Archive for June, 2009



“Because” and Causation Issues in Contracts

Tuesday, June 30th, 2009

Thanks to reader Steven Sholk, I learned that the U.S. Supreme Court recently considered the “ordinary meaning” of the words because of. Here’s how the CCH Workday blog described the issue: Construing this critical preposition in the text of the Age Discrimination in Employment Act (ADEA), a five-Justice majority concluded the statute’s requirement that an [...]

Training Your “Apprentices” in Contract Drafting

Monday, June 29th, 2009

You can find plenty of discussion online, at Above the Law and elsewhere, of the new “apprenticeship” model of first-year-associatedom at a handful of law firms. I suggest that such firms have a choice: either they’re going to give their apprentices the same old training, just more of it, or they’re going to use their [...]

“Forthwith”—A Quaint Archaism

Sunday, June 28th, 2009

Methinks forthwith has as a fusty, moldy air about it. I wasn’t surprised to see it included, along with the likes of hither and mayhap, in this list of quaintly archaic words. But lo and behold, forthwith was used in 502 contracts filed in the past month on the SEC’s EDGAR system, as compared with [...]

Questionable Defense of the Month: “I Signed the Contract in the Wrong Place”

Wednesday, June 24th, 2009

Today the Law Shucks blog posted this item about a former IBM executive, David L. Johnson, who is claiming that his noncompetition agreement with IBM is unenforceable. One element of his defense is that he signed the contract in the space where IBM was supposed to sign. According to Bloomberg: Johnson told Robinson he signed the [...]

“Obligate” v. “Oblige”

Wednesday, June 24th, 2009

In this comment to a previous post, reader Mark Anderson expressed a preference for saying that parties are obliged to do something, rather than obligated. He suggested that use of the verb obligate is the result of the noun obligation being pressed into service as a verb. Here’s the opening paragraph of what A Dictionary [...]

A Contract-Language French-English “False Friend”

Tuesday, June 23rd, 2009

In the course of considering, for purposes of today’s post on time is of the essence, how contracts are drafted in Quebec, I came across an oddity of the sort that I wouldn’t have expected to encounter in contract language—an instance of “false friends,” in other words pairs of words in two different languages that [...]

Enforceability of “Time Is of the Essence” Provisions in Civil-Law Jurisdictions

Tuesday, June 23rd, 2009

At the 2008 ABA annual meeting I appeared on a panel with Kevin Kyte, partner at the Montreal office of Stikeman Elliott. Kevin’s topic was things to bear in mind when drafting contracts governed by the law of a civil-law jurisdiction. It’s a topic I haven’t seen addressed in print, so I permit myself to [...]

“Represents, Warrants, Covenants and Agrees”

Thursday, June 18th, 2009

I received the following cry of despair from a Canadian reader: I’m preparing a partnership agreement and have been given precedent to work with. Using MSCD, I have spent some time trying to rework the precedent’s archaic language to make it more readable. It says, several times, “Each of the Partners severally represents, warrants, covenants [...]

Having Your Contracts Drafted Offshore—Do You Really Want to Do That?

Thursday, June 18th, 2009

I’ve recently seen and heard references to companies offshoring the task of drafting contracts. For example, this article in today’s London Times says that Rio Tinto has hired a team of Indian lawyers “to work for it on tasks such as reviewing documents and drafting contracts.” If that means having your offshore lawyers handle hundreds [...]

Expert Testimony and Ambiguity

Tuesday, June 16th, 2009

Recently I wanted to find out more about use of expert testimony to resolve contract ambiguity. (Remember, ambiguity arises when a contract provision is capable of expressing two or more inconsistent meanings.) So I consulted Walter R. Lancaster & Damian D. Capozzola, Expert Witnesses in Civil Trials. I learned that “it remains a basis for [...]

Drawloop—Automation of Routine Sales Contracts

Tuesday, June 16th, 2009

It seems as if every couple of months I find out about another company that’s somehow involved in the contract-automation business. Yesterday I learned about Drawloop. It offers general document-automation services, including automation of routine sales contracts, presumably using mail-merge type functionality. That seems like a sensible niche, one that offers high volume without the complications [...]

