basic strucutre and terminology

Basic Contract Structure and Terminology

Importance of Clarity in Contracts

  • Contracts serve various purposes and vary in length and draftsmanship quality.

  • A well-drafted contract:

    • Avoids wordiness.

    • Uses clear, understandable language rather than legalese.

  • Legalese:

    • Characterized by long, complex sentences written in passive voice.

    • Includes archaic terms such as "hereby," "sayeth," or "witnesseth."

Example of Legalese vs. Plain English

  • Legalese Example:

    • "This Agreement and the benefits and advantages herein contained are personal to the Member and shall not be sold, assigned or transferred by the Member."

  • Plain English Equivalent:

    • "Membership is not transferable."

Trend Towards Clear Language

  • There is a movement among drafters to:

    • Write in a clear, active voice.

    • Utilize plain English when drafting contracts.

Typical Contract Structure

  • Many contracts follow a consistent structure and sequence, which generally includes:

    1. Preamble

    2. Recitals

    3. Definitions

    4. Clauses

    5. Termination Conditions

    6. Appendices