Corporate & Securities Law

Choosing Among Alternative Categories of Contract Language

By Ken Adams

When in my “Language & Layout” seminars we discuss categories of contract language, I emphasize that in addressing a given issue one sometimes has a choice as to which category of contract language to use, but that one will work better than any other.

I encountered an example of that today. Consider the following provisions:

Acme may terminate this agreement immediately by giving Widgetco notice of termination. [Language of discretion]

This agreement will terminate immediately upon Acme’s giving Widgetco notice of termination. [Language of policy]

These provisions mean the same thing; I prefer the first. Language of policy is used for stuff that happens automatically. In this case, action by Acme looms large, so language of discretion seems more apt.

For another blog post about choosing among categories of contract language, click here.

Full post as published by AdamsDrafting on November 19, 2008 (boomark / email).