Best practices in draftsmanship: Arbitration clauses, wills and family settlement agreements

Draftsmanship is one of the quiet strengths of legal practice. A well-crafted sentence can prevent a dispute; a poorly drafted clause can create one. Nowhere is this more visible than in arbitration clauses, wills and family-settlement agreements: documents that often determine rights long after negotiations, relationships or even parties themselves have changed.

Young lawyers and emerging practitioners frequently handle these instruments early in their practice, which makes an understanding of practical drafting essentials important.

Arbitration clauses are often inserted as boilerplate, but they become the first point of friction when disputes arise. The most common mistakes are avoidable.

The clause must clearly state that disputes shall be referred to arbitration, not may. The difference between mandatory and permissive language can determine whether a party can bypass arbitration entirely and proceed directly to court.

The scope should include disputes “arising out of or in connection with” the agreement, so that associated disagreements are not pushed outside the clause. A narrow formulation like “disputes arising under this agreement” may exclude claims for misrepresentation, tortious conduct or pre-contractual liability, all of which frequently accompany commercial disputes.

Identifying the seat of arbitration is crucial; confusion between seat and venue continues to generate avoidable litigation despite consistent judicial guidance. The seat determines the juridical framework, supervisory court and governing arbitration law. The venue is merely the physical location of hearings and can change for convenience. Conflating the two creates uncertainty that parties exploit when arbitration begins.

The tribunal's composition must be neutral and legally sound. Naming a managing director, officer or interested party as an arbitrator will run afoul of the principles laid down by the Supreme Court in TRF Ltd. v. Energo Engg Projects Limited (2017) and Perkins Eastman Architects DPC v. HSCC (India) Limited (2020) and can invalidate the appointment. Even seemingly innocuous formulations (such as “an arbitrator nominated by the Chairman of the company”) can be challenged if the nominating authority lacks true independence. Where institutional arbitration is chosen, referring to the correct version of the rules and confirming the institution's name precisely avoids procedural confusion later.

Interim relief should be expressly permitted both before courts and within the tribunal’s powers. Without this, parties may find themselves unable to secure urgent protection for assets, documents or confidential information while the arbitration is constituted or ongoing.

Finally, the clause should reflect whether the parties intend institutional arbitration or ad-hoc proceedings. For the latter, it helps to specify procedure, timelines, language and fee structure so that the arbitration has a predictable framework. The choice should be deliberate, not accidental.

Wills require a different type of precision - one that must survive time, changing circumstances and, often, emotional disputes. Unlike contracts where parties can clarify ambiguities through correspondence or conduct, a Will speaks only once and the testator is not present to explain intent.

The document should describe assets clearly, preferably in schedules that set out all immovable property, financial assets, shareholdings and significant movables. Vague descriptions like “my property in Delhi” can lead to disputes where multiple properties exist. Instead, full addresses, survey numbers, title deed references or folio numbers should be used. For shares and financial instruments, specify the company name, class of shares, demat account details or certificate numbers.

Beneficiaries should be named unambiguously, not by relationship alone. “My eldest son” may seem clear, but in blended families or where parentage is disputed, it invites litigation. Full legal names, along with relationship and any identifying details (date of birth, residential address) eliminate doubt. Where a beneficiary has predeceased the testator or disclaims the gift, providing for substitution or lapse avoids unintended intestacy.

The manner of distribution (whether by percentage, specific assets or residuary shares) must be set out without room for interpretation. If gifts are conditional, the conditions must be legal, certain and clearly expressed. Conditions that are vague, impossible to perform or contrary to public policy will be struck down, potentially invalidating the gift itself.

Appointing an executor who is both capable and willing is important. The executor administers the estate, pays debts and distributes assets. Naming someone who is elderly, unwell, unwilling or residing abroad without contingency planning can delay the process significantly. Executors should ideally be younger than the testator, financially literate, trustworthy and preferably neutral where family disputes are anticipated.

Where minors are involved, the Will should identify guardians and provide instructions regarding management of their share. Trusts can be created within the Will to hold assets until the minor reaches a specified age. Trustees should be distinct from guardians where possible to ensure financial oversight remains independent of caregiving responsibilities.

A revocation clause is necessary to avoid doubt between multiple versions of the Will. Courts grapple with cases involving multiple Wills, codicils, and informal writings. A clear statement that all prior Wills and testamentary dispositions are revoked provides certainty. If only partial revocation is intended, the specific clauses or documents being revoked must be identified.

Finally, execution formalities must be followed: two attesting witnesses, signatures in each other's presence and ideally witnesses who are not beneficiaries. Courts scrutinise Wills closely; clear language and impeccable execution reduce the grounds for challenge. Witnesses should not just sign but also write their names, addresses and occupations. Like executors, witnesses should be younger than the testator, credible and traceable years later when any proceedings occur.

Family settlement agreements present their own complexities. They often emerge from long-standing disagreements and drafting them requires both sensitivity and firmness. Unlike commercial contracts where parties deal at an arm's length, family settlements are deeply personal.

