Every legal contract or agreement is different. But the general structure of most contracts is the same. I’ve come up with a General Contract Drafting Questionnaire to help people think about what to specify in their contracts. The general questionnaire structure is below. If you want to provide me with your questionnaire response for me to assist you in drafting a contract, the Google form is accessible here.
Parties
- Identify the parties in detail. Specify full names, registration numbers (NRIC/passport/UEN no.), registered/postal addresses, contact details.
- Practical tip: do due diligence on the person or entity to ensure that the person exists. Ask for corporate registration or personal identification documents.
Bargain
What are the parties buying and selling, or exchanging? Goods, services, property?
- Describe the subject matter: goods, services, property, etc.
- State the quantity, type of subject matter. E.g. “sale of 100 Apple iPhone 6”; “provision of website development services”; “the flat located at 123 Serangoon Road #12-03 Singapore 999111”.
- Any specifications for the subject matter? E.g. “10 notebooks; size: 10cm x 20cm; paper thickness 80gsm”; “website: WordPress-based; minimum 10 pages; mobile-friendly”.
Value or Payment
What is the value exchanged between parties? A purchase price? A rental fee? A fee for service? A promise for a promise? How is value exchanged? Payment in cash, cheque, bank transfer?
- What is the value exchanged between parties?
- E.g. “SGD 5,000 service fee per month”; “SGD 1,000 per unit of the goods”; “SGD 2,000 rental per month”.
- How is the value transferred?
- E.g. Payment in cash, cheque, cashier’s order, bank transfer? If bank transfer, specify the bank name, account number, account type, bank number, SWIFT code, etc.
Term
- What is the time period (term) for the agreement?
- E.g. 1 year; perpetual; until completion of service.
- When does the agreement commence?
- Can the term of the agreement be extended?
Representations, Warranties, Acknowledgements
What statements or facts or assumptions are material to parties entering this agreement?
E.g. “1. The supplier has the capacity to manufacture 1,000 notebooks per month”; “2. The software developer has completed at least 10 software development projects using Python”; “3. Party A has good title to the property”.
Conditions
What are important conditions for the agreement or deal to proceed?
E.g. “Party A shall provide to Party B documentary proof of its building licence by 1 April 2018”.
Obligations or Policies
- What are ongoing obligations parties must continue to perform during this agreement?
- E.g. “Party A shall provide a monthly written report of the revenue it received from the sale of Item A”.
- What are the policies governing the performance of obligations?
- E.g. “Party A shall store soft copies of its monthly written reports in a cloud storage system specified by Party B by the last calendar day of each month”.
Rights
- In what scenarios can a party terminate the agreement?
- E.g. “If Party A fails to deliver the goods within 30 days from the date of Party B issuing the purchase order.”
- What other rights do parties have?
- E.g. “If Party A requires Party B to do additional work outside of the Scope of Work, Party B shall be entitled to charge Party A for such additional work on an hourly rate basis.”
Remedies
What can parties do when any obligation is not performed or any representation or warranty is false?
E.g. “If Party A fails to rectify the defects within 30 days, Party B may hire its own contractor to perform the rectification works, and Party A shall bear all the costs of such rectification works.”
Miscellaneous
Which other clauses apply?
- Confidentiality
- Intellectual property rights
- Data protection
- Indemnity
- Limitation / disclaimer of liability
- Variation of agreement
- Entire agreement
- Non-assignment
- No rights to third parties
- Notices
- Others:
Governing law?
- Singapore law
- Other jurisdiction
Dispute resolution?
- Singapore courts
- Singapore Institute of Arbitration Centre (SIAC) arbitration
- Singapore Mediation Centre (SMC) mediation first, then Singapore courts
- SMC mediation first, then SIAC arbitration
- Others
General Drafting Tips
- Use simple language. Don’t need to have legalese or archaic language.
- Be concise. Keep sentences short.
- Specify details: who, what, where, when, how. (Unless you want to be purposely vague.)
- Use active not passive voice. Eg “Party A hereby assigns…”
- Shall = obligation.
- Shall not = prohibition.
- May / is allowed to = discretion / permission.
- Will = denotes something in the future.
- Must = a requirement, but not an obligation from that clause.
- Warrant / represent: a statement of fact that is material to the entering of the agreement. If not for this fact, parties would not have agreed to the deal. E.g. “Party A warrants that …”
- Where there are terms that may include categories, define the terms specifically.
Need advice on contract drafting?
If you need legal advice on contract drafting, you can get a Quick Consult with Ronald. With Quick Consult, you can check out in minutes and for a transparent, flat fee, the lawyers will call you back on the phone within 1-2 days to answer your questions and give you legal advice.
This article is written by Ronald Wong from Covenant Chambers and was first published on his website.
This article does not constitute legal advice or a legal opinion on any matter discussed and, accordingly, it should not be relied upon. It should not be regarded as a comprehensive statement of the law and practice in this area. If you require any advice or information, please speak to a practicing lawyer in your jurisdiction. No individual who is a member, partner, shareholder or consultant of, in or to any constituent part of Interstellar Group Pte. Ltd. accepts or assumes responsibility, or has any liability, to any person in respect of this article.
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