Weagree: milestones, milestones, milestones

We are very happy to share that we are finalising the training materials for our project for the International Trade Centre (ITC, a joint agency of the U.N. and WTO). After completing a Cross-border contracting training programme, I was commissioned to add a chapter on intellectual property rights and draft three model contracts (an MOU, an NDA and a Trademark Licence). Apart from correction rounds, language review and translation work, our preparatory work for the ITC is now done!

But there is more to share about Weagree:

Weagree Wizard – new release
Two weeks ago, we released a software update of the Weagree Wizard. It marked the end of a development programme that started a year ago. Of all of last year’s updates, this one brought about the greatest performance and user-experience improvement. Contracts of up to 100 pages will be ‘questionnaired’ at a speed almost equal to that of a simple NDA. It makes us curious as to the current limits: will performance decrease with a contract of over 200 pages? Or with 350-plus pages?

We had planned this release for mid September, but our software engineers seem to be over-delivering – not unusually – which is putting us ahead of schedule. So the anticipated time of our roadmap-to-go is looking very promising.

Milestones of the past 12 months
Milestones achieved include:

  1. Significant performance improvements (Q&A speed)
  2. Enhanced user’s sense of being ‘in control’
  3. Improved underwater screen
  4. Improved clause library
  5. Multi-browser compatibility (also for iPhone and iPad)
  6. Strengthened workflow and approval functionalities
  7. An e-mail workflow alerting system
  8. Centralised ‘contract house style’ management
  9. Multi-language support (incl. Russian, Chinese and Hindi)
  10. Improved software release testing protocols

Our roll-out to 10,000+ users at our long-standing launching customer, ASML, (replacing their global NDA tool) confirmed that the Weagree Wizard is highly user-friendly: user-training is not needed. The implementation was realised without complications, but for the improvement of a few approver functionalities.

What’s next?
The update brings the Weagree Wizard to the next level. From here, we will expand the Q&A-capabilities relatively easily. We are planning to connect to contract lifecycle management and DMS solutions, and will introduce new, advanced Q&A-options (without compromising on user-friendliness).

Concerning product development, our focus will shift from the user-experience towards a dramatic simplification of the administrator function. (As if it is not already extraordinarily simple!) As yet, approximately six hours of initial training followed by some ten to fifteen hours of template coach is required. Whilst the six hours of training will probably remain the same, we anticipate that inserting a contract template will become much more intuitive, and open to less tech-savvy lawyers.

Weagree is growing
From now on, our first priority will be Weagree’s operational support. We are working hard at bringing Weagree to the next level: we have been formalising all our internal processes, we’re further improving the administrator support function, we’re discussing strategic partnerships, and we will intensify our communications and sales efforts. More about this in the next newsletter. Contact me if you would like to hear more about the details of our plans.

Newsletter – Free eBook: Making and managing model contracts

Weagree has reached two great milestones, which we want to celebrate by publishing a new free eBook: Making and managing model contracts.

1.  Drafting contracts has welcomed its 3,000th member
As you may know, we initiated the discussion group Drafting contracts on LinkedIn. In some five months, the group has evolved into an active community of over 3,000 members!

Legal professionals from around the world share their experiences on contract drafting. Have you ever wondered about some of the following?

  1. MOU’s, letters of intent and ‘pre-contracts’
  2. Penalty clauses (or liquidated damages): a global overview of local issues and particularities
  3. Which type of damages do you exclude in a contract? With contributions about the parameters of such clauses
  4. “Losses” vs. “damages”: several jurisdictions appear to treat them as entirely different concepts
  5. The use of plain English, or legal jargon
  6. Are you an ‘Andorian’? About writing and/or
  7. The tension between “notwithstanding” and “without prejudice”
  8. Another item triggering response: words and phrases you hate most
  9. Why is initialling pages desirable (or unnecessary)?
  10. Not unimportant: what happens after signing the agreement? Common errors and best practices

Understanding differences and similarities between national laws facilitates business and brings people together. Our community appears to be successful in creating such understanding in the area of contract drafting. This is something that makes me rejoice.

If you (or a colleague) have not joined the Drafting contracts group yet: click here (and on the LinkedIn page click “Join“).

2.  The Weagree Wizard has +10,000 users
The other milestone we reached a week ago: Weagree’s launching customer, ASML, replaced their NDA-tool with the Weagree Wizard: all employees and in-house subcontractors now create their NDA’s with the Weagree Wizard. This encompasses a group of about 12,000 users in all parts of the world. Obviously, share purchase agreements of 75 pages work equally well.

