When Is an Amendment Not an Amendment?

The following oddity from a reader: When is an amendment not an amendment? When it's a separate agreement! From the introductory paragraph of a supplier's attachment to another agreement: IMPLEMENTATION ASSISTANCE AMENDMENT NUMBER ONE TO BASIC LICENSE AGREEMENT NUMBER [redacted] CUSTOMER: [redacted] This Amendment, together with the terms and conditions contained int he Basic License … [Read more...]

What Does “Prevailing Party” Mean?

[Update: I offer my analysis of this issue in this 2011 post.] Chadwick Busk of The Fine Print blog told me about this item on Lexology (free registration required) by Patrick T. Sharkey of Jackson Walker LLP. I hope Patrick doesn't mind if I quote extensively from it: A recent Texas Supreme Court decision highlights the importance of thoughtful drafting. In Intercontinental Group Partnership … [Read more...]

Computer-Assisted Legal Research and the Contract Drafter

Yesterday I spent the day at West’s headquarters in Eagan, Minnesota, with a dozen or so journalists and bloggers being introduced to WestlawNext, the next generation of Westlaw. More about that next week, when WestlawNext is launched. But kicking the tires of WestlawNext caused me to consider how computer-assisted legal research is used in contract drafting. I invite you to take the following … [Read more...]

Once More, With Feeling: Make Your Right Margins Ragged and Use One Space After Punctuation

In chapter 15 of MSCD and in this May 2007 post (which has attracted 32 comments) I explain why using ragged right margins makes word-processing documents easier to read. It's a no-brainer—you may think that full justification looks "professional," but typography experts are unanimously in favor of ragged right for word-processing documents. (Books and other works prepared using typesetting … [Read more...]

A Voice in Favor of Ambiguity?

Via Twitter, I came across a blog post entitled "Effective Contract Drafting: A Subversive Manifesto." It's by William Carleton, partner at a Seattle law firm. It begins as follows: It's always best to say what you mean as clearly and as simply as you can, right? Maybe. ... Ambiguity, however, is indispensable to the drafter of commercial contracts. At this point you might expect me, … [Read more...]

D.C. Toedt’s “On Technology Contracts” Website

If you're the sort who routinely rummages in the entrails of commercial contracts, you might well find of interest D.C. Toedt's website On Technology Contracts. D.C. Toedt (pronounced "Tate") is a business lawyer with an intellectual-property and software-law background. He's in private practice in Houston; I owe him a debt of gratitude for having introduced me to Ninfa's on … [Read more...]

What to Call the Components of the Body of the Contract

Yesterday I gave another of my Osgoode Professional Development seminars in Toronto, to a sellout crowd of eighty. During a break I discussed with one of the participants what to call the components of the body of the contract. In a follow-up email, here's what she had to say on the subject: As discussed, in England the practise as I know it is to refer to "clauses" and "paragraphs" and … [Read more...]

The Perils of Definedtermitis

"Definedtermitis" is a condition caused by excessive reliance on defined terms. It causes clogging of the arteries of your contracts. Those who succumb to it are referred to as "definedtermites." Consider an email I received today from a reader: OK, so I thought it was a typo, but it turns out it was intentional. I was reviewing a clause in a software sale agreement with a major third-party … [Read more...]

When Linguists Talk About Contract Language

It's not only transactional types who are interested in contract language. If you want to see how a different online ecosystem approaches the subject, I suggest you have a look at this post on Language Log and the related comments. I like to think that I stand somewhere between the linguists and the lawyers. It's good to have both perspectives. By the way, check out this comment by Anon. It … [Read more...]

Disclaiming the Warranty of Title in Sales of Goods

Rarely do I have occasion to offer thoughts on drafting under article 2 of the Uniform Commercial Code, which applies to sales of goods. Here are two warranty disclaimers from some equipment purchase agreements I've been reviewing: NO OTHER WARRANTY TO CUSTOMER FROM SELLER IS EXPRESS OR IMPLIED. SELLER SPECIFICALLY DISCLAIMS THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A … [Read more...]

“In Particular”

Today I had occasion to consider use of the phrase in particular in contracts. Here are some examples, taken from the SEC's EDGAR system: The Company has taken all reasonable steps to maintain the confidentiality of or otherwise protect and enforce its rights in its confidential information, in particular the trade secrets owned by the Company. Each FREGAT Owner represents that it is … [Read more...]

Recharacterizing Representations and Pre-closing Obligations as Conditions

I'm looking for caselaw or commentary on the following issue relating to the parts of a mergers-and-acquisitions contract. If a buyer wants to address in an M&A contract circumstances that are under the seller's control—for example, whether the seller is in good standing under Delaware law—it would make sense to do so by means of a representation. If that representation turns out to have … [Read more...]

“Guarantees That”

Today I saw the following in a contract I pulled from the SEC's EDGAR system: SunPower hereby guarantees that, subject to Section 22, it shall supply and deliver each of the Products to the delivery point specified in a given Purchase Order (each, a Delivery Point ) on or prior to the scheduled delivery date therefor specified in such Purchase Order (with respect to such Products and such … [Read more...]

Q&A with Steven Davidoff, Author of “Gods at War: Shotgun Takeovers, Government by Deal, and the Private Equity Implosion”

Currently on my nighttable is Gods at War: Shotgun Takeovers, Government by Deal, and the Private Equity Implosion, by Steven Davidoff. Steven is a professor at the University of Connecticut Law School (click here for his faculty bio page) and is the New York Times's "Deal Professor." Before teaching, he practiced for ten years with Shearman & Sterling in its New York and London offices and … [Read more...]