At MSCD 3.168–.196 and in this article, I discuss why the phrase at its sole discretion and its variants are pernicious. That’s because the unfettered discretion that it seems to suggest can fall foul of the implied duty of good faith. Peter A. Mahler (@PeterMahlerEsq) of the law firm Farrell Fritz offers in this post on his New York Business Divorce blog … Read More
Last week, something I saw in a contract I was reviewing prompted me to fire off the following tweet: "Acme hereby waives the right to" = "Acme shall not": use language of prohibition, not language of performance? — Ken Adams (@AdamsDrafting) August 6, 2016 As is often the case, it has to do with the categories of contract language. The … Read More
There’s no end to the suboptimal alternatives to may. Here’s another—is permitted. You see is permitted to when a party is the subject of the sentence or clause: … Sponsor is permitted to assign this Agreement in connection with a merger or a sale or transfer of substantially all of its assets … … neither the Seller nor the Purchaser shall … Read More
Here’s an example of what MSCD calls “passive-type policies”: Interest is payable at a rate of 8% per year. Here’s part of what MSCD 3.244 has to say about passive-type policies: Some policies are characterized by adjectives such as exercisable and payable and have a structure that’s analogous to the passive voice. This manual refers to such policies as “passive-type policies.” Passive-type policies have … Read More
I regret to report the sudden and unexpected demise of one of the categories of contract language, namely language of belief. Well, I don’t really regret it. In fact, I’m relieved. Language of belief was a scrawny, frail creature who stood around not doing much of anything other than picking its nose, gazing into space, and getting in the way … Read More
From reader Ben King, general counsel of Jive Communications, I learned about a 2016 opinion of the Supreme Court of Utah, Mind & Motion Utah Investments, LLC v. Celtic Bank Corp., 2016 UT 6, 367 P.3d 994 (PDF here). The moral of this particular story is that if you want a contract provision to be interpreted as a condition, you had better make sure it’s worded … Read More
Do you remember be and hereby is? In this 2007 post I dubbed it “the lamest drafting usage.” Well, we now have another contender. I can’t believe I haven’t written about it previously. It’s—drum roll, please—agrees to and does hereby. The lameness is something to behold. What makes it particularly lame? Primarily it’s the doubling up of verb structures to express … Read More
Yes, it’s time to return to the shall wars. Thanks to the article by Lori Johnson that I discuss in this post, I’d now like to consider a court opinion that I overlooked when it first appeared. I’m referring to Lubbock County Water Control & Improvement Dist. v. Church & Akin, L.L.C., 442 S.W.3d 297 (Tex. 2014) (PDF here). The Court Opinion … Read More
It’s time for that ever-popular game, Pick the Category of Contract Language! Bob, please tell our viewers what the choices are! Acme shall make all decisions relating to commercializing Licensed Products. [By using language of obligation, this expresses, appropriately, the idea that Widgetco wouldn’t want Acme to ignore what’s required to commercialize products. But it doesn’t express that Acme will be in … Read More
In this 2015 post I suggested that “instead of addressing each deal point in a separate sentence, you can often consolidate them.” When you do that, instead of using two main verbs to cover two deal points, you need only one main verb. But the example I used to illustrate this point ended up being hijacked by a substantive issue. … Read More
