Key Takeaways

  • Contracts Without Lawyers: You can create legally binding contracts without an attorney by ensuring clarity, completeness, and adherence to legal requirements.
  • Essential Elements: A contract must include parties, offer, acceptance, consideration, and clear terms to be enforceable.
  • State and Federal Laws: Contracts must comply with state and federal regulations, including industry-specific requirements.
  • Legal Clarity Matters: Ambiguous language can make a contract unenforceable, so precise wording is crucial.
  • Digital Contracts: Electronic contracts and e-signatures are legally binding under the E-SIGN Act and the Uniform Electronic Transactions Act (UETA).
  • Contract Templates: Using templates can be helpful but must be customized to fit the specific transaction.
  • Alternative Dispute Resolution: Mediation or arbitration clauses can help avoid costly legal battles.
  • Breach of Contract Remedies: Outlining remedies for breach in advance helps protect both parties.

Knowing how to make a legal contract without a lawyer is useful in cases where you want to save some legal fees. The first thing to do is to collate samples from other persons in your professional trade association or industry or you could look up contract form books in the local library.

A lot of business owners require written contracts or agreements when dealing with clients, vendors, and other entities they come in contact with during business operations. If you intend to use an attorney, it's best to communicate your expectations upfront and find out the cost of the services.

Drafting a Legal Contract Without an Attorney

However, you may decide to draft out the contract yourself. If your business operations focus on repairing or selling mobile homes and used vehicles; door-to-door sales; renting apartments or homes; cremation, burial, or funeral services, there may be special rules in your state governing the drafting of contracts.

Understanding the Legal Requirements for Contracts

When drafting a contract without a lawyer, it's crucial to understand the legal requirements that make a contract valid. In general, a contract must include:

  • Offer: One party proposes an agreement.
  • Acceptance: The other party agrees to the offer under the stated terms.
  • Consideration: A mutual exchange of value, such as money, goods, or services.
  • Legal Purpose: The contract must not involve illegal activities.
  • Competent Parties: All signers must be of legal age and sound mind.

Each state may have additional requirements, particularly in industries such as real estate, healthcare, or finance. Researching applicable laws is essential to ensure your contract is enforceable.

Contents of a Contract

Whether you decide to seek professional help or take a DIY approach when drafting your contract, there are a few things you should be familiar with. The following items must be included in the contract.

Common Pitfalls in DIY Contracts and How to Avoid Them

While drafting a contract on your own, be mindful of common mistakes that could make it unenforceable:

  1. Vague Language: Use precise terms and avoid ambiguous wording.
  2. Missing Key Terms: Ensure payment details, timelines, and obligations are explicitly stated.
  3. Ignoring State Laws: Some states require specific disclosures or clauses.
  4. Failure to Define Remedies for Breach: Clearly outline the consequences of non-compliance.
  5. Not Including a Termination Clause: Specify how the agreement can be ended.

To avoid these issues, review your contract multiple times, use clear and concise language, and consider using contract checklists to ensure completeness.

Parties to the Agreement

This is your business name and the name(s) of the other party or parties to the contract. This could be a vendor or client.

Consideration

This refers to what each party gains from the agreement.

Terms

The terms of the contract dictate what each party is expected to do. This constitutes the main body of the contract and should be explicitly defined. It should include things like the type of work to be performed, the price to be paid for such work, the length of the contract, as well as when and how the payment will be made.

Additional Terms

These usually include the conditions for terminating the contract and whether each party can assign or transfer the contract to another entity. Also, the additional terms can speak to the mediation or arbitration of disputes if they arise; the payment of legal fees in the event of a breach of contract; state laws that apply when issues arise, or the address where legal notices can be sent.

Digital Contracts and Electronic Signatures

In today's digital landscape, contracts don’t have to be on paper to be legally binding. The Electronic Signatures in Global and National Commerce Act (E-SIGN) and the Uniform Electronic Transactions Act (UETA) establish that digital contracts and e-signatures hold the same legal weight as traditional paper contracts.

