Boilerplate Language in Contracts

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 What Is a Contract Template?

A contract template is a general outline that is used for a contract. It could be a blank form that is filled in by the parties involved or it may already contain the information that is related to the transaction.

Contract templates are typically used in situations where the same agreement can apply to a variety of situations repeatedly without many changes. These are also sometimes referred to as standard contract forms.

A contract template may be helpful because it allows a company to have one basic contract document for various contracts. Contract templates may be created by attorneys for companies or they may be obtained through a legal service company.

It is typically best to have a lawyer create a contract template, as they will be familiar with the laws of the state and the needs of the business. These templates use language called boilerplate language that is standardized and formulaic instead of being tailored to suit the particular purpose or transaction.

One alternative to a contract template is a customized contract that is drafted in consultation with the client. With a new contract, the parties will negotiate the deal or transaction and the details will be outlined in the contract that is tailored specifically to their needs.

When Are Contract Templates Used?

Generally, a contract template may be used when the same type of agreement will need to be made over and over. For example, if a business only engages in the sale of a particular type of feed.

In this case, the company may use a standard contract form or contract template when negotiating with other parties, because the transaction is essentially the same every time. Using a template will help save the company time and resources on their contracts.

One of the drawbacks associated with contract templates is that they may limit the creativity and adaptability of the company during its negotiations. In certain agreements, a new type of contract will need to be created.

When this is needed, the business will need to hire a lawyer to draft a new contract specifically tailored to their transaction or to create a new contract template that can be used for similar agreements in the future.

What Is “Boiler-plate” Language in a Contract?

Boiler-plate language is language in a contract that is repeatedly used by the company that created it. Although other parts of a contract template may change, the boiler-plate language will remain the same and will be used in the same way across the different contract agreements.

One common example of this type of language is common clauses in a contract, such as arbitration clauses. If a business includes a non-litigation clause in its contracts, that language will likely stay the same.

In most instances it will say something similar to, “[I]n the event of a legal dispute, the companies shall forfeit their rights to litigation, and will resolve their disputes through arbitration rather than a lawsuit.” It is best for boiler-plate language to be drafted by competent and experienced attorneys, as the same language may appear in multiple contracts.

If this language contains an error, it may cause major legal issues for the business in the future.

What Are the Benefits and Disadvantages of Using a Contract Template?

A contract template can be very helpful for certain purposes and at certain times. Contract templates can:

  • Save time and resources that would be spent on drafting a new contract each time a certain type of transaction is made;
  • Provide uniformity for transactions and deals, when that is a desired goal;
  • Be perfectly adequate because a new, customized contract simply is not necessary for standardized transactions, such as rentals of residential real property; and
  • Possibly make it easier to keep accurate records of transactions.

If a residential landlord uses a contract template, it means they do not have to revise or rewrite the contract so they can use it for multiple rentals over time. In some cases, the rental agreement will have worked successfully and may have even been tested during eviction proceedings.

It is important to have a contract template reviewed and updated by a lawyer from time to time to ensure it complies with the current laws. There are also disadvantages to using one contract template for multiple transactions.

One contract template may not contain the right terms and conditions for every transaction. It may also not cover all of the terms that were agreed to during a negotiation.

Can a Contract Template Be Modified?

An existing contract template may be modified to change certain parts or terms of the contract to reflect the needs of the parties. Usually, this requires the contract to satisfy the elements for entering into a legally enforceable original contract.

This includes an offer, acceptance, and consideration. It is important to note that some contracts contain no-modification clauses. These are clauses in a contract that prohibit its modification in the future or limit the ways in which modification can occur.

There are numerous factors to consider when trying to determine if a contract template is adequate for a purpose or whether an individual should hire an attorney to draft a custom contract, including:

  • An individual’s expertise: An individual would want to consider how comfortable they would be with preparing their own document from a template. This would include thinking about the individual’s particular kind of business, their knowledge of the law and standard contract practices relating to that business, and the individual’s ability to engage in any necessary legal research;
    • An individual would want to consider how complicated the transaction is. For example, the sale of a business could involve many complicated issues, whereas a simple transaction for providing a one-time service would not;
  • Amount at risk: If a transaction is of limited financial value or involves little financial risk, a template might be good enough. On the other hand, if the transaction has a high value and an individual wants to avoid any risk of loss, then it may be worth the cost of hiring a lawyer to prepare a contract;
    • If an individual has spent their whole life establishing a business that they are going to sell, they probably do not want to take any risks;
  • The role of an attorney: An individual might think that bringing an attorney into the negotiations would result in a better deal. An experienced attorney may be aware of issues that should be addressed that an individual may not be aware of;
    • In addition, an attorney might get a party to a negotiate a better deal than they could obtain for themselves; and
  • An individual’s level of experience: One main factor is whether an individual knows the business and the type of transaction for which they need a contract;

Do I Need a Lawyer for Help with Contract Templates?

If you are considering using a contract template for your business or you already have one you would like reviewed, you should consult with a contract lawyer. A contract template can be a very important aspect of your business, so it is important to ensure it complies with the laws in your state.

Your attorney can review and edit your contract template or templates as needed. Your lawyer can also help you fill out a template and even negotiate a contract.

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