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This article is written by Chandrasmita Priyadarshini, studying BA LLB from Kiit School Of Law, Bhubaneshwar. This article discusses the importance of contract drafting for litigants and how contract drafting makes a source of additional funds. 

Table of Contents

Introduction 

A contract is a legal document, which is enforceable in the court of law and governs a relationship that involves consideration – which acts as an exchange of money for some commodity or goods, services, or something of a requirement. Contract drafting skills should be considered to be very essential as contracts are used for agreements in business for companies. A well-drafted contract can protect the legal interests of the companies, contracts in day-to-day lives as in informal relationships to prevent any unnecessary fear or risk to relationships. For this reason, a contract after proper drafting and negotiation can prevent any confusion which can result in lost time, money, and value of the object of the contract. Contracts are two sides of a  negotiated deal providing a common reference point for both sides of the contracting parties. Contracts are a legal document that makes a legal agreement enforceable by law. Mostly, a written contract is preferred but oral contracts are also enforceable nowadays with attorneys. Contract drafting is an important skill that all litigants must have knowledge about. This is undoubtedly a valuable and rewarding skill that has great career opportunities and has great earning potential. Commercial Contract is a source of income as it addresses pricing, payment, term and termination, warranties, confidentiality, insurance, dispute resolution procedures.

Basic guidelines to keep in mind while drafting contracts

The contract drafting process is very tedious. Before it’s drafting one must be very clear about its contents and what must be included or what all points to be covered in the contract, both the parties must be satisfied with the contents. A contract must be organised and properly structured. Some pointers to begin with drafting are:-

  • Resolve to write as many drafts as possible as it’s important to include all the details, facts, agreements, clauses. It may happen initially that it is possible to miss out on some points.
  • Usage of clear, simple, business, legal languages as to be specific towards the type of contracts like insurance or finance contracts. If technical words are used then these words must be defined as contracts as not all will be able to comprehend such terminologies.
  • The structuring of the contracts must be made in such a way that each clause must deal with one heading not more than that.
  • The contracts must be checked thoroughly in order to avoid any ambiguities. No different terms must be used to refer to a single object or person or using one term for different objects or persons as this might cause confusion afterward. This can prevent unwanted ambiguities. A definition section can be included to define all unusual or technical terms.  
  • After the final drafting of the contract, the document must be checked once again as a whole to avoid any contradictions which may have crept into the contract or might have overlooked any ambiguities. 
  • Later this can be consulted with other seniors as there might be some things which are left out, also both parties must be shown the final draft of the contract.

The benefits of possessing contract drafting skills

There are various benefits of contract drafting such as:-

  • The clarity in business contracts, agreements, and rights and duties between parties to the contract.
  • Avoiding any potential contract disputes and litigation charges that might happen if there is no formal contract.
  • To prevent any misrepresentation, confusion of communications, and agreements.
  • Contracts are essential in protecting intellectual property, real property, and true asset values.
  • Commercial contracts help in the maintenance of commercial relationships.
  • Clause or agreements between parties in the contract as to what to do in case of disputes, resolve by arbitration, mediation, litigation in any courts of a specified jurisdiction.
  • Documenting any comprehensive representation and review by an experienced business law attorney. 

How contract drafting skills can act as an additional source for funds

Drafting contracts is more of a skill that develops over time, which is essential for litigants. Contract drafting is a highly rewarding skill and profitable to any litigant or attorney. Every law firm or individual lawyer tends to make a significant portion of their revenue from drafting contracts. Also, this source of income is very reliable and profit-worthy. Many young lawyers make money and a good living from contract drafting as by the structure of commonly known contracts. Litigation is unpredictable whereas contract drafting is more apprehensive and margins are high. Many senior lawyers always hire junior lawyers and practice in courts along with income flowing from contract drafting by other lawyers. Well, known law firms usually make a lot of money from their transactional practices like merger and acquisitions between companies, Corporate finances and various banking projects which usually involves a lot of negotiations and transactions in their contracts. So, great contract drafting skills and negotiation ability are essential to draft a contract in these to-do law firms. A lawyer who is not successful enough initially usually benefits from contract drafting and negotiation.   

What are the contract drafting skills that can prove most essential for a litigator?

