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How to Write a Legal Contract

Updated on June 14, 2012
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Don't Sign It Without Seeing a Lawyer

What is a contract? What's the difference between an agreement and a contract? Absolutely nothing. They are the same thing.

A popular one liner for talk show hosts when introducing an act is: "Don't try this at home kids." If you are thinking of entering into a legally binding contract with someone, stop and think. That's what lawyers are for. You may think that you can save money, or maybe you just want to save money, and decide to enter a contract without legal advice. You won't save money. If a problem occurs with the contract what do you do? Call a lawyer, of course. That's why you won't save money. Putting scrambled eggs back into a shell is expensive and signing legal contracts without consulting a lawyer makes it more so.

But you can save money on a contract by putting it together yourself and THEN taking it to a lawyer. This article is about helping you to write a contract—without signing it— before you have it reviewed by a lawyer. When you contact a lawyer and tell him that you have put together the contract but that you want him to review it you should then ask if his fee will be modified to reflect the thinking you have put into it. This is quite appropriate, for you as well as the lawyer, because legal fees are partially based on the time the lawyer spends on your matter.

Writing a contract and then bringing it to a lawyer is about more than saving a few bucks on legal fees. The process takes you through the agreement you want to enter and forces you to focus on just what you will be agreeing to.



The Basic Elements of a Contract

The Title. A typical contract just has the word "AGREEMENT" centered across the top. Lawyers usually use the word agreement. If you used the word contract instead it wouldn't make a difference.

The preamble. Here is where you give the contract a title, state who the parties are and their addresses and the date of the contract.

This Landacaping Agreement dated this Fifth Day of June, 2012 (can you say June 5, 2012? Sure) between Terrence Jones, hereinafter referred to as LANDSCAPER with offices at ...(the old anachronistic "party of the first part" died out in the 1940s thank goodness because it was unnecessarily confusing. The modern way is to identify the party by his role in the contract. If he was entering a pre-nuptial agreement he would be referred to as HUSBAND. The person's description is traditionally in ALL CAPS, a good tradition because it's easy to locate on reading.) and Marcy Smith, hereinafter referred to as HOMEOWNER, residing at....

Recitals. Recitals provide an introduction to the contract and why it is being entered into. Recitals are not part of the contract, but may be useful for interpreting the agreement in the event of a dispute. The recitals section begins quaintly with the word:

WITNESSETH (centered on the page). Then follows recitals themselves

WHEREAS LANDSCAPER is in the business of providing residential landscaping services to homeowners; and

WHEREAS, HOMOWNER is in the need of landscaping services;

I know you have a question. Why do you have to use fancy words like WITNESSETH and WHEREAS? You don't. Bullet marks could replace the WHEREASES, and because you're preparing this for an attorney to review you can save yourself some typing by just putting in bullets. There is a school of thought that lawyers should abandon these anachronistic words. I strongly disagree. Not only is it harmless to use the word whereas or witnesseth, but it also serves a useful purpose. When a lawyer looks at a contract and sees whereas, he or she knows that it's the recitals section of the contract. It is the familiar framework that makes one contract look at first glance like another. Why change it?

The Body of the Contract. This is the guts of the contract and discusses all of the rights and responsibilities of the parties to each other. Each agreement is in a numbered paragraph.

NOW THEREFORE (more anachronistic language but so what. It lets you know that you're about to read the body of the contract.

1. LANDSCAPER will visit the premises once per week to perform his serviceS. (SEE weather and related issues in paragraph 13.

2. LANDSCAPER'S services shall consist of the following

(a). Mow the lawn

(b). Apply fertilizer four times during the term of the contract

And so it goes, paragraph by paragraph describing what each party will do. After all of the paragraphs in the body are done you will see standard boilerplate, standard language that goes into every contract. It is often found under the heading OTHER PROVISIONS. Arbitration agreements are usually included here.

19.1 Neither party shall be in default hereunder by reason of any failure or delay in the performance of any obligation under this Agreement where such failure or delay arises out of any cause beyond the reasonable control and without the fault or negligence of such party.

19.2 The provisions of this Agreement shall be construed and the performance thereof governed in accordance with the laws of the State of ____, United States of America.

Ending and Signatures.

IN WITNESS WHEREOF, the parties, intending to be legally bound, have executed (signed) this Agreement as of the date first above written. Okay, okay, more cute language

LANDSCAPER HOMEOWNER

____________________ ____________

Terrence Jones Marcy Smith

Now that we've gone through the basics of a contract you are prepared to answer the question: What is a contract.

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    • HOAGuide profile image

      Steve Parsons 5 years ago from Miami, Florida

      This hub is so useful and explains a contract in easy to understand terms. Thanks!

    • rfmoran profile image
      Author

      Russ Moran 5 years ago from Long Island, New York

      Thanks Simone. Don't forget to get it in writing!

    • Simone Smith profile image

      Simone Haruko Smith 5 years ago from San Francisco

      I'm a big fan of odd, informal social contracts, so now that I'm more familiar with the formal structure written contracts get, I'm thinking of ways in which I might translate my spoken ones to paper. What fun!

      The examples you've used are so helpful. Awesome Hub!

    • krsharp05 profile image

      Kristi Sharp 5 years ago from Born in Missouri. Raised in Minnesota.

      This is very helpful information. It's good to know that attorneys don't have to do everything and that we can save money - my attorney speaks so slowly I need to save all the money I can! Thanks for the good news. -K

    • lindacee profile image

      lindacee 5 years ago from Arizona

      Such important information! Very easy to follow instructions for those of us not well versed in legalese. I would never to into any type of an agreement these days without a written contract! Voted up, useful and interesting.

    • rfmoran profile image
      Author

      Russ Moran 5 years ago from Long Island, New York

      Thanks for your comment. I often tell people, an oral agreement isn't worth the paper it's written on.

    • spartucusjones profile image

      CJ Baker 5 years ago from Parts Unknown

      Very useful and informative hub. It was well researched and logically presented. It is definitely good to put things in writing and to make sure that it is legally binding.