included must be legally capable of entering the contract with having a lawful end goal. 

Fundamentals for Effective Contract Drafting  

Before you start writing a contract, ensure that you are clear about what to include in the contract and what situations it must cover; in short, know what all parties exactly want. You may try to make an outline of the contract, making it easier to include and organize all the essential pieces logically. 

Check the following guidelines and get some help in drafting a contract; 

1. Make it a habit to write multiple drafts and check to ensure you have included everything necessary. This will ensure you do not miss important points. 

2. Prefer to use simple, clear, business-friendly language. Do not overuse legal terms, and try to use only important technical terms and define them if needed. 

3. Make sure each clause states not more than one thing. Here, outlines can help you as you can break down the entire contract into multiple smaller points. 

4. Avoid ambiguities:  

While writing, ensure that you use one term for one person or item. Using two or more different terms to refer to the same person/item can create ambiguity, leading to misunderstandings. If you can, consider including a definition section where you can define all your key terms; this way, readers will understand the terms they are not familiar with. Also, make sure you do not use one term for different items or persons. 

5. After you draft each clause in the contract, you should read the document thoroughly, especially looking for contradictions between different parts of the contract, rather than detecting small errors/mistakes within one clause. You never know you might overlook larger ambiguities while using your eyes for detail. 

6. Besides, consult others or take help from your lawyer friends as they might find more mistakes and errors you might have missed. 

How Drafting Style Impacts the Effectiveness of Contracts? 

Avoid using passive voice to fill a contract with clarity and precision. An active structure of the sentence helps clearly define the performing party’s obligations. For example, rather than writing “rent should be paid within the first week of every month,” you can write “tenant shall pay rent within the first week of every month”; the latter sentence is more effective in defining the clause. Similarly, warranties and representations should clearly identify the party that is providing information upon which all parties are relying. 

Besides, using a plain English style can also help enhance the contract’s clarity. Usage of active voice is just one part of plain English style. Avoiding arcane phrases, usage of appropriate tabulation of lengthy or complex provisions, and writing short sentences are other important elements to consider while drafting contracts. 

Your clients are most like non-lawyers; therefore, you should draft provisions in a clear and conspicuous manner, making it readable and understandable for non-lawyers. By doing this, you ensure there is no ambiguity, and you get a well-drafted contract ready to be implemented between parties. 

Why is it Important to Revise Drafts of Contracts? 

Try to make a few drafts out of any legal piece given to you. Keep the first one thoroughly detailed, creative, and imperfect, and include everything that is necessary to the contract and everything you think shall be useful. After this, improve, rewrite, polish the draft to get the best in it. 

Guidelines for Revising Drafts of Contracts 

Just like you revise any other written material, it is vital to revise the draft – need not to mention why. It would be best if you focus on picking out small mistakes, transitions, sentence structure, grammar, paragraphing, and punctuation while revising. 

You may follow these two rules about revising; 

1 – Never revise while writing; it can slow down both the processes – writing and revising. While writing, direct your entire concentration only on writing creatively, regardless of how unpolished the draft may look. Always revise once you are done writing the draft. 

2 – Divide the revision part into stages to make the entire process easier. It might make you exhausted. If you revise on every level at once. Take your time to revise; move from common writing mistakes to more specific issues. 

Accuracy: Top-level readability can never replace accuracy; therefore, ensure that you check the correctness of the content of each legal point. Make sure that; 

a. The content is stated accurately. 

b. There are no points that could be misunderstood because of ambiguity. 

c. Irrelevant information and facts are excluded. 

d. Terms of art are used correctly. 

e. Key terms are used correctly. 

f. Paraphrases are accurate. 

g. Names of parties and their status are correct? 

h. The citations are precise. 

2. ORGANIZATION: Ensure that; 

a. Paragraphs are internally logical. 

b. There are clear and precise transitions between paragraphs and sentences. 

3. READABILITY: Make sure that; 

a. Subjects and verbs are close together. 

b. Unnecessary modifiers are removed. 

c. Sentences are not extra/unnecessarily long. 

d. Lists are clearly structured. 

e. Unnecessary prepositional phrases are removed. 

f. The overall text is generally concise. 

4. STYLE: Make sure;

a. The writing style is consistent. 

b. The tone and level of formality are appropriate and consistent. 

You shall give your complete attention to these categories for a certain amount of time while revising. Once you are done with revising, you may move further to polish the draft and make it the best. 

Conclusion 

Contract drafting must be done carefully in order to avoid confusion or conflicts. Lawyers should not use ambiguous terms so that in the event of any dispute, the matter can be resolved quickly. In most of the U.S States, the basic principles of contract drafting are the same. Today’s era has become digital, and lawyers are using software to draft contracts. Contract tech may not replace humans drafting contracts, but larger legal firms might look for particular skills in lawyers to give them contract drafting assignments. 

However, any lawyer can start to draft transactional documents effectively by following the tips mentioned above, proper organization, good legal research, and keeping clients’ needs and concerns in mind. Or else, if you, as a lawyer, often remain busy with a lot of other work, you may seek contract drafting services offered by reliable LPO firms in your area or overseas.