Creating Contracts as a Founder? Here's How to Make it Quick and Painless
As a founder, navigating the legal complexities of creating contracts can be a daunting task, but with these expert tips, you can streamline the process and save time and hassle.
At some point, every founder will need to create contracts. From employment agreements to supply of goods and services agreements to consultancy agreements, the legal complexities of these contracts too often lead to confusion and misunderstandings — costing the business time and money in the long run. This is why it's critical for founders to have a clear understanding of the contract creation process and the key elements to include in agreements. In this post, we'll explore some practical tips to help you streamline the process of creating contracts and ensure your documents are comprehensive, accurate, and legally sound.
Keep the language simple
One of the biggest mistakes that founders, or non-lawyers in general, make when creating contracts is using complex legal language that is difficult to understand. Remember, contracts are not meant to be a show of your legal knowledge, but rather a clear outline of the terms and expectations of the agreement.
Using simple, plain language will not only make it easier for both parties to understand the agreement but will also help you avoid any confusion or misunderstandings down the road.
Of course, using clear language in contracts doesn't mean oversimplifying terms or leaving out essential legal terminology. Instead, it means using plain language to explain legal concepts and ensuring that both parties understand the meaning and implications of each term. For instance, instead of using terms like "indemnification" or "force majeure," which may not be familiar to everyone, you can explain these concepts in simple terms such as "protecting against potential lawsuits" and "events outside of our control."
Another effective way to use clear language in contracts is to avoid using industry jargon or overly technical terms. This is particularly important for contracts that involve parties from different industries or backgrounds. By using language that is accessible and understandable to everyone involved, founders can help build trust and reduce the risk of confusion or disputes.
Overall, using clear language in contracts is essential to creating agreements that are easily understandable and legally sound. By being comprehensive and transparent in outlining the terms and expectations of the agreement, you can ensure all parties are on the same page and help prevent disputes down the road.
Define your terms
When creating a contract, it's essential to define any terms or concepts that may be unclear or subject to interpretation. This will help to ensure that both parties have a clear understanding of what is expected of them.
For example, if you're creating a vendor agreement, you may want to define what constitutes a "deliverable" or a "work product." This will help to ensure that both parties are on the same page when it comes to the scope of the agreement.
In addition to defining key terms, it's also important to include specific details and deadlines in the contract. For instance, if the contract involves a delivery of goods or services, the contract should specify the quantity, quality, and timeline for delivery. This level of specificity can help prevent misunderstandings or disputes down the road and ensure that both parties are meeting their obligations under the contract.
It's very important to consider the potential for changes or modifications to the agreement over time. While it's not possible to anticipate every potential scenario, including a clause that outlines how changes will be made can help prevent confusion or disputes. This clause can specify the process for making changes, such as requiring written notice from both parties or holding a meeting to discuss the proposed changes.
Include all relevant information
Your contract should include all relevant information, including the names and addresses of all parties involved, the duration of the agreement, and any payment terms.
Additionally, if there are any specific deadlines or milestones that need to be met, be sure to include them in the contract as well. This will help to ensure that both parties are aware of their obligations and responsibilities.
In order to ensure that all relevant information is included in the contract, it's important to have a clear understanding of the purpose and scope of the agreement. This may involve consulting with other stakeholders or legal professionals to identify any potential risks or liabilities that should be addressed in the contract.
For example, if the contract involves a partnership or joint venture, it may be necessary to include provisions for how profits will be shared or how disputes will be resolved. Similarly, if the contract involves the transfer of intellectual property or confidential information, it may be necessary to include provisions for how this information will be protected and shared.
Address potential issues
When creating a contract, it's important to anticipate any potential issues that may arise and address them in the agreement. This could include things like confidentiality agreements, non-compete clauses, or dispute resolution processes.
One effective way to address potential issues in a contract is to include provisions that outline the consequences of breach of contract. For example, if one party fails to meet their obligations under the agreement, the contract should outline what remedies are available to the other party. This could include things like monetary damages, termination of the agreement, or specific performance.
Another important consideration when addressing potential issues in a contract is to ensure that both parties have a clear understanding of their rights and obligations under the agreement. This may involve providing training or resources to help parties comply with the terms of the contract, or ensuring that there is a clear process for addressing any issues that may arise during the term of the agreement.
By addressing these issues upfront, you can help to avoid any conflicts later on while building strong relationships with your partners and vendors.
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Automate contract creation with Docue
Creating contracts can be not only an error-prone process but also a time-consuming one, especially if you're creating them from scratch every time. With Docue, you can streamline the entire contract creation process using our powerful templates and automation features. You don't have to worry if you contracts have the right terms and clauses, because we take care of all that for you.
Docue provides a library of lawyer-maintained, customisable templates that you can use as a starting point for any contract. These templates cover a wide range of contract types, including employment agreements, data protection policy, and health and safety policy and much more. Simply choose your template and working with inbuilt legal prompts and tickbox clauses, customise it suit your specific needs, including adding your own clauses and terms.
In addition to legal templates, Docue also offers powerful automation features that can save you even more time. Our automation tools let you set up workflows that auto-generate contracts based on predefined criteria. For example, if you're creating an employment agreement, you can set up a workflow that generates the contract automatically based on the position and job requirements.
By using Docue's templates and automation features, you can not only streamline your contract creation process but you'll reduce the risk of errors or omissions at the same time. Win-win, we like to call it.
Whether your draft your contracts manually, employ outside legal counsel or choose an automation tool like Docue, contract creation is an important aspect of any business. While managing legal documents can be daunting — and traditionally, it has been expensive and time consuming too — we hope these tips and tricks will make the process simpler for you. We created Docue to make legal and the whole process of contract making more accessible and affordable for all. If you'd like to chat with us to see how Docue can help your business save time and money with our trusted templates and contract automation tools, you can book a free consultation any time.