Drafting A Successful Contract

What does it take to draft a successful contract?  Here’s a Venn diagram that summarizes what’s needed.

Think about it.  Suppose the Parties agree they want to develop property, but don’t realize the zoning allows only agricultural land.  Even if they have compatible goals and expectations, they’re living in Fantasyland.  The property will remain agricultural until the zoning changes.

Suppose the Parties agree on the facts and expectations, but their goals are incompatible.  Maybe it will work out, but maybe not.  Cross your fingers.  Maybe their incompatible goals will lead them to interpret their expectations differently.

Suppose the Parties agree on the facts and have compatible goals, but can’t agree on what each Party will do.  Imagine how frustrating that will be.  Each sees success, but have not figured out how to accomplish it.

If everything is aligned, then the Parties are working with the same set of facts, they have compatible goals and consistent expectations.  When all those interests are aligned, all Parties have an incentive to make the deal work.  That’s a contract that will stand the test of time.