I can think of five issues relating to how you state amounts of money in a contract. Words and Numerals Drafters will often do the words-and-numerals thing when stating amounts of money: Acme shall pay Widgetco One Million Dollars ($1,000,000). The idea is that whereas numerals are easier to read than words, they’re more prone [...]
Here’s a quick way to save three words: instead of saying in accordance with the terms [or provisions] of section 6, say simply in accordance with section 6.
Today I read in a work on contract drafting an explanation of the purpose served by the phrase as the case may be. I think the analysis offered was incorrect. Here’s my view: When in a contract a sentence provides for alternative courses of action, often one or more sentences that follow go on to [...]
Bylaws is spelled both with and without a hyphen. For example, Black’s Law Dictionary gives a definition for bylaw but notes that it’s sometimes spelled by-law. So which is preferable? It appears that bylaw is gaining the upper hand. For example, the 1915 edition of Robert’s Rules of Order Revised used by-laws but the current [...]
In a recent post I suggested that accurate is a “less dopey” alternative to true and correct. (Yes, I know, I too thought that an impressive turn of phrase.) That led a reader to suggest to me that complete and accurate is preferable to accurate. Presumably he had in mind that if you give me [...]
I suggest that for purposes of contract drafting, you can always do without automatically. Consider the following fragment: … and each January 1 thereafter, this agreement will be automatically extended for one additional year unless not later than … I suggest that eliminating the word automatically wouldn’t affect the meaning. The same goes for automatically [...]
A couple of days ago reader David Munn—ever vigilant against the forces of contract-drafting darkness—sent me the following: I couldn’t find that you had blogged on one of my pet peeves, which is the overuse of the word “respective,” as in “All capitalized terms that are used but not defined in this SOW have the [...]
I received the following from reader Nigel Madeley, of the U.K. law firm Addleshaw Goddard: Ken, I know this one raises your blood pressure a little. A case about nuisance by vibration—an adjoining occupier sought an injunction against a developer. The injunction was awarded. The developer had to keep to agreed vibration limits; if it [...]
Avoid the prefixes bi- and semi- for purposes of references to time—they’re confusing. Bimonthly means “every two months” and semimonthly means “every half-month,” in other words “twice a month.” Biweekly and semiweekly reflect the same distinction. But biannual and semiannual both mean “occurring twice a year,” whereas biennial means “occurring once every two years.” So [...]
A couple of days ago I received from a reader an email that included the following: I’ve got a question about the use of apostrophes in notice period provisions. I was rather surprised to see that section 8.96 of the MSCD includes apostrophes after the number of days/weeks/months in your example provisions. Shouldn’t such provisions [...]
Quick—what’s the difference between promptly and immediately? I bet that what comes to mind is the notion that immediately requires speedier action that does promptly. Well, if that’s what you thought, you’re in good company. For example, the District Court for the Southern District of New York has said that promptly doesn’t mean immediately, but [...]
If anyone is wondering why I’ve been devoting time to efforts standards, have a look at this post on DealBook by Steven Davidoff regarding a development in Blackstone Group’s proposed acquisition of Alliance Data Systems. For reasons I discuss in MSCD, in this article, and in last week’s blog post, it would be bizarre for [...]
I suspect that the one usage that causes me most aggravation is best efforts. That’s because the way I see it is diametrically opposed to the way many practitioners see it. I think the problem is that people approach it as an issue to be resolved by case law, whereas I see it first of [...]
Here’s a paragraph from the manuscript for MSCD2. It’s so fresh that steam is still rising from the words: An internal cross-reference that consists of only a number gives the reader no indication of what’s addressed in the specified provision. That’s why in some contracts each cross-reference includes the heading of the article or section [...]
In this November 2007 post, I suggested that the phrase at any time is always extraneous. Well, the same goes for from time to time. Used With Language of Discretion The phrase from time to time is used to mean, in essence, “on one or more occasions.” It’s only used with language of discretion, as [...]
