If you’re not attuned to the nuances of categories of contract language, you may well overlook the distinction between conditions and obligations. That can lead to real unhappiness, given that the consequences of failing to satisfy a condition are very different from the consequences of breaching an obligation. In that regard, here’s a provision that I spotted on the SEC’s … Read More
What do disclaim and disclaimer mean for purposes of contracts? Here’s the Black’s Law Dictionary definition of disclaimer: disclaimer, n. (15c) 1. A renunciation of one’s legal right or claim; esp., a renunciation of a patent claim, usu. to save the remainder of the application from being rejected. 2. A repudiation of another’s legal right or claim. 3. A writing … Read More
Today a reader sent me the following question: Is there a reason why original contracts should be single-sided? Our Legal Department requires this. I’ve never considered this issue. As time goes by, more people are signing contracts electronically, or just trading signature pages, but presumably paper copies of signed contracts currently still have a big role to play. I welcome … Read More
[Updated 20 Nov. 2023: For a discussion of using no-reliance language in commercial contracts, see this 2016 blog post.] [Updated 23 May 2011: Revised again to clarify the analysis. Sometimes it takes a while to get stuff right!] In Italian Cowboy Partners, Ltd. v. Prudential Ins. Co., WL 1445950 (Tex. April 15, 2011) (PDF copy here), the Texas Supreme Court … Read More
Thanks to @TraciRiccitello, I learned of this Kelley Drye analysis of a recent Maryland Court of Appeals case, Weichert v. Faust. This dispute serves as a reminder of the potential ambiguity of -here and -there words, in this case hereunder. This case involved a dispute between a real-estate agency, Weichert, and its former vice president, Faust. The jury found that … Read More
Last week someone emailed me to ask me when I’d next be giving seminars in Europe. Of course, I responded by immediately planning some. So on July 12, 13, and 15, I’ll be giving in Geneva, Switzerland, my “Drafting Clearer Contracts” seminar. And on July 14, I’ll be giving a seminar entitled “The Structure of U.S. Mergers-and-Acquisitions Contracts.” For more … Read More
One of the participants at my recent Chicago seminar discussed with me what he described as the “optics” of contract drafting. What he was referring to was the value of not waving a red flag at the other side. He provided the following example of alternative section headings: Limitation of Customer Remedies. Customer Remedies. Aaron preferred the second heading—why have … Read More
Here’s an amusingly pointless usage: including o’clock when you state a time of day in a contract, as in before 4:00 o’clock p.m. on the Borrowing Date. Adding o’clock accomplishes nothing. It occurs in 109 “material contracts” filed on the SEC’s EDGAR system in the past year—not often enough to say that it’s a standard usage, but often enough to … Read More
More often than not, contract drafters use words and digits to express numbers, as in no later than thirty (30) days after the Closing. That’s a bad idea, for two reasons: First, it creates clutter that distracts the reader. And the more numbers a contract contains, the greater the distraction. And second, it violates a cardinal rule of drafting—Thou shalt … Read More
That one-man legal-research machine Steven Sholk informed me of the California Court of Appeal’s decision in Vespremi v. Tesla Motors, Inc. (go here for a PDF copy). The part that caught Steven’s eye was the court’s discussion of the following provision in the employment agreement of one of the plaintiffs (the employment agreement of the other plaintiff contained the same … Read More
