What should your contracts try and do? My 500-word contracts are designed to build trust, and safeguard your business without annoying your clients.
Being Too Literal
One of the concerns of any person writing a contract is to ensure that the contract is interpreted as the parties intend. Not just by the contract users (although that’s a great start) but by the courts.
Contract writers were aware that judges interpreted their contracts literally, by pouring over the minutiae. Judges have always and still complain about contract drafting:
“I find great difficulty in understanding the desire of commercial men to embody so simple an obligation in a document which is quite unnecessarily lengthy, which obfuscates its true purpose and which is likely to give rise to unnecessary arguments and litigation as to its meaning” (Trafalgar House v General Surety 1995)
“It is lamentable that an eighteenth-century English concept should be used in this jurisdiction to confuse everybody, as we think it has confused a lot of people in this case” (Tins Industrial v Kono Insurance 1988)
“That this document is not the product of skilful drafting is… evidenced by the presence of the expression ‘and/or.’ Its use in this clause is unnecessary and confusing… the use of [that] expression… in any legal document is in any case open to numerous more fundamental objections of inaccuracy, obscurity, uncertainty or even as being just plain meaningless.” (Situ Ventures v Bonham-Carter, 2013)
Writing with a Purpose
It is now apparent (since the turn of the millennium and more recently), that those who write contracts can stop worrying about being dissected by the courts.
The English courts are moving towards interpreting contracts by working out what they should mean in practice and how they can make the language reflect business common-sense. They are less keen on cases based on linguistic nit-picking.
What should you do?
Use normal words – not only will they be given their normal meaning by the courts, but, more importantly, you and your contract partner will understand your contract better.