Contract-language types General provisions Risk allocation Reps & warranties Miscellany

100

What is a covenant?
This category of contract provision is a promise or commitment to do or not do something.

100

What are "None"?
Under the so-called "American rule," this party can recover its attorney fees if it prevails in contract-related litigation if the contract does not say otherwise:

100

What is an indemnity provision?
This type of contract provision is a promise to reimburse a person for any harm the person might suffer from a stated event.

100

What is past and present?
A representation is a statement about facts in this time frame.

100

What is rescission.
This remedy for breach of contract --- seldom granted unless the contract itself provides for it --- basically "unwinds the deal."

200

What is a warranty?
This category of contract provision is a promise to pay the other party's damages if a statement about a past-, present-, or future fact proves incorrect.

200

What are an individual or a corporation?
Under Texas law, when a plaintiff successfully asserts a contract claim against a  defendant, if the plaintiff wishes to recover its attorney fees under Tex. Civ. Prac. & Rem. Code sec. 38.001, the defendant must be in one of these two types of person or entity:

200

What is a damages cap?
If a drafter had her "thinking cap" on, she could draft this type of limitation of liability (A) as "one size fits all," or (B) as separate limitations for different categories of events.

200

What is the seller?
In a normal purchase-and-sale contract, this party will normally want to think about whether a particular statement should be a representation or a warranty (the other party will want it to be both).

200

What is contra proferentem?
Under the rule of contract interpretation known by this Latin phrase, an ambiguity in a provision is resolved against the party that drafted the provision --- IF other rules of interpretation don't provide a resolution.

300

What is "indemnify"?
In most U.S. jurisdictions "hold harmless" is treated as a synonym for this type of contract term.

300

What is "illusory"?
If a contract provision gives Alice the right to unilaterally amend the contract but does not put certain limits on that right, then the entire contract might be unenforceable because it is "ill" in this way:

300

What is an insurance policy?
Alice is hiring Bob to do some work in her factory. Her draft of the contract requires Bob to indemnify Alice for any harm that might occur to any of his employees while at Alice's factory. Alice should also consider inserting a provision requiring Bob to enter into and maintain this type of ancillary contract to make sure there is a pot of money available if necessary to support Bob's indemnity obligation.

300

What are 1) punitive damages, and 2) rescission of the contract.
In a contract case, if Alice successfully proves the elements of misrepresentation, she might be entitled to one or both of these two remedies:

300

What is backdating the contract?
The former CEO of software giant Computer Associates spent nearly ten years in federal prison for engaging in this "35-day month" contract-signing practice for the purpose of falsifying the company's financial statements.

400

What is a "Whereas" clause?
This archaic introductory section of a contract has been replaced, in modern drafting, by the "Background" section.

400

What is a reliance disclaimer?
An entire-agreement provision, by itself, won't preclude an aggrieved party from claiming misrepresentation unless the entire-agreement provision includes this type of disclaimer:

400

What are incidental damages?
In some vendors' contract forms, the list of excluded damages will sometimes include (that is, exclude) this category of damages, of which one of the examples in UCC art. 2-715 is "commercially reasonable charges, expenses or commissions in connection with effecting cover ...."

400

What are: (1) a statement about a past or present fact, made by or attributable to Bob; (2) the statement's falsity; (3) a reasonable quantification of the damages that Alice suffered as a result of the statement's falsity.
For Alice to successfully sue Bob for breach of a warranty in a contract, Alice must demonstrate these THREE things:

400

What is ejusdem generis?
Under the rule of contract interpretation known by this Latin phrase, if a contract term says "food, including apples, oranges, and pears" then a court might limit the term "food" to fruits.

500

What is "incorporated by reference"?
This three-word phrase can be used to cause an external document to be treated as part of a contract.

500

What is a forum-selection clause?
A drafter whose client didn't have superior bargaining power might not want to include this provision stating where any litigation is to take place:

500

What is express and conspicuous.
Under the law in Texas (and some other places), if a contract provision requires Alice to indemnify Bob against the consequences of Bob's own negligence, that provision must be each of these two things or it will be unenforceable.

500

What are: (1) a statement about a past or present fact, made by or attributable to Bob; (2) the statement's falsity; (3) Bob's negligence, recklessness, or intent to deceive in making the statement; (4) Alice's reliance on the statement; (5) reasonableness of Alice's reliance; and (6) a reasonable quantification of the damages that Alice suffered as a result of the statement's falsity?
For Alice to successfully sue Bob for misrepresentation in a contract, Alice must demonstrate these SIX things:

500

What is "anything else?"
This is Prof. Toedt's favorite, all-purpose, two-word question when asking clients about business terms:

Contract Drafting review - Prof. Toedt, University of Houston Law Center

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