Ah, you never know what you’re going to dredge up from the murky depths of Edgar!
As regular readers will know, two recommendations I make in MSCD tend to cause brains to implode. One of those recommendations is that you dispense with using this agreement as a defined term. (The other recommendation is that you use states instead of represents and warrants when circumstances permit it; see this article.)
In my seminars I say that one never encounters a situation where the reader might be confused as to whether a given instance of this agreement refers to the contract as a whole or some portion of it. Well, thanks to a “separation letter and general release agreement” I happened to encounter (PDF here), I have to be a little more nuanced about that.
The drafter did the conventional thing and used this agreement as a defined term:
But behold the following, from later in the contract:
The drafter used “this confidentiality agreement” to refer to that section! That’s analogous to the kind of use of this agreement that I’ve said I’ve never seen! Imagine if the drafter had elected to be a bit more concise and had said “this agreement”!
Well, excuse me if I don’t use this as a reason to go back to the drawing board. Here are my reasons for standing pat:
First, using this X agreement to refer to part of a contract is profoundly unorthodox.
Second, using just this agreement to refer to part of a contract would be even more profoundly unorthodox, as the reader wouldn’t be given any indication exactly what is being referred to.
And third, for any problem to arise you’d have to have a drafter who is sufficiently attuned to modern drafting to use this agreement—lowercase a—to refer to the entire contract yet clueless enough to also use this agreement to refer to part of the contract. If such a bizarre creature exists, I don’t have any sympathy for them, and I’m sure as heck not going to pervert my recommendations in hopes of saving them from themselves.
I suggest that the explanation for the contract that prompted this post is that it is afflicted with the release-language disease. Release provisions—highly risk-averse and often drafted by litigators—are reliably craptastic.
8 thoughts on “This Is What Confusion Over “This Agreement” Looks Like”
The drafter’s English is all over the place. Does he mean “alluded to” rather than “eluded to”? Or is the latter spelling permitted in US English?
We can safely assume that the drafter is semiliterate.
He must have skipped a few English classes, so that his drafting is something he elided to.
Unfortunately, this level of inconsistency–and illiteracy–among my counterparts in the SaaS industry (particularly those with less than 10 years in practice) seems to be the norm, in my experience.
Far more grating than the general incompetence (and I mean that technically) is the level of apathy toward improving contract language among my cohort of transactional lawyers.
Also possible that the confidentiality *clause* was copied and pasted from a free-standing confidentiality *agreement.* But note the correspondence between this and arbitration clauses, which courts frequently analyze as agreements separate from the one in which they are embedded.
Except for use of “this confidentiality agreement” and “the Agreement” in the same sentence.
One sin leads to another. By improperly using language of agreement repeatedly in a substantive provision, the drafter tees up the subject reference to ‘this confidentiality agreement’.
The quoted phrase is also a needless variant on ‘the confidentiality requirement’ used just one line earlier.
Even if the references to ‘this agreement’ were cleaned up, it’s dangerous to say ‘a breach of the confidentiality obligation this section imposes will be a breach of this agreement’. What about breaches of obligations that other sections impose? Won’t they too constitute breaches of ‘this agreement’? Inconsistencies of expression can lead to inconsistencies of interpretation.
By the way, ‘obligation imposed by this section’ and its active-voice version ‘obligation this section imposes’ are both anthropomorphic, but I wonder whether it mightn’t be better to tolerate that than to cure it by recasting as ‘obligation the Employee takes on under this section’. How stern are you on avoiding anthropomorphism in contracts?
What he should have said was either “a breach of this confidentiality obligation” or “a breach of this Section 12”