I like to think that my recommendations regarding contract drafting fly under the radar—that most people who read an MSCD-compliant contract won’t find anything disconcertingly unfamiliar about it.
But corporate resolutions are a different matter. (By corporate resolutions, I mean the resolutions that the governing body of a legal entity adopts to memorialize its decisions.) When it comes to drafting resolutions, the prevailing idiom—featuring WHEREAS, RESOLVED, IN WITNESS WHEREOF, and so forth—is so archaic that I felt I had no choice but to discard it and come up with a more rational alternative, which I describe in chapter 16 of MSCD and in this article.
I find particularly fascinating one usage that is commonplace in corporate resolutions, namely be, and hereby is, authorized. Or directed. (The commas are optional.) A more prolix variant is be, and each of them hereby is, authorized.
Consider the following resolution: RESOLVED, that Acme is hereby directed to issue to Jones 1,000 shares of Series A preferred stock. This resolution constitutes a form of “factual resolution” that I’ve termed a “performative resolution,” in that it memorializes an action that is concurrent with the signing of the consent. (I’ve taken the liberty of co opting grammar terminology.)
Now consider this resolution: RESOLVED, that Acme issue to Jones 1,000 shares of Series A preferred stock. This is a “suasive resolution.” Suasive resolutions allow consent signatories to express that they intend for a specified action to take place in the future. (Suasive resolutions are characterized by the mandative subjunctive mood.)
The previous two examples show that factual resolutions (or more specifically, performative resolutions) and suasive resolutions can both be used to express an intention to bring about some change in the future.
What’s odd about the phrase be and hereby is is that it signifies conflation of a factual resolution and a suasive resolution:
RESOLVED, that each officer of the corporation is hereby authorized to execute and deliver the Merger Agreement.
RESOLVED, that each officer of the corporation be authorized to execute and deliver the Merger Agreement.
Factual and Suasive Resolution
RESOLVED, that each officer of the corporation be, and hereby is, authorized to execute and deliver the Merger Agreement.
It may be that drafters think that this two-resolutions-in-one approach represents a two-step process akin to the toss-and-smash in a tennis serve—setting up the proposition, then executing it.
But in fact it creates an inherent contradiction: If you are, by means of a performative resolution—using is hereby authorized—conferring authority on someone, it makes no sense to use in that same resolution suasive language—be authorized—to express an intent to authorize that person at some time in the future. You should only use performative resolutions to confer authority or to direct someone to do something.
So be and hereby is is a dysfunctional usage. I suspect that it arose out of uncertainty over whether to use a factual or suasive resolution—hey, why not use both! But it’s one dysfuncitonal usage among many. Why single it out?
Most suboptimal drafting usages persist due to unthinking regurgitation. That doesn’t seem to be the case with be and hereby is. I recall working with a partner who went out of his way to revise, with a pedantic flourish, a resolution that dared to use just is hereby authorized—he changed it to be, and hereby is, authorized. I’m sure he thought that this change demonstrated his command of a fiendish subtlety in the law, and I suspect that others who insist on this usage feel likewise. But in fact he was championing a usage that makes no sense.
Obliviousness tricked up as craft—that makes be and hereby is a good candidate for the lamest drafting usage.
By the way, I encourage you to consider adopting my format for corporate resolutions. This template makes it easy to do so, and you’d have the peace of mind of knowing that there’s nothing substantive involved in this change. And because resolutions involve a single entity, you wouldn’t have another party to worry about. Of course, when a set of resolutions forms part of the paperwork for a transaction, the other side might balk at any variation from the traditional format. But that shouldn’t represent too much of a problem.