Law & Legal & Attorney Contract Law

How to Draft Agreements

    • 1). Come to a verbal understanding of your deal with the other party before you begin drafting the agreement. While you need not have agreed on every detail, the major terms should have already been agreed upon before you begin drafting.

    • 2). Write down your understanding of the terms on which you verbally agreed, and show it to the other party. Ask the other party to revise it if necessary and present the revised rough draft to you. This process should go back and forth until both of you are satisfied with the wording.

    • 3). Identify the parties, making sure to distinguish between companies and their individual representatives. You should identify them by their legal name, legal address, and Social Security Number (for individuals) or Employer Identification Number (for companies). This section should generally state the purpose of the agreement, and be placed at the beginning of the agreement.

    • 4). Insert a definitions section as the second section of the agreement that clearly defines all major terms used in the agreement; capitalize each term, and use the capitalized version throughout the agreement (if the term "Product" is defined as a particular make and model of lawn mower, for example, it will mean something more specific than the word "product" without capitalization). The purpose is to provide convenient shorthand and avoid disputes over the meanings of terms.

    • 5). Insert the agreed-up terms you have already drafted after the definitions section.

    • 6). Add standard contract "boilerplate" provisions to the end of the agreement. Do not simply copy sample provisions--use only those provisions you need, and modify them to suit your needs. For example, if you are contracting with a Mexican company, you will need to specify which jurisdiction's law governs in the event of a dispute.

    • 7). Add headings to your agreement, and revise the agreement to make the terms of the transaction clear to a neutral third party who understands nothing of the deal before reading the agreement (a judge, for example). Present it to a third party, ask for opinions on how to improve clarity, and modify the wording accordingly.

    • 8). Create a signature section for the parties to sign. If any of the parties is a company, you should list the legal name of the company (not a defined term such as "Buyer") along with the company representative's name and title. The signature section should not be on a separate page. If you wish, you may include a section for a notary public to sign.

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