diff --git a/erpnext/crm/doctype/contract_template/test_contract_template.py b/erpnext/crm/doctype/contract_template/test_contract_template.py
index 6362da2afb7..c690239856c 100644
--- a/erpnext/crm/doctype/contract_template/test_contract_template.py
+++ b/erpnext/crm/doctype/contract_template/test_contract_template.py
@@ -1,8 +1,43 @@
-# Copyright (c) 2018, Frappe Technologies Pvt. Ltd. and Contributors
+# Copyright (c) 2026, Frappe Technologies Pvt. Ltd. and Contributors
 # See license.txt
 
+import frappe
+
+from erpnext.crm.doctype.contract_template.contract_template import get_contract_template
 from erpnext.tests.utils import ERPNextTestSuite
 
 
 class TestContractTemplate(ERPNextTestSuite):
-	pass
+	"""Contract Template validates its Jinja terms and renders them against a doc."""
+
+	def test_malformed_contract_terms_are_rejected(self):
+		doc = frappe.new_doc("Contract Template")
+		doc.contract_terms = "{% for x in %}"  # invalid Jinja
+		self.assertRaises(frappe.ValidationError, doc.validate)
+
+		# a valid template, and no template at all, both pass
+		doc.contract_terms = "Party: {{ party_name }}"
+		doc.validate()
+		doc.contract_terms = None
+		doc.validate()
+
+	def test_get_contract_template_renders_terms(self):
+		template = frappe.get_doc(
+			{
+				"doctype": "Contract Template",
+				"title": "_Test Contract Template",
+				"contract_terms": "Party: {{ party_name }}",
+			}
+		).insert()
+
+		result = get_contract_template(template.name, {"party_name": "Acme"})
+		self.assertEqual(result["contract_terms"], "Party: Acme")
+		self.assertEqual(result["contract_template"].name, template.name)
+
+	def test_get_contract_template_without_terms_returns_none(self):
+		template = frappe.get_doc(
+			{"doctype": "Contract Template", "title": "_Test Empty Contract Template"}
+		).insert()
+
+		result = get_contract_template(template.name, {})
+		self.assertIsNone(result["contract_terms"])