Quick Search: Enter Search Terms (Lease, Deed, Will, etc.)
Bookmark This Page
Browse Legal FormsFree Drafting TipsFree Sample ClausesFree Legal AgreementsLegal DictionaryLegal HumorResource Links

Free Legal Drafting Tips

Please note that the Disclaimer and Terms of Use
applies to these forms and all other resources
available on or through this site.
Click here for Corporate & LLC Record Book Kits


When you are drafting a legal form or agreement, don't forget to pay attention to the proper identification and statement of the parties - the legal names of the individuals or entities, or both, that are involved in the transaction.

Although this may seem elementary, it is important to get the identification of the parties right the first time. Even though you might not normally address someone quite so formally in conversation or a letter (particularly if it is someone you know well), you should still use their full name rather than a shortened form (for example, use "James Q. Smith, Jr." rather than "Jim Smith").

Remember that while this might seem to be overly formal when everyone is on good terms, one purpose of having written legal agreements is to clarify the terms of a transaction so there can be no question (or at least fewer questions) about the parties' intentions later, after circumstances have changed and memories have faded.

Don't hesitate to identify the individual parties by the location of their residence. For example, instead of simply filling in the form as "James Q. Smith, Jr.," state that the party is "James Q. Smith, Jr., an individual residing at 7887 Shady Brook Way, Arlington, Virginia 20095."

It is particularly important to get the names of entities right when drafting legal forms. When dealing with a corporation, limited liability company, or partnership, ask for a copy of the entity's articles of incorporation, articles of organization, or partnership agreement, respectively, to make sure you have the name exactly right. In states where there may be hundreds of thousands of active business entities, like New York, Texas, California, or Illinois, or very subtle differences in an entity name can mean that you have made a deal that may be hard to enforce against the entity you thought you were dealing with.

For example, you might want to prepare a contract for the performance of business services for your customer - AA Locksmiths. You may think that the proper corporate name is AA Locksmiths, Inc., but the name on file with the state filing authority may be Double A Locksmiths, LLC. While this may not seem like a big difference to you at the time, a court may have second thoughts about awarding damages to you if your customer should fail to pay as you expect. Be assured that a customer who doesn't want to pay according to the terms of a contract may also be willing to say, "hey, that contract was not with my company and therefore I don't owe anything."

Another point to consider when drafting a legal form for a business entity is specifying the state of formation after the name. For example, use "Double A Locksmiths, LLC, a California limited liability company" or "XYZ Business Consultants, Inc., a New York Corporation, with offices located at 8888 Main Street, Rochester, New York 13131." Remember that more specificity in the identification of the parties may eliminate misunderstandings later.

Top of Page


If you look at a legal agreement or contract, you will generally see a phrase in the opening paragraph indicating that the parties agree on an amount of money or "other good and valuable consideration." The concept of consideration has a long history in the law, but simply means something of value. An exchange of consideration between the parties to an agreement is necessary for the agreement to be legally enforceable.

Each party to an agreement must both give and receive something of value in order for a contract to be legally enforceable. The "something of value" may be either something that the person actually hands over (that they would not otherwise be obligated to hand over) or some right that they give up (that they would otherwise have been entitled to exercise). For example, if you agree to buy a car for cash, you agree to deliver cash to the seller, and the seller agrees to deliver the car to you. In that situation, there is legal consideration, or sufficient value, for the agreement to be enforceable.

Another example is a mutual release of claims. Suppose you accidentally hit a parked car, and you agree to pay the owner of the car $500 in cash to settle. In that case, you agree to deliver cash to the owner of the car, and the owner agrees that he or she will not file a lawsuit against you. (In such a situation, always get a written release of liability, or "release," from the owner of the car to prove that you have settled up.) The consideration from your side is the cash, and the consideration from the owner's side is that he or she gave up the right to sue you for the damages. Although the owner didn't give up anything physical, there is consideration to support the agreement because the owner gave up a legal right.

Top of Page

Term and Termination

Important concepts to consider when drafting a contract or legal agreement are the term of the agreement and the termination provisions. An agreement usually runs for a term, or period of days, months, or years, and that period should be specified in the agreement. The term may be stated, in its most basic form, in language similar to the following: "The initial term of this Agreement will be for one year from the effective date of this Agreement."

What happens after the initial agreement term is concluded? While you might think that the agreement is finished (and in most cases it is), in some situations (and in some states) an agreement may be deemed to automatically "renew" for an additional period of time equal to the initial term. This may be true if parties continue to act, after the term has expired, as if the agreement was still in place (which is not unusual in many business relationships). For example, if you continue to sell products or services to a customer as outlined in the agreement, and the customer continues to pay according to the terms outlined in the agreement, an argument can be made that the agreement has been extended or renewed by the actions or conduct of the parties. For this reason, it may be important to clarify if you intend for the agreement to be renewed. An example of "automatic renewal" language is as follows: "This Agreement will automatically renew, for successive one year periods, after its expiration unless notice of termination is given by either party."

If you want to be able to terminate the agreement at will (or upon relatively short notice), you need to either (A) make the initial term very short, such as 10-30 days, or (B) include termination provisions. An example of a termination provision is as follows: "This Agreement may be terminated before its initial term (or any renewal term) is completed by any party at any time, for any reason, provided that at least 10 days' advance written notice of termination is given to the non-terminating party by the terminating party." In essence, this language limits the agreement to a 10-day term from the date that notice of termination is given. Keep in mind that actions taken by either party during the 10-day termination notice period are within the specified duration of the agreement, and will likely be considered to be binding and enforceable.

Top of Page

If you have questions about this site or ideas for things you'd like to see here, please let us know.
Home | Free Drafting Tips | Free Sample Clauses | Free Sample Agreements
Copyright © 2003-2006 Republic Media, LLC. All rights reserved. Disclaimer and Terms of Use

The statements and information on this web site are for general informational use only, are not warranted in any way, and do not constitute legal advice. No statement on this web site should be construed as legal advice under any circumstances whatsoever.