Key Takeaways

  • A legal agreement between two parties outlines mutual obligations and protects both parties in case of disputes.
  • All valid agreements must include key elements such as offer, acceptance, consideration, legality, and capacity.
  • There are various types of agreements including business, service, partnership, lease, and purchase agreements.
  • Clearly outlining terms, expectations, and termination clauses minimizes ambiguity and legal risk.
  • A legal agreement template between two parties can streamline the drafting process while maintaining legal accuracy.

You can find samples of contracts between two parties online. Such contracts could be a business-to-business contract, a person-to-person contract, or a mixture of the two.  When writing a contract, it is critical to understand how important it is to include proper elements. Contracts are recognized in courts. In a dispute, a judge will decide what the contract means.

Both businesses and regular consumers use contracts. 

  • If you are a business or a professional working and you are hired by another business to render specific services, develop intellectual goods, or provide supplies in exchange for pay, you would outline the terms in a contract.
  • If you are buying a home, car, or start a new job, the terms and conditions would be outlined in an appropriate contract.

How to Write a Legal Contract

A contract is a legally binding agreement between at least two entities. It can be two or more people, two or more organizations, or a combination of the two. These agreements usually exchange something that has value for all involved parties. A contract should be mutually beneficial and equitable to all parties involved. In order to make a contract between two or more companies enforceable, the contract must be in writing.

  • Decide whether the agreement warrants a contract.
  • If you decide that you need a contract, make sure it includes all the necessary parts. A written agreement is a contract only if it: has an offer, an offer acceptance, and exchange of equitable values from each party.
  • Make sure all participants can lawfully take part in a contract. Form contracts with someone who is commissioned to carry a contract on a company's behalf. Also, in most cases, you must be 18 or older and have the mental ability to fully understand the terms of the contract.
  • Each party in the contract must exchange something valuable like money, a product, a service, or intellectual property. One party may pay for the other to provide intellectual property. Even still, one party may provide goods in exchange for the other party's cash.
  • Everyone must agree to the terms of the contract. A contract is legally binding if there is an offer in addition to someone accepting that offer.The law will only acknowledge the contract if everyone involved interpret the contract the same."Meeting of the minds" is the lawful term that signifies all parties involved agree.
  • All party must come to the deal intending to hold up their part of the contract. The parties must agree to the terms of the contracts. Everyone consented to the deal without feeling forced to do so.
  • Determine whether you can write the contract, or if you need legal assistance.  You may want to hire a lawyer, for instance, if you want a way to legally get out of the contract. Furthermore, if you have a lot at stake, consider hiring an attorney.
  • Start with basic information, like the name of each party. Use any information that identifies each person, like their title and the business they are representing.
  • Write a detailed account of what values or consideration you are exchanging. Make the sentences easy to understand and break it up into short paragraphs for readability.
  • Use an appendix (addenda) if you need to add further detail to clarify terms in your agreement.
  • If you do not want the other party to share information in the agreement, then include a confidentiality clause or a Non-Disclosure Agreement (NDA).
  • A termination clause lets all parties know the different situations that will end the contract.
  • Check your contract to make sure it is legal. Your document must meet the minimum criteria required by law.
  • The last page is saved for signatures. Both parties can sign and date the contract.

Essential Clauses to Include in a Legal Agreement

A comprehensive legal agreement template between two parties should include clauses that address a variety of legal, operational, and risk-related aspects. Including these essential elements helps ensure clarity and enforceability:

  • Identification of Parties: Clearly state the full legal names and roles (e.g., "Buyer" and "Seller") of both parties.
  • Scope of Work or Purpose: Describe in detail the purpose of the agreement or the services/products involved.
  • Payment Terms: Specify payment amounts, due dates, and accepted payment methods.
  • Duration and Termination: Outline the start and end dates, along with how the agreement can be terminated (e.g., with notice or for breach).
  • Confidentiality: Include a confidentiality or non-disclosure clause if sensitive information is exchanged.
  • Dispute Resolution: Define how disputes will be handled (e.g., mediation, arbitration, jurisdiction).
  • Governing Law: Specify which state’s laws will govern the contract.
  • Signatures and Date: Ensure both parties sign and date the agreement to acknowledge their consent and understanding.

