Here’s what I say in MSCD 16.58–60:
One way to signal the start of a new paragraph is to indent the first line. Another way is to put space between paragraphs. Typography professionals recommend that you not use both techniques. For example, Typography for Lawyers, at 136–37, says, “First-line indents and space between paragraphs have the same relationship as belts and suspenders. You only need one to get the job done. Using both is a mistake. If you use a first-line indent on a paragraph don’t use space between. And vice versa.”
Contracts invariably use space between paragraphs. Given that reading contracts often involves flipping from provision to provision, that space seems indispensable. Furthermore, the logic behind the MSCD enumeration scheme (see 4.53) requires first-line indents for sections (see 4.13) and subsections (see 4.26). The result is that the MSCD enumeration scheme uses both space between paragraphs and first-line indents. In this case, the need for a logical layout trumps typography considerations.
In the samples in this manual and in the redrafted version of the appendix 1 contract, paragraphs without enumeration—the introductory clause, the recitals, the lead-in, the concluding clause, and autonomous definitions—all use first-line indents. Given the lack of enumeration, one could dispense with the first-line indents, but they’ve been retained for reasons of consistency between enumerated paragraphs and paragraphs without enumeration. Given that for contract drafters document design is generally a low priority, the notion of switching from first-line indenting for enumerated paragraphs to doing without for paragraphs without enumeration seems too fussy.
Well, I’m now inclined to say, the heck with that! I’ve decided that using first-line indents with spaced paragraphs just looks too silly. I was mildly annoyed that my article on represents and warrants (here) uses first-line indents with spaced paragraphs.
So here’s what the front of the contract would look like without first-line indenting:
This approach would apply to all unenumerated paragraphs. So here’s what a set of autonomous definitions would look like:
This approach would apply equally to the hanging-indent scheme I propose in this post. Obviously so: if none of the the enumerated paragraphs uses first-line indenting, it would be odd to use first-line indents for the unenumerated paragraphs.
Sorry for pulling this switcheroo on you.