When using digital contracts:

  • Ensure both parties consent to electronic agreements.
  • Use reputable e-signature platforms like DocuSign or Adobe Sign.
  • Keep a digital record of the signed contract for future reference.
  • Confirm the contract meets industry-specific regulations, such as HIPAA for healthcare agreements.

Electronic contracts streamline transactions and provide a secure, verifiable way to enter into agreements.

Execution

You must ensure that both parties sign the contract. The person that signs the contract must have the authority to sign.

The Role of Notarization and Witnesses

Not all contracts require notarization or witnesses, but adding them can strengthen enforceability.

  • Notarization: A notary public verifies the identities of the signers and ensures they sign willingly. This is common for real estate contracts, wills, and financial agreements.
  • Witnesses: Some contracts, such as those involving large sums of money or long-term commitments, may require a witness to confirm authenticity.

While these steps aren’t always necessary, they add an extra layer of legal protection, especially in case of disputes.

Delivery

Ensure that all contracting parties receive copies of the final signed agreement.

Date

The date when the contract is signed.

However, it's best to have an experienced attorney draft your business or legal contracts. It helps protect your interests and rights and saves time and money in the event of a contract dispute.

Not all contracts are well-written.

It may be difficult or even impossible to enforce such contracts. Since such a contract doesn't clearly outline the terms of the agreement, the other contracting parties may not follow through with the provisions within the contract. Such contracts are poorly written and use ambiguous language.

In some cases, contracts are drafted to give undue advantage to one contracting party over the other. They fail to provide adequate protection to all contracting parties.

Properly outlining the terms of a negotiated agreement within the contract is just as important as having a well-written contract.

Experienced attorneys have the skill and expertise to draft contracts that protect their clients' interests. They also know how to handle a breach of contract as well as how to modify a contract that contains harmful clauses. With lots of experience in drafting contracts for various industries and use cases, attorneys know how to resolve contract disputes, avoid traps and loopholes and represent their clients' interests at the negotiating table and in the courtroom.

The components of a well-written contract include:

  • Offer
  • Acceptance
  • Consideration and
  • Agreement

Differences Between Implied and Express Contracts

An implied contract is one where an offer and acceptance are made through actions/performance. On the other hand, express contracts contain clearly written statements detailing the offer and acceptance.

A valid contract is a contract whose terms are readily enforceable by a law court. The court can order defaulting parties to pay damages for breach of contract.

Alternative Dispute Resolution Clauses

Disputes can arise even in well-drafted contracts. Including an Alternative Dispute Resolution (ADR) clause can save time and money by avoiding court battles. Common ADR methods include:

  • Mediation: A neutral third party helps both sides reach a resolution.
  • Arbitration: A private process where an arbitrator makes a binding decision.
  • Negotiation: Both parties attempt to resolve the issue informally before taking legal action.

Adding ADR clauses ensures that conflicts are managed efficiently, reducing the risk of costly litigation.

Frequently Asked Questions

1. Can I write a legally binding contract myself? Yes, as long as the contract contains essential elements like offer, acceptance, consideration, and clear terms, it can be legally binding.

2. Are electronic contracts and e-signatures legally valid? Yes, under the E-SIGN Act and UETA, electronic contracts and signatures are legally valid and enforceable.

3. What happens if a contract is missing key details? If a contract lacks essential terms like payment schedules or deliverables, it may be deemed unenforceable in court, or the missing terms may be interpreted by a judge.

4. Do I need to notarize my contract? Notarization isn’t always required, but it adds credibility and helps prevent disputes, especially for real estate, financial, or long-term agreements.

5. How do I protect myself from a breach of contract? Clearly outline the consequences of a breach in the contract, such as penalties or required actions. Including a dispute resolution clause can also help resolve issues without litigation.

If you need help with how to make a legal contract without a lawyer, you can post your legal need on the UpCounsel marketplace. UpCounsel accepts only the top 5 percent of attorneys/lawyers on its site. Attorneys on UpCounsel come from prestigious law schools like Yale Law and Harvard Law and usually have 14 years of legal experience, including work on behalf of or with companies like Airbnb, Menlo Ventures, and Google.