Costly Drafting Errors, Part 1—Rogers Communications and Aliant

I have a particular interest in the real-world implications of indifferent drafting, so I’ve been contemplating doing an occasional series on drafting screw-ups that make the news. I was prompted to inaugurate this series by Bryan Sims, who was kind enough to point out to me this article from today’s issue of the Canadian newspaper the Globe and Mail regarding a costly instance of confusion over punctuation.

The Dispute

In 2002, Rogers Communications Inc., a Canadian telecommunications company, entered into a contract with Aliant Inc. (now Bell Aliant Regional Communications) in which Aliant agreed to string Rogers cable lines across roughly 91,000 utility poles in the Maritimes for an annual fee of $9.60 per pole. But early in 2005, Aliant informed Rogers that it was terminating the contract and increasing its rates. Rogers objected, on the grounds that the contract couldn’t be terminated until the spring of 2007. Aliant, on the other hand, was of the view that the agreement could be terminated with only one year’s notice.

The sentence at issue stated that the agreement “shall continue in force for a period of five years from the date it is made, and thereafter for successive five year terms, unless and until terminated by one year prior notice in writing by either party.”

The dispute reached the regulators with the Canadian Radio-television and Telecommunications Commission (CRTC), who sided with Aliant, saying that “Based on the rules of punctuation,” the comma in question “allows for the termination of the [contract] at any time, without cause, upon one-year’s written notice.”

Rogers was evidently mortified, and it objected that it never would have signed the contract if it had known that the contract could be cancelled on such short notice. And its lawyers argued that the parties’ intent should prevail. But the CRTC disagreed, and as a result Rogers will likely end up paying about $2.13 million more than it had expected.

My Analysis

I can see why the CRTC reached the conclusion that they did. The comma after from the date it is made wouldn’t have been necessary had the sentence ended after successive five year terms, so (the argument would go) its only function could be to semantically link the phrase for a period of five years from the date it is made to the phrase unless and until terminated by one year prior notice in writing by either party.

If the comma after from the date it is made had been omitted, a court applying the Rule of the Last Antecedent would have held that only thereafter for successive five year terms was linked to the closing phrase.

The CRTC’s analysis seems pedantic, in that it would be unreasonable to assume that drafters grasp the implications of every comma. But as a way of resolving a dispute, consulting a few books on punctuation is certainly quicker than delving into the intent of the parties.

How would I have drafted the provision in question? The ambiguity derives from a closing modifier (see MSCD 8.135), but the solutions proposed in MSCD 8.135 don’t work in this case, in part because the temporal sequence of the two elements means that you can’t reverse their order.

And enumeration by itself can’t rectify the ambiguity caused by the trailing modifier, in that the trailing modifier wouldn’t be isolated in one enumerated clause. (See MSCD 8.124.) Consequently, it wouldn’t help to state that the agreement “shall continue in force (1) for a period of five years from the date it is made and (2) thereafter for successive five year terms, unless and until terminated by one year prior notice in writing by either party.”

The drafter would have been better off rewriting the provision. Here’s my version: “The initial term of this agreement ends at midnight at the beginning of the fifth anniversary of the date of this agreement. The term of this agreement (consisting of the initial term and any extensions in accordance with this section 12) will automatically be extended by consecutive five-year terms unless no later than one year before the beginning of any such extension either party notifies the other in writing that it does not wish to extend this agreement.”

As Bryan Sims suggested when he notified me of this story, breaking the provision into two sentences is the best way to avoid any ambiguity.

But note that my version provides for something that the parties might not have intended—to prevent a five-year extension, a party would have to notify the other party at least one year before that extension is due to begin. (Rogers and Aliant may have had in mind that you could give one year’s notice any time during an extension.) It’s misleading to provide for a term of X years yet allow either party to terminate without cause before the end of the term.

The one fix that I would not recommend is simply deleting the comma after from the date it is made. If the meaning of a contract provision could be significantly altered by adding or omitting a comma, you’re probably better off rephrasing it.

Submissions Welcome

Now that I’ve inaugurated this occasional series, I encourage you to submit to me examples of drafting errors that have made the news, whether recently or in the dim and distant past. Ideally they’d provide fun for armchair drafters. (Not all drafting-error stories meet this criterion—I’m thinking of the recent Alston & Bird story.)

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.

13 thoughts on “Costly Drafting Errors, Part 1—Rogers Communications and Aliant”

  1. Good post on auto-renew drafting. I try to avoid auto-renews in my contracts for several reasons, including the drafting trap you describe here. In many contracts, I’ve ended up making an indefinite term with specified termination outs for cause and convenience. This may not have the same effect as an auto-renew, but it does force the parties to consider the right issues. Eric.

