Obligation to Purchase = Obligation to Sell

Reader Michael Fleming informed me of US Salt, Inc. v. Broken Arrow, Inc., Civ. No. 07-1988, 2008 U.S. Dist. LEXIS 10841 (D. Minn. Feb. 11, 2008). This case serves as a reminder that a court would likely conclude that if Smith promises to purchase widgets from you, you've in effect also promised to supply widgets to Smith. US Salt and Broken Arrow entered into a contract in which US Salt agreed … [Read more...]

“The Terms Of”

Here's a quick way to save three words: instead of saying in accordance with the terms [or provisions] of section 6, say simply in accordance with section 6. … [Read more...]

“As the Case May Be”

Today I read in a work on contract drafting an explanation of the purpose served by the phrase as the case may be. I think the analysis offered was incorrect. Here's my view: When in a contract a sentence provides for alternative courses of action, often one or more sentences that follow go on to address the immediate consequences. When the contract is signed it won't be known, for purposes of … [Read more...]

Upgraded Registration System for Geneva Seminars

As I noted in this post, from April 21 through April 25 I'll be giving my "Contract Drafting—Language and Layout" seminar at the Geneva, Switzerland offices of Hogan & Hartson. Well, I've now upgraded the registration system. For one thing, you can now pay by credit card, if you wish. To go to the registration page, click here. For information about the seminars, click here. … [Read more...]

“Bylaws” or “By-laws”?

Bylaws is spelled both with and without a hyphen. For example, Black's Law Dictionary gives a definition for bylaw but notes that it's sometimes spelled by-law. So which is preferable? It appears that bylaw is gaining the upper hand. For example, the 1915 edition of Robert's Rules of Order Revised used by-laws but the current edition, Robert's Rules of Order Newly Revised, uses bylaws. And … [Read more...]

“Complete and Accurate”

In a recent post I suggested that accurate is a "less dopey" alternative to true and correct. (Yes, I know, I too thought that an impressive turn of phrase.) That led a reader to suggest to me that complete and accurate is preferable to accurate. Presumably he had in mind that if you give me a list, the items on that list might be accurate, but some items might be missing, meaning that the list … [Read more...]

“Automatically”

I suggest that for purposes of contract drafting, you can always do without automatically. Consider the following fragment: ... and each January 1 thereafter, this agreement will be automatically extended for one additional year unless not later than ... I suggest that eliminating the word automatically wouldn't affect the meaning. The same goes for automatically in the following … [Read more...]

Semicolons

Perhaps because they're aware that I've had occasion to consider punctuation, some readers contacted me about the February 18 New York Times article about use of a semicolon in a New York City Transit subway placard. Here's the one thought that came to mind: In contracts, I use semicolons between integrated enumerated clauses when they're preceded by a colon and between tabulated enumerated … [Read more...]

Seminars in Geneva, Switzerland, April 21–25

I'm pleased to announce that from Monday, April 21, through Friday, April 25, I'll be giving five consecutive one-day seminars on "Contract Drafting—Language and Layout" at the Geneva, Switzerland offices of the global law firm Hogan & Hartson. All are welcome to register. The seminars are being supported by ACC Europe and by the International Bar Association, so their members are entitled to a … [Read more...]

My New York Law Journal Article on the Cerberus Litigation

Today's issue of the New York Law Journal contains my article on the recent litigation between Cerberus and United Rentals. Click here to go to a PDF copy. It's also available at the NYLJ website if you're a subscriber. … [Read more...]

“Respective” and “Respectively”

A couple of days ago reader David Munn—ever vigilant against the forces of contract-drafting darkness—sent me the following: I couldn't find that you had blogged on one of my pet peeves, which is the overuse of the word "respective," as in "All capitalized terms that are used but not defined in this SOW have the respective meanings given to them in the Agreement." Or "In witness of this, the … [Read more...]

Stating that Recitals Are “True and Correct”

In the past year, 265 contracts filed as "material contracts" on the SEC's EDGAR database contained a provision stating that the recitals were true and accurate. Here's an example: The above recitals are hereby made a part of this Agreement and the Borrower acknowledges and agrees that each of the recitals is true and correct. That's not an enormous number of contracts, but it's certainly … [Read more...]

Adams Featured in LexBlog Q&A

Kevin O'Keefe's Real Lawyers Have Blogs has posted a Q&A with yours truly. Click here to go to it. … [Read more...]

English Courts—A Hotbed of “Endeavours” Insanity!

I received the following from reader Nigel Madeley, of the U.K. law firm Addleshaw Goddard: Ken, I know this one raises your blood pressure a little. A case about nuisance by vibration—an adjoining occupier sought an injunction against a developer. The injunction was awarded. The developer had to keep to agreed vibration limits; if it exceeded them, it had the burden of showing that it'd … [Read more...]

“Bimonthly”

Avoid the prefixes bi- and semi- for purposes of references to time—they’re confusing. Bimonthly means “every two months” and semimonthly means “every half-month,” in other words “twice a month.” Biweekly and semiweekly reflect the same distinction. But biannual and semiannual both mean “occurring twice a year,” whereas biennial means “occurring once every two years.” So if someone is under … [Read more...]

Oddball Usage of the Day: “Includes Only”

What's wrong with this picture: "Subsidiary" includes only any company in which the applicable entity, directly or indirectly, has a beneficial ownership interest of greater than 50 percent. Well, includes only equates to means— what includes gives, only takes away. So use instead means. … [Read more...]

Fun and Games with the Meaning of “Year”

Reader Steven Sholk of the Gibbons law firm alerted me to the February 6 decision by the Mississippi Supreme Court in Barbour v. Mississippi ex rel. Hood. Click here for a copy of the opinion. Steven had been alerted to this case by Rick Hasen of the Election Law blog. This case involves a squabble between the governor of Mississippi and the state's attorney general regarding the timing of the … [Read more...]

When Performance Under a Contract Is by a Division

Here's yet another issue regarding the introductory clause that I haven't previously written about: How, if at all, should you address in the introductory clause the fact that performance under the contract will be by a division of a company? You could ignore it. After all, the company will be on the hook, not the division, which isn't a separate legal entity. And anyway, the fact that … [Read more...]

The Apostrophe in “Five Days’ Notice”

A couple of days ago I received from a reader an email that included the following: I've got a question about the use of apostrophes in notice period provisions. I was rather surprised to see that section 8.96 of the MSCD includes apostrophes after the number of days/weeks/months in your example provisions. Shouldn't such provisions simply refer to "days", "weeks" or "months" without the … [Read more...]

More on Alliance Data Systems and Blackstone Group

As I mentioned previously, Alliance Data Systems and Blackstone Group are in litigation over Blackstone's proposed acquisition of ADS. More specifically, ADS has filed a complaint alleging that Blackstone breached its obligations under the merger agreement by failing to use its “reasonable best efforts” to obtain the approval of the Office of the Comptroller of the Currency to transfer of ADS’s … [Read more...]