Having well drafted, secure contracts on all levels of your business will help you focus on your business goals and prevent you from being stalled or interrupted by disagreements with business partners, customers, service providers or tenants.
Drafting and negotiating contracts can be complex, as it not only involves perusing and negotiating the contract that is before you, but also the ability to identify and address various issues, notably risks, on which the contract may be silent or cryptic. In other words, one must be able to “see and address what is not there” in a contract and only years of extensive experience in the field of contractual drafting can confer this skill upon an attorney.
Probably the most crucial element of a contract is risk transfer. Risk should be allocated equitably between each contracting party and placing responsibility for risk on a specific party should be consistent with that party’s ability to control and insure against that risk. An in-depth knowledge and understanding of the client’s insurance policy and the extent of its cover are essential before any meaningful contract can be negotiated for a client.
How to deal with and resolve possible deadlocks (or so-called “deal breakers”) is of equal importance; an attorney must always try to find a practical solution to a possible deadlock, rather than compromise a business transaction. This would involve identifying the extent of the client’s risks when in a deadlock and then to sufficiently protect the client from or minimise that risk without frustrating the transaction.