How to use contract precedents as a junior lawyer

Nobody sits down with a blank sheet of paper and drafts a contract from scratch anymore. As a junior lawyer, there's usually a precedent to use as a starting point. But it's not as simple as filling in the blanks and copy-pasting — there's actually thinking involved.

1. Where can you get precedents?

• Your firm or business may have standard contract documents setting out acceptable risk profiles (with blanks to fill in).
• Documents prepared for previous matters with similar circumstances, parties or risk profiles.
• Precedents prepared by other organisations (e.g. Practical Law by Thomson Reuters).

2. What to do before you start

A few things to understand from your client / supervisor first, because they change how you amend the precedent:

• The project / matter — the words on the page need to reflect what's happening in real life. A construction precedent may require insurance for the works; if the project is demolition, that requirement should go.
• The client — who they are and where they sit in the contracting chain drives which precedent to use and how to amend it. A risk profile that favours a contractor is unfavourable for a principal.
• The purpose of the document — a draft for internal discussion can largely follow the precedent risk profile with questions for the client; a draft reflecting agreed commercial terms needs far more amendment.
• How it should be presented — usually save changes as a new document with amendments marked up (Word's Review tab); you can also issue a clean copy with amendments accepted.

3. Amending the precedent

There are two types of amendment:

1. 'Mechanical' amendments — things you can do from day one.
2. 'Thinking' amendments — things to consider, but which take experience to get right.

4. Checklist of 'mechanical' amendments

Look out for each of these and either amend it or, if you don't have the information yet, replace it with "[insert]":

• Party names
• Project / matter name and details
• Dates
• Person names / addresses / emails (e.g. in notice provisions)
• Terminology (e.g. 'Contractor' → 'Subcontractor' / 'Supplier')
• Jurisdiction (e.g. governed by a different State's laws)
• Legislation / policies (some may be outdated)
• Execution blocks
• Automatic cross-references (some may break when you amend)

5. Getting familiar with the 'thinking' amendments

These are what clients actually pay us for. They take time to master, but it's never too early to start thinking about them (and they're great fodder for feedback):

• Applicability of the precedent to the client / project / matter.
• Appropriateness of the risk profile (does it reflect market positions, or a favourable starting position for your client?).
• History of the document (were there negotiated positions from a past project that no longer apply?).
• How the precedent has worked in practice (mechanisms that led to disputes, or issues with payment / notice provisions).
• Flow-on effects — amending one clause can have consequences elsewhere in the contract.

6. Tips and tricks to avoid common mistakes

• Don't trust 'replace all' — universally changing 'Contract' to 'Deed' risks nonsense like 'Deedor'. Use 'replace' one-by-one.
• Replicate formatting — use Format Painter (Home tab) to copy formatting from elsewhere in the document.
• 'Not used' — when deleting automatically-numbered parts, replace the wording with 'not used' so the numbering and table of contents still work.
• Unformatted paste — copying from other documents, right-click and choose 'Keep Text Only' to strip foreign formatting.
• Check cross-referencing — broken references show as "Error! Reference not found." Refresh (Ctrl+A then F9) and search for "Error!".
• Mirror wording — when drafting new wording, match the terminology and style of the existing provisions (e.g. for indemnities).
• Remove metadata — especially from precedents from previous projects; strip the metadata before the document leaves the building.