The launch went smoothly. An anecdote: a user, more acquainted with Chinese characters, filled in the field “short name” with the full address details of the counterparty (and skipped the neighbouring address fields). The Weagree Wizard is proving to be as user-friendly as we aimed for it to be.

For those who are interested: the Weagree Wizard is a true SAAS-solution (operating from our ISO-certified datacentre, with automated user identification (in jargon: ‘user-provisioning and authentication’)). It has an approval workflow (which can also be linked to external workflows) and it communicates with our customer’s e-mail server to alert about submitted requests or return the approved NDA (as PDF or Word-document).

3.  A new free Weagree eBook
To celebrate these milestones, Weagree has published a new eBook. Of course, the eBook is free. The topic of this eBook covers one of the key focuses of our LinkedIn group: Making and managing model contracts:

  • Ten steps to upgrading your model contracts
  • Contract drafting conventions (a sample)
  • Implementing contract assembly

The eBook gives practical suggestions, based on Weagree’s experience.

We hope you like the eBook. You can download it by clicking here.

If you have any suggestions, please let us know. If you want to share your thoughts or ideas, you’re welcome to do so in the LinkedIn group.

Websites offering free model contracts…

In our LinkedIn-group, an interesting ‘discussion’ has started: identifying websites which offer free model contracts.

I guarantee that you want to join the LinkedIn-group and reap the full benefit of the discussions on Contract drafting if you’re a legal professional and click here.

The links added so far:

International Trade Centre (ITC, a joint agency of the United Nations and WTO, for which we have been developing a training programme on cross-border contracting):

http://www.intracen.org/exporters/contract-templates/

Mainstream general commercial model contracts:

  • Sale of goods contract (short form and long form)
  • Long-term supply of goods agreement
  • Manufacturing agreement
  • Distribution agreement
  • Commercial agency agreement
  • Supply of services agreement
  • Alliance / collaboration agreement
  • Joint venture (corporate) agreement


UK Intellectual Property Office (IPO) – ‘Lambert toolkit’


http://www.ipo.gov.uk/lambert (overview)
http://www.ipo.gov.uk/whyuse/research/lambert/lambert-resources.htm (small contract types)

  • Research & development agreements
  • Collaboration agreements
  • Consortium agreement
  • Consultancy agreement
  • Materials transfer agreement
  • Confidentiality agreement
  • Patent assignment deed
  • Equipment loan agreement


Free downloads
(generic website)

http://freepdfdb.com/pdf/supply-of-goods-agreement-template (PDFs)
http://freepdfdb.com/doc/supply-of-goods-agreement-template (Word-docs)

Various sample commercial contracts


National Venture Capital Association (NVCA)

http://nvca.org/resources/model-legal-documents/

Model venture capital (and private equity) financing documents:

  • Term Sheet
  • Stock Purchase Agreement
  • Certificate Of Incorporation
  • Investor Rights Agreement
  • Voting Agreement
  • Right of First Refusal and Co-Sale Agreement
  • Management Rights Letter
  • Indemnification Agreement
  • Model Legal Opinion


Australian and New Zealand governments’ standard forms (SourceIT)

http://www.finance.gov.au/policy-guides-procurement/sourceit-model-contracts/
http://www.business.govt.nz/procurement/for-agencies/government-model-contracts

IT (hardware and maintenance) contracts


UK Clinical Research Collaboration

http://www.ukcrc.org/regulationgovernance/modelagreements/

Pharma research (and clinical trial) agreements


SEC-filed ‘material contracts’. Three sources, presumably pointing at (essentially) the same contracts:

http://www.lawinsider.com/
http://www.onecle.com/
http://corporate.findlaw.com/contracts

Numerous types of contracts, mainly M&A and finance related (not model contracts but only actual use-cases)


Logic-Oil

http://www.logic-oil.com/

Oil & Gas industry Contracts.

Our LinkedIn group welcomed its 2,500th member!

Today, our LinkedIn group Drafting contracts (click here to join) welcomed its 2,500th member! Since the start of the group in February of this year, numerous discussions have been initiated on various aspects of contract drafting. The group members are very enthusiast about the high level of discussions and discussion topics. They give a tremendous insight in the experience of legal professionals from all over the world, who explain the particularities of their own national legal system.

