When to use a Template vs When to see a Lawyer
There are an abundance of websites that provide downloadable template legal agreements, forms and documents for personal or business use. Some can be downloaded free of charge, while others must be paid for. It is tempting to complete the template yourself rather than retain a lawyer, primarily because of the potential cost savings involved. Unfortunately, sometimes this can turn out to be a false economy.
Using Template Agreements and Forms
Templates can be very helpful in reducing legal risk and aiding legal compliance, but they are not one-size-fits-all. A template adapted by a non-professional will rarely be the optimal way of managing legal risk or ensuring compliance. Basic or simple forms tend to give the least cause for concern, particularly where you are only required to insert a few basic details such as your business name and address.
The templates will have been drafted by legal experts and should be accompanied by detailed guidance notes explaining how to adapt the content. However, the notes are not often as clear as they should be and you may quickly find that you encounter difficulties in completing the document. In fact, the websites providing these services will almost always contain disclaimers, making it clear that:
A template is not legal advice, it is a useful information resource or reference tool provided in generic form.
No warranty is given that the template document is complete or error-free.
To the extent allowed by law the company excludes all liability and responsibility for your usage. In other words use it at your own risk.
Templates are not intended to avoid the need to use a company lawyer, as every company’s circumstances are different.
You will need to consult your lawyer to ensure that your use of these documents is appropriate for your situation.
When using a template you need to pay careful attention to the particular needs of your business. It is essential that you get the basics right. Do you know when you need to use an "Agreement" as opposed to using "Terms and Conditions"? Do you need both? Agreement templates are typically used where the parties negotiate the terms of the document, that is, the terms are not being imposed by one party on the other. Terms and Conditions templates tend to be used where one party is imposing its standard terms of trading on the other party, and where the terms are not up for negotiation.
The documents may be available in versions of varying length and complexity. Are you sure that you know when to choose the “short-form” version of a document over the “long-form”? Does the document cover all of the matters that are important to your business? Will you know if the document is missing important clauses? If you have recognised the absence of an important clause will you know how to word it yourself?
Consult a Lawyer
Choose a lawyer that has experience in the field of law that your template covers. For example, if you have started completing a franchise agreement and have questions you should try to find a franchise lawyer who has many years of experience in that field. The costs of instructing a lawyer to draw up a commercial contract from scratch will vary dramatically, depending primarily upon the complexity and scope of the job and the efficiency of the lawyer. Inform your lawyer that you do not need to have an agreement drafted from scratch, but would like to clarify some points or obtain their input on others. When you consult with your lawyer they will be able to advise you of which parts of the document are essential and which parts are superfluous. The lawyer will identify which additional clauses are required in order to reduce your risk and protect your business.
In particular you should ensure that you have addressed all concerns regarding matters relating to:
Warranties and indemnities
Liability – you want reassurance that your business is covered, as far as possible, for legal risks
Intellectual property – uses, licenses, termination
Which law and jurisdiction are appropriate in the circumstances.
With an experienced lawyer, you can be reassured that a contract properly reflects the business/transaction, that main legal risks relating to the contract have been identified and where practicable dealt with or mitigated. The lawyer will also ensure that regulatory compliance issues have been dealt with. You will save yourself the time and frustrations of trying understand the notes and adapt the template.
Most lawyers actually have their own templates and prefer to work from these. If you believe that the template that you downloaded (or plan to download) will need wholesale revision you may find it more cost effective to have the lawyer use their own template.
What should I do next?
At You Legal, we can provide legal advice on all aspects of commercial agreements, and also provide you with template agreement for everyday use that suit you business. We will be happy to prepare the required documents for the common activities that your businesses may undertake, just be in touch.
* This blog is for general guidance only. Legal advice should be sought before taking action in relation to any specific issues.