Corporate & Securities Law

When Is an Amendment Not an Amendment?

By Ken Adams

The following oddity from a reader:

When is an amendment not an amendment? When it’s a separate agreement!

From the introductory paragraph of a supplier’s attachment to another agreement:

IMPLEMENTATION ASSISTANCE AMENDMENT NUMBER ONE TO BASIC LICENSE AGREEMENT NUMBER [redacted] CUSTOMER: [redacted]

This Amendment, together with the terms and conditions contained int he Basic License Agreement, dated January ___, 2010 shall constitute a separate and distinct Agreement between the parties. All the terms and conditions of said Basic License Agreement continue in full force and effect and shall control this Amendment unless specifically modified hereby.

I’m not entirely sure what this means. From what I gather, what they really intend is for this “Amendment” not to amend anything, but to use the “Basic License Agreement” as a master set of terms and to add additional terms to address “implementation assistance” services. Sort of like an addendum with additional legal terms. Nevertheless, I wonder whether its prudent under any circumstance to refer to something as an “amendment” when you don’t intend it to modify the agreement to which it is attached.

From the world of bizzaro-drafting!

I agree: don’t give anything in a contract a misleading label, because someone?notably a judge?may take you at your word.

Full post as published by AdamsDrafting on January 28, 2010 (boomark / email).