Monday, July 16, 2007

Contracts - some pertinent ideas

What makes a better contract?

My short answer is the better contract lets everyone know what is expected of them and what they get for doing what is expected of them and what will happen if someone does not do what they are supposed to do.

Serendipity resulted in finding the following posts. I suggest them for those needing contracts written or writing contracts. They give a much fuller answer to what makes a better contract.

David Munn's Blog has a post, Extreme Contract Simplification, but the following is key to the post (and has more information than available to non-members at the IACCM site) about Scottish & Newcastle's approach to contracts:

The S&N approach is radically different. Their approach is to start with the assumption that they can use a short and simple contract. If they can’t find a good reason not to use this approach, they try to develop a contract that is stripped of as many legal terms as possible—and those that remain are as simple and short as possible.
The post mentions S& N uses this method for supply agreements, trademark licenses, and international distribution agreements.

Then Ken Adams has a post on Contract Language and Layout—Ten Dos and Don’ts
distilled from a year of his posts on Adams Drafting. I think you will find that both posts preach the same sermon.

I agree with the approaches to contracts in the posts I cited but I also maintain that the clients (that is you, dear reader, if you are not a lawyer) are greatest hindrance to simplifying contracts. Clients expect legalese from lawyers, they will pay more for legalese, and between those two poles operate the lawyers. Fearing to lose clients because the contracts are in plain English and thus lose income, we bow to the client's desire for bulkier and bulkier contracts.

I would also say lawyer laziness contributes to the mess. Explaining to clients why legalese is not good does require more effort than merely cracking out the precedent and presenting the client with a finished product. However, inertia is probably a better word than laziness.

Speaking of legalese, I want to suggest The Party of the First Part blog which has its motto: Adventures in Legalese. It is fun and educational and seemed a good mention after all this dry grousing about contract terms.