The other day, a reader of this blog—I’ll call him John—contacted me about a problematic bit of contract language. (I’ll refer to it as “John’s language,” although he didn’t draft it.) To him, it was something of a mysterious nuisance, but when I read it, my heart went pitter-patter, in that I saw that it would give me the opportunity … Read More
During the term of this agreement seems an innocuous enough phrase, but more often than not it’s redundant. The default rule is that contract provisions that directly address party actions remain in effect only during the term of the contract. That means that if you use during the term of this agreement to modify language of obligation, discretion, or prohibition, … Read More
In my recent article on using wikis in the contract-drafting process, I suggested that a simpler way to capture the collarborative aspect of wikis without any of the anarchy would be to use an online-collaboration tool such as Google Docs. So today I noted with interest an article in Legal Technology entitled “Time for Lawyers to Collaborate in Real Time.” … Read More
Here are some examples, drawn from the SEC’s EDGAR database, of provisions containing the phrase unless the context otherwise requires: Unless the context otherwise requires, capitalized terms used in this Agreement have the following meanings. Unless the context otherwise requires, references to the “Company” shall be deemed to refer to the Company and its Subsidiaries. Each of the representationsand warranties … Read More
The doublet costs and expenses occurs routinely in contracts. Here’s an example selected at random from the SEC’s EDGAR database: If action is instituted to collect this Note, the Company shall pay all costs and expenses, including, without limitation, reasonable attorneys’ fees and costs, incurred in connection with such action. Black’s Law Dictionary gives the following definitions for cost and … Read More
The word competitive is routinely misused in contracts. That comes as no surprise, given that it’s routinely misused in legal and business writing generally. Competitive means (1) of, involving, or based on competition and (2) likely to succeed in competition. In the following contract provision, competitive is used to express the first meaning: Executive acknowledges the highly competitive nature of … Read More
Given that I’ve been blogging for a year, I thought I’d take the opportunity to pull together in this post, in the form of “dos” and “don’ts,” some components of my online presence. The coverage is necessarily patchy, but it’s safe to say that in the past year I’ve been able to write about the issues that I feel most … Read More
I recommend that you give serious thought to never using it being understood. In the vast majority of instances, it being understood is equivalent to it is agreed. (Indeed, often enough the phrase used is it being understood and agreed.) When used in this sense, it being understood adds nothing, seeing as the contract lead-in states that the parties are … Read More
I recently reviewed for a company a draft settlement agreement that had been prepared by outside counsel retained by the company. I thought the draft needed help. In particular, I found the recitals bloated and vague: RECITALS A. As of the date of this Settlement Agreement a dispute exists between AcmeTek and Widgetz regarding the contracts made between them. AcmeTek … Read More
Regarding use of the word parties as a defined term, MSCD 2.42 says the following: [D]o not use the defined term the Parties. It ostensibly spares the drafter from having to refer throughout a contract to the parties to this agreement, but one can simply refer to the parties, because such a reference could not conceivably be construed to mean … Read More
