In MSCD 2.3 I recommend that you not use a title that looks at one transaction from different perspectives, as in agreement of purchase and sale. I'm thinking that the same approach applies when one party engages another to provide services. In other words, if I say "Acme hereby engages the Consult to perform those services specified in ...," I don't need to add "and the Consultant hereby … [Read more...]

My contract-drafting class at the University of Pennsylvania Law School focuses on the building blocks of contract language. But we'd be reckless if we didn't also consider process—more specifically, the implications of the fact that contract drafting is an industrial-scale team sport. To that end, we devoted last week's class to two online document-assembly demos. The first was a demo of … [Read more...]

In this October 2007 post, I discuss how placement of only in a sentence can affect meaning. Well, here's another issue relating to use of only—the ambiguity that arises when you use only in language of discretion. Consider the following sentence: Acme may close any one or more Contract Stores for any reason, and in doing so it may consider only its own interests. This sentence is ambiguous. … [Read more...]

I sporadically find myself discussing the nexus between contract drafting and contract law, or rather the contract law that's taught in the first year of law school. A reader pointed out to me this post on the Conglomerate Blog, which offers a musical analogy to explain the relationship. Buried deep in the comments to that post is my own analogy. As it might be of interest to readers of this … [Read more...]

During a CLE session at the recent Associate of Corporate Counsel annual meeting, one of the panel members used the phrase termination for convenience. It's a phrase I don't encounter too often, so I thought I'd better look into it. The Implications of "Termination for Convenience" A quick review of contracts on the SEC's EDGAR system shows that the phrase termination for convenience occurs … [Read more...]

Today one of my former Penn Law students sent me the following email: I just thought I'd write you a quick note and let you know how incredibly helpful your class has to been to me over my last 3 months of law practice. I am drafting all the time—largely because the partners I work for are very impressed with how clear my contracts are and how quickly I can draft them, without sacrificing … [Read more...]

In my tireless quest to master all things related to materiality, I recently asked myself what the heck material breach means. I suspect that if you were to ask that question to a random sample of lawyers and business people, you'd mostly get a lot of hemming and hawing. By extrapolating from my analyses of material and material adverse change (the most recent being the third article in this … [Read more...]

Earlier this week I received the following email from a reader: Could you please do a post about your thoughts on enforcing contracts that use faxes or pdf scans as the only proof of the other party's acceptance? People seem very reluctant to send ink-on-paper originals these days. The Uniform Electronic Transactions Act (adopted in almost every state) seems to say that e-signatures are okay, … [Read more...]

An abandoned blog can be mildly poignant. Everything is as it was when the proprietor up and left. It's like encountering the Mary Celeste. This thought came to mind when I rediscovered Corp Law Blog, which Mike O'Sullivan, a partner at the Los Angeles office of Munger, Tolles & Olson, posted to between May 2003 and October 2004. More specifically, what caught my eye was this post on the … [Read more...]

It's commonplace for drafters to use the phrase action or proceeding. Consider the following extract from a jurisdiction provision: Any party bringing against another party any legal action or proceeding (including any tort claim) arising out of this agreement may bring that action or proceeding in the United States District Court for the Eastern District of Pennsylvania or in any court of the … [Read more...]

A new document-sharing site, docstoc, has just opened to the public. Its slogan is "Find and share professional documents." Here's one of the FAQs: What is docstoc? docstoc is a user generated community for sharing professional documents. Find a vast quantity of high quality legal, business, technology, educational, and creative documents for free. docstoc allows users to upload their … [Read more...]

As I was packing up after a recent in-house seminar, one of the participants—I'll call him Sam—came up to me to discuss a point I had made. I had said that the phrase indemnify and hold harmless is pernicious, in that it invites litigators and judges to find nuances of meaning where most likely none had been intended. (For more on this, see these three posts.) Sam disagreed—he thought it … [Read more...]

Reader Thomas Gould asked me about use in drafting of the virgule, also known as the forward slash. Here's what Garner's Modern American Usage has to say: Some writers use [the virgule] to mean "per" (50 words/minute). Others use it to mean "or" (and/or) or "and" (every employee/independent contractor must complete form XJ42A). Still others use it to indicate a vague disjunction, in which … [Read more...]

In the case Premium Nafta Products Ltd & Others v Fili Shipping Company Ltd & Others [2007] UKHL 40, the House of Lords—the highest appellate court in the U.K.—has struck a blow for semantic sanity by holding that no valid purpose would be served by distinguishing between arising under and arising out of. I permit myself to quote a useful account prepared by the solicitors Fenwick … [Read more...]

The Times of London has published the first of six excerpts of Richard Susskind's new book, "The End of Lawyers." (Click here to go to the excerpt.) The book will be coming out in May 2008. Susskind is a well-known English commentator on law and technology. I've previously had occasion to mention him, namely in this post. To this casual reader it seems that he's been saying the same thing for a … [Read more...]

A cautious drafter would be advised to include in a comprehensive forum-selection provision elements that might seem redundant. Here's why: An agreement could provide for either permissive (also know as non-exclusive) jurisdiction or mandatory (also know as exclusive) jurisdiction. The following language provides for permissive jurisdiction: Any party commencing against the other party any … [Read more...]

I'll be in Chicago October 28–31, attending the annual meeting of the ACC (the Association of Corporate Counsel). And I'll be attending as part of the DealBuilder team. DealBuilder is the leading logic-based document-assembly software. It's developed by Business Integrity, a company with an impressive roster of clients. I've long said that only by embracing document assembly will major … [Read more...]

Today's issue of the New York Law Journal contains my article "Making Sense of 'Shall.'" Click here to go to the PDF reprint. And click here to access it for free—at least for the time being—on the NYLJ's website. My thanks to those who were kind enough to review drafts of this article. The topic of shall came up during my panel discussion with Richard Wydick and Bryan Garner at this summer's … [Read more...]

Last year I drafted the following introductory clause to a merger agreement: This merger agreement is dated March 23, 2006, and is between DARIUS TECHNOLOGIES, INC., a California corporation (“Parent”), SWORDFISH ACQUISITION, INC., a California corporation and a wholly-owned subsidiary of Parent (“Sub”), TROMBONE SOFTWARE, INC., a Delaware corporation (“Target”), and the stockholders of Target, … [Read more...]