What is Confidentiality Agreement Drafting?
A confidentiality agreement, usually referred to as a Non-Disclosure Agreement (NDA), is a legally-binding contract between parties that prevents sensitive and private information from being shared with a third party or the public.
These documents typically include key terms to inform parties of their responsibilities, such as what items should be kept confidential and what happens if they breach the contract.
Read the rest of this article to explore confidentiality agreements in more detail, including how to draft them and when to consult with a lawyer for help through the process.
What are Key Terms in a Confidentiality Agreement?
A confidentiality agreement usually contains the following essential terms:
- Confidential information definition. The specific information that must be protected under the agreement, such as trade secrets and technical information.
- Usage. How the receiving party must protect the information, such as by only using the information they receive for the intended purposes.
- Standard of care. The receiving party must handle the data or information with a reasonable standard of care, which usually just means that this must be done in the same way in which they would protect their information.
- Exclusions. It’s important to clarify the information that doesn’t need to be protected, such as information that’s already known by the public.
- Term. How long the confidentiality agreement will last.
- Post-termination duties. The responsibilities the receiving party will have to fulfil after the contract ends, such as destroying information.
- Breach and remedies. What constitutes a breach of the confidentiality agreement and how it can be resolved, such as by paying damages.
How Do You Draft a Confidentiality Agreement?
There are important terms to include in your confidentiality agreement to prevent confusion or violations. Here are some to consider.
Full Legal Names of Parties
The confidentiality agreement should have both parties’ legal names and addresses included so that it’s clear to see the disclosing party sharing the sensitive information and the receiving party.
Definitions of Protected Information
One of the most important sections to include in the confidentiality agreement is a clear description of what information will be protected. Anything ambiguous can create problems, such as accidental violations that harm the business reputation.
Purpose
The receiving party must know for what purposes they can use the sensitive information, as well as any prohibited uses. Be exact about both permitted and prohibited activities, no matter how minor they might seem. A mistake when drafting the contract is to assume that both parties will understand what’s required.
Term
It’s common for confidentiality agreements to last for several years, such as in the case of protecting trade secrets. This means that the receiving party needs clarity about their post-termination duties, such as what to do with the information.
In some cases, there could be confusion about how to return information, such as if the information was accessed in the form of signing into digital platforms or making use of online documents. The agreement should clarify reasonable steps the receiving party can take to fulfill their post-termination duties.
Governing Law
Specifying the applicable laws for the confidentiality agreement is important. It determines how the confidentiality agreement will be enforced. This is something not to forget to include as it can have a direct influence on how well you can protect your rights.
Consequences
The recipient party should be made aware of possible consequences for violating the agreement, such as legal action or the payment of damages. This will serve to deter misconduct, while helping to enforce the agreement terms.
Clear, Specific Wording
When drafting a confidentiality agreement, it’s best to keep the wording clear and specific. Focus on details and avoid writing anything vague or too complex for parties to understand. This will go a long way to helping you prevent disputes in the future.
Do You Need a Lawyer to Draft a Confidentiality Agreement?
You should work with a lawyer to draft your confidentiality agreement. If it’s not detailed enough, it might not be legally enforceable. Here is how a lawyer can assist you with the contract drafting process.
- Although a confidentiality agreement looks simple on paper it can be complex and needs details to make it enforceable. A lawyer will be able to ensure it’s easy to understand, specific to your situation, and legally valid.
- A lawyer will align the confidentiality agreement with all applicable regulations and laws so that it will hold up in court.
- They’ll avoid drafting ambiguous or broad clauses that can result in misunderstandings or disputes. Instead, they’ll use clear, specific wording.
- They’ll identify any hidden risks that you might not have thought of, such as third-party access to the information and intellectual property (IP) ownership.
- Besides drafting your confidentiality agreement, a qualified lawyer can also review a contract you already have written up. This will give you peace of mind that it’s legal, balanced, and protects your interests.
Where to Get a Lawyer to Draft Your Confidentiality Agreement
You know why it’s important to hire a lawyer to write your confidentiality agreement, but where do you find one? Although searching for a reputable lawyer might sound like a stressful or time-consuming task, online legal platforms have made it easier.
On ContractsCounsel, one of the largest online legal marketplaces, you can quickly connect with the most suitable lawyer to draft your agreement. All you have to do is submit a project request on the platform and lawyers will come to you.
Here are the steps to follow:
1. Go to the ContractsCounsel marketplace, where you can post your project for free.
2. Include some details of what you need so you’re directed to the best legal matches.
3. You’ll receive multiple bids from lawyers directly on the platform who can assist you.
4. After receiving the lawyer bids, you can choose the best one for you. Review the lawyers' profiles by checking out data on the platform, such as their location, client ratings, years of experience, credentials, and field of expertise.
5. Connect with a lawyer you think is best suited to your requirements and hire them.
