Book Review: “A-Z Guide to Boilerplate and Commercial Clauses”

To count as an authority these days, I think you need two things: First, a substantial body of work. And second, a megaphone. If you can’t be bothered to take part in the general hubbub, how are we meant to hear what you have to say? And why should we care?

Using those criteria, I think of Mark Anderson as England’s foremost commentator on contract drafting. For one thing, the list of books and parts of books that he’s written, on his own and with his colleague Victor Warner or another co-author (here), is scarily long—it makes me look like a piker.

And Mark is the principal voice of the blog IP Draughts. He’s also a regular presence in the comments on this blog.

Given how large Mark looms in the subject, it’s high time that I had a look at one of his books. By process of eeny, meeny, miny, moe, I’ve chosen Mark Anderson & Victor Warner, A-Z Guide to Boilerplate and Commercial Clauses (2d ed. 2006). It’s something of a companion volume to their Drafting and Negotiation Commercial Contracts, the third edition of which will be appearing shortly.

As regards its scope, here’s what the introduction says:

This book aims to provide guidance on the purpose and effect of boilerplate clauses that are in common use. It also covers a selection of other contract clauses that might not be regarded as boilerplate, but are nevertheless frequently encountered in many types of commercial agreement (for example, confidentiality clauses)(. The main purpose of this book is to discuss why such clauses are used, discuss drafting issues that arise, and provide practical samples of commonly used precedents. Also included are extracts from judgments where particular clauses have been defined, analysed or interpreted.

The main part of this book consists of nearly 100 topics arranged in alphabetical order, starting with ‘Acknowledgments’ and ending with ‘Warranties’. Also included is a set of typical boilerplate terms in a form which they might be found in a lengthy commercial agreement (see the ‘Boilerplate Agreement’ in Appendix A). An accompanying CD contains the precedent clauses found in this book.

Let’s get one thing out of the way: If you’re an English practitioner and you routinely find yourself with your head under the hood of contract boilerplate, you’ll want a copy of this book.

But I suspect that Mark is less interested in plaudits than suggestions that attempt to be constructive. So here goes:

Topics

In The Structure of M&A Contracts, I say that “‘Boilerplate’ refers to provisions that address interpretation of the contract and other matters typically relevant to contracts generally.”

By contrast, A-Z Guide says that it uses “the term ‘boilerplate’ … broadly to mean contract terms that are often found in commercial agreements.” And its interpretation is indeed broad.

To be sure, many of the topics covered equate to general provisions, including “Announcements,” “Force majeure,” and “Notices,” among many others. But  also included as topics are issues relating not to provisions in the body of the contract but rather to the front of the contract and the back of the contract, for example “Attestation clauses (signature block) and testimonium (execution clause),” “Commencement date,” “Date of agreement,” and “Recitals.”

And other topics relate to contract building blocks that can occur anywhere in a contract, among them “Best endeavours and reasonable endeavours,” “Breach,” “Covenants,” and “Conditions precedent and subsequent.” After all, the title does refer to “commercial clauses.”

There’s nothing objectionable about the broad scope of the book. But together with putting the topics in alphabetical order, it necessarily turns A-Z Guide into a bit of a potpourri.

Descriptive Versus Prescriptive

I know from Mark’s posts on IP Draughts and his comments on this blog that our approaches to contract language are broadly compatible, but that he’s more deferential of traditional usages than I am.

For example, regarding time is of the essence, A-Z Guide says as follows:

The expression ‘time is of the essence’ does not naturally convey its legal meaning, which needs to be learnt. Arguably, therefore, it should not be used in commercial contracts which are meant to be understood by business people (let alone where consumers are involved). Instead, the meaning should be spelt out in straightforward terms.

I’d lose the “Arguably”! And I noted that despite this guidance, all the sample language included in that section uses the phrase time is of the essence.

And regarding best endeavours and reasonable endeavours, A-Z Guide says as follows:

It is a common understanding among most English commercial lawyers that an undertaking to use reasonable endeavours is less onerous than an undertaking to use best endeavours. There is relatively little case law, however, to support this understanding.

That’s a polite way of putting it! Despite the, um, fragile nature of this distinction, A-Z Guide offers in that section one bit of sample language—Precedent 12—that uses both best endeavours and reasonable endeavours.

So where MSCD is unabashedly descriptive, A-Z Guide seems more flexible, but on occasion it gives drafters enough rope with which to hang themselves. I’d enjoy it if in future editions A-Z Guide were to flex its muscles and ruffle some feathers.

Terms of Art

I know from, among other things, this post on IP Draughts that Mark is acutely aware that you have to be careful how you use legal terminology in contracts.