This might be of interest to anyone who has followed the litigation between United Rentals, Inc. and the RAM entities. (Click here for my previous post on the subject.) A sideshow in the litigation was the expert report of Professor John C. Coates that the RAM entities submitted to the court and how Chancellor Chandler [...]
[In this recent blog post I provided a partial analysis of the phrase moral turpitude and invited readers to complete it for me. No one took up my challenge with sufficient vigor to warrant awarding the prize, a signed copy of A Manual of Style for Contract Drafting. (Cue much wailing and gnashing of teeth!) [...]
I’ve had in the can for a few weeks a partly completed blog post on the subject of the phrase moral turpitude. This phrase features in various kinds of agreements providing for an ongoing relationship, but I associate it with employment agreements in particular. The post remains unfinished because although I’ve identified the problem with [...]
In this post I discuss “needless elaboration”—the tendency of drafters refer to a given set, then refer to subsets that compose all or part of that set, even though there’s no question as to the boundaries of that set. I give as an example use of the phrase at law or in equity. I’d like [...]
In my post on “termination for convenience” (click here) I said that in language providing for termination for any reason you can dispense with the phrase at any time, as that concept is implicit in termination for any reason. But the point can be made more broadly—the phrase at any time would seem to be [...]
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 [...]
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 [...]
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 [...]
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 [...]
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 [...]
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 [...]
You’ve been very kind to tolerate my vendetta against best efforts, or more specifically against the notion that a best efforts obligation requires a greater effort than a reasonable efforts obligation. But I’m not done yet. The foundation of my argument is the notion that the best in best efforts constitutes rhetorical emphasis. I discuss [...]
Here’s what Garner’s Modern American Usage has to say about only: Only is perhaps the most frequently misplaced of all English words. Its best placement is precisely before the words intended to be limited. The more words separating only from its correct position, the more awkward the sentence; and such a separation can lead to [...]
The following constructions using party are commonplace: Acme is a party to a confidentiality agreement with Widgetco dated October 7, 2007. Acme and Widgetco are parties to a confidentiality agreement dated October 7, 2007. In the above examples, party is used as a noun. I suggest that in this context it would be preferable to [...]
In grading student assignments, I found myself commenting on their use of unless the parties agree otherwise. I thought that I had already written something somewhere about this phrase, but evidently not. So here goes: As a general matter, the phrase unless the parties agree otherwise is redundant. The parties could agree to waive, amend, [...]
One of the participants at my recent Washington, D.C. seminar asked me about the notation “intentionally omitted.” I love being asked about stuff I hadn’t ever thought of writing about. “Intentionally omitted” is used in a contract to indicate when the text of an article, section, subsection, or enumerated clause has been omitted while leaving [...]
A reader from Australia emailed me the following: You may be interested to see what the Courts of New South Wales make of the “difference” between “best endeavours” and “all reasonable endeavours”—pretty much nothing (usually), which reflects what the law in Australia has been for over 20 years. Here’s how a recent Chief Justice of [...]
You should avoid using in your contracts the word willful (alternative spelling wilful), as it’s ambiguous. This lesson comes courtesy of Judge Gerard E. Lynch of the Southern District of New York, in his opinion in Johnson & Johnson v. Guidant Corp., 2007 U.S. Dist. LEXIS 64114 (S.D.N.Y. Aug. 29, 2007). (Click here for a [...]
A reader in Italy asked me about a short article that he had seen on www.breakingviews.com. I wasn’t familiar with this site, but it describes itself as “the leading international source of online financial commentary.” (Click here to go to the article; you’ll need to subscribe, or at least register for a free trial.) The [...]
Once more, I doff my cap to a reader of this blog. Steve Pappas—a Penn Law classmate—suggested to me that the construction on the one hand … on the other hand is often misused. It had never crossed my mind to investigate this usage. I’ve now done so, and I agree with Steve. The construction [...]
Today’s issue of the New York Law Journal contains my article Revisiting Materiality. Click here for a pdf reprint; it’s also available on the GC New York website (free registration required). This article discusses how the word material—that favorite of deal lawyers—is ambiguous, and it suggests ways of addressing this problem. This is a topic [...]
