Construction Law 2004

It is absolutely imperative that when writing a contract, lawyers are precise and accurate in their language and understanding of the subject. Simple mistakes can cost parties thousands or even millions of dollars because of a later contract dispute. In the case of Sherwood v. Walker the potential costs to both parties were huge. Had Walker won the contract dispute, he would have received a cow worth more than ten times as much for a mere $80 and, since she was pregnant at the time, would also have received her calf for no extra investment at all.

The sellers would have lost a prime breeding cow and her calf for the price of a cow being sent to the dinner table. The case ended up in a courtroom, costing both parties untold amounts in legal fees and ruined what might have otherwise been a long-term business relationship because both thought they should benefit from the unexpected fertility of the cow. If the contract for sale had been written up more specifically and had outlined the conditions under which the contract was terminated, it would have saved both parties much time and aggravation.

It is therefore imperative that the attorneys drafting contracts understand all assumptions that clients are operating under and note any common or mutual mistakes in the language of the contract. Attorneys must also guard against attempts by one party to take advantage of the other through the exploitation of unilateral mistakes and mistakes of identity. Furthermore, it is important that attorneys are very familiar with the rule of law regarding the contract under discussion. If an attorney misapplies the law in writing a contract, it is almost guaranteed that his client will suffer for the error.

Therefore, it is essential that lawyers understand how the law applies and clarify all the details of a contract. Recommendations It might seem obvious, but the answer to mistakes in contract law is often as simple as proofreading a document, asking questions, specifying everything. and double-checking all facts. Proofread Most minor mistakes in contract law could be avoided if the lawyer preparing the contract or his staff took the time to proofread the document. This is particularly important if a standard contract is used from year to year.

Simple mistakes like incorrectly labeled dates and misspelled names could be detected in this phase and prevent errors from occurring which might impact the usefulness of the contract. Ask Questions It is often human nature to assume that we know things that we don’t. For a contract attorney to do her job well, she must be willing to ask questions. She should verify the names, titles and spellings of all parties before beginning to write the contract. She should provide a step by step analysis of the contract, specifying when the contract begins and when it ends and then clarifying what steps will be taken along the way.

A good attorney will even ask parties to clarify when they say that it will be completed “like we always do it”. As a matter of formality, attorneys should verify before negotiating a contract that the parties involved are appropriate representatives for their companies. For example, if the president of the company is the only one authorized to enter contracts, negotiating with anyone else, even a vice president, may be a waste of time. Attorneys should have parties verify their identities, titles and the names of their corporations at the contract signing so as to avoid mistakes in identification.

The attorney should ask as many questions as necessary to be able to identify the items being discussed as clearly and accurately as possible. That way, if the contract is invalidated by a pregnant cow, no one has any questions about it. Specify Everything If the agreement is null and void if the cow becomes pregnant, say so. If the contract changes in the event of national emergency or natural disaster, say so. If the laws of Canada will apply to one portion of the document and American laws will apply to another, be very specific in outlining the provisions of the contract.

In short, the lawyer should make absolutely no assumptions regarding the contract. Even if the parties have worked together forever, there should be specific language regarding how disputes are to be resolved and what laws apply. Double Check Everything Even if the last contract written between these two parties was yesterday, double check everything. Ask if either company has been sold or changed their name, verify all calculations and then double check them again. The key to successfully writing contracts is to assure that all the details are correct.

Attorneys should do this themselves and then have a staff member double check the work as two sets of eyes are always better than one.

References

Alexander, Larry. “Inculpatory and exculpatory mistakes and the fact/law distinction: An essay in memory of Myke Balyes”  Law and philosophy Volume 12, Number 1 / February, 1993 http://www. springerlink. com/content/u2r33l07283x65g9/ July 30, 2007. “Another Law School Course Outline” Internet Legal Resource Center , 2003 <http://www. ilrg. com>, July 30, 2007.