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A Manual of Style for Contract Drafting PDF

1079 Pages·2013·9.29 MB·English
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2 Cover design by Tamara Kowalski/ABA Publishing. Page layout by Quadrum Solutions. The materials contained herein represent the opinions of the authors and editors and should not be construed to be the views or opinions of the law firms or companies with whom such persons are in partnership with, associated with, or employed by, nor of the American Bar Association or the Business Law Section unless adopted pursuant to the bylaws of the Association. Nothing contained in this book is to be considered as the rendering of legal advice for specific cases, and readers are responsible for obtaining such advice from their own legal counsel. This book and any forms and agreements herein are intended for educational and informational purposes only. © 2013 American Bar Association. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. For permission contact the ABA Copyrights & Contracts Department, Library of Congress Cataloging-in-Publication Data Adams, Kenneth A., 1961– Manual of style for contract drafting / By Kenneth A. Adams. pages cm ISBN 978-1-61438-803-6 (alk. paper) 1. Contracts—United States—Language. 2. Contracts—United States. 3. Legal composition. I. American Bar Association. Section of Business Law. II. Title. KF807.A33 2013 808.06’634-dc23 2012048990 Discounts are available for books ordered in bulk. Special consideration is given to state bars, CLE programs, and other bar related organizations. Inquire at Book Publishing, ABA Publishing, American Bar Association, 321 N. Clark Street, Chicago, Illinois 60654-7598. www.ShopABA.org 4 To my daughter, Sydney A. Adams 5 List of Tables List of Samples List of Figures Preface Introduction CHAPTER 1 The Characteristics of Optimal Contract Language Contract Language Should Be Clear Omit Archaisms Omit Problematic Terms of Art Use Standard English The Myth of “Tested” Contract Language Contract Language Should Be Precise Contract Language Should Omit Redundancy Limit the Use of Strings Reject Needless Elaboration Contract Language Shouldn’t Explain, Tell a Story, or Persuade 6 Contract Language Should Omit Repetition Contract Language Should Employ Usages Consistently CHAPTER 2 The Front of the Contract The Title The Introductory Clause “Know All Men by These Presents” Format Reference to the Type of Agreement What Verb to Use Date “Between” Versus “Among” Identifying the Parties The Order of the Parties Having a Parent Company Enter into a Contract on Behalf of an Affiliate Parties with a Limited Role Referring to Lists of Parties Describing the Parties Defined Terms for Party Names The Defined Term “This Agreement” 7 Recitals Function Giving the Recitals a Heading Enumeration Use Simple Narrative Prose What Verb to Use in Purpose Recitals Premature Recital References to the Agreement Incorporation by Reference “True and Correct” Defined Terms in the Recitals The Lead-In Wording Consideration Giving a Heading to the Body of the Contract Cover Sheet, Table of Contents, and Index of Defined Terms CHAPTER 3 Categories of Contract Language Preliminary Considerations Use the Third Person Use the Active Voice Unless the Passive Voice Is Appropriate 8 Language of Agreement Language of Performance Use of “Hereby” in Language of Performance Problematic Usages Indicating Absence of Performance Future Performance Advantages of Granting Language Language of Obligation Language of Obligation Imposed on the Subject of a Sentence Language of Obligation Imposed on Someone Other Than the Subject of a Sentence Imposing Impossible Obligations Obligations—Some Related Terminology Language of Discretion Using “May” to Convey Discretion Be Explicit as to Whether Discretion Is Limited The Ambiguity Inherent in “May . . . Only” Using “May” to Convey Possibility “May Require” Don’t Use “At Its Sole Discretion” with “May” “May” and the Timing and Frequency of Permitted Actions 9 “Hereby Grants . . . the Right To” When Exercising Discretion Requires Cooperation “Is Entitled To” “Is Not Required To” Language of Prohibition “Shall Not” “May Not” “Is Not Entitled To” Don’t Use “Shall Refrain” Other Suboptimal Usages Collective Nouns Prohibition by Way of an Exception to Language of Discretion or Obligation Choosing Between Discretion and Prohibition for an Action Subject to a Condition Language of Policy Verbs in Language of Policy Passive-Type Policies Expressing Conditions Conditional Clauses Language of Policy Used to Express Conditions Language of Obligation Used to Express Conditions 10

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