Getting Right the Temporal Aspect of Adjective Clauses

Consider the following, which relates to the consequences of Acme's cancelling a purchase of equipment: Acme shall reimburse the Vendor for reasonable expenses that the Vendor incurs in connection with manufacture of the Units being cancelled. Hmm. Does that mean Acme has to reimburse only expenses incurred after cancellation? Arguably. Now consider this: Acme shall reimburse the Vendor for … [Read more...]

Don’t Use Initial Capitals When Referring to Parts of a Statute

Those who consult MSCD will be familiar with the notion that it's unnecessary and distracting to use initial capitals ("nitcaps," to those in the know) when referring to the parts of a contracts. In other words, in cross-references the words section, exhibit, and schedule (among others) should be all lowercase. It follows that one should also use all lowercase letters when referring to parts of … [Read more...]

Is Anyone Familiar with This Cross-Referencing Convention?

At yesterday's "Drafting Clearer Contracts" seminar in Aarhus, Denmark, for MHI Vestas Offshore Wind, one of the participants asked me whether I was familiar with the convention that has internal cross-references stated in initial capitals (Section 5.4) and cross-references to other contracts stated in all-lowercase letters (section 3.2 of the Distribution Agreement). I said I was unfamiliar … [Read more...]

“This Is a Plain English Warrant Agreement”?!?

Behold what I just found washed up on the shores of the SEC's EDGAR system: PLAIN ENGLISH WARRANT AGREEMENT This is a PLAIN ENGLISH WARRANT AGREEMENT dated May 22, 2008 by and between RELYPSA, INC., a Delaware corporation, and TRIPLEPOINT CAPITAL LLC, a Delaware limited liability company. What the ... ! First off, if you want your contract to be in plain English, then make it in plain … [Read more...]

“During the Period”

Following up on my post about the date that is (here), here's another bit of clutter that occurs in references to time—the phrase during the period. Like the date that is, it occurs in more than 10,000 contracts filed on EDGAR in the past year. Here are some examples, as tweaked by me: The Partnership will furnish to each Underwriter, without charge, during the period when[read whenever] a … [Read more...]

“The Date That Is”

The phrase the date that is—as in before the date that is, after the date that is, no later than the date that is, and so on—is almost always clutter and can be surgically excised. Nevertheless, it occurs in more than 10,000 contracts filed on the  SEC's EDGAR system in the past year. Here are some examples dredged from EDGAR, with the strikethrough added by me: If the Exchange Offer is not … [Read more...]

“Declination”

A few days ago I received from my daughter's school a form with the heading "Influenza Vaccine Consent/Declination." I had never met declination, meaning "formal refusal," in the wild before, but I knew that I didn't like it. It's stultifyingly bureaucratic. (@bretsmoore will tell you that it also means the angular distance of a point north or south of the celestial equator.) So of course I did … [Read more...]

Terms of Art That Can’t Be Replaced

I recently saw the following on Twitter: Do you think there are legalisms (terms of art) that cannot be replaced with plain language? We're making a list: http://t.co/Hd0ZLidJK7 — Cheryl Stephens (@CherylStephens) June 20, 2013 It prompted me to think, Hey, that's a great idea! Why don't I ask my readers to help compile a list of contract terms of art that can't be replaced by something … [Read more...]

My Discussion With the Chicago Style Q&A Regarding Capitalization of Words Denoting Political Divisions

The Chicago Manual of Style is an essential resource. It's useful even for contract drafters (see this 2012 post). But I've long had a quibble about its guidance on one small issue regarding capitalization of words denoting political divisions. So today I exchanged emails with the online Chicago Style Q&A—itself a great resource. If I understood it correctly, the interpretation offered by … [Read more...]

“However So Described” and a Different Way to Handle Redundancy

At last week's seminar in Sydney, one of the participants asked me about the phrase however so described. I told her that I'd look into it; she probably didn't expect that it would lead me to another way to handle redundancy. Redundancy has two sources. There's what I'll call rhetorical redundancy: when you throw in synonyms or near synonyms just because it makes contract prose seem less drably … [Read more...]

A Case Study in Eliminating a String of Nouns from a Contract

Consider the following (emphasis added): This agreement is personal to the Employee. The Employee shall not assign any of the Employee’s rights or delegate any of the Employee’s obligations under this agreement to any other person, except that the Employee may assign the Employee’s rights under this agreement to the Employee’s personal or legal representatives, executors, administrators, heirs, … [Read more...]

Is “The Chicago Manual of Style” Relevant to Contract Drafters?

I was surprised to have my publisher point out to me that although in the manuscript for the third edition of MSCD I had cited the fifteenth edition, the sixteenth edition of The Chicago Manual of Style has been with us since 2010. So I immediately bought a copy and updated my CMoS references. It's no mystery why I should find CMoS useful. CMoS is generally accepted as the most authoritative … [Read more...]

Court Describes Contract Language as “Gibberish”

The reader who goes by the name A. Wright Burke, M. Phil., told me about this article by Edmund H. Mahoney in the Hartford Courant. It describes how in Pac. Employers Ins. Co. v. Travelers Cas. & Sur. Co., 3:11CV924 MRK, 2012 WL 3202934 (D. Conn. Aug. 3, 2012) (PDF copy here), the judge describes as "gibberish" the insurance-policy provision at issue in a multimillion-dollar lawsuit. An … [Read more...]

Goodbye, “Magic Words”

Some readers may have noticed that in this post discussing problematic terms of art I don't use the phrase "magic words." I've long used "magic words" as a label for dysfunctional terminology; see this 2010 blog post. But while writing my post on terms of art, I realized that although "magic words" has real snark value, it's otherwise unhelpful. So into the dustbin it goes. I also suspect … [Read more...]

The Different Kinds of Problematic Terms of Art Used in Contracts

[This post replaces this previous post, which I deleted, except for the comments. Very occasionally I write something, post it, and then promptly realize that the topic in question is more complex than I had bargained for. That happened with my previous post. I revised it once, but realized that wouldn’t do the trick, and revising it again seemed a bit much—hence this post. My thanks to those who … [Read more...]

What Terms of Art Are Indispensable? (Deleted Except for Comments)

[I've deleted this post because it has been supplanted by this post. Sorry for the discombobulation!] … [Read more...]

Interpretation Mischief at the Fifth Circuit?

A recent opinion by the Fifth Circuit Court of Appeals serves as yet another reminder that the job description of anyone drafting a contract includes guarding against overreaching by a court. The case in question is Flagship Credit Corp. v. Indian Harbor Ins. Co., 2012 WL 2299484 (5th Cir. June 15, 2012) (copy here). A finance company that was sued in a class action sought a declaratory … [Read more...]