The discussion topics in the group address everyday contract drafting aspects. Have you ever wondered about some of the following:

  1. Stipulate “represent and warrant” or just “warrant”?
  2. Best practices re. MOUs, LOI‘s and pre-contracts.
  3. “Shall” or “will” – which obliges more in a contract?
  4. Recitals and preambles – what do they mean in your country?
  5. When do you opt for arbitration and when for a court of law?
  6. For the avoidance of doubt” : in which rare contexts would you use the phrase?
  7. Why exclude the CISG (Vienna Convention) from your contracts?
  8. Should a contract provide for ‘equitable relief‘?
  9. Indemnities in purchase contracts: how to draft them and do you need one?
  10. Counterparts clauses: why do we include them?
  11. Pathclearer‘ – a sensible approach to contracting?

Why is the LinkedIn group so helpful? Well, the world has globalised. Over the past decades, cross-border contracting has triggered an increasing need to understand the other party’s interests. Whilst national laws and case law have been converging in solutions and approaches, lawyers still begin to argue from their traditional national-legal-cultural point of view. Understanding the differences and similarities between national laws facilitates business and brings people together. The LinkedIn group appears to be a useful platform for creating such understanding.

This is a niche group: we maintain focus on issues related to contract drafting. Permitted subjects relate to:

1.  Sharing model contract clauses
2.  Best practices of drafting clear and unambiguous contract clauses
3.  The use of ‘legalese’ or archaic contract language
4.  Why or when to use certain contract language
5.  Legal or practical impact of certain contract clauses
6.  Comparative (contract) law enquiries
7.  Cross-border contracting and negotiating
8.  Checklists for contracts
9.  (How to) cooperate on model contracts
10. The look & feel of a contract

We will not approve (and will remove):

– job inquiries
– contributions mainly aiming at the sale of a product or (legal) service
– personal advertisements

Does this sound like an attractive environment to reflect on contract drafting issues?!

We started the LinkedIn-group Drafting contracts

Last week, I gave a contract drafting course to the in-house counsel of a Dutch multinational. The topics of the session included (“without limitation”):

  • The vacuous use of and/or
  • The rare circumstances in which for the avoidance of doubt serves a proper purpose
  • How to refer to numbers in sentences like “One (1) Shareholder will receive 12,000 euro, seven Shareholders will receive one U.S. dollar, and 14 Shareholders will receive 13 million euro” ?
  • Archaic legalese such as legal and valid, made and entered into, and in witness whereof

Our discussions were heated and spirited. Legal professionals appear to have their own thoughts about what is supportive or necessary when drafting a clear contract, without ambiguities. Sometimes, this goes against rules of grammar or even aligns with common parlance within an organisation. I doubt whether this is the right approach for contracts.

 

You will appreciate that I started a LinkedIn group “Drafting contracts“. As a legal professional, you’re welcome to join the group:

    Click here to be amongst the first to join!

The group focuses on Contract Drafting only. Share, discuss or observe any aspect related to drafting contracts:

  1. Model contract clauses
  2. Best practices of drafting clear and unambiguous contract clauses
  3. The use of ‘legalese’ or archaic contract language
  4. Why or when to use certain contract language?
  5. Legal or practical impact of certain contract clauses
  6. Comparative (contract) law enquiries
  7. Cross-border contracting or negotiating
  8. Checklists for contracts
  9. (How to) cooperate on model contracts
  10. The look & feel of a contract

Targeted members are legal professionals (attorneys-at-law, in-house legal counsel). The group drafting contracts is not intended for job inquiries, commercial advertisement or mere hyperlinks to your weblog. This is why we will moderate the group, at least in the beginning.

Tell your colleagues and other legal professionals
Obviously, we like to share and discuss aspects of contract drafting with our colleagues. If you know people who are in to contract drafting, or who like to join, link them into the group! Again:
http://www.linkedin.com/groups?gid=4036673

Forthcoming courses Contract Drafting

We will organise a new series of contract drafting courses. In collaboration with the Network Ondernemende Juristen (here is their website). The course is meant for experienced legal counsel and entitled:

Contract drafting – Techniques, Best practices, do’s and dont’s related to contract drafting

The training sessions will be on Tuesday evenings, 26 February, 12 & 26 March and 9 & 23 April at the offices of Netwerk OndernemendeJuristen in Amsterdam.

The contract drafting course is targeted at legal counsel with broad experience in drafting contracts. The course is given by Willem Wiggers (Weagree). The emphasis will be on aspects of writing an unambiguous contract (and not so much on recent case law). The language of instruction will be Dutch, clause examples will be from English-language agreements.

