Drafting Contracts

By FindLaw Staff | Legally reviewed by Aviana Cooper, Esq. | Last reviewed November 15,
2023

Legally Reviewed

Fact-Checked

Small-business owners, entrepreneurs, and senior-level managers must draft contracts to meet
their business needs. As part of running a business, including a startup, you might need to write
employment contracts, service contracts, nondisclosure agreements, independent contractor
agreements, and joint venture contracts.

These legal documents form the bedrock of many business transactions and business
relationships. Of course, some contracts require the expertise of a qualified business attorney.

FindLaw's Drafting Contracts section provides a general understanding of how to write legally
defensible contracts. It includes articles on commonly misused contract terms, a primer on
contract drafting, and an overview of different types of contracts. It also provides contract
templates, such as sample sales agreements and related resources.

Write a Business Contract: Key Considerations

All valid contracts, whether an employment agreement or a service agreement, follow some
basic rules. One party forms a contract by offering an exchange of value, which the other party
accepts. There are many guides to contract drafting, but there are some key elements that all
legal contracts require:

 Intent to make a contract

 A lawful subject matter
 An offer made by one party
 Acceptance of the offer by the other party
 An exchange of something of value
 A written agreement, in some circumstances

A contract does not have to include payment terms to be legally enforceable. As long as a
contract includes an offer, acceptance, and consideration, it is legally valid. However, spelling
out payment terms avoids confusion and disputes later on. Payment terms explain:

 The financial obligations of each party

 When payments are due
  How to make payments

However, certain types of contracts have statutory payment term requirements. For example,
construction contracts often require the inclusion of payment schedules.

Including payment terms is a best practice for most contracts.

Revocation, rejection, and counteroffer determine if parties created a business agreement. You
can revoke an offer at any time before acceptance. Once the offer is accepted, an agreement is
made. If you agree to keep the offer open for a certain amount of time, you can't revoke the offer
until the period is over. Rejection occurs when one party extends an offer, and the other declines
the deal. A counteroffer is when a party rejects a proposed agreement and offers a contract with
modified terms.

By comparison, accepting a contract, whether an employment contract or a service contract, is

simple. A party can accept a contract via several different means, including:

 Through a clear statement or writing

 By performing their part of the agreement
 By promising to perform their part of the agreement
 Or even if the party begins to perform their part of the bargain incorrectly due to their
misunderstanding