I’ve written about granting language several times, most recently in this November 2011 post. I now have another issue for you.
Consider the following stripped-down provisions:
Acme hereby grants Smith a license to use the Marks.
Acme hereby licenses the Marks to Smith.*
And consider these provisions:
WidgetCo hereby grants to Jones a lease to the Premises.*
WidgetCo hereby leases the Premises to Jones.
In each case, the asterisk denotes what I think is the irregular way to express that meaning.
My conclusion? Although language of performance for licensing and leasing could use analogous verb structures, most drafters use the noun license and the verb lease. There’s no cosmic significance to that—it’s just a quirk of legal language.
Am I right?
Ken:
Three usages to consider:
First, for licenses, one often puts adjectives in front of the noun “license” that are much more difficult to read as adverbs. One does not simply non-exclusively, worldwidely license anything. That may not be a great usage, bit is surely is easy sometimes.
Second, sometimes the agreement is not the license, but is an agreement selling the license. In that instance, the verb is not “grant” but “sell.” This is sometimes the case in bulk sale agreements, where the licensee purchases (or agrees to purchase) some number of licenses, where the license terms are actually in a different document.
Third, sometimes the grantor of the license is really a sub-licensor who does not own the intellectual property being licensed. Saying that you are licensing the intellectual property to someone kind of rubs wrong. Granting a license seems less offensive.
None of these necessarily contradict what you say (and they seem way down in the weeds), but they might make a drafter more used to the “grant a license” type of language.
Next, it seems to me that, in the phrases “licenses to” and “licenses from,” the meaning of the work “licenses” is slightly different. in the first case, “licenses” means “grants a license.” In the second case, “licenses” means “receives a license” or “accepts a license.” I’m not sure that the difference is significant, but it could be a case of the same word meaning two different things in the same document. And you never really know when an ambiguity will be significant.
Finally, I am always sensitive to making my drafts somewhat robust to common drafting errors. i like using constructions that make little sense if i drop out a negation (no, never, none, not, etc.). I don’t like putting numbers in letters and numerals. I don’t like using licensor and licensee because they are too easy to mix up. And so on. For that same reason, I don’t like using a word in two ways where the meaning for the word varies so significantly by the word “to” or “from” following it, which could get accidentally changed in a draft. Most other types of transactions use different words on the providing and receiving ends — buy/sell; provide/receive; offer/accept; deliver/receive. The only other one I can think of (other than license and lease) is ship to/ship from. And that one seems like a potential screw-up.
Chris
Chris: Thanks, this is helpful. Incidentially, the “to” or “from” issue regarding the verb “licenses” applies equally to the verb “leases.” Ken
Ken:
True. I just know a lot less about leases than I do licenses.
Chris
In leases, I typically write something like, “Landlord hereby leases the Premises to Tenant, and Tenant hereby leases the Premises from Landlord, on the terms stated in this Lease.” This approach prompts a fair question whether the term “lease” means the same thing in each phrase. I am not sure the phrase about Tenant is necessary, but some consider it important to express the Tenant’s acceptance of the lease.
I have also seen, “Landlord hereby leases to Tenant, and Tenant hereby hires and rents from Landlord,” but the differences in phrasing in that sentence only seem to add stuffiness, not anything meaningful. When that phrasing turns up, “unto” often appears in place of “to,” only compounding that effect.
Tim: I’d be happy to rely on “to” and “from.” And I think that reciprocity is appropriate. Ken
English is a great but far from perfect language. (That goes double for its use as a world lingua franca.) One of its deficiencies is that it hasn’t easy words to distinguish “lease to” and “lease from” (except, of course, “lease to” and “lease from”). German has “mieten” und “vermieten” to cover those, but I doubt English speakers would ever adopt “lease and belease.” English has lots of useful pairs in other contexts: give/receive, throw/catch, grant/accept, sell/buy, but in this context (leases), we have only “let” and “hire.” It’s lovely that they’re old, short words but “hiring an apartment” clangs. Also, can one live with “lettor” and “hirer”? Another case of NGWO (“no graceful way out”), pronounced “nog woe,” but unrelated to holiday hangovers.