The concept of plain language contracts and the benefits that flow from them are difficult to argue. Every business wants legal agreements that are easy to understand. Every company wants to spend less time negotiating and more time satisfying the customer. Every company wants to spend less time managing their contracts and more time innovating. But change in any business is hard, and radical change – which is the case here – is damn almost impossible. Creating a solid model for contracts in plain language takes time, immobilizes resources, and intellectually fiscalizes your organization, given the habits formed over the years. Without a little old-fashioned courage and perseverance, your initiative in simple language will fail. It may seem far-fetched. However, I believe it is really possible – as demonstrated by an effort of more than three years to promote plain language contracts in GE Aviation`s digital services sector. Since the beginning of this initiative in 2014, this entity has signed more than 100 such contracts.
These agreements took 60% less time than their previous legally loaded versions. Some clients have even signed plain language contracts without a single change. Customer feedback has always been positive, and there has not been a single dispute between clients about the wording of a contract in plain language. The “Indemnification” clause is a statement in a legal contract that releases one or both parties of a contract from legal liability for injuries or damages signed by the party. The inadmissibility clause is common in many situations that are less obvious than a contract for skydiving courses. My head turned as I read each chord. I felt like a confused cartoon character from Dilbert: have I seen a contract or a textbook of quantum physics? We want you to fully understand the terms and conditions of use of this website (the “Website”) and related services, media, documents and other information (the “Website Content”). These Terms of Use (this “Agreement”) constitute a legal agreement between you (a person or entity) and Imaginable Futures Services LLC for the use of the Site and Site Content. By using or accessing the Site, you agree to be bound by this Agreement and to be a party to this Agreement. The first situation described above is a unilateral disclaimer. The entrepreneur is the only one to demand to be held harmless.
The second example represents a reciprocal theorem. The owner also demands compensation from the contractor. Consider this scenario: A snowplow contractor is hired to plough a parking lot and salt sidewalks. In this example, the snowplow operator creates a “standard contract” with the time and frequency of ploughing. Both parties sign the agreement. Two months later, while ploughing the parking lot, the snowplow struck a parked car, causing $5,000 in damage. The angry car owner wants someone to pay for the damage to their car, a rental car, and the loss of wages from work. If the claim is sent to the snowplow operator in the hope that he will pay for the damage caused by him, it refers to the signed contract, which included a damage and compensation agreement that required the parking lot owner to pay for all damage caused by the plow driver. The non-avoidability clause may be unilateral or reciprocal. With a unilateral clause, one party agrees not to hold the other party liable for any injury or damage.
By a counter-clause, both contracting parties undertake to compensate the other. Indemnification and indemnification agreements are becoming increasingly important in commercial contracts. These are elements or clauses of a contract or agreement that can work for the benefit of your business, or they can just as easily work against your business. Indemnification and indemnification are terms that are used synonymously, but do not necessarily mean the same thing. As with many things, the devil is in the details – or in this case, in the wording. Looking for more information about using contracts to protect your business, including insurance certificates, limitations of liability, and the benefits of indemnification and indemnification? Don`t miss this white paper: A clause doesn`t always protect against lawsuits or liability. Some states do not adhere to harmless agreements that are nebulous or too broad in language. In addition, the clause may be considered null and void if the signatories strongly argue that they have been forced or deceived to sign a harmless clause. Contractors often add unscathed clauses to their contracts to protect their businesses from potential liability arising from their work. For example, a contractor who was hired to add a deck to a private home may add the clause to anticipate a lawsuit if a violation occurs on the deck at a later date.
The owner, in turn, can add a threshold clause to prevent a lawsuit if the contractor suffers an injury during the work. This clause is also known as a harmless disposition. If spelled correctly, the intent of a indemnification or indemnification agreement is to impose on one party the responsibility to pay all liabilities, damages, costs, expenses and even attorneys` fees for the other party to the agreement. Even if it wasn`t your fault and the other party was to blame, you could still be required to pay damages. A company can add a secure agreement to a contract if the service used involves risks for which it does not want to be held legally or financially responsible. (l) use the Services to identify or locate a specific person or household. Is there a practical reason for this? Are pages of definitions; words such as “past”, “indemnification”, “guarantee” and “force majeure”; and wording such as “notwithstanding anything to the contrary herein”, “subject to the foregoing” and “including but not limited to” that is necessary for the applicability of an agreement? Is there a counterintuitive value in useless boilerplate language? Does a contract really need 15-word synonym strings? Sentences in italics and bold that span multiple pages; clumsy movements with many semicolons; and an obsolete grammar to be worthy of a signature? In my opinion, the answer is a resounding no. A contract should not take countless hours. Executives should not have to call a lawyer to interpret an agreement they are supposed to manage.
We should live in a world where contracts are written in accessible language – where potential business partners can sit and read for a short lunch without their lawyers, really understand and feel comfortable signing a contract. A world in which disputes caused by ambiguity disappear. Companies that offer high-risk activities such as skydiving often use a clause. While this is not an absolute liability protection, it does indicate that the client has acknowledged certain risks and agreed to take them. This non-withholding clause may take the form of a letter. There is a real appeal for a one-sided contract or a contract that has less than x words. But the truth is that fewer pages and words don`t necessarily make a contract more understandable. .