Drafting a contract is writing out the terms and details of the contract/agreement, so that those that sign the contract can fully understand the terms of the agreement. A contract can be drafted by anyone, but for a secure and reliable contract it is important to have it drafted by a lawyer.
How Are Contracts Drafted?
Form contracts such as a lease agreement are stiff, which means the contract is drafted by one of the parties and do not have room for negotiation. So, to allow for negotiations, some choose to loosely base their own agreement on a form contract instead of following a pre-set one.
Each party must thoroughly understand the terms and conditions in a contract, as this is the main goal. The person drafting the contract should use clear and simple language. A contract full of legal terms and concepts is not a good idea. If any words or terms are not easily understood, make sure you find out what it means. Don’t be afraid to ask, as it is very important for you to understand what you are committing to.
What is a “Contract Review”?
A contract review is when a person signing the contract carefully reviews the document or has their lawyer review the document. This is to make sure that the contract is what the person wanted and that they understand what they are agreeing to. Ultimately, a contract is a spoken or written agreement between two parties. Each party is asking for, and receiving something in exchange from the other party.
If a problem were to arise, both parties can refer to the contract and pinpoint what is expected of them. A clearly written and easily understood contract can lessen any confusion between parties. However, if it is not written clearly, legal issues may arise.
What are Some Reasons for Contract Review?
Contracts are necessary in business. Since contracts can be lengthy, many people skim over paragraphs and don’t actually know what they are signing. Having a qualified lawyer review your contract may save you from a legal mess down the road. Here are a few reasons why it’s important to review contracts:
- You need to know exactly what you and the other party are signing. Terms and conditions must be clear, leaving no doubt as to what is expected between the parties.
- No one wants to get in trouble, especially with the law. Review the contract, make sure all aspects are legal, and protect yourself. You do not want to be the victim of a scam.
- By having your contract reviewed now, you may save yourself legal problems down the line. If there is a disagreement, you have solid documentation to protect yourself.
What Are Contract Negotiations?
Simply stated, negotiations in a contract involve both parties presenting what they want, then bargaining for a suitable outcome. While negotiating a contract, keep the following in mind:
- To begin, each party must understand what the other party expects of them, in order to keep their end of the bargain.
- Parties should be satisfied with their duties and obligations.
- Include a remedy for breach of contract as this may save a lot of time and money.
What Are the Best Ways to Review Contracts?
Always read a contract before signing your name. Make sure each party understands very clearly what their duties and obligations are, before signing the contract. If a party does not understand what is expected of them, they may be liable for unknowingly breaching the contract.
A qualified lawyer who can review your contract before you enter into an agreement, can save you time, stress, and money.
What Are the Different Types of Business Contracts?
There are several types of business contracts, here are a few:
- Agreement for the Sale of Goods
- Purchase Order
- Employment Agreement
- Confidentiality Agreement
- Lease for Real Property
- Franchise Agreement
Should I Consult a Contract Lawyer When Drafting and Reviewing Contracts?
Negotiating a financial contract can be especially complex. Having a business attorney assist you from start to finish may safeguard you against complications, errors, and misunderstandings. A qualified lawyer will keep your best interests at heart, and prevent legal issues arising from a poorly written and negotiated contract.