My view is that the fewer terms of art you use, the better. Terms of art are for analysis. They’re not suited to use in contracts, because they’re freighted with meaning that goes beyond whatever function they might serve in a contract.

Take, for example, covenants. A-Z Guide mildly suggests that in most contexts, drafters might want to consider a more modern and straightforward alternative. (Although all the sample language it offers uses covenants.) But A-Z Guide does say that “The word is most often seen in agreements relating to real property, where there are important legal distinctions between positive and negative covenants.” I suggest that although covenants, in the U.S. as in the U.K., serves as a label for some kinds of obligations in different kinds of contracts, nothing is served by using the word covenant in a contract. Instead, express the obligation as you would any other obligation.

Similarly, the “Warranties” section in A-Z Guide offers sample language that uses the verb warrant. I suggest that using the verb warrant to express a factual assertion or an obligation, as the case may be, is asking for confusion. Instead, express those provisions as you would any other provision of that sort.

As I noted in this blog post regarding the English approach to endeavours, I’ve found that English judges and English practitioners are particularly susceptible to the “magic words” approach to contract language—the notion that the only way to express, for example, a covenant is to use the word covenant. As such, A-Z Guide has a tougher task than does MSCD—advocating an entirely rational approach to contract language could alienate some of its readership.

Categories of Contract Language

The sample contract language included in A-Z Guide is consistent with traditional contract language, in that shall is prominently on display. In contexts where MSCD recommends a range of different verb structures, A-Z Guide uses shall.

Overuse of shall is inconsistent with the notion that in drafting you should use one word to convey a single meaning. It contributes to traditional contract language resembling no other English prose on earth. And it results in drafters failing to notice important distinctions.

For example, the “Notices” section of A-Z Guide offers the sample language “Any notice given pursuant to this agreement shall be in writing and shall be sufficiently given to any party if sent … .” Using in this context shall, a word associated with obligations, suggests that the parties are under an obligation to deliver notices in writing. That doesn’t make sense.

Instead, I’d express this concept as a condition, using language of obligation: “For a notice or other communication under this agreement to be valid, it must be in writing and delivered … .”

Similarly, A-Z Guide‘s section on arbitration provisions offers the following sample language: “The Parties shall agree [on] the identity of a single independent, impartial expert to determine such questions. In the absence of such agreement within 30 days of the Referral Notice … .” But an obligation to agree doesn’t make sense, and is probably unenforceable to boot. Instead, I’d omit the first sentence and begin the second sentence with a conditional clause: “Unless no later than 30 days after the Referral Notice is delivered the parties select a single independent, impartial expert to determine such questions … .”

Those are a couple of examples selected at random. I’m not about to claim that MSCD‘s approach is right and the traditional approach is wrong. Instead, I suggest that the MSCD approach results in prose that is much clearer and more concise. The MSCD approach also increases the odds of a drafter spotting an issue rather than lumbering along in a shall-induced fog.

Precedent Language Versus Model Language

The most awkward thing about A-Z Guide is the “sample precedent language” offered in each section. Mark tells me that it’s a mix of language vetted by the authors and language culled from other sources. In other words, it isn’t model language. Hence the potential for disconnect between analysis of a topic and the sample language provided—I note instances of that above.

There’s no shortage of uncertain contract language in the world. Instead, what’s lacking is contract language that has been thoroughly scrutinized to make sure that what it says makes sense and that it says it in the clearest manner possible. Mark and Victor are in a position to provide that, rather than leaving it to readers to sort through the language on offer in A-Z Guide.

Print Versus Document Assembly

A-Z Guide provides an enormous amount of valuable guidance, but it nevertheless leaves the reader with an enormous amount of work, in terms of figuring out which recommendations and which sample language apply in a given context, and to what extent.

I too have written a book on contract boilerplate. But it’s a much shorter one, and it consists of the questions, answers, guidance, and associated contract language incorporated in Koncision’s confidentiality-agreement template. If someone is interested in any contract language I have to offer, they’d want to incorporate it in a contract. Document assembly provides by far the most efficient way to accomplish that. Mark might want to explore using document assembly.

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So there are my suggestions. But they shouldn’t obscure that A-Z Guide to Boilerplate and Commercial Clauses is a rich resource. Given that I plan on making the third edition of MSCD more explicitly international in scope, I expect I’ll be consulting A-Z Guide a fair amount.

About the author

Ken Adams is the leading authority on how to say clearly whatever you want to say in a contract. He’s author of A Manual of Style for Contract Drafting, and he offers online and in-person training around the world. He’s also chief content officer of LegalSifter, Inc., a company that combines artificial intelligence and expertise to assist with review of contracts.