Each contract drafter should write plain English in contracts and keep only a few main drafting principles in mind. A contract should be in plain English, meaning that the contract language used is simple and clear. A drafter must be accurate. The contract should be consistent as regards style, structure, terminology and level of detail. A drafter may use vague terms but should be conscious how and when to use them, and should avoid ambiguities (unless it serves an intended purpose).

Furthermore, a contract drafter who works in a multinational context should have a broad understanding of the characteristics of different national legal systems and be aware of significant differences between legal cultures.

Use plain English in contracts: a businessman should be able to understand what it says. The involvement of a legal counsel should be necessary only to give an impartial view, oversee the legal consequences, to clarify that certain phrases are normal or to confirm that indeed they reflect the parties’ intentions. The legal aspects of a contract should be limited to what is being expressed, not how it is expressed. (No tricks!) Old fashioned contractual language, which is not plain English (anymore) will make a contract harder to read. It will also not serve the interests of the parties.

Plain English. What is plain English in contracts language, especially plain legal language? It is ordinary ‘adult English’, used in day-to-day context. It is language stripped of archaic ‘legalese’ or the latest business jargon and vocabulary, supported by a proper layout and typography of the text. As regards spelling, a multinational company may prefer British English (or another) to U.S., Canadian or Australian English but in either case, language should be used consistently.

Don’t. Nevertheless, do not use:

  • …it’s…
  • …ain’t…
  • …won’t…
  • …can’t…
  • Purchaser should not…
  • Licensee should…
  • …owe Seller…

…for obvious reasons (?) – notably, the word “should” is as such optional, advisory, and probably facultative (which is what a contract drafter should assume); whether a ‘what-should’-stipulation nonetheless binds the party concerned, would depend on overriding contract law-principles (under the applicable law), such as whether there is ‘consensus’, party behaviour and other parameters.

No archaisms. There is no need to include archaisms such as WITNESSETH or oddities such as the use of both words and numerals to express numbers (words may be useful because a number is easy to misprint, but equally risky is updating figures whilst forgetting the corresponding words; words to ascertain that 30 days are “(thirty)” days and not “13” or “20” is ridiculous). The use of Latin terms is not archaic but you should avoid grotesque speech.

Important and necessary. A good drafter determines what is important. It is important to understand where in the business the real risks or avoidable exposures are, or where the desired performance by a party is not self-evident. Secondly, a drafter should consider whether providing for it is necessary; in other words, who carries the burden of any true uncertainty? Often, deleting words or clauses makes clear what really matters.

Do not emphasise the unnecessary (plain English in contracts is plain…)

A contract drafter should resist attempting to insert more emphatic wording than is necessary to achieve the purpose of an obligation or a provision. If words are clear and precise, there is no need to underline that they mean what they say. A few words seem to be particularly common. For example:

No Party shall subject its interests in the Shares in any manner whatsoever to a right of pledge, a right of usufruct or other encumbrance of any kind.
Upon settlement of the IP Claim, Peterson shall have no right of action whatsoever against Johnson.
Purchaser may in its sole discretion waive any of the Conditions under paragraphs (a), (c) and (d) at any time.

Obviously, a compromise in discussions between the parties may well result in a contract provision emphasising that a certain behaviour is prohibited. Do not avoid such psychological strategies.

Delete unnecessary words

…. Finalising a contract by deleting the superfluous words makes it crisp. Deleting unnecessary words brings the truly important matters to the surface. This is even more important in contract drafting than in other writings. A woolly novelist may bore the reader; but a wordy contract drafter may even create ambiguity.

In der Beschränkung zeigt sich erst der Meister.[1] (Dare to delete.)

The following ‘drop dead provision’ can be much shorter:

This Agreement may be terminated at any time prior to the Completion by either Party, if the Completion shall not have been consummated on or before 31 March 2008, provided that the termination right shall not be available to any Party whose failure to perform any material obligation under this Agreement is the cause of such delay.

The provision states an exception that will likely apply in every mature jurisdiction: one cannot have cake and eat it. Therefore, more appropriate would be:

Each Party may terminate this Agreement at any time prior to the Completion, if the Completion shall not have taken place before 1 April 2008.

A good drafter determines what is important. It is important to understand where in the business the real risks or avoidable exposures are, or where the desired performance by a party is not self-evident. Secondly, a drafter should consider whether providing for it is necessary; in other words, who carries the burden of a true uncertainty. Often, deleting words or clauses makes clear what really matters.

Plain English in contracts require short sentences

Short sentences are easier to read. Everyone knows that short sentences are much easier to read than longer ones. Contracts are amongst the least readable texts one can imagine. Apart from the abstract language, the typical reason for this is the use of lengthy sentences. Therefore, be concise and to the point and address only those matters that must be elaborated on to avoid surprises or confusion, or those matters which have relevance in litigated disputes. Not only short sentences but also a well-organised sentence structure, aligning with the reader’s intonation is important.

