INTRODUCTION
An understanding before entering into an agreement play a major role as it enables to understand the mindset of the parties before formulating any official agreement. It is a well-known fact that without understanding between the parties no contract or agreement can be formulated as the fundamental principle of any contract or agreement is “Prior Meetings of the minds between the parties”. Through the help of this article our Contract lawyers will make the readers understand the benefits, need and drafting of Pre-Contract Agreements.
What is the meaning of Pre Contract Agreement?
Pre Contract Agreement is an agreement of understanding between contracting parties which is executed prior to the actual contract. In other words, it is kind of Memorandum of Understanding executed between the contracting parties before entering official Contract.
What is the importance of Pre Contract Agreement?
The importance of executing pre contract agreement is that it provides clear understanding and chance for negotiation between the parties so that no such dispute can be arise after the execution of official agreement. The execution of this agreement provides additional time to the parties to go through the layout of the agreement and may suggest changes at the later stage before the execution of final agreement.
What are the benefits of Executing Pre-Contract Agreement?
Our Contract law Lawyers states about the benefits of executing Pre contract between the parties. Therefore, the importance is classified into bullet points and are mentioned herein below:
- It provides clear understating of the terms and conditions which have to be executed between the parties.
- It helps in providing the lay out of the actual agreement which has to be executed in future.
- It classifies the element of prior meeting of mind between the parties.
- It enables the parties to agree on the terms as stated between them at prior stage.
- It provides time for negotiation between the contracting parties before entering into agreement.
- It provides an idea about general pricing and cost which is to be levelled in the project.
- It provides time for any future changes if required at time of executing final agreement.
What are the key provisions that are to be included while drafting Pre-Contract Agreement?
Our Contract law lawyer will now mention some of the key provisions that are to be included while drafting Pre Contract Agreement. The said provisions are mentioned herein below for:
- DETAILS OF THE CONTRACTING PARTIES
The details of the contracting parties shall be mentioned correctly. It is noteworthy to mention here that the details of the contracting shall not be changed at the time of execution of the final agreement unless otherwise agreed in writing between the contracting parties.
- PURPOSE
This clause will define the purpose of the Pre contract and will clearly specify that this cannot be considered as final agreement between the contracting parties.
- DEFINITION CLAUSE
This clause will define the meaning of words which will be used in agreement so that neither of the party can claim different interpretation.
- TERMS AND CONDITIONS
This clause will define the terms and conditions as agreed between the contracting parties. Suppose if the terms are related to the use of Intellectual Property Rights or Patents then all the information regarding the same has to be mentioned in clear terms. In other words, there shall not be any hidden details which may cause harm or loss to the other party if discovered at the stage of executing the official contract.
- NON-DISCLOSURE CLAUSE
This clause will impose obligations upon the parties not to disclose any information exchanged between them as this will protect the confidentiality of information and will maintain privacy.
- INDEMINITY CLAUSE
In accordance with this clause the parties to the contract will indemnify each other in case of breach committed or caused by the actions of any party.
- TERMINATION CLAUSE
This clause will define the terms and conditions for the termination of agreement. Moreover, the termination can only be performed as per the conditions set forth under this clause so it is necessary to draft this clause in a diligent manner.
- DURATION OF THE AGREEMENT
This clause will specify the duration of this agreement and will end upon the expiry of the said tenure.
- JURISDICTION CLAUSE
This clause will define the jurisdiction of law in case dispute arises between the contracting parties.
WHY DO YOU REQUIRE US?
Nour Attorneys Law Firm tends to provide you their best skills in form of legal document drafting services, our lawyers are highly skilled and qualified enough to draft Pre Contract Agreement in such a manner that it will provide protection to our clients.
Our Contract law lawyers are specialized in drafting pre contract agreements which are drafted in such a manner that it will favor and protect the interest of our client. Our law firm has a track record in matching with expectation of our clients.
