New Year – click refresh on contract forms

New Year – click refresh on contract forms

How long has it been since you have had a hard look at your standard contract forms?  Have you really considered your commercial terms in light of their use in practice?  When was the last time you assessed the implications of recent case law or changes in state and federal regulations? Are your current insurance coverages and limits reflected in your documents?

With the new calendar year, review and refresh your contract forms and templates; particularly if it has been several years since a fresh, independent read of your working forms.

 An independent review can:

  • Accelerate contract negotiations by addressing concerns raised by your customers. If you are seeing the same comments over and over again from customers (or potential customers), consider making some adjustments to your templates to streamline the negotiation process.

  • Spot errors, typos, and confusing or ambiguous text. Being too close to a document hinders the identification of obvious issues that can be easily remedied as part of a refreshed template.

  • Ensure your insurance coverage and limits are appropriate. These are likely renewed each year; a good review of your contract forms will include a check with your risk manager, broker or underwriters.

  • Keep your templates abreast of new or updated laws and regulations, as well as recent case law. Just like the standard of care for professional or manufacturing practice, the law is not static; old forms tend to reflect old practices.

“It sounds like a lot of work. How do I get a good review in a prompt, cost effective manner?” It’s not hard or costly if you use a simple plan:

  • Gather your standard contractual forms and templates, in an electronic form (if they are not in electronic format, scan them!).

  • Pull together written comments or mark-ups received from customers during negotiations – both the initial comments and the final executed agreement.

  • Identify errors, typos, inconsistencies and common comments.

  • Ask your legal counsel and risk manager to review the documents for clarity and substance.

  • Prepare a draft update for consideration by management.

  • Ask your insurance broker or underwriter for a final check on insurance issues.

  • Prepare an updated revision for use.

  • Update management and staff on the revisions and use of the forms and templates.

Your contracts are a reflection of your company’s philosophy, culture and sophistication. Old, outdated documents present an old, outdated image. Updated forms and templates reflect current trends and business practices. In the end you will improve your company’s contracting practices and close more deals faster.

Comments (0)

    Add a Comment