A reader who identified himself as “a faithful reader from Northern Virginia” asked me about use of the word faithfully in contracts—yet another usage that had somehow escaped my scrutiny.
In trawling for faithfully on the SEC’s EDGAR system, I saw that it’s used primarily in provisions stating an employee’s principal obligation under an employment agreement:
Executive shall devote her best efforts and sufficient business time and attention to the business and affairs of the Company and shall diligently, faithfully and competently perform her duties and responsibilities hereunder; …
During the Employment Term, Executive agrees to … (ii) to use Executive’s best efforts to perform faithfully and efficiently Executive’s duties hereunder …
Executive agrees to be a loyal executive and that he will at all times faithfully, industriously and to the best of his ability, experience and talents perform all the duties that may be required of him pursuant to the express and implicit terms hereof …
Employee shall conduct himself at all times faithfully, loyally, and to the best of his abilities, and according to the best interests of the Company.
To which I say, as I do periodically, You cannot be serious! (Go here to put yourself in the appropriate mood.)
For one thing, what does loyalty have to do with it? (The term of art “duty of loyalty” applies only to corporate fiduriaries, including directors.)
But more broadly, note how other wishy-washy words are piled on: diligently, competently, industriously, and so on.
Here’s the problem: If an employee is in management, it might well not be clear exactly what the employee will be called on to do—that will depend on how the company’s business develops. And whatever the employee ends up doing, it likely won’t consist of performing some discrete, quantifiable task. Instead, it will call on the employee’s expertise, judgment, and experience.
Measuring that kind of performance is subjective. For lack of anything more tangible, drafters throw in faithfully and the like. But I don’t think it does any good. In a contract you might well say that the employee is obligated to perform duties specified by the CEO (or, in the case of the CEO, by the board of directors), is obligated to work full-time, and can be fired for specific transgressions. Beyond that, you face the question of whether the employee will do a good job and be successful. Unless you come up with quantifiable targets, imposing on an employee an obligation to be successful wouldn’t work. So drafters make impotent gestures in that direction—that’s where faithfully comes in.
So I recommend that (1) you be as specific as possible regarding an employee’s duties and (2) accept that if beyond that the employee doesn’t work out as you had expected, you’ll have to terminate them without cause, with whatever consequences, or lack of consequences, arise under the contract. So forget about faithfully and the like. But I’m no employment lawyer; I’ll be interested to hear what, if anything, those guys have to say.
Now, to round out the discussion of faithfully, you also see it used in connection with specific obligations:
Tenant and Tenant’s Occupants shall faithfully observe and comply with all of the rules set forth on the attached Exhibit B …
Each Loan Party shall, from time to time, at its expense, faithfully preserve and protect the Collateral Agent’s Lien on and Prior Security Interest …
The party either complies with the obligation, or doesn’t. What does faithfully accomplish?
18 thoughts on ““Faithfully” (Including How to Express an Employee’s Key Obligation in an Employment Agreement)”
My impression is that employment contracts, particularly for senior executives, tend to state explicitly certain duties that are implied into the employment relationship, at least under English law. These implied terms include:
– “…that the employee with serve the employer with fidelity and in good faith” [Chitty, 30th 3edn, para 39-057]
– “… [but] the employment relationship did not give rise in and of itself to a general fiduciary duty to account, so that such a duty arises only where specific terms or aspects of the relationship give rise to it.” [Chitty 39-064]
I assume that faithfully is another way of saying with fidelity.
A published employment contract (from Christou, Drafting Commercial Agreements, 2004) includes the following obligations:
During the Employment the Executive shall (i) faithfully and diligently perform his duties hereunder, (ii) use his best endeavours to promote the interest and welfare of the Group, (iii) devote the whole of his time, attention and abilities [during hours of work] to the affairs of the Group, and (iv) not knowingly, without the Company’s prior written consent, be directly or indirectly engaged or interested in any capacity (including without limitation through a Connected Person) in any Competing Activity.
Mark, do you approve of making the (legally) implicit explicit, or do you regard doing so as a drafting vice? Or sometimes one, sometimes the other?
For example, would you make explicit the duty of good faith and fair dealing that in some jurisdictions is implied in every contract?
