How To Write Better Contracts (A Guide For Lawyers)

If you’re a lawyer, you probably spend a lot of time writing contracts. And if you’re a lawyer who writes contracts, then let me tell you: You have my sincerest sympathies! Writing good contracts is hard. 

There are a thousand little details that can trip up even the most experienced lawyers and make them look stupid. But it doesn’t have to be so complicated! That’s why I’ve put together this handy guide for writing better contracts and I want to share it with all of my fellow lawyers out there struggling with this same problem. The video below walks through each section in detail:

Takeaways
1. Clear and Concise Language
2. Comprehensive Scope and Obligations
3. Legal Compliance and Enforceability
4. Attention to Details and Potential Contingencies
5. Inclusion of Dispute Resolution Mechanisms
6. Consideration of Industry-Specific Nuances
7. Collaboration with Legal Professionals
8. Regular Review and Updates
9. Balancing Flexibility with Specificity
10. Prioritizing Clarity over Complexity

1. Start With What You Need

First, you need to know what you need to accomplish. The contract needs to be structured so that your client can accomplish their goals without running into any problems with the other party or the law.

Second, you need to know what the other party wants to accomplish in this agreement. This is why it’s important for lawyers who work with contracts on both sides of an issue (like real estate deals) to are also excellent negotiators because they’ll understand both sides’ goals and how each side’s interests may conflict or overlap with each other

Third, you need to know what the other party’s needs are from this agreement; since every person involved has different goals and desires when entering into a business relationship or contract

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2. Avoid Using “Shall”

When you’re drafting a contract, it can be tempting to use “shall” and “will.” But these words have very specific meanings that often don’t match your intentions.

Here are some guidelines for using these words:

The user shall be in place of will when the event is future and you want to indicate a command or expectation (e.g., “The Contractor shall deliver the completed Project by May 15”).

The use will be in place of shall when the event is future but not order or requirement (e.g., “The Contractor will deliver the completed Project by May 15”).

Avoid using will at all costs! This word has too many meanings and may confuse readers who aren’t lawyers—especially if they’re new to contract law. Additionally, because wills are created only after someone dies, their use also suggests that something has happened before its creation rather than before its signing date or effective date (see Section 1 above).

3. Keep The Paragraphs Short

Use short paragraphs and sentences. Short paragraphs break up the long sections of a contract, making it easier to read. 

If you have an agreement with one paragraph for every sentence, then you’ll find yourself struggling to make sense of what you wrote. Instead, try breaking up each sentence into two or three different paragraphs with each paragraph containing 2-4 sentences (a maximum). 

This will help keep things organized and make sure that there isn’t too much text on any given page.

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4. Put The Essential Stuff First

The easiest way to make a contract accessible is to put the essential stuff first. That’s because if your client isn’t going to read it, you’ve got a problem. So be sure to focus on what matters most:

Make the contract short and easy to read. You don’t want your clients having to fight through paragraph after paragraph of legalese before they even get to the meat of what you’re trying to tell them or worse yet, give up entirely on reading it all together! 

If there are multiple pages involved in your contract, consider breaking those into separate sections that can be easily scanned by someone who isn’t looking at every single word with a magnifying glass (and maybe even updated once or twice over time). 

This will help ensure that everyone in your office knows how important it is for everyone else that these contracts are understandable even when being read by people without much legal experience (like me!).

5. Use “The Parties” Instead Of Names

Avoid using names in contracts. Instead, use “the parties” or “each party” to refer to the parties to the agreement. This is a good idea because:

You don’t have to change anything if you are dealing with multiple agreements that are similar but not identical. If one party is replaced by another.

It will be more difficult for your reader (and you) if they’re not trying to figure out which one is being referenced when reading through documents that are bound together at the end of their contract lifecycle or series of agreements spanning multiple decades and/or generations of companies owned by different corporate parents throughout time! 

It’s confusing! You can avoid this confusion by using “the parties” instead of names in contracts so there isn’t any question about who is being referred to when looking back on old documents after many years have passed since their creation date.”

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6. Use Active Voice In Contract Language

As a lawyer, you are probably used to writing in passive voice. This is true not only in legal assignments but also in formal papers and other important documents that you write as part of your professional life. However, a good contract needs to be written using active voice so that it can be more effective and efficient.

In active voice, the subject acts while in passive voice, the subject receives an action. For example:

Passive – The contract was prepared by us (not by us).

Active – We prepared the contract (by ourselves).

7. Be Clear About Pronouns

It’s a good idea to use gender-neutral pronouns in your contracts. For example, if you’re referring to a plural noun (like “the individual,” or “the attorneys”), don’t use the plural pronoun. Say “they” instead of “they/their.” 

Similarly, if you’re talking about an individual noun (say, an employee), don’t default to using the third person plural pronoun that is, “their.” Instead, say “he/she” or just stick with singular pronouns like him and her.

This won’t be hard as long as you remember this simple rule: Use the same pronoun for the same noun throughout your contract!

8. Use Present Tense For Present Facts, Past Tense For Past Facts, And Future Tense For Future Events (With Exceptions)

When you write a contract, it can be easy to get confused about the tense you should use for your facts. Should you write “on July 1st” or “on the 1st of July?” What about “before June 1st”? These are questions that will often arise when drafting a contract and can lead to confusion among parties involved in negotiations.

However, there is an easy way to avoid this problem entirely: stick with present tense for present facts, past tense for past facts, and future tense for future events. 

If there is any doubt as to what needs changing when drafting your agreement which thankfully shouldn’t happen very often just ask yourself whether or not something happened recently (or soon) or whether something will happen soon (or recently). 

