Legal writing in English can sometimes confuse readers because different items of legal terminology can sometimes be ambiguous. Here I take a look at some of those and suggest ways to avoid problems.
1. TERM
Principal Legal Meanings:
(i) a provision included in a contract -
e.g. It is a term of the contract that the car I am buying is blue;
(ii) a period of time for which a contract is in force -
e.g. The term of this contract is five years;
(iii) a word or phrase used to denote something -
e.g. The term "tenancy" is used to denote occupancy of premises under a lease.
Avoiding ambiguity
The first two examples above can be especially confusing if used together - e.g. It is a term of the contract that all of the necessary work must be performed before the term expires
Rewrite to avoid ambiguity - e.g. The contract provides that all of the necessary work must be performed while the contract is in force.
In other situations, context should make apparent which meaning is intended, but use other synonyms if necessary.
2. CONDITION
Principal Legal Meanings:
(i) a requirement stated in a contract, which must be met for the contract to come into or remain in force -
e.g. I have agreed to sell the car to Bill once I have bought it myself, but it is a condition of the contract that ownership must be transferred to me before the end of February;
e.g. I have sold the car to Bill, but it is a condition of the contract that he must pass his driving test by the end of February.
NOTE: a condition of this nature will fall into one of two types -
either a condition precedent, which is an event which must take place before the parties to a contract must perform their obligations; or
a condition subsequent, which is an event which, should it occur (or fail to occur), terminates the obligation on the parties to a contract to perform their obligations.
In the two examples above, the first is a condition precedent and the second is a condition subsequent.
(ii) under English law, a term of a contract which is fundamental to the contract and the breach of which therefore entitles the 'innocent' party to terminate the contract -
e.g. Bill sold me a car, but it was not roadworthy so he was in breach of contract; as the term requiring the car to be roadworthy was classed as a condition, I was able to terminate the contract;
(iii) a state of being -
e.g. the condition of the goods was unacceptable so I returned them to the shop and asked for my money back.
Avoiding ambiguity
It is difficult to replace the word "condition" in the first two examples above, because in each case it is a term of art with a specific meaning. In most cases, the context should allow you to identify what is meant.
Generally, the assumption of a reader or listener would be that the first meaning is being referred to because, as a concept, it is encountered more frequently in practice.
If not, consider adding wording to clarify, e.g. (a) a condition the non-fulfilment of which will result in the contract never coming into force; or (b) a condition, or fundamental term, of the contract [the breach of which by one party will entitle the other to terminate].
When "condition" is used as in the third definition above, the context should almost certainly ensure that there is no doubt as to the meaning intended.
3. WARRANTY
Principal Legal Meanings:
(i) a promise that is created in a contract either expressly by a statement of fact or impliedly by law or the nature of the transaction, which concerns the object of the contract and which forms a basis of the bargain and the terms express warranty (one which is expressly included in the contract by a statement of fact) and implied warranty (one which is implied by law or the nature of the transaction) are construed accordingly
e.g. we managed to convince the seller to give a warranty (or an express warranty) that the company is not aware of any actual or pending litigation against it
e.g. in a consumer contract for the sale of goods in the UK, the law operates automatically to include in the contract a warranty (or an implied warranty) that the goods are fit for the purpose for which goods of that type are normally bought
(ii) under English law, a term of a contract which is incidental to the contract and the breach of which therefore does not entitle the 'innocent' party to terminate the contract -
e.g. Bill sold me a car, but instead of upholstery being blue, as we'd agreed, it was grey; he was in breach of contract, but as the term concerning the upholstery was classed as a warranty and not a condition, I was unable to terminate the contract;
(iii) a written guarantee of the integrity of a consumer product and of the maker's responsibility for the repair or replacement of defective parts -
e.g. when I bought my new car, it came with a one-year manufacturer's warranty as standard but I paid extra and extended it to three years.
Avoiding ambiguity
In each of the first two examples above, warranty is used as a term of art with a specific meaning. In most cases, the context should allow you to identify what is meant.
Generally, the assumption of a reader or listener would be that the first meaning is being referred to because, as a concept, it is encountered more frequently in practice.
