I can’t recall ever having used the adjective contractual, meaning “of, pertaining to, or secured by a contract.” I find it an awkward mouthful. As a general matter, I’d rather simply use contract, as in contract terms and contract obligations rather than contractual terms and contractual obligations. And rather than referring to contractual instruments or [...]
A court opinion doesn’t have to come from an exalted court in order for it to raise an issue of interest to drafters generally. A case in point is Managment Strategies v. Hous. Auth. of New Haven, 2009 Conn. Super. LEXIS 1550 (Conn. Super. Ct. June 2, 2009). In that case, the following release language [...]
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 [...]
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 [...]
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 [...]
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.) [...]
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 [...]
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 [...]
Black-and-white is simpler than shades of gray—the most straightforward MSCD recommendations are those urging you to scrap entirely a given word or phrase. Here’s a partial list of words and phrases that ideally would be absent from your contracts: at no time best efforts covenant for the avoidance of doubt hereinafter referred to as including [...]
In MSCD 12.285–315 I explain why it’s pointless and confusing to say represents and warrants, not to mention representations and warranties. No one has made a serious attempt to refute my argument. But recently I received an interesting report from the front lines. Knowing that I have a thing about represents and warrants, Trevor Grant [...]
In MSCD 12.134 and in these blog posts, I recommend that you rid your contracts of the phrase indemnify and hold harmless. Most lawyers unthinkingly use indemnify and hold harmless as synonyms. And I’ve found that lawyers who instead think those concepts can be distinguished don’t agree on what they actually mean. So using both [...]
While researching the implications of the word deed (see today’s blog post on deed), I encountered a contract with the following concluding clause: THIS AGREEMENT has been duly executed as a Deed on the date stated at the beginning of this Agreement. The phrase executed as a deed also occurs in signature blocks. A variant [...]
MSCD 12.148 and this May 2007 blog post consider the word indenture. Well, here’s another word for a particular kind of contract: deed. Black’s Law Dictionary defines deed as “A written instrument by which land is conveyed” and “At common law, any written instrument that is signed, sealed, and delivered and that conveys some interest [...]
I spent this morning in Toronto conducting a seminar at Rogers Communications, the Canadian communications company. David Miller, the general counsel of Rogers Communications, mentioned a requirement under Texas law that certain indemnification language be conspicuous. I’ve long been vaguely aware of that, so after the seminar I chased down further information. The gist of [...]
The word signatory is ambiguous. Black’s Law Dictionary defines signatory as “A party that signs a document, personally or through an agent, and thereby becomes a party to an agreement.” But it’s also used to mean someone who physically signs a contract, whether as a party or on behalf of party. For example, after “Title” [...]
In the current edition of New York magazine, someone agitating about Facebook’s new terms of service is quoted as saying “No Latin! I’m not sure what forum non conveniens means, and I shouldn’t have to [know].” As a general principle, No Latin! makes sense to me. I’ve found on the SEC’s EDGAR system contracts filed [...]
A chapter of MSCD is devoted to syntactic ambiguity, in other words uncertainty over which part of a sentence a given word or phrase modifies. One source of syntactic ambiguity is closing modifiers. MSCD discusses how to avoid ambiguity caused by closing modifiers, but it doesn’t discuss in each case (or the wordier in each [...]
Every issue of contract language, no matter how minor, is worth addressing correctly. And some readers have clearly embraced that approach. For example, I received the following note from reader David Baghdassarian, an associate at K&L Gates: Have you opined on use of the word “telecopier” instead of “facsimile” (or “fax”)? I believe “telecopier” was [...]
I was prompted to consider the word subsidiary when I realized that it’s not necessarily clear what kind of entities can be a subsidiary. And I stuck around to consider how one might define subsidiary. What Kind of Entities? The main problem with subsidiary is that it can create confusion regarding what kind of entities [...]
Reader Jonathan Handel—he of the Digital Media Law Blog—sent me the following interesting inquiry: I’m wondering if you have any thoughts in regards to a gay rights issue related to drafting various corporate documents. This question may be on the edge as to whether it’s a drafting issue or a substantive one, but I figured [...]