The programme is divided into five blocks of two+ hours each. Each block can be followed independently from the others:

1.     Drafting techniques – Tuesday 26 February
(tricks for improving readability and avoiding ambiguities). Subject matters:

  • Preventing ambiguity
  • Where in a text is the most important information? (The “left-right principle” and the “pyramid principle”)
  • Drafting ‘conceptually’ (not exhaustively)
  • Techniques to keep it short

2.     Setting up and drafting an agreement (1/2) – Tuesday 12 March

  • Contract structure (do’s and don’ts, schedules and annexes)
  • Letter agreements, side letters and LOI’s
  • Best practice rules for drafting recitals, definitions, conditions and covenants

3.     Setting up and drafting an agreement (2/2) – Tuesday 26 April

  • Drafting warranties, limitations of liability and indemnities
  • Dispute resolution (arbitration vs. court) and applicable law clauses
  • Miscellaneous clauses (about counterparts, severability, ‘entire agreement’ and other boilerplates)

4.     Legalese, other misfits and numbers in contracts – Tuesday 9 April

  • The misuse of various typical contract phrases (e.g. for the avoidance of doubt, deemed to be, without limitation)
  • Archaic doublets & triplets (“acknowledge and agree”, “indemnify and hold harmless”, “made and entered into”, “right, title and interest”, “execute and deliver”)
  • Guidelines for using numbers and figures in contracts (e.g. 30 (thirty))

5.     Cross-border contracting: the main foreign legal systems – Tuesday 23 April

  • Typical common-law-features and their impact on agreements (consideration, remedies, deeds, miscellaneous-clauses, “in witness whereof”)
  • Contracting under foreign law (what should be your focal points and where can you be more confident): a tour d’horizon of French and German law vs. ‘the’ common law
  • Remaining subjects from previous blocks

The costs are 180 euro per evening. Paying members of the OJ Network pay only 120 euro per evening. The course evenings are from 19:00-21:15 h. (doors open at 18:30 h.) at the offices of OndernemendeJuristen Emmastraat 40, 1075 HL Amsterdam. You will earn 1 credit points for the Dutch Bar per attended course hour, and will receive a certificate afterwards.

Newsletter – update: innovating and courses

Today, Weagree has published a new eBook, volume 9. Of course, the eBook is free. It complements part 1, about the miscellaneous provisions at the end of your contracts:

  • Miscellaneous (boilerplate) clauses (part 2, including confidentiality clauses)

We hope you like the eBook. Download it here.

We also distributed the following newsletter:

After the update of the Weagree contract assembly wizard in May, we enjoyed a wonderful summer. Two major Dutch multinationals signed up for a license, which enabled us to define new functionalities.

Over the past few months, we contacted Weagree Wizard users individually, and interviewed those who had seen our presentations. The users are proving to be very happy with the Weagree Wizard.

1.  Weagree’s ‘design slot’ for our contract assembly wizard
Our users are drawn to using the Weagree Wizard: they find our document automation solution convenient and rich in features and possibilities, and experience great time savings both in drafting time and response time. Happy users are more than happy to provide us with feedback. And so they are enthusiastically taking part in our innovations.

In May, we upgraded Weagree’s contract assembly wizard. Along with various technicalities, we improved multi-language support, simplified the user-interface and improved contract formatting capabilities (house style).
The forthcoming upgrade characteristically remains focused on user-friendliness. Having listed some 48 points for improvement, we made detailed specifications, requested quotations for realising them, and prioritised the list according to committed license fees.

A noteworthy comment came from Chantal, long-time user at our launching customer: she told me about her ‘lawyerish’ inclination not to delete her contract assembly history: lawyers wish to archive. A feature to put on the list.
Equally, we will continue to improve centralised contract house style management. Many organisations struggle with the ‘enforcement’ of a unified contract house style (if there is one at all). In a previous free Weagree eBook, we made various suggestions on how to achieve this. The coming upgrade will permit differentiation between different types of automated documents. (All house style changes will be managed from one central place and changes need not be repeated for all templates.)

2.  New courses on contract drafting
This autumn, we will be giving contract drafting courses. Not the boring type of programme, which discusses the latest pseudo-developments in case law on general terms and conditions, on contract rescission or pre-contractual liability. Rather, we’ll be offering tricks and techniques on the subject of:

  • How to avoid ambiguities and write clearer
  • How to set up a first draft agreement
  • Best practices on the use of definitions, conditions, covenants, warranties and limitations of liability

Obviously, we will also address legalese and the stupidity of archaic doublets and triplets, together with a comparative law tour d’horizon of the major legal systems worldwide. If you’re interested, it is all in my book Drafting contracts – Techniques, best practice rules and recommendations related to contract drafting (Kluwer 2011).

