A conference speaker recently stated that a company’s legal documents should avoid vague provisions like “the parties will use their best efforts to….”
I agree that clarity is generally a virtue in legal contracts. Except when it isn’t. Practicing law, like many things, is part “science” and part “art”. One of the “arts” is knowing when a vague (or semi-vague) provision might help your client’s interests and, conversely, when clarity might hurt your client’s interests.
This assertion may offend classic principles of contract drafting. So, to be clear, I am not advocating that legal contracts should be full of carelessly vague statements. But there are at least two occasions on which I believe my client is better served by inclusion of a vague provision instead of a clear one:
- When, if the provision were made clear, the clarity would bind my client to do something that it is not positive it can fulfill — for example, rather than commit my client to selling X units/year in order to keep a contract, I might opt to have the client agree to “diligently pursue sales” (note, however, that if I’m representing the other side, I’ll push for clarity).
- When the parties are simply unable to agree upon a “clear” provision, but the deal can be made if they compromise on a vague one — my role is to help the parties get a deal done if they both want to do one; in fulfilling that role, I try to help the parties think about and clarify all ambiguity (where appropriate), but find a way to keep the deal moving forward even if they can’t clarify a particular provision at a particular time. In the formative stage of a joint venture, for example, the parties sometimes don’t know enough about each other or their prospective business relationship to resolve in detail how a particular issue will be handled.
Ask your lawyer to counsel you about the nuances of key issues under negotiation, including whether any particular issue should be made more clear or more vague. Don’t forget that, when it comes to contractual obligations, clarity can sometimes be a curse and vagueness a virtue.
Look for a future post on “controlling the draft”. It can be more expensive to have your lawyer be the primary draftsperson, but that gives him or her an important advantage in managing the nuances of a contract, including the degree of clarity inserted for each particular issue.