Part 1 of the “Drafting Clearer Contracts” Webcast Series Launched

Friday, June 12th, 2009

Yesterday saw the first broadcast, in a “live” session, of part 1 of my new webcast series “Drafting Clearer Contracts.” The topic was the front and back of the contract. Because I had prerecorded the webcast, the broadcast was a zero-stress affair. Consistent with the live format, I was on hand afterwards to reply in [...]

Apostrophe in “Shareholders Agreement”?

Friday, June 12th, 2009

I’ve previously written about whether to use stockholder or shareholder; see MSDC 12.336 and this blog post. (I say it doesn’t matter which you use.) Here’s a related issue that’s just as thrilling: should you say shareholders’ agreement, with an apostrophe, or shareholders agreement, without the apostrophe? (Obviously the same debate applies to stockholders’ agreement.) [...]

Addresses That Aren’t So Dependable

Friday, June 12th, 2009

In contracts, addresses occur in the notices provision. And if a contract doesn’t include a notices provision, usually I’ll include in the introductory clause the address of any individual that’s a party, so as to distinguish that individual from anyone else with the same name; see MSCD 1.49. But some addresses are more dependable than [...]

Is Uncertainty Over the Meaning of “Occurrence” Susceptible to a Drafting Solution?

Thursday, June 11th, 2009

Can astute contract drafting can forestall all contract disputes? No, it cannot. Most contract disputes, sure. But not all. For example, vagueness is an essential tool for the contract drafter, as often the future is too uncertain to allow you to be precise. But being vague leaves room for future dispute. And often parties rationally [...]

Use of the Imperative Mood in Architectural Specifications

Tuesday, June 9th, 2009

I’ve recently become acquainted with a specialized form of contract language—architectural specifications, which are attached to construction contracts and define the requirements for products, materials, and workmanship on which the contract is based and requirements for project administration and performance. My entrée to this field was Andrew Wilson, whose business, AWC West, prepares custom-tailored architectural [...]

A Recent English Commercial-Law Decision on Waiver Language

Friday, June 5th, 2009

This Mace & Jones “Education Update” alerted me to the recent English case of KG Bominflot Bunkergesellschaft fur Mineralole MBH & Co KG v Petroplus Marketing AG (2009). Here’s the gist of it: The buyers purchased from the sellers fuel oil that tested OK before shipping but was found to be unsatisfactory on arrival. The [...]

Two PowerPoint-Related Technologies Behind My Webcasts

Thursday, June 4th, 2009

Each of my webcasts—or rather the first five, solo webcasts—consists of a narrated and annotated PowerPoint presentation. That sounds simple enough, but it’s not the norm in the webcast world. Webcasts for the most part consist of phoned-in audio or talking-head video. If there’s a PowerPoint presentation, the audience is invited to view it on-screen [...]

“Remediate” v. “Remedy”

Wednesday, June 3rd, 2009

In contracts and elsewhere, it’s standard to refer to remediation of environmental contamination. It’s also standard to use the verb remediate to refer to the act of remediation. Garner’s Modern American Usage isn’t fond of remediate: remediate, a back-formation from remediation, is either a needless variant of remedy or a piece of gobbledygook. E.g.: “The [...]

“is there anything more boring than drafting a contract?”

Monday, June 1st, 2009

For the heck of it, every so often I search “contract drafting” on Twitter. A few times I’ve been pleasantly surprised to spot a mention of my book. Once someone who evidently was then in one of my seminars tweeted that the seminar wasn’t as much fun as her dinner with an old friend the [...]

A Texas Court’s Take on Syntactic Ambiguity

Monday, June 1st, 2009

Reader Patrick Grant told me about a ConstructionRisk.com newsletter describing a Texas case involving syntactic ambiguity. (Syntactic ambiguity derives from uncertainty over which part of a sentence a given word or phrase modifies.) The case in question was Consolidated Reinforcement v. Carothers Executive Homes, 271 S.W.3d 887 (Tex. App. 2008), a case before the Texas [...]

Lame Definitions—Inviting Reader Submissions!

Monday, June 1st, 2009

In an item posted today on the (new) legal writer, Ray Ward says the following: Right now I’m reading a long list of definitions in a bankruptcy plan of reorganization, and I just came across this one: “‘SpiritBank’ means SpiritBank.” As definitions go, that’s pretty lame. I’m sure you, dear reader, have seen other examples [...]