Who said you can’t draft a contract in 3-4 pages?
I expose the myth that we cannot shorten our everyday contracts.
What’s the first thought that comes into your mind when you think of contracts? I think, “too long and too dense!” Yes, I subscribe to that notion even as a future member of the legal profession.
It’s true, really.
Contracts tend to be, too long and too dense.
I get that contracts are legal instruments: they carry real-life legal consequences for the contracting parties. However, that is no excuse for verbosity. We can do better.
What we can do better
If we agree that contracts are too long and too dense, it follows that, for a start, there’s two improvements we can go for immediately:
- Make contracts shorter. This is self-explanatory. We literally need to reduce the average number of pages a contract rambles on for.
- Make contracts less dense. Contracts are often too crowded: too many words in a paragraph, too little punctuations, unfathomably long sentences, and so on. Its length aside, this makes contracts difficult to comprehend. What we need are more readable contracts: more paragraphs, smaller sentences, no archaic English, more punctuations, and the like.
In this blog, I’m focusing on a method to make contracts shorter. Our best friend for this purpose? Say hello, to MS Word.
Yes, contracts can be short!
Contrary to popular belief, contracts can be way shorter than most of them are presently. What’s better than some examples, to prove my point?
(i) Example #1: Confidentiality Agreement.
I looked up some samples. Apparently, a typical confidentiality agreement for a mergers & acquisitions (M&A) negotiation runs into at least 4–5 pages.
Pfff! What if I told you I drafted a confidentiality agreement for an M&A negotiation in 2 pages? Dude, here it is:
No no no, don’t scream, “That’s cheating!” There’s no rule you can’t put 2 columns on each page to make the contract shorter. Rather, I’d say you should.
That’s not all. This draft also uses far lesser words than its classical counterparts. Nevertheless, it is as good as any other typical confidentiality agreement for an M&A negotiation, except that it’s 2 times smaller.
[Sidenote: I’m making every reader an open proposal. Find me a lacuna in my draft which isn’t there in those longer samples, and I’ll make a public correction to this article. I’d love to learn.]
(ii) Example #2: Mortgage Deed.
Okay, forget M&A negotiations and confidentiality agreements. Let’s talk about something we’re much more intimately familiar with: mortgage deeds. Unless you’re as young as I am, you’ve probably had a mortgage at some point in your life, in which case you will almost certainly have signed a mortgage deed.
You will know that a somewhat comprehensive mortgage deed runs into at least 6–10 pages. Well, I present for your perusal, ladies and gentlemen and everyone in between, a mortgage deed of 4 pages! Here you go:
It says the exact same thing as a longer ones typically would be, except that it’s much shorter.
[Sidenote: Again, I’m making every reader an open proposal. Find me a lacuna in my draft which isn’t there in those longer samples you typically use, and I’ll make a public correction to this article. I love to learn.]
Why should contracts be short at all?
Before we proceed further, it’s best to lay the laundry out to dry: why should we bother making contracts brief?
Let’s not forget, one of the fundamental purposes is effective communication.
A contract determines the mutual rights and obligations of the contracting parties which they themselves have agreed on. A written contract reduces this understanding into words. There’s a reason why so many contracts are written down, even though it’s not necessary in most cases: for the sake of clarity.
When the contracting parties have a clear understanding of their respective expectations, the lesser is the propensity for disputes (which are inherently costly). Putting a contract in words serves this purpose.
If that is one of the fundamental purposes of a written contract, it’s easy to see why we should try to keep contracts brief.
The longer a contract, the more the inertia to read it closely, the more the difficulty of comprehending it, the more costs we incur in reading and comprehending it.
This reduces the efficacy of the contract in communicating the intentions of the contracting parties, which is one of its fundamental purposes. It’s pure human psychology.
I get that there’s sometimes a trade-off between length and comprehensiveness. However, this is just not true in all cases. There are many, many contracts which can express the very same thing but in lesser words.
As contract drafters, the challenge we therefore must meet is to make express the very same thing in lesser words.
How to make contracts shorter
If you’re still with me, I presume you find it reasonable to say that we can, and should, make contracts much shorter than they presently are.
