The June/July 2013 issue of The Advocate, published by the Idaho State Bar, contains my article It’s Time to Get Rid of the “Successors and Assigns” Provision. Go here for a copy of the article; go here for the entire issue.
This article is a mash-up of three blog posts I’ve written on the subject over the years. My thanks to the inimitable A. Wright Burke, M. Phil., for his comments on a draft.
I was happy to have this article published in The Advocate, seeing as I was so impressed by the Idaho State Bar and had such a good time there recently. And this issue has some interesting stuff. In particular, I look forward to reading the article on forum selection clauses by Brian R. Buckham and Adam J. Richins, whom I met while in Boise.
On the other hand, I noticed in passing that another article recommends that you “Carefully consider inclusion of ‘hold harmless’ language in an indemnification provision to safeguard against additional and unwanted future obligations.” As I explain in MSCD and in this 2012 post, I think that’s bad advice. It might seem ill-mannered of me to point that out, but my primary responsibility is to the marketplace of ideas.
Busy practitioners who elect to educate themselves on a given contract-drafting topic, whether it be the “successors and assigns” provision or indemnification, could elect to round up all resources on the subject, digest them, and then come to their own conclusions. But few have the time or interest to reinvent the wheel in that manner, and few have the expertise required to cut through the cacophony. That’s why I aim to make myself a one-stop shop—I want my treatment of any topic to be the definitive one, although it might take me a few attempts to get there.
4 thoughts on “My New Article on the “Successors and Assigns” Provision”
Question about your point #5. In it you say that the parties having an intention to be legally bound is not a condition to enforceability. The basic elements of contractual formation include an intention to be legally bound.
The only way I can reconcile your comment is that you use “enforceability” to mean that the formation of the contract is not in question (i.e. only a contract that is properly formed can be questioned whether it is enforceable). Am I missing something?
Check out MSCD 2.80. Section 21 of the Restatement (Second) of Contracts says, “Neither real nor apparent intention that a promise be legally binding is essential to the formation of a contract.” Instead, formation of a contract requires an intentional act manifesting assent.
Thanks, No surprise but I guess it’s a bit different in the US (I practice in Canada). Here, courts try to determine whether there was an intention to create legal relations. That said, in doing so they will look at the parties’ conduct objectively to determine whether an ordinary person exhibiting the same conduct in the same circumstances would intend to create legal relations.
I think it all boils down to the same thing. And once you have a signed contract, expressions of intent become irrelevant.