Drafting contracts

Step 1: Selection of contracts and scope of contract automation

A legal department should of course decide which type of contract templates will be tailored first through contract automation in the Weagree Wizard. Those contracts may typically require an ‘upgrade’ (or quality review) if only to make them consistent. The selection of the commercial contracts that will be upgraded is largely coupled with the decision which selection automated contract creation will be delegated to the business and staff (see step 9 below). Whilst broadly identifying the various categories of users (e.g. in-house counsel and business line managers), the selection of the contracts to be upgraded may be expanded.

As a first step, the ordinary course commercial contracts would be included in the Weagree Wizard: these are all the contracts negotiated on a regular basis by the company’s relevant businesses or departments. Typically, the selection of contracts would cover the most important and the most frequently used contracts:

  • sales agreements (i.e. general sales agreements, service contracts and licenses),
  • purchasing and supply chain contracts (i.e. purchasing contracts, strategic and non-product-related, one-off transactions and long-term supply, warehousing, transportation, waste treatment and subcontracting contracts),
  • contracts related to intellectual property (incl. confidentiality agreements),
  • HR (employment contracts, termination settlement agreements, secondment agreements), and
  • in some cases, M&A-related documents (incl. for portfolio investments in innovative start-ups and growth-stage companies).

Also corporate housekeeping (i.e. resolutions and powers of attorney) can be managed through the Weagree Wizard.

The selection of contracts should not distinguish for different levels of complexity and possible not even for types of underlying product or services. Only if the complexity or nature of products or services demands a significantly different contractual approach, adjusting the selection would be appropriate. For example, a purchaser-friendly contract does imply significant other contractual devices as opposed to seller-friendly sales contract. However, the distinction for the complexity of a transaction or the nature of the contracted products or services should be made by the end-user (as part of the Q&A): such distinction would rather result in contract clauses not being included (or the inclusion of mere high level principles) than in completely different building blocks. In making the selection, the identification of required building blocks should be leading.