In the post before this one, I consider, among other sentences, Acme is not prohibited from selling the Widgets. I’ve now changed my mind about how it should be treated.
This story begins with my saying Nothing in this agreement prohibits Acme from selling the Widgets. Then, I added this to the fifth edition of MSCD: “Use is not prohibited from to express absence of prohibition. … Except to avoid confusion, don’t use the wordier this agreement does not prohibit Acme from or nothing in this agreement prohibits Acme from.
But something was nagging at me, and I think I’ve figured it out. The absence of prohibition isn’t accomplished by the contract; instead, it’s a state of affairs deduced from what isn’t in the contract. So this issue should addressed using not language of discretion, but language of declaration. The function of language of declaration is to allow parties to make statements of fact. In this case, we don’t want one party to make a statement of fact regarding matters under its control. Instead, we want both parties to acknowledge what they’ve deduced from what isn’t in the contract.
That could conceivably be accomplished by saying The parties acknowledge that Acme is not prohibited from selling the Widgets. But because the absence of prohibition isn’t derived from the contract, that sentence could be understood as meaning that Acme is not prohibited in any way from selling widgets. That’s too broad. So here’s where I end up: The parties acknowledge that nothing in this agreement prohibits Acme from selling the Widgets. In effect, one step back (what I added to the fifth edition), two steps forward (this blog post).
What do you think?
So glad you have started posting about categories of language again.
If the parties want to say the contract does not prohibit something, I think this is an unusual occasion where the best form is the original ‘Nothing in this agreement prohibits … ’.
In MSCD, you describe this original as wordier than ‘is not prohibited from’. If so, it is not by much!
Your latest suggestion is logical but wordier than the original. Also, I don’t think it improves clarity.
The original implicitly contains the wording you add at the start of your latest suggestion (namely, ‘The parties acknowledge that …’). So, the original acts as both a declaration of the parties, and a (policy?) override in the event there is anything in the contract which would prohibit the thing which is not intended to be prohibited.
Hi Mark. Thank you for playing! This is an oddity, so I expect work indeed remains to be done! Ken
Ken, I stopped using the introductory phrase “The parties acknowledge that…” years ago, prompted, I think, by one of your posts. If memory serves, you saw no added value in the phrase.
Have you changed your thinking on this point? Thanks!
Hi Pedro.The parties hereby acknowledge is appropriate for language of declaration where one or more parties are acknowledging another party’s facts or facts that are widely recognized. See the quick reference chart for the categories of contract language, at https://www.adamsdrafting.com/the-mscd5-quick-reference-chart-of-the-categories-of-contract-language/.