A year ago I published in this post the first draft of what I called a “quick reference” to the categories of contract language—a summary of the different categories, what they look like, what they’re used for, and where you can find more information. Go here for the version included in chapter 3 (The Categories of Contract Language) of the fourth … Read More
[Updated 11 Dec. 2021: For more on this topic, see this July 2018 post and this April 2020 post.] For a while now, I’ve asked myself what category of contract language to use when providing for one party to invoice the other. Here are the possibilities: Language of obligation: Widgetco shall invoice Acme monthly in arrears for purchases under this … Read More
I signalled in this post that my task of compiling guidelines to the building blocks of contract language is largely done. But it will never be over, and here’s an example of that. I recently encountered the formula this agreement allows. That sent me to EDGAR, where I found the following examples: As a general form of contract, this Agreement … Read More
Welcome back to the categories of contract language! Consider the following alternatives: Language of Discretion The Customer may purchase Widgets only by using Acme’s purchase-ordering system to submit a purchase order to Acme. Language of Obligation Used to Express a Condition To purchase Widgets, the Customer must submit purchase orders to Acme through Acme’s purchase-ordering system. Which do you prefer? … Read More
Today a reader posted the following comment (found here): Ken, I have been pushing your rules about shall and must since I started drafting contracts. Recently, a colleague said that we should use must exclusively. He pointed to the following link to bolster his case: https://www.faa.gov/about/i… I wanted to point it out for your opinion. Thanks If you want to … Read More
A benefit of this blog is that I get to try out new ideas. Often enough, I end up revisiting those ideas. That can make the original post out of date, but that’s a blogging fact of life. (I’m not disciplined enough to always put a link in the original post.) Here’s an example for you. In this post from … Read More
In this comment to a recent post, a reader outlined steps they’ve taken to make their contracts simpler and clearer. For purposes of this post, what’s of interest is that those steps include the following: … use “will” for our obligations and “shall” for the other party, … This is only the second time I’ve encountered the notion of using different verb … Read More
This is from an intercompany services agreement dated 3 July 2017 between General Electric Company and Baker Hughes that I happened upon in the SEC’s EDGAR system (PDF here): SECTION 10.16 Integrity. Each Party covenants that it is committed to unyielding integrity and will act in a manner consistent with the GE Integrity Guide for Suppliers, Contractors and Consultants, a … Read More
Recently I sent a consulting client a short explanation of how I handle statements of fact. Here it is, in case it’s of interest: I thought you might find it helpful if I summarized how I treat statements of fact. As a general matter, incorrect statements of fact give rise to a remedy. If the idea is that an incorrect … Read More
I’ve stated elsewhere (for example, in this 2014 article) the advantages of using shall to express an obligation imposed on the subject of a sentence, if the subject is a party to the contract. The primary advantage is that shall gives you an extra tool to work with. Instead of using will or must to express multiple meanings, you use … Read More