A settlement is effective only if every stakeholder is identified and included; leaving out a legal heir or interested family member almost guarantees future litigation. Even distant relatives or persons with contingent interests must be considered. If their consent is necessary under succession law or property statutes, it must be obtained and documented. A recital listing all legal heirs and explicitly recording their participation (or informed waiver) strengthens the settlement against later challenges.

Preparing an accurate inventory of assets (immovable, movable, business interests, trademarks, goodwill) ensures clarity about what is being divided or relinquished. Ambiguity about the corpus of the estate leads to disputes over whether particular assets were included in the settlement. Schedules should be as detailed as in a Will: property descriptions, share certificates, bank accounts, intellectual property registrations and partnership interests should all be listed with specificity. Where valuation is relevant, obtaining professional appraisals and attaching them to the agreement provides an objective foundation.

The settlement should be comprehensive and final, addressing present disputes as well as potential future claims. Releases and waivers should be explicit: each party should acknowledge full and final satisfaction of all claims - known or unknown, present or future - arising from the family estate or the dispute being resolved. Without such comprehensive language, residual claims often resurface years later.

Ignoring stamp duty and registration requirements can undermine the document completely. An unregistered instrument affecting immovable property cannot be admitted in evidence under the Registration Act. Stamp duty should be paid in the correct jurisdiction at the correct rate. Many family settlements fail not on their substantive terms but on procedural non-compliance.

Language should be clear and binding, not emotional or informal. Phrases like “in the spirit of family harmony” or “with love and affection” are understandable but should not replace operative language of transfer, release and relinquishment. The document must function as a legal instrument, not merely a memorandum of understanding. Consideration, even if nominal, should be recited to avoid arguments that the settlement is voluntary and revocable.

It is also useful to provide a dispute-resolution mechanism. Many families now prefer mediation followed by confidential arbitration. Including such a clause ensures that if disagreements arise over interpretation or performance, they can be resolved privately rather than through protracted public litigation. The arbitration clause itself should follow the drafting standards discussed earlier: clear, mandatory, with defined seat, scope and procedure.

Proper witnessing, page-by-page signatures and consistent schedules help establish authenticity and reduce allegations of interpolation later. In emotionally charged environments, the risk of one party later claiming fraud, coercion or forgery is real. Multiple witnesses (ideally independent, not family members) as well as contemporaneous legal advice documented in writing all serve as safeguards. Where elderly or vulnerable persons are parties are involved, recording of able mental capacity at the time of execution is prudent.

Across all three categories, certain universal drafting principles apply. Clarity in language should always take precedence over stylistic flourish. The goal is to be understood without ambiguity. Short sentences, active voice, defined terms and logical sequencing all contribute to clarity.

Draft as though the document will be interpreted years later by someone unfamiliar with the context; successors, not the original parties, are often the ones who litigate. The drafter should assume that the reader has no background knowledge, no access to correspondence or negotiations and possibly even a motive to misread. Interpretation should be possible only from the four corners of the document itself.

Anticipating future contingencies is part of preventive lawyering. What happens if a party defaults, divorces, dies or ceases to cooperate? What if an executor refuses to act? What if property is sold before distribution? What if laws change? While no document can predict every possibility, addressing foreseeable risks through conditional clauses, substitution provisions and fallback mechanisms reduces disputes.

Internal consistency is essential: names, definitions, schedules, dates and references must match. A party named “ABC Private Limited” in one place cannot become “ABC Pvt Ltd” midway through. Defined terms should be used consistently. Cross-references between clauses must be accurate. Schedules should correspond exactly to the recitals and operative provisions. Inconsistencies invite interpretative battles and undermine credibility.

Procedural requirements like stamping and registration matter as much as the substantive content. The most brilliantly drafted document is worthless if it cannot be enforced due to procedural defects. Understanding the interplay between the Contract Act, Registration Act, Stamp Act, Transfer of Property Act, Arbitration Act and succession laws is not optional; it is foundational. While templates can be useful, they are starting points; every document demands conscious, fact-specific drafting. Copy-pasting from precedents without adaptation is negligence. Each transaction has unique commercial terms, each family has distinct dynamics and each testator has particular wishes. The drafter's role is to translate those specifics into enforceable legal text, not to impose a generic structure that may or may not fit.

Good draftsmanship is rarely visible because its purpose is to prevent problems, not highlight itself. When arbitration clauses withstand scrutiny, when Wills reflect a testator's intent without dispute and when family settlements preserve peace rather than provoke litigation, the value of precise drafting becomes evident. Conversely, bad drafting announces itself through court proceedings, strained relationships and wasted resources.

For young practitioners, investing time in learning these nuances early on is not only a professional advantage; it is an essential part of responsible lawyering. Drafting is an exercise in foresight, empathy and precision. It requires understanding not just what the law permits but what clients need, what courts will enforce and what time will test.

The best drafters develop an instinct for what can go wrong. They read their own work with caution, imagining how an adverse party might exploit ambiguity or how changing circumstances might render a provision unworkable. They seek feedback, study judgments arising from poorly drafted documents and continuously refine their approach. That is the quiet strength of legal draftsmanship and it is worth cultivating with care.

Vishakha Gupta is a commercial disputes and arbitration practitioner as well as the founder of Eidos Law, a boutique full-service practice based in New Delhi.