If it did or will happen recently or soon enough that we’re still talking about it now without mentioning specific dates/times/circumstances/conditions etc., then use present-tense verbs when describing those things happening here on Earth right now!

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9. Use The Simple Past Tense If There Is A Specific Date Mentioned

When describing events that occurred in the past, use the simple past tense. For example, if you want to describe a contract that was signed on April 15th, 2019, use “signed” instead of “will sign.” Similarly, if you want to talk about an event that will happen after some other event (like a meeting), use “had happened” rather than “will have happened” or “is happening.”

If there is no specific date mentioned in your contract and you need to refer back to something earlier in time (such as another contract), then use the past perfect tense: “The parties had executed an employment contract with each other.”

For ongoing or future events where there isn’t a specific date mentioned use either present tense or future tense depending on whether it’s clear from the context which one works better for your sentence structure. 

When writing contracts for clients who are non-native English speakers making grammatical mistakes can be harmful because these errors could lead someone else into thinking something different than what was intended by using incorrect tenses incorrectly as shown above!

10. Do Not Capitalize Contract Terms Without A Reason To Do So

You should only capitalize the first letter of a contract term if it is part of a legal term, such as “Easement” or “Contractual Liability.” 

You should also capitalize any word that you would capitalize in other types of writing and that has specific significance to your industry (for example “Internet”). 

However, if you are using capitalization simply to distinguish between two different types of contracts such as an employment contract versus an independent contractor agreement you should stop capitalizing contract terms when they become generic terms describing documents with similar purposes.

11. Write Out Numbers Less Than 100 As Words; 100 And Larger As Numbers (Uk Style) Or Use Arabic Numerals For All Numbers (Us Style)

The main thing to remember is that numbers less than one hundred should be written as words, while numbers over one hundred should be written out in numerals, even if they are not grouped with other numbers. 

If a hyphen is used in between two single-digit whole numbers, it should always be placed before the units digit (i.e., “six-and-a-half,” not “6½”). 

When using commas for thousand separators, make sure that you place them before the last three digits of any number below 9999; otherwise, your document may look like it was written by someone who only speaks English as a second language!

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12. Spell Out “Percent” Rather Than Using The % Symbol

The % symbol is a mathematical operator. It’s used to indicate that something is a percentage of something else. For example, if I want to say that the number 1 is 10% of 100 and the number 2 is 20% of 100, I have to write it as 1/10 * 100 = 10% and 2/20 * 100 = 10%.

However, “percent” can also refer to what we lawyers call “a percentage” in other words, the quantity itself (not its proportion compared with something else). So if I want to say that “I am happy with this contract because you are giving me a higher percentage than you did last time” then I should write:

“I am happy with this contract because you are giving me a higher percentage than you did last time.”

13. Add Punctuation Or Separate Elements To Avoid Long Sentences Or Commas Splices

Use a comma before coordinating conjunction to avoid confusion:

If you are writing more than one complete sentence, use commas to separate them.

If you have an independent clause and a dependent clause, use a comma before the coordinating conjunction that connects them. 

An independent clause can stand alone as a sentence; it expresses a complete thought. A dependent or subordinate clause (such as “because”) cannot stand alone as a sentence because it does not express its complete thought; it needs to be connected to an independent clause for meaning. 

When the two clauses are separated by only one phrase or by words like “and” or “but,” then no comma is necessary because there is no risk of misreading either part as being incomplete without the other:

We were happy to see our old friends from law school again next week at their wedding reception in New York City; however, everyone had been looking forward to seeing each other at the Green Bay Packers game on Sunday afternoon instead!

14. Do Not End A Sentence With An Abbreviation Or Acronym If It Can Be Avoided (Exception: Et Al)

If you’re not sure whether to end a sentence with an abbreviation or acronym, try rephrasing the sentence so that it doesn’t end with the abbreviation. If this is not possible, and you must end your sentence with an abbreviation (or a word followed by an acronym), use either et al, etc.

For example: “I have been advised by my client that they will be filing a suit against you on behalf of its employees covered under their collective bargaining agreement.” (Et Al)

Or: “I have been advised by my client that they intend to file suit against your company on behalf of its employees covered under its collective bargaining agreement.” (Etc Etc)

Conclusion

This is a great starting point for writing contracts. It’s something that any lawyer, whether in-house or in private practice, can do to improve the quality of their documents.

Further Reading

Here are some additional resources to further enhance your understanding of contract writing:

How to Write a Contract – A Practical Guide: Explore this comprehensive guide that provides practical insights into the process of writing contracts, covering key aspects and considerations.

9 Tips for Drafting a Clear-Cut Contract: Discover nine valuable tips for drafting contracts that are clear, concise, and effective in achieving their intended purpose.

Mastering the Art of Writing Contracts: Delve into this resource to master the art of contract writing, gaining valuable advice and strategies for creating legally sound agreements.

FAQs

What are the essential components of a well-written contract?

A well-written contract should include clear parties, terms, conditions, obligations, and remedies. It should also address potential contingencies and provide a dispute resolution mechanism.

How can I ensure my contract is legally enforceable?

To ensure legal enforceability, your contract should be clear, unambiguous, and compliant with relevant laws. Consultation with legal professionals is recommended.

What are some common mistakes to avoid when writing a contract?

Common mistakes include using complex language, vague terms, and overlooking important clauses. Proofreading and legal review can help identify and rectify such issues.

How can I draft a contract that protects my interests?

To draft a contract that safeguards your interests, clearly define the scope of work, payment terms, intellectual property rights, confidentiality provisions, and liability limitations.

Are there specific industries that require specialized contract writing?

Yes, certain industries, such as construction, healthcare, and technology, often require specialized contract language to address unique risks, regulations, and considerations.