How to Handle Statements of Fact, in 397 Words

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 statement of fact would just give rise to whatever default remedies are available, you don’t need anything more than the statement of fact.

To introduce statements of fact I don’t use represents and warrants. That phrase is pointless and confusing; see this article. And using one or other verb, or both of them, has the potential to be risky. In the US, people don’t get into fights over verbs used to introduce statements of fact, but they do in England. My article discusses that. I use states to introduce statements of fact—it’s clear and eliminates an annoying legalism. And I use Statements for Fact as a heading.

If you signal that you’re introducing a set of statements of fact (whatever the one or more verbs you use), make sure they really are statements of fact. If they use will or shall, they aren’t statements of fact—they’re obligations or they’re statements of future facts, which should themselves be restated as obligations.

A bogus explanation for use of the phrase represents and warrants is that it has something to do with remedies. If you want to address remedies, do so explicitly. So if (1) a statement of fact relates to goods or services and (2) the idea is that inaccuracy of that statement of fact would give rise to specific remedies, such as return or replacement of goods, then address those remedies explicitly. You could use the word warranties to refer to those remedies, but it’s not necessary that you do so. For example, the Uniform Commercial Code, in effect in the US states, says that you don’t have to call something a warranty in a contract for it to be a warranty. But because the concept of a warranty is widely understood and routinely used in contracts, my practice is to use Warranties as a section heading.

But I don’t use the verb warrants. More specifically, I don’t say the following: Acme warrants that the Equipment is in good condition. If Acme breaches that warranty, Acme shall … Here’s what I do instead: If the Equipment is not in good condition, Acme shall … It’s more economical, and it isn’t unnecessarily legalistic.

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.