Office Environmental Protection- Six Golden (or Green) Rules for Working with Contract Templates

I review contracts all the time.  Some of these are created by my company (e.g. a sales team member sends me a draft to review before they send it to a client) and some we receive from suppliers or customers.  And every so often, I come across an error of a particular type: Document Pollution.

And that would be?

Document Pollution can be anything from an employment contract for Yossi that has Moshe’s name and address in the Inventions Assignment Agreement,  to a set of supplier contract terms and conditions littered with nonsensical sentence fragments, to a sales contract sent to Company A which still includes Company B’s (absolutely draconian) payment terms. It’s any sort of error that derives from reusing contracts and misusing contract templates

Awkward.  🙁   And potentially costly.  But, happily, super avoidable!

Your Office Environmental Protection Act–in six golden–or green–rules. 

  1. Keep out the humans. We mess everything up!  You want to keep your template clean and pristine, as if it were some secluded and miraculously untouched mountain lake.  Your templates should remain blissfully unmarred by coarse human contact.  If you want to create a new contract, open the template, save a copy as a new document with a new name in a new, separate file and then amend that.  Make sure that these templates are made available to team members and that they know when the template has been updated. Saving your templates as “read only” is a great way to prevent inadvertent amendments to the original.
  1. No recycling. Don’t worry—it’s electronic—the trees are safe.  Always create new contracts off the template.  Don’t take the contract you did last week and just change the key details. That’s how you end up sending a contract to Nike with Adidas’ details in the T&C’s.  If there is a specific item or description in one contract that you want to reuse, copy and paste that specific section (while carefully reviewing it, of course). 
  1. Build firebreaks. As much as possible, separate practical commercial stuff from the legalese. This will allow you and your team members (yes, we are all liable to make a mess here) to fill in contracts while minimizing the chance that the T&C’s will be inadvertently garbled in the process.  For example:
    1. For customer contracts, use a standalone order form with the key commercial terms (what is being sold, to whom, when, at what price) and add a reference and/or link in the signature section to the terms and conditions.
    2. For consulting and supplier contracts, stick all of the key commercial terms (what service is being received, contract term, price, termination details, etc.) into an annex to the consulting/supplier services contract. You can then send the annex off to the relevant team member to fill in, and then send that and the separate contract document to the service provider.
  1. Lay down some paths. You cannot always break out the details from the legalese.  In this case, the details are going to be scattered throughout the document.  Before you let your team go trampling through your document, provide them with a map. In order to avoid inadvertently missing one and, say, sending out an employment contract with no salary details,  have the contract drafted with highlighted blank fields, like this [____________] for each item that needs to be completed.  All you need to do is go the through the contract, look for all those lovely, colored spots and fill in the relevant terms and delete inapplicable sections.  Remember to remove the brackets and the colored highlighting! 

Generally, the data to be provided will be pretty self-explanatory from the context (it’s an NDA, not a novel) but if not, you can also do this:  [Address____________].  Do leave the blank space, as it’s a good visual clue.

  1. Lay down some law. Don’t underestimate the power of rules and regulations in environmental protection. Communicate to team members:
    1. what needs to be filled out in each type of contract and what can be left blank (a.k.a. “do not submit a sales contract without payment terms”);
    2. who is authorized to approve changes to contract legal terms for each type of contract and ensure that there is 100% compliance (may involve some verbal smack-downs);
  1. Regular litter collection runs. Despite your best efforts, your contract templates may become corrupted over time.  Perhaps you inadvertently made direct changes on it and then didn’t restore it.  There are a few ways to catch this.  You can read through the document or have your legal counsel do so.  You also can periodically run the “compare documents” function in Word to compare the current template against the original saved elsewhere.