Adopt a contract drafting convention. Some organisations have a rule that no sentence should exceed 17 words and that no word should exceed five syllables. This may be excessively prescriptive but it imposes an excellent discipline. It certainly requires the drafter to express ideas one at a time. A true dragon is the following sentence:

Exclusivity.  The Seller covenants and agrees that for a period of ninety (90) days after the date first written above (the “Effective Date”) or such shorter period as set forth below (as the case may be, the “Exclusivity Period”), none of the Seller, its affiliates or subsidiaries will, and they will cause their respective shareholders, directors, officers, managers, employees, agents, advisors or representatives not to, directly or indirectly, solicit offers for, encourage, negotiate, discuss, or enter into any agreement, understanding or commitment regarding, a possible direct or indirect sale, merger, combination, consolidation, joint venture, partnership, recapitalization, restructuring, refinancing or other disposition of all or any material part of the Company or its subsidiaries or any of the Company’s or its subsidiaries’ assets or issued or unissued capital stock (a “Company Sale”) with any party other than Purchaser or provide any information to any party other than Purchaser regarding the Company in that connection; provided that, (i) for the time period commencing on the Effective Date and ending at 11:59 p.m. Central European Time on 7 July 2022 (the “Bid Confirmation Date”), the Parties shall work together in good faith and use commercially reasonable efforts to facilitate due diligence by Purchaser and their advisors to confirm, based on the information made available to Purchaser or their advisors prior to the Bid Confirmation Date, the intent of Purchaser to implement the Transaction pursuant to the terms of this Heads of Agreement and if Purchaser does not deliver notice to Seller of such intent by 11:59 p.m. Central European Time on (or otherwise prior to) the Bid Confirmation Date (such notice, a “Bid Confirmation”), then Seller shall have the right to terminate the Exclusivity Period effective as of (but not prior to) the Bid Confirmation Date by providing written notice to Purchaser by no later than 5 p.m. Central European Time on (but not prior to) the day following the Bid Confirmation Date; and (ii) if Purchaser delivers the Bid Confirmation or if such termination notice set forth in the preceding clause (i) is not given, the Seller shall have the right to terminate the Exclusivity Period effective as of (but not prior to) 11:59 p.m. Central European Time on the sixtieth (60th) day following the Effective Date by delivering written notice of such termination to Purchaser by no later than 5 p.m. Central European Time on (but not prior to) the sixty-first (61st) day following the Effective Date. [Are you still there?]

Techniques to simplify such sentences are to think first and to conceptualise: does it really increase ‘certainty’ if you draft the long lists of persons, actions or matters?! A list also has drawbacks such as encouraging creativity towards the grey areas of the listed matters; concepts are more likely to capture any failing manifestations; a list of concepts lacks conceptuality.

The above contract clause can be shortened easily by a better use of definitions, by separating out the condition (i.e. the second half), by defining:

  • the exhaustive (?) list of related persons (e.g. “their respective shareholders, directors, officers, managers, employees, agents, advisors or representatives”);
  • several or all (?) of their prohibited actions (e.g. “not to, directly or indirectly, solicit offers for, encourage, negotiate, discuss, or enter into any agreement, understanding or commitment”); and
  • all (?) the possible transaction structures (e.g. “a possible direct or indirect sale, merger, combination, consolidation, joint venture, partnership, recapitalization, restructuring, refinancing or other disposition of all or any material part of the Company or its subsidiaries or any of the Company’s or its subsidiaries’ assets or issued or unissued capital stock”).

In other words, a quasi-exhaustive list could be reduced into concise wording addressing the relevant concept rather than its manifestations.

Uncertainty can be taken out if abstract references are made concrete. A reference to time (e.g. “5:00 p.m. Central European Time on (but not prior to) the sixty-first (61st) day following the Effective Date”) can replaced by the actual date and time.

Plain English in contracts is supported by using signalling words

Three techniques to link. Bryan Garner[2] divided such links or transitions into three categories:

  1. Pointing words: this, that, these, those and the.

These words – especially this and that – refer directly to an antecedent. If the preceding sentence or paragraph describes a principle or prohibition, and the next paragraph begins with “An exception to this…” the word this makes a clear connection.

  1. Echo links: words or phrases echo a preceding qualification, condition or concept.

An echo link between two provisions of a contract provides a strong connection and is therefore a useful technique to avoid ambiguity. At the same time, contract drafters tend to expand the echo links to avoid ambiguity. Therefore, always remember the general drafting principles of keeping a contract simple and clear (e.g. ‘write short sentences’ and ‘delete unnecessary words’). An ‘echo link’ often appears together with the pointing word such (e.g. “…such prohibitions do not…”). As a matter of style, consider limiting yourself to the more elegant pointing word the or this in connection with an ‘echo link’.

