The contract is basically an agreement enforceable by law. The Act defines the term agreement as “every promise and every set of promises, forming the consideration for each other”.
The world has become business-oriented; the document between the parties entering into the business is the contract to establish a legal relationship. The clauses in a contract bind them to assured requirements, terms and conditions. An error in drafting or any other mistake in a contract as a consequence of improper drafting has caused loss to many clients everywhere.
You should keep in mind the rules of drafting stated below.
Title: The title of what contract should be mentioned on the top of the Agreement i.e.; Partnership Agreement.
Detail the Parties: Detail the name of the parties, age, address of the parties and in the case of the company, date of its incorporation and address.
Know the occurrence: The most important step is to listen to the client and make sure what type of contract he is entering into. Missing out of a point in the contract may reverse the purpose of the contract. Try to make it simple but it should have every point.
Language: The language used to write a contract should be reliable, accurate, modest and clear. The punctuation marks and grammar should be used properly.
Be Detailed: The rights of each party should be laid out in precise language that leaves little room for clarification. If there are any specific dates it should be mentioned clearly on the agreement.
Confidentiality: If your client does not want the other party to share any particular information with any other person than it should be mentioned in a clause that binds the other party from disclosing your business information.
Compensation: When any provision in the contract is penetrated by a party, this clause specifies the compensation.
Location of Execution, and Witness, Signature and seal: At the end of the agreement it is important to make sure that the Name, Signature and location of the parties and the witness are mentioned.
THIS AGREEMENT made on the _____ day of_____ in the year______. BY AND BETWEEN
____________hereinafter called the "Owner" having its principal office at_______ AND ___________ hereinafter called the "Contractor" ________ having its principal office at_______. Here in after referred as Parties.
The specific terms of the Contract are as follows:
Signed on the Day of _ __ 20__
Name and Signature of Parties
Address of parties
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