The Word “Indenture”

The word “indenture” is something of an oddity.

Here’s how Black’s Law Dictionary defines it:

A formal written instrument made by two or more parties with different interests, traditionally having the edges serrated, or indented, in a zigzag fashion to reduce the possibility of forgery and to distinguish it from a deed poll.

Obviously we no longer produce contracts with serrated edges. Nevertheless, the word “indenture” has survived in the following terms (again, the definitions are from Black’s Law Dictionary):

bond indenture. 1. A contract between a bond issuer and a bondholder outlining a bond’s face value, interest rate, maturity date, and other features. 2. A mortgage held on specified corporate property to secure payment of the bond.

debenture indenture. An indenture containing obligations not secured by a mortgage or other collateral. • It is a long-term financing vehicle that places the debenture holder in substantially the same position as a bondholder secured by a first mortgage.

trust indenture. A document containing the terms and conditions governing a trustee’s conduct and the trust beneficiaries’ rights.

So “indenture” is simply a synonym of “agreement” and “contract” that has come to be used to refer to a limited group of documents. One could just as well refer to a “bond agreement” or “trust agreement.” If someone felt inclined to do so, I wouldn’t object. The only thing that “indenture” has going for it is tradition, and tradition isn’t a sufficient reason to perpetuate a given usage.

Can you think of another synonym of this sort for “agreement” and “contract”?

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.