Properly drafted contracts not only allow cooperation to be established, but also help in asserting claims when a possible conflict arises or recalling the obligations under it when memory fails after a long time. Drawing up a complete contract should therefore be a priority for both parties. How to draft a contract and what to always include in it to make it fully useful?

Why is it so important to create a thoughtful and complete agreement?

In an ideal world, a verbal agreement between parties wishing to cooperate would suffice, which each of them would fulfill conscientiously and honorably during the course of the contract. And while the world is a beautiful place, and we would like to believe that the people around us always have good intentions, reality reminds us every day people can be fallible, memory unreliable, and situations in life unpredictable.

That is why every business should be based on reliably prepared, complete and clear contracts. Well-drafted documents will help you not only in crisis situations, such as when you need to go to court. A clear contract will also be a document that you will look at to remind yourself of the duration of the contract and check exactly what the rights and obligations of one party and the other are.

Questions that should be answered by the content of the agreement

Every contract you conclude should begin with a compary – it is best to draw it up in the form of a clear table. You can read more about what provisions should be included in it in the article: Composition of the contract – what should be included in it?

When preparing the content of the agreement, it is worthwhile to consult a lawyer, who will help prepare it so that the content is complete and in accordance with applicable law. However, if you decide to prepare the contract on your own, try to include in its content the answers to several important questions. What are these questions?

What is the agreement about and what are the intentions of the parties?

The most important part of the content of the contract is to specify exactly what it concerns. Include information on what type of contract it is and what the parties are committing to. Avoid generalities, precisely define, for example, the scope of services provided. It is also very important to describe the manner of performance described in the contract (for example, a provision that the performance will be delivered in stages). It is also worth mentioning how the process of possible complaints or corrections will be carried out.

How will the parties be held accountable?

Each contract should also include information on the methods of settlement (for example, that settlement will follow the issuance of a VAT invoice) and payment terms. At this point, it is also worth describing how to proceed when a party fails to make a payment on time.

What happens when the contract is terminated?

Every contract should include a provision on how it can be terminated, and it is rare that a contract does not specify this issue. However, it is very common that the content lacks information on what happens when the contract is terminated. And yet, in many cases, it is necessary, for example, to hand over equipment, transfer accesses or pay the outstanding amount of money. That’s why it’s worth thinking carefully about how to terminate the contract in order to close the cooperation to the satisfaction of both parties, and include the conclusions in the body of the contract.

What rules and principles apply to a given collaboration?