“Is Advisable and in the Best Interests Of”

[Revised 2:00 p.m. Sept. 11 to reflect comment by randomjohn]

It’s commonplace for resolutions in board consents to state that something is advisable and in the best interests of the company. My first instinct was to say that is advisable and is redundant. But responding to my call for input, reader randomjohn pointed out that in a number of provisions, the Delaware General Corporation Law refers to a determination of advisability (see comment below). That being the case, in those contexts using advisable represents the prudent choice. Perhaps alternative words conveying the same general meaning might do, but no one would want to get into a fight over that. It doesn’t necessarily follow, though, that I’d use advisable in other contexts.

radomjohn also says that caselaw attributes significance to a determination that something or other is in the best interests of the company. That’s nothing I’ve looked into, and I’m not inclined to do so, as in the best interests of is as a general matter unobjectionable.

So I’m going to give is advisable and in the best interests of a pass, at least in those contexts where the DGCL refers to advisability. Of course, I have no idea how this plays out in other jurisdictions.

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.