If you are new to contracts in Microsoft CRM 4.0, this diagram should help you starting off. You may have tried to take a look at the statuscode and status reason attributes with the only available value of 'draft'. The statuses of a contract is fully controlled by the system and is being set regarding to the actions taken on the contract ( 'Invoice Contract', 'Hold Contract', 'Cancel Contract') and the start and end date of the contract.
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