Not sure. Maybe depends on context. As good faith has only limited relevance to contracts under English law, probably worth stating in the contract, if such a duty is to be required. On the whole as a common lawyer I am nervous of terms being implied into contracts and want to address the issue explicitly. Eg I want to say in the agreement whether an IP licensee is allowed to sublicense, to avoid implied terms which may be uncertain in scope and depend on the law of the contract. Eg I am told under German law, an exclusive licensee has an implied right to sublicense whereas a non-exclusive licensee doesn’t. Better to include a term in the contract I think, particularly in negotiations where the law of the contract is not always known at the start of negotiations.
Don’t forget that, in some jurisdictions, that duty is only an interpretive principle, not a free-standing duty on which a cause of action rests.
That’s useful to know, but I don’t see any value in making it explicit. Furthermore, Chitty is flirting with redundancy, in that in not sure that one can create a meaningful distinction between “fidelity” and “good faith.”
Maybe, I haven’t studied the case law, but perhaps fidelity is more like loyalty whereas good faith is more like openness.
Whatever the distinction, I wouldn’t include that terminology in a contract.
Ahem. Anyone who defends expressions like ‘the single tallest building in Wiltshire’ cannot credibly accuse another of ‘flirting with redundancy’. On the difficulty of distinguishing ‘fidelity’ and ‘good faith,’ I agree. It may be a fool’s errand, like distinguishing ‘reasonable endeavors’ and ‘best endeavors’.
You’re the single most pedantic commenter.
I can’t wait to learn what the single tallest building in Wiltshire is!
The answer to that is surprisingly interesting. It’s Salisbury Cathdral, which is 123m high. Built in the 13th century, not only is it the tallest building in Wiltshire but also (following the collapse of a few competitors) the tallest medieval building in the UK.
I claim Westmorlandia for the anti-“single” team. Boo on pompous redundancy!
Presumably you’d also ban very in very best. Any other strictures we should know about? :-)
Back up for a minute.
Stephen Pinker, you, and I all dislike ‘sticklers, pedants, peevers, snobs, snoots, nit-pickers, traditionalists, language police, usage nannies, grammar Nazis and the Gotcha! Gang’.
That’s a given.
Now, the question is whether ‘single’ plus superlative is good style or bad style.
The rap against it is that it’s redundant and hackneyed.
Your defense of it is that it’s a justifiable use of redundancy for rhetorical emphasis.
If that were a good defense the charge of redundancy, it would still leave the charge that it’s hackneyed, like ‘pleased as punch’.
As for ‘very’, along with its sibling qualifiers ‘little’, ‘pretty’, and ‘rather’, it’s one of ‘the leeches that infest the pond of prose, sucking the blood of words’. (Strunk & White)
Yet ‘very’ is not redundant, and ‘single’ before a noun in singular form is.
Redundancy can of course be used for emphasis: ‘I’m a stupid idiot’, ‘a single bomb levelled Hiroshima’.
But there’s no excuse for ‘Hiroshima was the largest *single* man-made explosion in history up to its time’.
If all the redundant ‘singles’ in prose could be sent to Scotland and made into single malt whisky, this world would be a very, very much better place.
In conclusion, I could always be wrong. Also off-topic.
Yours most awfully faithfully,
I’m happy to back up a minute, as I’m not inclined to go to the barricades over “single” or “very.” In any event, I see them as being used in casual speech or writing, to the extent that I see them at all.
I think that the reason for these types of squishy phrases is not to actually impose a duty on which you base a cause of action. Rather, it is to impose a duty, the breach of which is sufficient to form a defense against wrongful termination. In the US, at least, the trial context for the two is vastly different. The real deal is that they form the basis for a notice to an executive giving the executive 30 days to cure or be fired.
I suggest that the distinction you note is one of strategy, not of semantics.
I don’t think your response gets me anywhere. As the employer, I want something in the employment agreement that allows me to address situations that I can’t currently think of where it would be unfair for me to have to invoke a termination for convenience provision that requires me to pay severance. That means it must be vague. Isn’t that your semantic problem? That vagueness is useful for me. See MSCD 7.33-7.39.
Thanks for the explanation. But if someone isn’t being faithful, or industrious, or whatever, you’d probably have some other basis for bringing a counterclaim, no?