Common Types of Legal Agreements Between Two Parties

Understanding which type of legal agreement best fits your needs is crucial. Here are common types of contracts used between two parties:

  • Business Partnership Agreement: Outlines roles, contributions, and profit sharing among business partners.
  • Service Agreement: Used when one party provides professional services to another.
  • Independent Contractor Agreement: Establishes terms for freelance or contract-based work.
  • Lease Agreement: Details the rental terms between a landlord and tenant.
  • Sales Agreement: Documents the sale of goods or property and includes terms like price, delivery, and warranty.
  • Loan Agreement: Outlines the terms of borrowing and repayment between a lender and borrower.

Each type of agreement serves a different legal purpose and includes specific provisions suited to its context.

Tips for Using a Legal Agreement Template Between Two Parties

Using a legal agreement template can save time and ensure essential clauses are included. However, the following tips will help ensure your template serves your specific needs:

  • Customize for Each Situation: Avoid using a generic template without adjusting terms to match the agreement’s purpose.
  • Use Clear Language: Ensure the template is written in simple, straightforward terms to avoid confusion.
  • Check Local Legal Requirements: State-specific laws may impact enforceability, especially regarding disclosures and governing law.
  • Include Only Applicable Clauses: Remove any boilerplate provisions that don't pertain to the agreement.
  • Seek Legal Review: Especially for complex agreements or high-stake transactions, consult an attorney.

If needed, you can find experienced attorneys on UpCounsel to help review or draft a legal agreement tailored to your circumstances.

Benefits of Written Agreements

While verbal agreements can be legally binding, written contracts provide more security and clarity. Benefits include:

  • Clear Expectations: Written terms reduce misunderstandings.
  • Proof of Agreement: In the event of a dispute, a written document serves as evidence.
  • Defined Remedies: Contracts often include clauses for addressing breaches.
  • Professionalism: Presenting a written agreement helps build trust and establish legitimacy.

Digital Contract Execution and Storage

With the increasing use of remote business practices, executing legal agreements electronically is now common and enforceable in most jurisdictions.

  • E-signature Validity: Under the ESIGN Act and UETA, electronic signatures are legally valid.
  • Secure Platforms: Use reputable e-signature platforms like DocuSign or Adobe Sign for security and audit trails.
  • Digital Storage: Maintain digital backups of all signed contracts in a secure cloud environment or encrypted local storage.
  • Access Control: Ensure only authorized parties can view or modify the agreement.

Digital contracts improve efficiency while maintaining legal compliance.

Sample Template Structure for a Two-Party Agreement

Here is a simplified outline of what a legal agreement template between two parties may include:

Copy/Edit

LEGAL AGREEMENT TEMPLATE BETWEEN TWO PARTIES

This Agreement is entered into on [Date] by and between:

Party A: [Full Legal Name, Address]

Party B: [Full Legal Name, Address]

1. Purpose

2. Terms and Conditions

3. Payment and Compensation

4. Confidentiality

5. Termination

6. Governing Law

7. Signatures

IN WITNESS WHEREOF, the parties have executed this Agreement on the date above.

______________________          ______________________  

Signature of Party A            Signature of Party B

This format provides a strong starting point for customizing your agreement to your specific use case.

Frequently Asked Questions

1. Is a legal agreement template between two parties legally binding?Yes, if it includes offer, acceptance, consideration, and is signed by parties with the capacity to contract, it is legally enforceable.

2. Can I write a contract without a lawyer?Yes, for simple agreements. However, it's advisable to consult an attorney for complex or high-value arrangements.

3. Are electronic signatures legally valid in contracts?Yes, electronic signatures are generally enforceable under U.S. federal law (ESIGN Act) and most state laws.

4. What happens if a contract does not include a termination clause?It may still be enforceable, but terminating the contract could become more complicated without clear terms.

5. Where can I find a reliable legal agreement template between two parties?UpCounsel offers access to customizable templates and experienced attorneys to help tailor them to your needs.

There are all kinds of samples of contracts between two parties. First, know what kind of agreement you are considering. What consideration are you offering? What do you expect to get? Depending on the complexity of those answers, you may want to seek assistance in writing the contract. 

If you need help with crafting a contract between two parties, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.