Now that were on the same page, for a start, here’s a non-exhaustive list of ways to shorten a contract. Incidentally, these methods are exactly how I shortened the example-contracts you see above.
(i) Reduce the verbosity.
Lawyers seem to have a penchant for verbosity.
I seriously think contract drafters (mostly, lawyers) can convey the very same thing with far lesser words than they tend to use.
Again, I’ll use an example to prove my point. This is a standard indemnification clause which is found in many contracts:
Indemnification.
14. Each Party shall indemnify, defend and hold harmless the other Party, its officers, employees, agents, representatives, consultants, and contractors from and against any and all loss, costs, penalties, fines, damages, claims, expenses (including attorney’s fees) or liabilities arising out of, resulting from, or in connection with a breach by the former of any obligation created by or arising out of this agreement.
Lord! What if I told you I can express the very same thing, in this much smaller indemnification clause for a 2-party contract:
Indemnification.
14. If a contracting party does not comply with any obligation arising out of this agreement and consequently causes damage to the other contracting party, it shall make good such damage to the other party.
In the same vein, here’s a small indemnification for a more-than-2-party contract:
Indemnification.
14. If a contracting party does not comply with any obligation arising out of this agreement and consequently causes damage to another contracting party, it shall make good such damage to that another party.
Duh. There you go!
How should drafters keep their contracts brief? Oh, I think there’s a simple formula which we all can use:
Don’t use more words than are necessary and sufficient to express what you want.
This requires us to critically subject everything we draft to the twin tests of necessity and sufficiency. It’s time for contract drafters to come out of the rubric of passively relying on classical templates which are clearly verbose, and actively and critically draft contracts which use only as many words as are necessary and sufficient.
(ii) Use some MS Word vodoo.
Some drafters continue to use huge font, and magnanimous line spacing and margins, like they own a substantial portion of the world’s real estate. For God’s sake, please don’t do that.
There are such things as 10 pt font, single line spacing, 1-inch margins, and multiple text columns, in MS Word. For the love of God, please use them. We’re not in the era of typewriters anymore!
MS Word has made contract drafting so much simpler. It’s only wise to use everything it has to offer, to make contracts brief and therefore more readable.
I’ll use my example confidentiality agreement to make my point. Here it is again, take a quick glance at its first page:
Here’s a list of MS Word vodoo I used to keep this contract short:
- Small Font: Times New Roman, 10 pt.
- Standard Margin: The standard 1-inch margin of MS Word, no magnanimous margins like I’m the Berkshire Hathaway of real estate.
- Single Line Spacing: Please don’t use double (or triple!) line spacing, it’s a waste of pages. Use single line spacing.
- Two Text Columns: This here is my secret sauce, I used 2 text columns in every page. There is no rule you can’t use multiple text columns in a page. Use it then. It makes the contract look brief.
I know what you’re thinking. “Sarkar, these are all cosmetic changes, do they really matter?” Yes they do, Your Honour.
I agree with the characterisation that these are cosmetic changes, they only make the contract look and feel shorter without reducing the number of words. But then, no contract drafter can legitimately argue that the look and feel of a contract doesn’t matter. Of course it does.
A contract which looks and feels smaller, has the same psychological effect as a contract which is smaller in substance by using lesser words.
I’ve already argued why it is in our clients’ interests to keep contracts brief (see above, “Why should contracts be short at all?”). These cosmetic changes are hence one more way in which we can advance our clients’ interests.
A Call to Action
For too long, contract drafters have relied on verbose templates which use more words than are necessary and sufficient. This has made contracts inordinately long when they undoubtedly could have been shorter.
Long contracts have conspicuous costs for the contracting parties (in terms of effort to read and comprehend, and propensity for disputes), which every contract drafter should be conscious of.
Now is the time to make the transition to drafting shorter contracts.
As I hope to have demonstrated, it is very much possible. The contract drafter must now rise to the occasion, and endeavour to draft contracts which are brief and therefore further her client’s interests. All it requires is, some mastery of MS Word, and some active critical thinking.
