How do you create a contract template that is flexible and adaptable?

Instead of jumping into a contract take a step back and look at the bigger picture. Priorities for the transaction or relationship need to be agreed before this stage.

The very word "template" suggests something that is not flexible and adaptable. That's why leading organisations are focused on the development of clause libraries with intelligent front end questioning to enable the creation of an appropriate combination of clauses to meet the needs of all parties and to achieve the outcomes desired.

Research tells us that 88% of business users find contracts either difficult or impossible to understand! Contract design and simplification is being embraced globally. The Contract Design Pattern Library supported by World Commerce & Contracting is a fabulous resource for those looking for support in this space https://contract-design.worldcc.com

Use formatting to highlight definitions and ensure that references are clear and concise. Making the contract easy to read and understand will expedite negotitiations.

I’ve found it useful to have a summary page that can be shared with key stakeholders that don’t have the time or desire to read the full contract. It includes start and end dates, termination options, price variation options and key contacts.

In my experience the best contracts incorporate all issues that have been raised by customers during the previous one. Service based contracts must have performance indicators and requirements to put right issues so end customers who have been impacted are more receptive in the future.

Routine audits ensure that changes in laws or regulations are reflected in your contracts and that the terms and conditions accurately reflect your company's operations. Review and update templates once a year or whenever material changes to an agreement impact its use to avoid potential legal disputes or misunderstandings. Updating templates helps to maintain a healthy and transparent relationship between your company and its partners or clients. After a merger or acquisition, a company may want to review and update its contracts to ensure they reflect all parties' intentions. For changes that affect how an agreement is used, such as changes to the scope or updates to industry standards, modifications to current templates can be necessary.

Don't only test internally. See whether you can find some friendly customers to run with your user tests. After all, they will eventually be the harshest critics of your template terms. Of course, having a sensible, balanced contract in the first place will also smooth the negotiation path (see below!).

Too many contracts are written from an individual perspective. A contract should be entered into as a partnership and I find often drafting a contract in that manner pays dividends further down the path of the client relationship.

What and how we negotiate has a huge impact on outcomes. Research tells us that we typically focus our negotiations on the clauses that are relevant when things go wrong (Limitation of Liability, Warranties, Indemnities) and we fail to focus on the things that deem to be more important (Scope and Goals) - we typically contract with the divorce in mind and not the marriage! WorldCC's Most Negotiated Terms Research provides some fascinating insights into this and solutions to the current impasse. https://www.worldcc.com/Resources/Content-Hub/View/ArticleId/11465/Release-of-Most-Negotiated-Terms-Report-2022

Too many templates are filled with over-reach from the start (a right to auto-debit fees from our account? are you joking?), missing commercially standard terms, and riddled with inconsistencies, redundant paragraphs, misuse of defined terms, vague or just plain weird wording. There's really no excuse for that these days. Forcing a customer to fight an uphill battle just to arrive at a collection of terms that are clearly written and fair is a terrible way to start a business relationship.

In the UK public sector legislation prevents negotiated contracts in some instances so again check the legalities associated with it. I agree with Ian contracts are partnerships to achieve a mutual positive outcome- it pays no-one for a contract to fail least of all the end customer.

Another perspective, treat writing a contract as you would any other writing - make sure it is clear to the audience/end users, those who will be responsible for the execution of the underlying activities in the contract.

Ensure the Well Design is completed, clear, and agreed prior to engaging contractors. It greatly streamline contract agreement.

If measurements are mentioned ensure a method is referenced. Example SMM 7 in uk is a standard method of measurement or CESMM civil engineering standard method of measurement . Why? Because we have ended up in arbitration court arguing if weight of tie wire on rebar should be paid for!