In grading student assignments, I found myself commenting on their use of unless the parties agree otherwise. I thought that I had already written something somewhere about this phrase, but evidently not. So here goes:
As a general matter, the phrase unless the parties agree otherwise is redundant. The parties could agree to waive, amend, or delete any provision in a contract, whether or not that contract says that they may. But if a party feels that it would facilitate negotiation of a given provision if everyone were reminded that the parties might agree on a different arrangement down the road, then by all means use the phrase.
4 thoughts on ““Unless the Parties Agree Otherwise””
One situation where you might want something like this is the following:
In a master agreement/statement of work template, the usual contract rule of “later, more-specific controls” is sometimes overridden by a term in the agreement that says (paraphrasing liberally here) “the terms of this agreement control over any conflicting terms in a SOW, unless a section of this agreement says it can be changed by a SOW.”
In practice, SOWs don’t come to the law department’s attention from the business as regularly as agreements or amendments do. This gives us a little hope that core legal terms won’t be changed without a lawyer’s review. We allow SOWs to vary the terms that are reasonably within the discretion of the business (payment terms, certain acceptance criteria, etc.)
The language that would trigger this would be something like “Unless a SOW provides otherwise…” Obviously, not the same as your sample language, but similar concept.
I encounter this type of language often in my review and negotiation of commercial contracts for a technology company. I agree that it is redundant for the reasons stated above, but I also find that it sometimes facilitates negotiation as suggested above.
However, I prefer to use language such as, “unless otherwise agreed in a writing signed by the parties.” I feel that this language does a better job of avoiding a dispute down the road over a situation where one of the parties “agreed” orally or via acceptance of additional terms hidden in the body of a PO to waive or change a particular provision.
I recall when being more of a young buck that I would try to liberally cross out any use of that phrase or something similar, with anassailable logic that the basic idea of ‘we can always mutually agree to change anything’ made it redundant. Of course my premise was correct, but…
Like the above commenters, the reality is that it’s used more for the purpose of allowing one or the other party to save face or move a deal along. We must, of course, counsel our client on what this really means — That neither side likely has any obligation to agree to do the amendment down the road, or even to use ‘good faith’ in considering a request to change. I still see some folks who believe that this phrase provides some magic that will force the other side to do something it doesn’t necessarily want to do down the road. But, those folks, it turns out, are in the minority–Most business people get it right away (even before you counseled them).
“Unless agreed otherwise” is of course redundant but it is a phrase that clients will often ask for you to insert somewhere! As lawyers we sometimes like to say “unless agreed otherwise in writing” – the problem with that is if your client is the sort who does things on the basis of spoken word and a handshake then you are potentially causing them a problem by requiring changes to be in writing. Certain contracts of course such a clause makes sense – such as when you are preparing a standard contract form for a client and you want to eliminate future spurious customer arguments that something else was agreed.