“Is Permitted”

There’s no end to the suboptimal alternatives to may. Here’s another—is permitted.

You see is permitted to when a party is the subject of the sentence or clause:

… Sponsor is permitted to assign this Agreement in connection with a merger or a sale or transfer of substantially all of its assets …

… neither the Seller nor the Purchaser shall enforce any remedies against the other’s Primary Collateral, but each is permitted to exercise remedies against the Primary Collateral securing its respective Crossed Underlying Loans …

Instead, use may. Simple.

A little more subtle is use of is permitted when the subject is an abstract noun:

Termination by Customer is permitted, as to any or all sites, without liability in the case where the connection is out of service for a period of 4 (four) consecutive business days from Ticket Open (as defined in the SLA).

In such cases, make the party in question the subject of in the sentence and use may. In the immediately preceding example, you’d say The Customer may terminate. Verbs good, abstract nouns bad.

You see is permitted used  to refer to permission granted by some other provision in the contract, or by some other contract:

… as of the date of the issuance of such Letter of Credit, the Borrower is permitted under the Permitted Secured Debt Documents, the Senior Unsecured Debt Documents and the Permitted Unsecured Debt Documents to incur such Credit Extension …

Seller agrees to give appropriate notices of termination of the Contracts which Buyer timely notifies Seller it wants cancelled, but only to the extent termination is permitted thereunder without penalty to Seller.

In the first of the two examples immediately above, you could replace is permitted to with may. And with some reworking you could do the same with the second example. But would you want to? For expressing obligations, to avoid confusion I would use is required to instead of shall to refer to obligations imposed elsewhere in a contract or by some other contract. Shouldn’t I apply the same approach with language of discretion?

In a word, No. The distinction between shall and is required to makes sense because the convention is to use shall only to impose an obligation, as opposed to using it also to refer to an obligation imposed elsewhere. No comparable convention applies to use of may, because may is used more broadly in contracts than is shall. For example, may is used to grant discretion to nonparties.

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.