Two Issues Relating to Contract Obligations to Comply with the Law

Behold the following tweets, one by me considering the difference between saying comply with the law and comply with all laws, not to mention comply with all applicable laws, and an unexpected reply from Jason Morris, aka @RoundTableLaw:

It took a while for me to understand Jason’s point. You can read the thread yourself, but the gist of it is that it would be “surplus” to impose on a party an obligation to comply with the law, as we’re all already under an obligation to comply with the law. Jason suggests that instead you say in a contract that it’s a breach of the contract when a party violates the law in performing under the contract.

I get Jason’s point, but I’m not convinced. Yes, everyone has to comply with the law (let’s just suspend disbelief here), but if you don’t, you answer to the state. I don’t see any harm in creating a separate obligation for purposes of the contract. And it might arguably be surplus, but it has the benefit of being more concise than Jason’s formulation. So I don’t think it’s worth trying to teach old and precedent-driven dogs this new trick. But I’d like to hear what you think.

Jason’s question led me to a different and perhaps more thorny issue: how do you determine whether someone has violated the law? Is it only the state that decides that, or is a contract party entitled to assess the facts and the law and come to its own conclusion? If only the state gets to decide, what sort of outcome constitutes violation? For example, if a contract party enters into a consent decree with a government body, would that constitute acknowledgment of violation of law? I’ve done zero research on this. I thought I’d start by putting the issue out there.

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.