There is a simple and effective way to facilitate business transactions through better management of the information that a contract may contain. A thorough examination of the content of a contract reveals that most contracts suffer from the same chronic problem, namely the lack of an universal sequence and structure for the information contained therein, which could contribute greatly in facilitating their preparation , drafting, negotiation and subsequent management. In ths newsletter, we will introduce a transactional template to be used as universal canvas for the drafting of business contracts, which business people can use to better govern their business processes and which lawyers can then adapt to the specific needs of each transaction.
The basic template for a transactionnal contract is a tool intended to be used as a starting point for any type of transactional contract, namely all contracts except partnership agreements. It can be used to draft a very large number of contracts: employment contracts, financing contracts, sales contracts, lease contracts, service contracts, business license contracts, franchise contracts and distribution contracts, to name a few.
This instrument proposes a system for universal storage of the provisions of a transactional contract whose main objective is to end the confusion that prevails in the world of business contracts due to the fact that there are not any generally accepted standards of presentation of this type of legal instrument to date. This storage system based on a set of information modules (known as Parts in the contract), to which a fixed address, i.e. a specific number is assigned in all such contracts to facilitate identifying clauses (termed according to their hierarchy: section, subsection, paragraph or subparagraph) that make up such a module.
This basic model also offers, in order to fill the universal container described in the preceding paragraph, a variety of universal provisions that can be used to specify the contents of each of the parts (information module) and the formulation of such provisions. Some provisions are available in multiple versions. In such case, an alphanumeric indicator (V1, V2) and specific title appears at the beginning of each version so as to distinguish each of them from the others.
Finally, this instrument contains (in its annotated version only), a data sheet listing all the basic legal information regarding such as well as a specific set of annotations for each of the provisions it contains. These annotations can be used either to explain how the storage system found in the basic template works or explain the technical or legal reason for a provisions found in the latter. If applicable, these annotations can also be used to clarify the links between the basic legal information listed in the data sheet and the specific provisions contained therein. Where such annotation exists in a provision, the number of the provision appears after the citation of the law, case law or doctrine, in brackets [ ].
We recommend using the basic transactional template to document any business transaction (other than a partnership) where the law applicable to this contract does not require a mandatory form or text.
The content of this methodological instrument applies to all contracts for business-type transactions regardless of the jurisdiction to which the contract is subject. The storage system proposed in this paper transcends the many jurisdictions which may govern such a contract.
With regard to its legal content, it should be noted that the instrument has been designed according to the law of the province of Quebec, Canada. Any proposed use of this document for a jurisdiction other than the province of Quebec requires validation of its legal content by a lawyer practicing in said jurisdiction.