If not, consider adding wording to clarify, e.g. (a) a warranty given in the contract by the seller and stating a particular fact; or (b) a warranty, or incidental term, of the contract [the breach of which by one party will not entitle the other to terminate].
When "warranty" is used as in the third definition above, the context should probably ensure that there is no doubt as to the meaning intended, but it is preferable to use the term "manufacturer's warranty" to make sure.
4. REPRESENTATION
Principal Legal Meanings:
(i) a statement of fact made during negotiations which does not amount to a term of a contract and so does not give rise to a contractual obligation (but which may, in certain circumstances, bring about liability for misrepresentation if untrue) -
e.g. I only leased that retail unit because of the seller's representation that it had already signed lease agreements with other "high quality tenants" for units in the same development;
(ii) the act or action of representing somebody legally -
e.g. does the defendant already have representation or will he need to use the duty solicitor? (NB - this is a solicitor whose services are provided to those who are arrested and do not have their own lawyer).
Avoiding ambiguity
It is difficult to imagine a context in which the respective meanings above would be confused.
5. GUARANTEE
Principal Legal Meanings:
(i) a legally binding commitment to by one party to stand in another party's shoes and comply with an obligation of the other party if it fails itself to comply -
e.g. Brian guaranteed the debt that Bill owed to me, so when Bill failed to pay, I received the money from Brian;
Note - you may also see the form guaranty; this tends to be an American usage.
Note also that this concept is similar to a surety, i.e. a person who person who offers security for the payment of a debt or the performance of an obligation
(ii) an assurance, not legally binding, of a particular outcome or condition -
e.g. I will do my best to guarantee a successful outcome in these negotiations;
(iii) a manufacturer's guarantee is the same as a manufacturer's warranty, i.e. it is a guarantee of the integrity of a consumer product and of the maker's responsibility for the repair or replacement of defective parts -
e.g. this product comes with a two-year manufacturer's guarantee.
Avoiding ambiguity
If using 'guarantee' in a consumer sense to refer to the obligations assumed by the manufacturer relating to repair and so on, always use the full phrase manufacturer's guarantee.
Otherwise, because the primary meaning of 'guarantee' has the serious consequence of referring to a binding legal commitment, it should be used only in that sense.
Where the intention is not to create a binding legal commitment, a synonym or paraphrase should be found. Thus, in the second example above, 'guarantee' should not be used. Instead, it would be better to use 'ensure' or 'procure' or, colloquially, 'see to it that', etc. Or else, rephrase it and say, "I will do my best to make these negotiations a success."
Note - 'guarantee' is also encountered in other phrases. For example, the expressions, 'full title guarantee' and 'limited title guarantee' in English real estate law reflect the standard of the assurance as to title being given to a buyer in a contract for the sale and purchase of real estate.
Note also - 'guarantee' is often confused with 'indemnity'. See below.
6. INDEMNITY
Principal Legal Meanings:
(i) an undertaking by one person to meet a specific potential legal liability of another, which entitles the person indemnified to a payment if the event giving rise to the indemnity takes place -
e.g. the target company which we are buying is being sued and so we have obtained an indemnity from the sellers for the amount of the award against it;
e.g. in agreements in the UK relating to the sale and purchase of a business, a buyer will commonly seek an indemnity in respect of various employment-related liabilities that may arise as a result of the operation of applicable legislation;
(ii) in the context of insurance, the total cover available to the insured under an insurance policy -
e.g. the total indemnity under my home insurance policy is $250,000.
Avoiding ambiguity
Whether or not 'indemnity' is being used in its usual or in an insurance sense should be clear from the context.
An 'indemnity' differs from a 'guarantee' in that the indemnity is a promise to compensate a party with money while a guarantee is a promise to step in and perform the obligations of a non-performing party. There is some similarity where a guarantee involves the payment of a debt on behalf of another party, and often a guarantee and indemnity are given together, but they are in fact different things.
Note - 'indemnity' is also encountered in other phrases. For example, the expressions, 'indemnity basis' and 'indemnity principle' reflect the basis and nature of a type of costs order in litigation.
