Contract Drafting: Why Lawyers’ Involvement Matters and How They Do It

Business people and lawyers see contracts and end up weighting them differently. In most of complex transactions, business deals could get stuck or could not be consummated successfully without lawyers’ engagement.

Business deal and contract concepts

Every business transactions play different roles in contemplating business structures. Deal lawyers help translate clients’ business deal into contract concepts. The terms of business deal are the deal lawyer’s facts. Each contract concept serve a different business purpose and has different legal implications. The deal lawyer must find the contract concepts that best reflect the business deal and use those concepts as the basis for drafting the contract provisions.

Charles M. Fox in “Working with Contracts” emphasizes the importance of lawyers that “…It is often necessary for a lawyer to guide his client through the contract negotiation and drafting process…. “. In addition, “… it is the lawyer’s job in the contract formation process to make the client understand and care about many things that the client may prefer to ignore. It is a task requiring not only technical knowledge of the issues but the necessary interpersonal skills to engage the client in this process. In order to perform this task well, the lawyer must also develop the skill to explain complicated concepts and issues in a clear and understandable way. A significant element of this is gauging the client’s knowledge and interest level and tailoring the explanation accordingly….”

How lawyers do their work

In addition to translating the business deals into contract concepts (that would be taught in contract class and difficult to explain in a nutshell), lawyers need contract form books as guidelines to save time and efforts. Knowing how to use it takes time and practice.

Contract form books generally fall into one of two general categories. The first category includes general multivolume works that attempt to cover a large segment of the legal world. The other general category of form books consists of specialized volumes addressed to a specific area of the law, which is confined to a particular area of transactions.

Regardless of the categories, they are a tool of the trade as they assist a lawyer in the difficult task of putting the first draft down on a piece of paper. It is rare that a form is created for the exact factual situation that the drafter confront. The perspective of the form drafter, such as his bias, experience, skill, and knowledge may be captured in the form. Certainly, the form will be affected by these factors. Moreover, forms don’t generally teach us how the factors were used in their creation.

In short, the drafter must understand enough of the facts and law as well as the slant of any form to evaluate its utility. It is, in any event, only a starting point. Under no circumstances should any form language be used that is not completely understood both grammatically and legally.

Lawyers’ role is to be able to tailor a type of contract form to specific business deal

In many instances, the deal has been started before a lawyer is engaged. However, clients who have complex transactions to accomplish will often consult with lawyers early in the process of a proposed transaction. In these circumstances, the lawyer often has the ability to offer advice concerning the structure of a deal. This advice may be of great value to the client and the opportunity to offer it should never be overlooked. In addition to the counseling role, the lawyer is to educate the client as to the benefits of using a written contract that is well-tailored to specific business deal. In most instances where a lawyer is deeply involved, the contract will be of the promise-for-a-promise bilateral variety, which is equipped with clarity, completeness, enforceability, and effectiveness.

Bui Tien Long (Rudy)