It was important, and still is.
If you’ve heard it once, you’ve heard it a thousand times – the general terms at the end of an agreement being referred to as “boilerplate” provisions, a phrase that misleadingly suggests that these provisions are of lesser importance. As it turns out, both the original boilerplates and the modern-day contract provisions that carry the same name need to be carefully crafted to protect the people using them.
Originally, a boilerplate was a type of heavy rolled or plate steel used to make steam boilers. Eventually, this term was used as a nickname for the similarly large, flat pre-set typesetting plates used by local newspapers for prepared text like ads or syndicated columns. From there, the term matured into its modern usage, referring to the standardized provisions in contracts.
But regardless of whether boilerplate is used in a steam boiler or a contract, it needs to be constructed with care. In this series, we will review some of the most notable issues arising with standard contract provisions and why it’s important not to disregard them. Issues like the proper scope of force majeure provisions, the enforceability – or lack thereof – of severability, anti-assignment, arbitration, and jury trial waiver provisions, and how and when to permit electronic signatures. These are all matters that can be easily, and yet determinately, overlooked.
Common Problem: Notice Provisions
We will start with the mild-mannered notice provision, which is often overlooked. As is the case with many boilerplate provisions, it is common for language that no longer tracks with modern practice to survive in these sections, hidden from scrutiny at the back of the contract. With respect to notice, many agreements still require notice to be provided by hand-delivery, certified mail, or commercial delivery service in order to be effective.
Notwithstanding this fact, once signed, parties to a contract often communicate and provide notice by email, even though it is technically ineffective. Providing ineffective notice leaves the door open to a dispute, which of course is the first step towards litigation.
Fixing Notice Provisions
To avoid turning such a mundane misunderstanding into a potentially serious outcome, decide whether electronic notice will be permitted at the outset of negotiating your next contract. If so, how it will be accomplished? For example, if notice is sent by email, is confirmation of delivery necessary? Once you’ve made these determinations, you can craft a notice provision that accurately tracks with your anticipated course of conduct.
This is just one example of the types of outdated boilerplate provisions we will explore in future posts.