Step 6 and 7 for upgrading your model contracts

Upgrading model contracts is often a very burdensome process. In the FAQ-section of this website (under Ten steps to a successful upgrade of your model contracts), I give some recommendations as to how such processes can improved and accelerated.

In this blog, I will highlight one aspect of Step 6 and elaborate on Step 7.

The best practice group on model contracts should of course facilitate its ‘audience’. This is essential. Even if this audience must not approve the model clauses, most likely, the audience will (or will not) use them in their practice. The audience is usually a group of peers, each of whom will feel equally qualified for the model contract drafting job. A proposal submitted by the best practice group will invite them to hand over additional ‘model’ texts. Such additional text will possibly contain elements that were considered by the best practice group, as well as valuable content. There is not much wrong with such cooperative approach, except that it contains inefficiencies.

In step 6, I explained that proposals for model clauses should be collected in tables (spreadsheets with per column a type of clause, the submitted text variants in different rows underneath each other, gathered subject-by-subject and the resulted (proposed) model clause in the first row). Probably, such separation of input and proposed model clause will not be enough to call the audience’s attention. To structure the discussions, it is helpful to highlight (e.g., in yellow) both the (accepted) discussion elements in the proposed model clause and the (rejected) discussion elements in the input clauses underneath. By structuring the ‘model’ clauses and proposed texts in this way, the contract drafter ascertains that in the end-result, all relevant and less relevant subject matters will have been considered. The additional ‘model’ texts should be peeled off the same way; whether they must be used immediately might depend on the best practice group.

Step 7 describes the subsequent process of adopting and further upgrading the building blocks and model clauses. To prevent that this ongoing process stops (e.g., after heated discussions), the best practice group could adopt a modification policy:

Two appointed members of the best practice group (but always including the drafting person responsible for preserving consistency of applied drafting conventions – see Step 2) may at all times modify all building blocks and model clauses, except that they need prior approval for matters which they anticipate would trigger any relevant discussion in the best practice group.

This delegation implies (a) improved efficiency in the follow-up upgrading activities, (b) prevention of the non-use of model contracts because no-one wants to touch the heavily discussed texts even if a modification is necessary to change the obvious, and (c) a responsibility on the authorised person to act responsibly.

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