In connection with one of my Calgary seminars, someone suggest that my treatment of best efforts doesn’t apply in Canada. I thought I should address that, because if my analysis doesn’t work for Canada, it doesn’t work anywhere. Chapter 7 of MSCD contains my analysis of efforts provisions, and I’ve also done a good number [...]
A few weeks ago, while driving my daughter Sydney somewhere in Garden City, I laid the following observation on her: If you have to take some action at a specified time, you’re likely going to be early or late, to a lesser or greater extent. That’s because any given time of day isn’t a period [...]
Drafters use the phrase time is of the essence to indicate that failure to meet a contract deadline constitutes grounds for termination. But as I explain in MSCD 12.394–403 and in this May 2006 blog post, saying Time is of the essence for purposes of this agreement is problematic, in that such provisions suggest that [...]
Reader Doug asked me about the difference, if any, between in accordance with and according to. Garner’s Modern American Usage says that according to means (1) “depending on”; (2) “as explained or reported by (a person)”; or (3) “in accordance with.” It’s used relatively often in contracts to convey the last of these meanings, as [...]
In this October 2008 blog post I said that together with is usually a roundabout way of saying, depending on the circumstances, and or with or plus. Well, it just crossed my mind that a related usage is as well as—you should be able to use and instead. Often together with and as well as [...]
The following is from reader Tom Hertz: Based on MSCD, I gather that you’d say that parties enter into an agreement, rather than simply enter it. (See, for example, MSCD 2.21 and 8.18.) The former usage is certainly common and, just as certainly, redundant. Why not use just enter? Prepositions have a way of glomming [...]
If often find myself alluding to the “magic words” approach to drafting. Here’s what I mean: You’re using magic words when you don’t clearly articulate in a contract a given concept but instead use legalese to grope at the intended meaning, in the hope that custom, or the courts, will fill in any gaps. Using [...]
MSCD 12.258–277 discusses the distinction—or not—between immediately and promptly. Here’s another aspect of immediately—it’s often misused in connection with stuff that happens automatically. Consider the following provision: This agreement will terminate immediately upon Acme’s giving Widgetco notice of termination. I’ve stricken the immediately because it suggests, inappropriately, that a moment of time, however short, passes [...]
Most drafters use words and numerals to express numbers—as in no later than thirty (30) days after Acme delivers a Termination Notice. Numerals are easier to read than words but are more prone to typographic errors, so using both affords the immediacy of numerals while providing insurance against a transposed decimal point or an extra [...]
Longtime readers of this blog will be aware of my hostility towards the phrase represents and warrants (and representations and warranties). Over the weekend I was reminded that I don’t include in the MSCD discussion (starting at 12.285) a point I make in my seminars. Here it is: The only purpose that Acme represents and [...]
Contract drafting is facilitated if you find the simplest way to articulate a given meaning and then stick with it. That applies to the small stuff, too. Take, for example, together with. Often you’re better off trading two longer words for one shorter one—and: “Hotel” means the Site together with [read and] the Buildings. At [...]
Who knows what ambiguity lurks in the heart of contracts? Well, reader Steven Sholk has an inkling, because he’s the one who told me about Graev v. Graev, 2008 N.Y. LEXIS 3252 (N.Y. Oct. 21, 2008), a case that involves the meaning of the word cohabitation. As part of their divorce settlement agreement, Mr. Graev [...]
A few months ago a reader asked me what I thought of the phrase default or event of default. Here, belatedly, is my answer, along with my thoughts on a related phrase, has occurred and is continuing: “Default or Event of Default” The phrase default or event of default is a fixture of loan agreements. [...]
When in my seminars I discuss the phrase including without limitation, I’m sometimes asked what I think of for example. Here’s my answer: Don’t use for example in contracts to introduce lists of items, but by all means use it to introduce illustrative scenarios. First, let’s consider including. It can be used to introduce a [...]
Comments to my recent post on granting language in a license alluded to the case of Jacobsen v. Katzer (Fed. Cir., Aug. 13, 2008). I’d like to pick up on something mentioned by commenter Chris—the court’s discussion of provided that. This case involved the language of an “open source” copyright license. The license granted users [...]