  2. I recently noticed some perceptive comments by “anonymous” to a post by Wayne Schiess on this topic at Today I revised my version of the contract language at issue to reflect anonymous’s first comment and I added a paragraph to address his/her third comment. Ken Adams

  3. The CRTC’s decision is predicated on the mistaken grammatical analysis that yielded false conclusion that the presence of both commas in the contentious sentence creates a paranthetical clause within the sentence. However, in this case, the phrase “and thereafter for successive five (5) year terms” is not a paranthetical clause.

    Correct analysis of the contentious sentence is made easier if we do a high-level parsing of the sentence. The sentence in its original form appears as follows:
    “. . . this agreement shall be effective from the date it is made and shall continue in force for a period of five (5) years from the date it is made, and thereafter for successive five (5) year terms, unless and until terminated by one year prior notice in writing by either party.”

    The sentence, when parsed, reads:


    this agreement shall be effective C1
    shall continue in force C2.1
    unless and until

    C1 = from the date it is made
    C2.1 = for a period of five (5) years from the date it is made
    C2.2 = thereafter for successive five (5) year terms
    C2.3 = terminated by one year prior notice in writing by either party

    Now we see that the commas are in fact used to separate a list of complements to the verb phrase “shall continue in force”.

    The only question left to be answered is “one year prior to what?”. The meaning of the first part of the sentence makes it evident that it is “one year prior to the end of the first five-year period or any of the successive five-year terms”. It would never mean “one year prior to when the terminating party wishes the agreement to no longer be in force” (which would then make mention of five-year periods meaningless).

    The CRTC made an error in fact in their grammatical analysis. Once the analysis is done correctly, interpretation of the meaning of the entire sentence is plain and simple. In my opinion, should Rogers choose to appeal their ruling, they would be successful.

  4. Ray: For reasons that it would take too long to explain in this comment, I don’t agree with your analysis. I expect that at some stage I’ll write some more about this dispute. Ken

  5. I think that splitting the provision into two sentences is the best option here. It has been my experience that many, if not most, drafting errors are caused by the sloppy management of dependent clauses.

    If, however, the author was intent on cramming everything into a single sentence, then a workable solution would be to change the order of the last two dependent clauses:

    “shall continue in force for a period of five years from the date it is made and, thereafter, unless terminated by one-year prior written notice by either party, for successive five-year terms.”

    This solution is a far cry from poetry, and two separate sentences would be best. But it would have avoided the bad result for Rogers in this case.

  6. Ken: I look forward to your follow-up. What we need to realize (and what I should have mentioned first but did not in the interests of space) is that my analysis was done on the principle of providing the best possible explanation as to the meaning of a sentence that it is in fact grammatically flawed. Much like with run-on sentences or sentence fragments, they may be gramatically incorrect, but you can still derive meaning from them. They do, however, present the problem that you can misinterpret them (or “mis-analyze” them). The analysis I did, in fact, takes a flawed sentence and parses it in such a manner that it elucidates the most likely meaning intended by the authors. I did not accept your analysis as it tries to fit formal rules to a sentence that is flawed in the first place. Your response to my analysis would have to reconcile your formal approach (which works perfectly well with grammatically correct sentences) with the flawed nature of the sentence it analyzes. I look forward to seeing how you will accomplish that.

  7. The original sentence is not flawed, though it is not as clear as we might wish.

    The real issue is much simpler: if the second comma had been omitted, the final prepositional phrase would apply to only “and thereafter for successive five (5) year terms”; but with the comma, the final prepositional phrase applies to the whole sentence, allowing Aliant to give notice at any time.

    With or without the second comma, the grammar is correct; but the meanings are very different.

    The final prepositional phrase should have been written in a sentence of its own, with the author’s intention made much clearer.

  8. G.: Your view is that of the Canadian Radio-television and Telecommunications Commission. I happen to disagree. In due course I’ll explain why. Ken

  9. An old post, but worth a comment.

    I don’t think anyone has yet mentioned yet that the drafter has not correctly described the conceptual operation of the set terms (though Ken fixes the problem in his 2 sentence version).

    Here, the contract terminates by itself if it is not extended (albeit it extends automatically). The notice is therefore more accurately described as a notice of non-extension than a notice of termination. Had the drafter used non-extension terminology rather than termination terminology, the regulators could never have interpreted the clause as they did, wherever the commas were.

    So I see this as more of an issue of precise description than an issue of syntax.


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