In the next installment of our legal english vocabulary builder we look at the structure of contracts and some of the key vocabulary.
A commercial contract follows a typical structure starting with the parties to the contract who are the people entering into the agreement. This is usually followed by the recitals which provide some background to the agreement. Following this there is a definitions section which sets out how certain words are to be interpreted within the contract.
After this the main body of the contract follows which includes the operative provisions of the contract. This usually consists of provisions which may be categorised as warranties and conditions. If, for example the contract is an agreement for the sale of goods it is usual for the agreement to include provisions such as warranties as to title, merchantability and fitness for purpose.
At the end of the agreement there is a list of Miscellaneous (or Boilerplate) clauses. These are standard clauses which are included in the majority of contracts. Typical examples of this type of clause include the force majeure clause, the entire agreement clause and the severability clause. The force majeure clause allows the contract to be terminated in the event of some unexpected event outside of the control of the parties (sometimes referred to as an act of god). The entire agreement clause states that the contract forms the entire agreement between the parties and that any prior discussions or correspondence do not form part of the contract, whilst the severability clause states that it is possible for the contractual clauses to be read independently of each other in the event that one or more of them is found to be unenforceable.
Finally there is the signatures section and following this there may ‘schedules‘; attached to the contract. The schedule may list something included in the contract in more detail, for example a price list.
Most lawyers do not start from scratch when drafting a contract but rather their contracts are based on legal precedents. Most law firms have a precedent bank or precedent library to work from.
Key Legal English Vocabulary
Some of the key vocabulary is listed below:
Parties to the contract (note the correct preposition here is ‘to’)
Recitals
Definitions
operative provisions
warranties and conditions
to start from scratch
to draft a contract
Boilerplate Clauses
Entire Agreement Clause
Severability Clause
Force Majeure Clause
Schedule
Precedent Bank/Library
