Drafting and review of commercial contracts under the Indian Contract Act 1872 and related statutes, tailored to the commercial substance and risk allocation desired.
A well-drafted contract records the commercial bargain between parties and allocates risk in a manner that is enforceable in the event of dispute. A poorly drafted contract creates ambiguity, exposes parties to unintended liabilities, and frequently fails to achieve its intended purpose when tested in litigation or arbitration.
Indian contract law is codified principally in the Indian Contract Act 1872, with subject-specific statutes (the Sale of Goods Act, the Companies Act, the Information Technology Act, and others) applying to particular categories of contract.
LexWiser drafts and reviews commercial contracts across a range of areas: founders' arrangements, customer and vendor contracts, technology and licensing agreements, employment and consulting agreements, confidentiality agreements, and IP assignments.
Engagements in this area generally involve some or all of the following work. The actual scope is set out in the engagement letter once the matter is understood.
Discussion of the parties, the commercial transaction, the desired outcomes and the risk position.
Either a term sheet is prepared to record the commercial agreement, or detailed drafting instructions are taken directly.
Preparation of a first draft. The draft is shared with the client for review and revisions are made based on feedback.
Where the contract is between two parties, the draft is exchanged with the counterparty. Counsel reviews counterparty markups and negotiates terms on the client's behalf.
On finalisation, the contract is executed by the parties. Counsel advises on stamping, notarisation and registration where required.
Most contracts attract stamp duty under the state Stamp Act of the place of execution. The duty varies by state and by type of instrument. Inadequate stamping can render a document inadmissible in evidence.
Choice of law and forum should be considered carefully, particularly in cross-border transactions. Indian courts will generally enforce choice of foreign law in commercial contracts between commercial parties.
Section 27 of the Contract Act renders agreements in restraint of trade void, subject to limited statutory and judicial exceptions. Non-compete and non-solicitation clauses require careful drafting to be enforceable.
Arbitration is the default mechanism in commercial contracts. The seat of arbitration, the institutional rules (or ad hoc), the language and the number of arbitrators should be specified.
Contracts drafted include, among others: founders' and co-founders' agreements, shareholders' agreements, share subscription and share purchase agreements, employment and consultancy agreements, vendor and service agreements, customer terms of service, NDAs and confidentiality agreements, IP assignments and licences, and software development agreements.
Templates are a starting point at best. They are typically drafted under foreign law, do not address Indian stamp duty or registration requirements, and rarely reflect the specific commercial bargain of the parties. A contract drafted by counsel is materially safer.
Yes, oral agreements are generally enforceable. However, proof of terms is extremely difficult, and certain categories of contract (such as transfer of immovable property) must be in writing. Written contracts are recommended for all commercial transactions.
Both create legal obligations if the parties intend to be bound. A document headed "Memorandum of Understanding" can be fully binding if the language indicates an intention to create legal relations. Whether a document is binding depends on its substance, not its title.
Yes. Contracts may be amended by a written addendum, executed by all parties, with appropriate stamping. Verbal amendments are generally not recognised, particularly where the contract itself requires amendments to be in writing.
Every engagement begins with a confidential consultation. Schedule one to understand the scope, approach and fees for your specific matter.
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