Here’s another entry in the rhetorical-emphasis hall of shame—in all respects. Here’s an example: This agreement is in all respects governed by Minnesota law. By omitting in all respects you lose nothing except surplus words. The same goes for in all material respects—use instead materially, but remember that it’s ambiguous. (For more on that, see [...]
Thanks to the litigation in Lawler Mfg. v. Bradley Corp., recently I discovered the nuances of such as. That led me to write about such as in this post. Yesterday I received a message from Wayne Turner, a litigation partner in the downtown Indianapolis office of Bingham McHale. I enjoyed Wayne’s message, and I thought [...]
A reader recently asked me the following question: We frequently sign global services agreements that provide that the parent company is signing “for and on behalf” of an affiliate. What do you think of this practice? I’m uncertain about having a parent sign a contract on behalf of an affiliate. (In any event, the words [...]
Here’s what Garner’s Modern American Usage has to say about anniversary: anniversary (= the day of the year on which an event occurred in a previous year) is today used informally to denote a milestone in months or even weeks. That usage has become increasingly common, perhaps because there is no convenient equivalent for terms [...]
If you say that something has to be satisfactory to Acme, the standard might be an objective one, in that it would be met if a reasonable person in Acme’s position would be satisfied. Alternatively, it could mean that Acme actually has to be satisfied, subject only to the implied duty of good faith—the standard [...]
Such as is ambiguous—it might be unclear whether the clause it introduces serves to reduce the scope of the class represented by the preceding noun. This can result in contract disputes. Consider the following sentence: Richard collects books about painters such as Botticelli and Donatello. Given the general nature of the class in question (painters) [...]
In MSCD 8.55 I recommend that you steer clear of and/or unless using it would spare you some verbiage. Well, consider the following basis for terminating an employee for cause: the Employee is charged with any crime that (1) is punishable by a custodial penalty, instead of or in addition to any fine or other [...]
A couple of months ago, reader Kent asked me what I thought about using parentheses in contracts. Here, belatedly, is my answer: In regular prose, parentheses (namely round brackets, like those enclosing these words) are used to offset text that constitutes an explanation or aside. The limited and stylized prose of contracts is generally not [...]
Reader Steven Sholk sent me a case today. I found it of interest, but not for the reason he anticipated. What caught my eye was the phrase during continuance of this agreement. A search of the SEC’s EDGAR database showed that it’s not a complete rarity: it occurs in about 200 contracts filed in the [...]
Reader Larry Bell pointed out to me that the April 2008 issue of Corporate Counsel’s Quarterly contains an article by the publisher’s editorial staff entitled “Best Efforts Clauses.” I’m afraid that I can’t provide a link, as I have only a hard copy. When it comes to guidance on drafting usages, I’m not particularly a [...]
Here’s what The Chicago Manual of Style 8.55 has to say about use of initial capitals in references to political divisions: Words denoting political divisions—from empire, republic, and state down to ward and precinct—are capitalized when they follow a name and are used as an accepted part of the name. When preceding the name, such [...]
In this November 2006 post I wrote about words that are fine in narrative writing but would be out of place in a contract. Well, I’ve thought of some more—therefore and related words such as thus, hence, and consequently. Here’s an example I just spotted: The term of this agreement will end three years following [...]
It’s been a couple of months since I looked through recent opinions. It’s time for me to get back into the habit of doing so, because all sorts of interesting issues crop up. Consider Moore v. Wal-Mart Stores, Inc., 2008 U.S. Dist. LEXIS 30480 (N.D. Miss. Mar. 31, 2008). It bears on how you create [...]
Here’s another issues that cropped up during my Geneva seminars: Which is preferable, change in control or change of control? My instinct was that both usages are equally acceptable, and that was borne out by five minutes of research. Contracts filed on the SEC’s EDGAR system don’t seem to display a marked preferance for one [...]
During one of my Geneva seminars this week, someone asked me whether it’s better to say listed/described/stated in schedule X or on schedule X. I’d been asked this question a couple of times previously, and I’d responded that I wasn’t sure that I cared. But on being asked a third time, it dawned on me [...]