[Revised August 8, 2007] I’ve previously blogged about how drafters often refer to a given set, then refer to subsets that compose all or part of that set, even though there’s no question as to the boundaries of that set. I’ve decided to call this phenomenon “needless elaboration.” It’s like saying “I don’t eat fish, [...]
I’m reconciled to the fact that every so often I’ll change my mind on some issue and thereby render obsolete some portion of my writings. In this article and in MSCD 7.34, I propose a definition of reasonable efforts that you might want to use in sensitive contexts. Well, in the course of reviewing for [...]
In this September 2006 blog post I examined the phrase form and substance, as in “an opinion of counsel in form and substance satisfactory to the Buyer.” That phrase, along with the variant form and content, is found in language of obligation requiring the parties to enter into a given contract or requiring one or [...]
Let’s tour the universe of alternative defined terms. Alternative Defined Terms for Party Names In MSCD 2.40 I note that drafters sometimes give alternative defined terms for a party name (as in “Acme” or the “Company”). Doing so serves no purpose and inflicts on the reader the burden of remembering that Acme and the Company [...]
Don’t use Etc. in section headings, as in “Effect of Merger, Consolidation, Etc.” It conveys the impression that the drafter couldn’t be bothered to come up with a suitably all-encompassing heading. And it’s hardly informative. Some drafters get quite carried away with using Etc. in headings. A UST Inc. credit agreement filed with the SEC [...]
It’s commonplace to refer in a contract to effectiveness of something or other—a merger, perhaps, or a registration statement. That’s unobjectionable. But I’m dubious about using the defined term Effective Date in a contract to refer to effectiveness of that contract. This occurs in various ways. First, Effective Date is sometimes used to refer to [...]
I subscribe to the RSS feed of Mondaq.com, a repository of law-firm white papers, newsletters, whatever you want to call them. Occasionally something will show up that falls within my bailiwick, and last Friday I spotted a white paper issued by the English law firm Lawrence Graham LLP entitled “Drafting Contracts: How Useful Is the [...]
During the term of this agreement seems an innocuous enough phrase, but more often than not it’s redundant. The default rule is that contract provisions that directly address party actions remain in effect only during the term of the contract. That means that if you use during the term of this agreement to modify language [...]
Here are some examples, drawn from the SEC’s EDGAR database, of provisions containing the phrase unless the context otherwise requires: Unless the context otherwise requires, capitalized terms used in this Agreement have the following meanings. Unless the context otherwise requires, references to the “Company” shall be deemed to refer to the Company and its Subsidiaries. [...]
The doublet costs and expenses occurs routinely in contracts. Here’s an example selected at random from the SEC’s EDGAR database: If action is instituted to collect this Note, the Company shall pay all costs and expenses, including, without limitation, reasonable attorneys’ fees and costs, incurred in connection with such action. Black’s Law Dictionary gives the [...]
I recommend that you give serious thought to never using it being understood. In the vast majority of instances, it being understood is equivalent to it is agreed. (Indeed, often enough the phrase used is it being understood and agreed.) When used in this sense, it being understood adds nothing, seeing as the contract lead-in [...]
Regarding use of the word parties as a defined term, MSCD 2.42 says the following: [D]o not use the defined term the Parties. It ostensibly spares the drafter from having to refer throughout a contract to the parties to this agreement, but one can simply refer to the parties, because such a reference could not [...]
Don’t worry—I’m not going to get on my representations and warranties hobby-horse again. Instead, I just want to point out some terms that are inappropriately used in relation to representations. As I say in MSCD 3.113, one breaches an obligation, but not a representation. Instead, a representation, like any statement of fact, is either accurate [...]
The word “indenture” is something of an oddity. Here’s how Black’s Law Dictionary defines it: A formal written instrument made by two or more parties with different interests, traditionally having the edges serrated, or indented, in a zigzag fashion to reduce the possibility of forgery and to distinguish it from a deed poll. Obviously we [...]
