Kitchen-Sink Definitions

I’m not a fan of kitchen-sink definitions—definitions that include a grab-bag of items, not all of which belong together.

Consider the following definition of “Claim,” culled from the grand flea market that is EDGAR:

“Claim” means all losses, claims, damages, penalties, judgments, liabilities and expenses of any kind (including, without limitation, reasonable and documented out-of-pocket costs of investigation and defense thereof and reasonable and documented external counsel’s fees and disbursements associated therewith and any applicable value added tax).

I don’t understand how in that definition “claims” can be included with “losses.” Acme buys a widget from WidgetCo, the widget blows up, and Acme’s plant burns down. So Acme brings a claim against WidgetCo, seeking to recover its losses. The claim is a proceeding; the losses are that which Acme is seeking to recover. So throwing them both into a definition can’t work—they’re not equivalent.

In the example from EDGAR, the simplest fix would be to omit “claims” from the definition and use “Losses” as the defined term.

Mind you, that definition needs lots of additional help.

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.