At some point, almost every business is going to enter into a contractual agreement. Even simple agreements rely on the basic tenants of contracts: insuring that both parties know what their responsibilities are and will uphold them.

Many of the contracts I see are convoluted, making it difficult for either party to know what they are supposed to do. When contracts get unnecessarily complex, no one wins. In the event that there is a contract dispute, having clear, concise language can keep you and your business out of court and focusing on what you love.

If you are wondering how to make your contracts simpler, here are four tricks to keep in mind.

1. Less is (Usually) More

Agreements should be easy to understand. Evaluate your sentences to find spots where you can use just one or two words instead of six or seven. While some concepts are going to require more explanation than others, you may be surprised how many contract terms require only a few sentences. If you aren't sure if a phrase makes sense shortened, ask someone to explain the phrase back to you. If it makes sense to an outside reader, it will likely make sense to everyone else.

2. Say Who Owns Each Task

Before you start drafting, decide whose is going to own each action in the contract. If you are responsible for producing a product and the other party is responsible for accepting the product, say exactly that! Identifying the party makes is easier to understand the expectations and can resolve disputes before they start. For example, “ABC Company will deliver 20 products within 30 days of contract acceptance” is much clearer than “The products will be delivered within 30 days.” In the first example, we know ABC Company is responsible for delivery, while the second example does not specify who is ultimately responsible for the action.

TIP: This concept applies to other terms, too! Clarify each action, including time frames, delivery methods, and payments, so there is no confusion when it comes time to execute the contract.

3. Avoid the Pronoun Trap

I love pronouns as much as the next person, but sometimes, they can lead to trouble. Refrain from using generic pronouns (think “it," “this,” “that”) unless it is abundantly clear what the pronoun is referring to. Generally, clarity is better. If the reader cannot understand what is being referenced, how can they determine what the contract actually means? Trying to decipher a contract’s intended meaning after signing is not how you want to spend your valuable time. Eliminating pronouns can alleviate the confusion.

TIP: This applies to personal pronouns, too! Consider: if there are three parties to a contract, using “they” could mean two of the parties or all three. If the pronoun could have multiple meanings, even if everyone agrees today, swap it out for a concrete term.

4. Stick to the Plan

Create an outline and stick to it. Most writing starts with an outline, so the writer stays focused and doesn't miss key objectives. Drafting contracts is no different. Starting with a framework provides transparency around the process and identifies what terms are essential to all parties. I have found the majority of negotiating can be accomplished during the outline phase, expediting the drafting and execution phases significantly. Remember, if it didn't make the outline, it probably shouldn't make the contract.

Looking for more drafting tips? We can work together to evaluate your current contracts by implementing these tips!