Almost every transaction in a business involves some form of contract, either implied or written. For example, every time you buy an item, the implied contract is that you are trading money for the item and its effectiveness. Other times, the contract may be written to the effect that you are giving money in exchange for a service for a certain period of time.

Whenever a contract is breached, the two parties are involved in a dispute and there may be litigation to dispute the meaning of certain terms and provisions of the contract. The purpose of this article is to illustrate how you, the business owner, can write an effective contract that seeks to avoid such ambiguities and ensure that you and the client come to a solid understanding of the terms and conditions.

#1: Make sure you take into account all possible situations in the contract

Whenever the parties get into a dispute over the terms of the contract, one party may argue ignorance or may argue that the situation was never written into a contract. For example, if you are selling SEO services and your client wants to change plans between the length of their contract, you might want to include in the contract whether or not this is allowed. Another good example is if you are designing a website for your client and they want you to make substantial changes even after the website has been launched and finished. Addressing this in the contract would help avoid a lot of disputes and long-term pain.

Accounting for every possible situation requires you to sit down and really assess the different situations. This is a process that should take a long time. You have to think from a client’s point of view, if he or she saw the contract, what various loopholes and situations would they try to exploit? Most likely, if the client has found a loophole in the contract she drafted, he will try to exploit it. Make sure you have taken this into account in the contract.

#2: Write the contract in clear and concise terms that the client can understand

As with anything you write, you want to make sure you write for your audience. In this case, your audience is your customers. Be sure to use clear, simple language that the client understands, using simple words where possible and making sure to define certain terms in the contract if they need to be defined. Also, be sure to use as few words as possible, as long provisions can lead to ambiguity issues and the client may be inclined to skip over them.