Mastering the skill of contract drafting is very essential for a litigant as contract drafting is considered to be the most fundamental skill that any litigant may possess irrespective of their specialization area. It is undoubtedly a valuable and rewarding legal skill in terms of better career opportunities and from an income point of view. Though not many lawyers have knowledge in dealing with contract drafting due to lack of training or not being taught at an earlier stage in life in the curriculum of their law graduation. Later these lawyers get to learn from their senior lawyers or by experience from dealing contracts in their domain area. Contract drafting means identification of the legal document on accounts of the facts of the particular case along with the legal points that can give impact to the parties of the contract. Then preparation of the contract with the identified facts and laws that will help to accomplish their client’s goal is what’s most essential for the litigant. Hence, these legal documents are a set of instructions to be followed to fulfill the intent of the parties of the contracts which must be clear and functionally appropriate for the client’s goal. Contract drafting skills that are essential for a litigant are:-

  • To obtain information from the client or the parties of contracts to understand the result expected by the client and the commercial context in which the parties relationship is based on;
  • A rough draft must be prepared to express the basic agreements between the client and the other party;
  • Apply all the legal issues to be applied to the rough draft that would be of impact;
  • All the legal issues must be researched well to be accountable when applied in the agreement;
  • This rough draft and the legal issues so applied must be structured and planned to benefit the client in all means;
  • Making a formal agreement to accomplish all the goals of the client and any other business goals;
  • The agreement must be shown to the client to verify the document and administer the document;
  • Editing and revising the document in accordance with the client or for any review, lawyer drafts along with usage of language that is legal, clear, and comprehensible. 

The main intention behind this process of contract drafting is to profit the client and must be understandable by the client as to the contents of the document along with the effect this will give to the client. Anything apart from this is unacceptable from any litigant drafting a contract. This process is basically the same while drafting a contract, conveyance, letter, settlement, interrogatory, or any form of the petition including the goals, principles, or objectives. In each of these situations, the litigant must know how to draft accordingly and identify the facts and laws mainly achieving the desired goal or objective of the client. 

Contract drafting skills: a must for all lawyers 

To be realistic, the skill of drafting is like expressing something through writing. This skill is essential for the legal profession which makes it a must for all lawyers. A good lawyer must be able to draft his client’s case in an efficient manner. Legal knowledge and the awareness to translate these well-drafted contracts are the greatest assets of any lawyer. The language and tone of every commercial agreement must be clear and free from any ambiguities. Any agreement made must face scrutiny from various parties to the contracts, clients, other lawyers, adjudicating authorities, etc. However, it must be carefully drafted to be compliant and understandable to everyone and must protect the client’s interests. Each and every word chosen or used in the draft must be picked very carefully, be it drafting a legal document, simple response to an inquiry, or sending a legal notice, it must be written in a clear and precise manner. Any contract drafted is like jail or bail for the client of that lawyer. Every lawyer must have writing skills along with negotiating skills with which the opposite party will have no loopholes in the contract to object or counter it. Even though these commercial contracts have a great monetary aspect but if not drafted well it can affect the reputation along with the business of the parties. For these reasons, lawyers must be experienced enough to draft accordingly along with this a lot of burdens and expectations of the client are attached to the contracts.  A lawyer along with good language, formatting, sequencing must have legal knowledge, knowledge and wants of the clients, expectations of clients, business sense, analyzing skills, observing details, foresightedness, etc.  Drafting is something that is learned with time, improved accordingly, and cultivated with experience. 

Conclusion 

In simple terms, a contract is a legal document that involves an agreement between two or more parties for the exchange of value which involves the exchange of goods, commodities, services, etc. If there is any agreement involving providing something in return for something else is basically a contract. Legally contracts cannot be made enforceable without consideration. Along with it the contract must be clear so that it can be enforceable in any court. Every lawyer is expected to know contract drafting and reviewing along with a great additional source of income. This drafting requires the license of the lawyer to be in a capacity to draft contracts. Leave and license agreement, memorandum of understanding(MOU), confidentiality and non-disclosure agreement/non-circumvention, lease deed, partnership agreement, employment agreement are various commercial agreements that are to be drafted by lawyers as to the requirement of clients. When it comes to contract law, it is very complicated. So drafting contracts must be made in such a way that the rules must be applied with respect to the parties signing it. The main intention behind contracts is to protect the parties if in any event, a party fails to keep up to their commitments. Any poorly drafted contract results in a loss for the party who failed to fulfill the contract. Hence, it is essential for litigants to be fluent in drafting contracts. 

References


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