Newsletter on free eBook and our project for ITC

In April, I received a phone call from Geneva, “whether I was willing to develop a training programme on contract drafting.” I tell you the story, which I circulated in our Newsletter of this morning, in this blog post.

About a year ago, Weagree’s work had attracted the attention of the International Trade Centre (ITC), a joint agency of two major ngo’s. They were planning to establish the contract drafting training programme for the world’s 48 least developed countries (LDC’s). Though we were somewhat short of time, we undertook this dream job, being aware it was a unique opportunity.

1.  Forthcoming book: Cross-border contracting – Practical guidance and training materials

Our work for the ITC will result in a new book “Cross-border contracting – Practical guidance and training materials“. It will constitute the basis for training sessions that the ITC will provide to the 48 LDC’s during the coming years. For this purpose, I travelled to Cambodia and Laos, where our training sessions were received with great enthusiasm. It struck me that these countries are clearly developing into full members of the world community. As you can imagine, this work and the feedback are highly rewarding!

The new book builds on eight key model contracts developed by ITC with the involvement of over 50 law firms worldwide. The contracts cover international sale of goods, long-term supply, manufacturing, commercial agency, distribution, provision of services, alliances and joint ventures. If you are interested, click here for a free PDF.

The forthcoming book complements the model contracts with explanatory notes, do’s and don’ts regarding cross-border contracting, contract drafting best practices, negotiation tips and training materials. A considerable part deals with the Vienna Convention (CISG), as well as intellectual property law. Also, various well-known materials of the International Chamber of Commerce (ICC) will be worked out: documentary credit, Incoterms 2010, arbitration proceedings.

2. The Weagree Wizard upgraded

Early May, we upgraded Weagree’s contract assembly wizard. Along with various technical improvements, several functionalities were added:

  • Multi-language support (i.e. date format, country lists, and headers, footers and cover page can be generated in the correct language)
  • Generating PDF’s
  • Simplifications for users
  • Improved workflow
  • Improved contract formatting capabilities (house style)

This upgrade is in line with the key feature of Weagree: focus on user-friendliness.

3.  A new free Weagree eBook

I’m happy to tell you that Weagree has published a new eBook, volume 8. Again, the eBook is free. This time, it focuses on whether to insert and how to draft the miscellaneous provisions at the end of your contracts:

  • Miscellaneous (boilerplate) clauses (part 1)

We hope you like the eBook. Download it here.

Assignment of contracts clauses

In the free eBook published earlier today (click here to go to the download page), we discuss ‘assignment’ clauses: a type of miscellaneous clause (or ‘boilerplate’) that prohibits the ‘sale and transfer’ or, more correctly, ‘sale and assignment’ of an agreement. This blog post is a paragraph of the eBook.

Many contracts will provide for a prohibition to assign the rights and obligations under the agreement. Normally, each party should be able to negotiate that the approval of the other party to an assignment will not be unreasonably withheld or delayed:

Assignment. No Party shall assign its rights or obligations under this Agreement in whole or in part, without the prior written approval of the other Party, which approval shall not be unreasonably withheld, conditioned or delayed.

In many cases, the parties would like to make an extra carve-out for intra-group restructurings of activities or the performance under the contract by an affiliate, whether for tax or other geographical reasons. This would be the typical example for the applicability of shall not be unreasonably withheld. However, contracting parties may seek more certainty. Uncertainty becomes particularly problematic when a party prepares a divestment of the business. Obviously, when the new investor in such business is a competitor of the customer, the latter’s refusal to unconditionally approve assignment is reasonable. In other cases, the parties want to be free to assign the agreement (i.e. the rights and related obligations) as part of a sale of the entire business to which such agreement relates. The uncertainty may be covered by a specific exception:

…, except that Seller may assign its rights and obligations under this Agreement in connection with a sale of all or a substantial part of its business to which such rights and obligations pertain.

The more complete version will also require a re-assignment in case of divestment of the Affiliated Company and have an additional provision:

Seller shall procure that an assignee Affiliate assigns back the assigned rights and obligations, immediately prior to such assignee ceasing to be an Affiliate of it.

