Yesterday someone mentioned to me the phrase as between the parties. I hadn’t ever looked at that phrase before, so off to EDGAR I went:
If any of the provisions of this Amendment are inconsistent with or in conflict with any of the provisions of the Principal Agreement then, to the extent of any such inconsistency or conflict, the provisions of this Amendment shall prevail as between the Parties.
As between the Parties, EverInsight shall be solely responsible for the cost for the Development of the Compound and the Licensed Product in the Licensed Field in the Territory and VistaGen shall be solely responsible for the cost for the Development of the Compound and the Licensed Product in the Licensed Field outside the Territory, except as otherwise provided in Section 4.1 and 4.4(b).
As between the parties, RenalytixAI will have the first right to pursue any Infringement Action against an infringing third party at its own expense, and (ii) if, within [*] after becoming aware of any suspected infringement or Infringement Action, RenalytixAI has not elected not to initiate, defend, or otherwise resolve such Infringement Action, then ISMMS shall have the right, but not the obligation, to initiate, control, pursue, and/or defend such Infringement Action at its own expense.
All “third-party due diligence reports” generated in connection with the Third-Party Due Diligence Services are, as between the parties to this Agreement, deemed to have been obtained by NMAC pursuant to Rules 15Ga-2(a) and (b).
As between the Parties, and subject to the licenses granted under this Agreement, each Party retains all right, title and interest in and to all intellectual property rights that such Party owns or Controls as of the Effective Date or that it develops or otherwise acquires after the Effective Date and outside the course of the Collaboration.
Subject to the terms and conditions of this Agreement, as between the Parties, Company, by itself or with any of its Subsidiaries or any Rights-Holding Party, will have the sole right, but not the obligation, at its sole expense, to research, develop, manufacture and commercialize Company Drug IP , as it or they may determine in its or their sole discretion.
As Between the Parties Hereto. The parties release each other, and their respective authorized representatives, from any claims for damage to any person or to the Premises, and to the fixtures, personal property, Tenant’s improvements, and alterations of either Landlord or Tenant in or on the Premises that are caused by or result from risks insured against under any insurance policies carried by the parties and in force at the time of any such damage.
I particularly like how the last example uses it as a heading!
The mystery at the heart of as between the parties is that the entire contract is between the parties and no one else, so as between the parties is, in effect, read into every single provision. If in a contract with King Eurystheus I promise to do something—say, clean the Augean stables—it follows that I’m making that promise only to King Eurystheus. If for whatever reason I don’t perform, no one else can use my contract promise to get me to clean the Augean stables for them. Except, of course, if the other party is a third-party beneficiary, in which case as between the parties won’t do me any good.
So I say the heck with as between the parties, but I’m prepared to have someone show me a circumstance where it’s of use. Give me your best shot.
I’ve used the phrase in limited circumstances (none of which present in your examples). It’s where I may simultaneously owe duties to third parties as well as the other contracting party which revolve around the same topic. If I want to be clear that my contractual duty I’m doing for the other contracting party does not alter what I’m responsible for to the third-party, I may insert the phrase to avoid any confusion. And even then only if I’m worried based on the particular context and facts that someone may later claim I’ve given something up to the third party I never intended to give. (It’s usually in some risk allocation term.) I could probably count on two hands the number of times I have resorted to this. It does look clumsy.
I think if there’s some circumstance you’re try to address, there will always be a clearer way to do so.
1/ None of the proposed exceptions to the ban persuades me. If “as between the parties” is ever necessary, it’s necessary all over the place: “The parties, as between themselves, agree as follows”? The project of clarifying the pellucid “just to be safe” drives me batty. “Why not state every sentence in the contract twice, just to be safe?” Angels and ministers of grace preserve us. The case against redundancy in a Talking Heads nutshell: “Say something once, why say it again?” (Psycho Killer)
2/ There’s no reason to violate the ban where nothing in the contract imposes a duty on Acme to repay Widgetco the costs Widgetco incurs to nonparties in discharging its duties to Acme. If there’s a good reason to emphasise the lack of duty, MSCD suggests “Acme is not required to reimburse Widgetco for any costs Widgetco incurs in performing any of its obligations under this agreement”. I think that’s better than “incurs to nonparties” because “incurs” all by itself is tantamount to “incurs to anyone”, which is probably the intent.
3/ The phrase “third-party beneficiary” is immovably entrenched, but outside of that one phrase, “nonparty” is the better choice to describe one who is neither a promisor nor promisee under the contract, because “nonparty” avoids the hint that a “third party” is a special kind of party to the contract.
This gets my vote.
There is a very common usage in the context of multi-party agreements, such as partnership agreements, that contemplate side agreements that may be inconsistent or supplemental to the main agreement.
The main agreement will authorize the use of side agreements but provide that the terms shall apply “as between the parties [to the side agreement].” Similarly, the side agreement will recite that that its terms apply only “as between the parties hereto” to be clear that the terms do not purport to bind the parties to the main agreement.
Arguably the usage is not necessary, since (by definition) a contract (usually) cannot bind non-parties. However, in practice, the language can be very helpful to add clarity, especially in very complex situations where authority and binding power may be unclear.
For example, in the context of partnership agreements, the general partner may also have a separate power of attorney from all other partners, and the usage of “between the parties hereto” in the side agreements makes clear that the general partner is not binding the other partners via the power of attorney.
Or the general partner may have the power to unilaterally amend the partnership agreement in certain circumstances, and the language in the side agreement makes clear that the side agreement is not an amendment to the partnership agreement that binds the other partners.
In fact, I would guess that the first two examples you mention are instances of these princples:
“If any of the provisions of this Amendment are inconsistent with or in conflict with any of the provisions of the Principal Agreement then, to the extent of any such inconsistency or conflict, the provisions of this Amendment shall prevail as between the Parties.”
If you assume that the “Principal Agreement” is a multi-party agreement that includes parties other than the parties to the “Amendment”, then this language makes clear that the parties to the Amendment are not purporting to bind the other parties to the Principal Agreement.
“As between the Parties, EverInsight shall be solely responsible for the cost for the Development of the Compound and the Licensed Product in the Licensed Field in the Territory and VistaGen shall be solely responsible for the cost for the Development of the Compound and the Licensed Product in the Licensed Field outside the Territory, except as otherwise provided in Section 4.1 and 4.4(b).”
This reads to me like a cost allocation formula for two parties in a JV agreement to develop technology licensed from a third party. There would be a license agreement between the parties to the JV agreement and the licensor pursuant to which each party to the JV agreement owe the full costs to the licensor; but “as between the parties” to the JV agreement, the parties agree to split the costs between them according to a certain formula.
Hi Brian. Thanks for these comments, and sorry for being slow to respond: Disqus has been erratic in notifying me of comments.
I get your point, but as between the parties is formulaic. I think the meaning, whatever it is, could be expressed more clearly, even if that involves only a modest tweak.