“Basis” (Including “Timely”)

Here’s another weapon in the never-ending war on verbiage in contracts—be careful how you use the word basis. As Bryan Garner says in Garner’s Modern American Usage, “The word basis often signals verbosity in adverbial constructions.”

So instead of on a daily basis, try daily, as in “Interest will accrue on a daily basis [read daily].” (In other words, use daily as an adverb rather than as an adjective.) Analogous fixes would take care of on a weekly basis, on a regular basis, and other such phrases.

The same goes for on a pro rata basis, as in “Those shares will be allocated on a pro rata basis [read pro rata] to the Remaining Holders.”

And how about on a timely basis? In on a timely basis, in a timely manner, and in a timely fashion, the word timely is used as an adjective. But in American English timely can also be used as an adverb, and in the interest of concision you’d be best off replacing those phrases with timely, as in “a material adverse effect on the Company’s ability to perform on a timely basis [read timely perform] its obligations under any Transaction Document.”

But Bryan Garner notes that “This adverbial use of timely is archaic in [British English].” See Bryan’s Dictionary of Modern American Legal Usage. That explains why this usage initially seemed odd to me—I received most of my pre-law-school education in England.

Sometimes the fix requires a bit more surgery. Consider the following example: Acme may not enter into any transaction with any Affiliate unless that transaction is made on an arm’s-length basis and [read other than an arm’s-length transaction that] has been approved by a majority of the disinterested directors of the Company.”

The above fixes might seem trivial, but if the approach they reflect were applied over an entire contract, the reader would notice the difference.

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.