Boilerplate clauses are provisions that do not relate directly to the particular subject matter of a legal contract but set out the respective rights of the parties during the term of the agreement and, in some cases, after the agreement is terminated. They are standard clauses drafted using commonly used and understood language, whose function is to save legal drafters time.
While many boilerplate clauses are common to most commercial contracts, some will not apply to a particular contract and others will need to be adapted to meet the particular requirements of the parties. Failure to include appropriate boilerplate clauses can come back to haunt the drafter if things subsequently go wrong between the parties and one of them finds itself unexpectedly disadvantaged. The purpose and effect of each boilerplate clause, therefore, must be understood as it applies to each individual legal agreement.
Below are some examples of commonly used boilerplate clauses and their purpose.
Entire Agreement
This Agreement contains the entire agreement between the parties relating to the subject matter and supersedes any previous agreements, arrangements, undertakings or proposals, oral or written. This Agreement may be varied only by a document signed by both parties.
This clause limits the parties’ rights and obligations to only the provisions contained within the agreement. This means that neither party can claim to have acted based on any statement, discussion or document not expressly contained within the agreement.
Force Majeure
Neither party shall be liable for delay or failure to perform any obligation under this Agreement if the delay or failure is caused by any circumstance beyond their reasonable control, including but not limited to, acts of God, war, civil unrest or industrial action.
This clause prevents the parties to a contract from being liable in the event that circumstances outside their control stop them from being able to undertake their obligations under the contract.
Law and Jurisdiction
This Agreement shall be governed by and construed in accordance with the law of England and Wales and each party agrees to submit to the exclusive jurisdiction of the courts of England and Wales.
This determines the law of the country that governs the contract. In the event of litigation the jurisdiction is the country that will hear any legal dispute.
No Assignment
Neither party shall assign or otherwise transfer any of its rights, interests or obligations under this Agreement to a third party without the prior written consent of the other party.
This refers to the rights and obligations of a party to a contract and the ability or not of that party to pass on those rights and obligations to a third party. Often contracts have a ‘no assignment’ clause, preventing either party transferring their duties under the contract without consent.
Notices
Any notice required to be given by either party to the other under this Agreement may be sent by either email, fax or recorded delivery to the most recent email address, fax number or address notified to the other party, and if sent by email shall unless the contrary is proved be deemed to be received on the day it was sent or if sent by fax shall be deemed to be served on receipt of an error free transmission report, or if sent by recorded delivery shall be deemed to be served 2 days following the date of posting.
This provides the parties to a legal contract with an agreed method of communication and sets out the way in which parties should communicate, and the timescales, thereby avoiding dispute later on.
Severance
If any provision of this Agreement is held invalid, illegal or unenforceable for any reason by any court of competent jurisdiction, such provision shall be severed and the remainder of the provisions hereof shall continue in full force and effect as if this Agreement had been agreed with the invalid illegal or unenforceable provision eliminated.
If a clause in a contract is found to be invalid, illegal or otherwise unenforceable, this clause allows the parties to remove that clause and continue performing under the contract.
For More Information
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