[Don’t bother reading this post! It has been superseded by this post.]
Today another interesting contract word came to my attention—wanton. Here’s my instapost on the subject.
Wanton is seriously old-fashioned. It has different meanings. The meaning intended in contracts is, presumably, “having no just foundation or provocation; malicious.”
But I’m not sure where wanton is meant to fit. You have intentional misconduct, which involves doing something intentionally. You have gross negligence, which involves reckless disregard. I don’t think there’s any room for wanton in between those two. I say don’t ever use wanton in a contract.
Here are some examples culled from the 194 contracts filed on the SEC’s EDGAR system in the past year that use wanton:
This Agreement may be terminated for Cause … if, during the Term of this Agreement, the Employee … (iii) exhibits repeated willful or wanton failure or refusal to perform his duties in furtherance of the Company’s business interest or in accordance with this Agreement …
“Cause” means conduct by the Participant reasonably likely to cause material harm to the Company that consists of proven gross negligence, wanton or willful disregard of duties, acts of fraud, embezzlement, theft or the commission of a felony in the course of his employment or service, as determined by the Board or Committee after full consideration of the facts presented on behalf of both the Company and the Participant.
For the purposes of Clause 18.4(a) “negligence, gross negligence or willful misconduct” means the failure by a person to exercise the standard of care that a reasonably prudent person would have exercised in the same or similar circumstances, and any act or failure to act (whether sole, joint or concurrent) by any person which was intended to cause, or which was in reckless disregard of or wanton indifference to, harmful consequences such person knew, or should have known, such act or failure to act would have on the safety or property of another person.
The Escrow Agent shall not be liable to either party for misdelivery of any Funds held in escrow unless such misdelivery shall be due to gross negligence or wanton and willful misconduct on Escrow Agents part.
In three of the examples, wanton is used with willful. Methinks the alliteration explains use of wanton, as opposed to any distinct meaning it conveys.
Ken:
It is far from clear that gross negligence requires recklessness as to the probability of harm. The term gross negligence, as DC’s blog post illustrates, is a wide range of conduct. Garner’s Dictionary of Modern English Usage illustrates how the term wanton, while still vague, implies a higher standard than recklessness. So I would avoid gross negligence; almost anything would be better than that because — in practice — it means that any dispute is going to the jury..
In particular, your assertion that intentional misconduct involves doing something intentionally, while gross negligence involves reckless disregard, is nothing more than relabelling without analysis. As I said before, what must one intend or be reckless towards? The conduct? The harm? The fact that the conduct is wrongful (e.g., breach)? And where the party’s conduct is contractual performance, virtually all conduct will involve some level of intent. How do you separate that intent from whatever level of intent you claim is requires to constitute either intentional misconduct or gross negligence? And when the parties do not allocate a responsibility contractually, how does disregarding the risk not assumed relate to your standard of gross negligence?
I think you will have to cite something better than (a) frustration with a possibly endless set of nuances, (b) a sense that the word wanton is old-fashiuoned, and (c) a badly written contract on EDGAR.
Chris
Chris: The purpose of this post wasn’t to elaborate on gross negligence versus intentional misconduct, which is a bigger issue that I’ll be chewing over. Instead, it was prompted by my surprise that “wanton” is regarded as a plausible word for contracts.
My post was so spur-of-the-moment that I didn’t look at Garner’s Dictionary of Legal Usage. Yes, it says “The word ‘wanton’ usually denotes a greater degree of culpability than ‘reckless.'” What am I meant to do with that? For one thing, I wager that most readers (and up until today that would have included me) would have no idea what to make of “wanton.” Furthermore, in such a vague and fact-specific inquiry, parsing degrees of culpability to that extent is an angels-on-the-head-of-a-pin exercise.
But I’ll be working on a broader analysis, so as to put “wanton” in context.
Ken
I may be wrong, but my impression is that “wanton” is a term that is used mainly in US criminal law, along with “reckless”. (FWIW English law doesn’t seem to use the term wanton (although it may have done in the dim and distant past) and is moving away from reckless (eg the old offence of reckless driving is now dangerous driving or similar). To my English ear, the word wanton has a rhetorical or literary feel, and is probably only understood by a small percentage of the population).
I think there is a danger in applying terms of art used in one branch of the law into another branch (eg contracts). Using any legal terms of art goes against the objective of using standard English, but may be necessary or highly desirable in some cases. I am doubtful whether it is necessary or desirable to introduce the term wanton into contracts.
Chris raises some very interesting questions, to which my answers would, I think, be, either:
(a) let’s not try to make a carve out for gross negligence or similar in indemnities; or
(b) if such a carve out is so deeply embedded in US legal practice that (a) is a non-starter, let’s define the term in the contract (but can we do so without using lawyers’ terms such as wanton in the definition?)