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How to Write a Contract Agreement

If you are researching how to write a contract agreement then our book How to Use Legal Forms covers the structure of typical contracts, and covers each of the following in detail:

  • The Front of a Contract
  • Table of Contents & Index of Defined Terms
  • Body of the Contract
  • Back of the Contract

In this article we are going to consider the back of a contract – an area that inexperienced business people often do not pay enough attention to.

Back of the Contract

The back of the contract is made up of a concluding clause, the signature page, and attachments.

Concluding Clause
The concluding clause really just introduces the signatory page, and often could just be omitted. It is usually included to support the flow of the document. An example of an actual concluding clause is, ‘In witness whereof the parties hereto have caused this Agreement to be signed by their respective presidents, attested by their respective chief negotiators, and their signatures placed thereon, all on this 15th day of September 2009.’

Signature Page
With a contract the form itself must be correct, but just as important is that the right people sign it. If you or the counter-party are not the legal signatory of the document then the terms may not be enforceable. You must make sure that you both have the right to sign the contract.

This is particularly relevant when a contract is being signed between businesses. Other considerations for this type of contract are that the legal structure of the company should be defined, including details of where it is structured/incorporated. However, on the signature page itself these details need not be repeated, and instead the signature block need only have the signatory in capital letters, and depending on the rest of the contract it may state the name of the company the signatory represents, and the date of signing.

Sometimes you may come across a circumstance where a company conducts business as a brand rather that using its actual company name. This is known as dba, or “doing business as.” If this is the case then this should be referenced in the contract, but not on the signature page.

Attachments
Attachments are information that comes after the body of the contract, and take the form of exhibits and schedules. Exhibits are self-contained pieces of information which support the contract, such as maps or drawings. Schedules are pieces of factual information that are linked directly to the contract.

Contract Language

How to Use Legal Forms examines contract language in detail. The book explains the importance of language, and provides a number of examples. Here we will consider one of the most common intentional uses of vague language: the term “best efforts.”

A standard use of vague language is the phrase “best efforts” and it is very useful when you want to express a commitment to meet an obligation that you do not have total control over meeting. For example, you may commit to “make best efforts to complete the zoning of the property” because it is a government body that grants the ultimate permission, and you cannot be held accountable for government decisions.

Some contracts use variations on “best efforts” such as “commercially reasonable efforts,” which refers to efforts using a standard of reasonableness defined by what a similar person would do as judged by the standards of the business community in question. Some attorneys will tell you that tests for variations of “best efforts” are lower, but you should note that case law indicates otherwise. If you want to have a lower test, then the best thing to do is include a definition of the term.

There are a whole host of other terms that you may come across: good-faith efforts, reasonable best efforts, reasonable efforts etc. With each term your attorney should advise on what case practice implies – often you will see that the difference from “best efforts” is not what is commonly understood unless the difference is specifically referenced in the contract definition.

A common way to introduce some specifics to vague contract language is the use of carve outs. For example, such terms can carve out some specific situations under which the “best efforts” obligation is no longer in place.

Clearly then using “best efforts” in a contract is not a simple task, both the term itself and the way the term is worded must be carefully considered.

Bilateral and Unilateral Contracts

There are two basic types of contract: bilateral and unilateral. With a bilateral contract the parties involved make promises to one another, and with a unilateral contract one party makes a promise to the other/s. For example, an employment contract is bilateral because the employees promises to work and the employer promises to pay for this work, however, if a company offers third parties a finder’s fee for introducing customers then this is unilateral because there is no legal obligation to make such an introduction.

Further Information
For further information we recommend that you purchase How to Use Legal Forms. To buy now just click here. The courts are clogged with people who entered into agreements that don’t afford them the protection they thought they did at the time. Some of the most common mistakes are people using outdated forms that don’t take account of new laws that have been passed, and the inclusion of terms that are unenforceable under the jurisdiction that governs the agreement. The book How to Use Legal Forms helps you avoid these pitfalls.

Also, don’t forget to subscribe to the email mini course, which delivers more information on legal forms direct to your mailbox. Just enter your name and email into the contact form at the top right of this page.

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