For example, it is unnecessary to repeat or summarise prohibitions if qualifying them as such (or identifying them by their number) is unequivocally clear. So after an enumeration of three prohibitions, avoid elaborate echo links such as:

The three prohibitions not to modify, manufacture or use the Prototype do not apply in the event that…

Given the strong interrelationship created by an echo link, it is recommended to minimise it to what is really necessary for making the transition (and avoiding ambiguity):

The three prohibitions do not apply if…

It would probably be appropriate, especially if the preceding enumeration consists of visually separated subitems, to continue with the mere caveat “…, except if…”.

Note that the echo link may well be used to express a qualification of what precedes (e.g. calling the three enumerations ‘prohibitions’ implies a qualification). However, be reluctant to introduce more than one qualification in such echo links. The qualifications themselves may be a source of ambiguity. Note that the use of defined terms is a species of echo links.

  1. Explicit connectives: words intrinsically making a transition (such as further, also, therefore).

These ‘explicit connectives’ greatly improve the readability of a text because the coherence of provisions increases. Garner categorised the explicit connectives:

  • Adding a point: also, and, in addition, besides, similarly, further;
  • Giving an example: for example, for instance, for one thing (and for another);
  • Restating or summarising: in other words, that is, in short, put differently, again;
  • Introducing a result: so, as a result, therefore, accordingly, then;
  • Contrasting: but, however, on the other hand, nevertheless, conversely;
  • Summing up: to summarise, to conclude, in conclusion, in short;
  • Sequencing qualifications, conditions or concepts: Firstly,… Secondly,… Thirdly,… Finally,…

Not all of these categories apply to contracts. Examples should be given only when the obligation or provision is not readily understandable or if the extent or priority of any exceptions, qualifications or limitations cannot easily be understood without an example. Furthermore, a contract should not contain a restatement or summary of any obligations other than in the recitals. Similarly, the background of obligations and other provisions should not be explained (except for key obligations and provisions that may be announced in the recitals); therefore, only exceptionally ‘introducing a result’ is appropriate.

Use the active tense in contracts and personalise sentences

Active tense. A golden rule for writing texts, equally valuable in drafting contracts as for any text, is to use the active tense instead of the passive. Often, the active voice results in a sentence that is less wordy and more direct.

In passive tense there is the potential danger that it is unclear which party is obliged to perform. To solve this in the passive, the drafter should insert additional words like by Seller. Two additional words. A technique to prevent this is to realise that each obligation should mention the debtor. In most cases, this will almost automatically turn the sentence into the active tense in which the debtor of an obligation is also the (grammatical) subject of the sentence.

Personalise! A method to make contracts dry as dust is to ‘impersonalise’ the contract provisions. Impersonal sentences can be recognised by phrases such as It is agreed that. Often, this phrase is redundant because it would be followed by something like A shall do x and y, which is sufficient and clear. If it is not, the actor (i.e., the debtor of the obligation) is probably missing. Similar examples, in which the debtor potentially remains unclear, start with The Parties agree to.

Similarly, if possible, obligations and other provisions should be drafted in the singular number and the present tense. Instead of The Parties shall promptly notify each other of the occurrence of events of force majeure, it is better to write A Party shall promptly notify the other Party of the occurrence of an event of force majeure.

Nominalisation. Nouns are more tiresome to read than verbs. ‘Active sentences’ tend to build ‘verb-heavy’ structures that would in the passive be covered by nouns. A verb gives a sentence its action, whereas a noun places the reader outside the context. This means that a text also becomes more vivid in the active voice. Not only does the active voice keep a sentence simpler, it also tends to make the sentence clearer.

Lawyers are well able to nominalise verbs: in the lawyer’s eye, a shareholder does not resolve but adopts or makes a resolution; a buyer does not pay but makes a payment; a party does not notify in writing but gives a written notice; a service provider does not act appropriately but takes appropriate action. NOT! Try to avoid these nominalisations and build on verbs as much as possible.

Use the singular. If possible, obligations and other provisions should be drafted in the singular and using the present tense. The idea behind this is that the use of plural nouns and prepositions such as and, or, each, every or any may create ambiguity. With those prepositions, it may be questionable whether in a particular context a reference should be made to a single member of the group identified by the noun, or to the entire group. For example, instead of:

The Parties shall promptly notify each other of the occurrence of events of force majeure.

It is better to write:

A Party shall promptly notify the other Party of the occurrence of an event of force majeure.

 

[1]      Joseph M. Williams, Style – Lessons in clarity and grace, Pearson Longman 2007 (9th ed.), 92 ff. Barbara Minto, The pyramid principle – Logic in writing and thinking, Prentice Hall/FT, 2009 (3rd ed.).
[2]      Bryan A. Garner, Legal Writing in Plain English, University of Chicago Press, Chicago 2001, p. 67-71.
[1]       Goethe, Natur und Kunst, 1802.