“Applicable”

Here’s another target in the battle against ponderous contract prose—the adjective applicable. I discuss below three different ways that it’s used in contracts. “Applicable” Plus Noun Sometimes applicable is used before a noun. It’s possible to use applicable appropriately in this manner: The Company shall provide the Employee with pension and welfare benefits and group employee benefits … [Read more...]

Issues in Drafting Commercial Agreements—Using the First and Second Person

I had always assumed that only consumer contracts use the first and second person, as in Each of us is free to enter into similar agreements with others and You are responsible for any personal property taxes. But recently someone sent me a major company’s form of customer agreement. In that agreement, the company—let’s call it Acme Global Corporation—was called Acme. The customer—presumably … [Read more...]

Issues in Drafting Commercial Agreements—The “Box”

My background is in drafting for deals rather drafting commercial agreements. (By “commercial agreement” I mean, vaguely enough, a form agreement relating to the supply of goods, services, or technology to customers.) But in my consulting activities, I've recently been dealing exclusively with commercial agreements. Because any given commercial agreement will likely be entered into dozens if … [Read more...]

“Without Limiting the Generality of the Foregoing”

I had such fun contemplating for the avoidance of doubt that I was inspired to move on to its very close relative, without limiting the generality of the foregoing (and the even clunkier without limitation of the generality of the foregoing). My verdict? That you should almost always be able to use a less ponderous alternative. Drafters use the phrase without limiting the generality of the … [Read more...]

“For the Avoidance of Doubt”

How’s this for a categorical statement: Never use for the avoidance of doubt. Sometimes a drafter will use this phrase in a contract to introduce language that seeks to clarify preceding language, usually by indicating that something either falls within or is excluded from the scope of the preceding language. In this context, for the avoidance of doubt says, in effect, “excuse us if we state … [Read more...]

Costly Drafting Errors, Part 1—Rogers Communications and Aliant

I have a particular interest in the real-world implications of indifferent drafting, so I’ve been contemplating doing an occasional series on drafting screw-ups that make the news. I was prompted to inaugurate this series by Bryan Sims, who was kind enough to point out to me this article from today's issue of the Canadian newspaper the Globe and Mail regarding a costly instance of confusion over … [Read more...]

The Bankruptcy Code’s Effect on a Drafter’s Ability to Restrict Assignment and Provide for Termination on Bankruptcy

Drafters should be aware of laws that can trump provisions of a given contract. A good example of this is the way the U.S. Bankruptcy Code can render unenforceable contract provisions that restrict assignment of rights under a contract or give a party the right to terminate if the other party files for bankruptcy. To improve my own knowledge, I consulted a useful article on the subject, … [Read more...]

“Certify”

The issues of word choice that I discuss in MSCD are ones that drafters are likely to encounter repeatedly. In your day-to-day drafting, you'll probably come across many other, quirkier issues. Here's one I encountered today. I'm currently revising a software license agreement. It includes, in the section dealing with what's meant to happen when the license terminates, the following sentence: … [Read more...]