The exception and related assign-back provision can, of course, accommodate both parties. Note, however, that there is a greater logic that a purchaser does not want to source from its competitors or from suppliers with a questionable background (e.g. suppliers obtaining products manufactured by children or in an environment-polluting way) than vice versa. Child labour or pollution of the environment are matters that a company would typically want to control upwards the product chain and not down.

In case of private equity and other leveraged transactions, the purchaser may need to be able to assign its rights (and obligations) freely under the share purchase agreement, in order to be able to obtain financing more easily. In such case, the seller would keep some control over the financing parts of the transaction by a restrictive assignment clause. The caveat that assignment shall not unreasonably be withheld or conditioned will give the seller at least the opportunity to review the financing obligations and analyse the potential consequences of an assignment of the rights (and obligations) under the share purchase agreement to the banks and other lenders involved. A relaxed assignment clause facilitating the purchaser would be as follows:

Assignment.  No Party may assign or transfer any of its rights or obligations under this Agreement without the prior written approval of the other Party, except that:

  1. each Party may assign any of its rights under this Agreement to its Affiliates; and
  2. Purchaser may assign any of its rights under this Agreement to any of its lenders or to any person acquiring all or substantially all of the rights or assets of Target after the Completion Date,

provided, however, that no such assignment shall relieve an assigning Party of its obligations under this Agreement.  For the avoidance of doubt, Purchaser may grant security interests in its rights under this Agreement to its lenders.

Please note that an assignment clause does not relieve the parties to an assignment from fulfilling the requirements of the applicable law to such assigned rights and obligations. In order to give an assignment of rights its full effect (i.e. enforceability against the debtor and an obligation on the debtor to perform vis-à-vis the assignee only) most jurisdictions require a (written) assignment notice to the debtor[1]. An assignment of obligations would usually be subject to the consent of the debtor although under English law a distinction is drawn between novation and the assignment of a contract; whereby the latter does not require consent although will only be effective so as to assign the ‘benefit’ and not the ‘burden’ of the contract.

[1]      See Common Frame of Reference Section III.5.1 (Art. III. – 5:104 ff.) and compare the U.N. Convention on the Assignment of Receivables in International Trade (12 December 2004).

Independent contractors – no partnership established

Contract drafters can influence the interpretation of a contract. They cannot influence the legal qualification of the contractual relationship (unless certain qualifiers are taken out or added). Still, in many (mostly common law originating) contracts a miscellaneous clause is inserted that emphasises the non-existence of a legal quality or qualification. This blog post is about the redundancy (non-sense) of such clause.

The discussion below also appears in today’s free eBook (on Miscellaneous (boilerplate) clauses, part 1 (click here to download).

Although the categorisation of a contract or contractual obligation is a matter of law, in certain contracts originating from a common law environment there may be disclaimers such as:

Independent contractors. The Parties are independent contractors. Nothing in this Agreement shall be deemed to constitute a partnership or joint venture between the Parties or constitute any Party to be the agent of the other Party for any purpose.

The purpose of the clause is to avoid the consequences of an unwanted legal relationship. For example, if a contract, obligation or ‘legal act’ would entail a certain level of dependency, partnership or joint venture; in common law countries, such circumstances may create an unwanted legal structure with undesired (financial or tax) obligations. This imposes important ‘duties of loyalty’ upon the fiduciary, such as a duty to disclose all conflicts of interest and a duty to subordinate the fiduciary’s own interests in favour of those of the other party. However, a contractual denial of the existence of such relationship or facts is not likely to be determinative of the legal effect, at the same time, consider whether the unwanted relationship is realistic at all.

No authority. A more valuable miscellaneous clause would be to provide expressly that the contract does not implicitly grant a power or authority of one party to act on behalf of the other party. This is because the agency doctrine of ‘apparent authority’ may apply. Under this doctrine, a person becomes bound by the acts of someone else, its agent, if after becoming aware of those acts, the former, as (apparent) principal, has been behaving in an acquiescent manner or must otherwise be deemed to have (tacitly) accepted the consequences of such acts (by its apparent agent). An argument to support the opposite intentions is reflected in the following sentence of an ‘independent contractors’ clause. Note, however, that since such provision is not also addressed to unrelated third parties acting in reliance on the representative’s acts, its effectiveness is limited to the internal relationship between the ‘apparent principal’ and its ‘agent’:

No Party shall have any authority to act for or bind the other Party in any way, or to represent that it has such authority.

Typically, a miscellaneous clause on ‘independent contractors’ is dispensable. A stipulation that one party shall not represent the other is of limited use.