The golden rule of writing any contract (Part 1).
I had just started reviewing the first draft of a complex contract prepared by a company when I could not avoid thinking: who is this contract written for? Certainly, not for me. The more I went on reading the document, the more the purpose of it was obscure ("for the straightforward pathway had been lost", Dante would say). Then I realised that what I was giving for granted, is that everybody knows the golden rule of writing a contract: you are just not writing for yourself. In a way, you certainly are: putting black on white the outcome of your negotiation it is definitely the main purpose of your contract. And you are not even just writing for the counterpart. Of course, you want to make sure that the other party understands all the implications of the main terms that were agreed at the table. But, again, this is not the point.
According to my experience, the person you should be writing for, is a third party who knows nothing about your deal, or even your business. It could be a foreign director of your company who has to sign the agreement and little knows about the background of the contract. It could be the new general counsel of the counterpart, who perhaps has a different view on the meaning of a clause negotiated by the former legal manager. And, last but not least, it could be the judge in charge of the dispute on your contract, who has no intention to make an extra effort to discover the hidden sense of decontextualised clauses or the meaning of technical jargon used as a way of showing off (of course, quoting Dante does not count).
Want to know about the tips? Part 2 is out: Drafting tips!
Copyright Giorgio Mariani 2016. All rights are reserved.
OTHER ARTICLES PUBLISHED ON LINKEDIN BY Giorgio Mariani:
The way back from the closing dinner (M&A integration issues)
20 features of Italian M&A agreements (that foreign investors should know)
A NOTE ON THE AUTHOR: Giorgio Mariani is an Of Counsel at the international law firm Simmons & Simmons since 2008. He specialises in cross border M&A, real estate and commercial transactions in the TMT, infrastructure, energy and fashion industries. He acts as M&A legal advisor for industrial groups under special insolvency administration (Amministrazione Straordinaria).
Lawyer | Corporate & Banking
7 年In my opinion, this rule works in all the different aspects of law, not only in drafting contracts. Whether you are interpreting the law or arranging the best possible solution for your client, going straight to the point, keeping it simple and always referring to general principles is the best way. Sometimes it's difficult, but that's the "path", you can see it.
Partner| M-Ciarb
7 年Thank you for sharing your experience, Giorgio. To me, drafting a contract is not a way for a drafter to show off his/her writing. Wording skill of a drafter is to convey intents and agreements of the contractual parties into an explicit and straightforward manner so that non-legal or non-technical readers may understand the contract contents explicitly.
Legal/Contractual Professional
8 年Really, it is an excellent nugget about contract writing and its effectiveness in the practical corporate world. The author is very specific about his thought, which highlights that contract writing is for the purpose of third party, who knows nothing about first party's deal or any background. I contemplate that it will be a spotlight for the people who are in contracts management arena.
Conseil et enseignement
8 年It could be the financial sponsor conducting its due diligence to acquire your business
Expert Delay Analyst & Quantum Consultant
8 年Beware the words "For The Avoidance of Doubt" - obfuscation follows.