Question for the lawyers on here (contract pet peeve)

[Blackjack200]

I negotiate a lot of contracts in my job and one of the comments I frequently get on our shell agreement is something to the effect of "provided that disclosure of such information would not be deemed to be in violation of law or applicable regulations"

I am certainly no legal expert, but I always believed that any part of a contract that was illegal was automatically invalid. Am I wrong? Why are these lawyers spilling so much ink protecting themselves from being required by the contract to break the law?

FWIW, we believe our contracts are completely within legal and regulatory bounds, and I think our counterparties also believe this.

Is this just excessive caution? It seems wasteful to me.

 

[RKS]

The quoted phrase seems to be addressing disclosure of contractual terms or other information and not regarding an illegal activity unless I am missing something.

 

[KaOTiK]

Damn roommate agreements!

 

[sactoking]

Not enough context to be sure. However, you've just encountered attorneys potentially adding useless language for the sole purpose of justifying their expense to the client. Nobody wants to pay an attorney $300/hr to review a contract and have them say it's ok so they make stuff up to "correct" to justify the cost.

 

[Anonemous]

Damn roommate agreements!

Make sure you get the power of attorney!

 

[Corporate Thug]

I negotiate a lot of contracts in my job and one of the comments I frequently get on our shell agreement is something to the effect of "provided that disclosure of such information would not be deemed to be in violation of law or applicable regulations"

I am certainly no legal expert, but I always believed that any part of a contract that was illegal was automatically invalid. Am I wrong? Why are these lawyers spilling so much ink protecting themselves from being required by the contract to break the law?

FWIW, we believe our contracts are completely within legal and regulatory bounds, and I think our counterparties also believe this.

Is this just excessive caution? It seems wasteful to me.

No. Most contracts have severability clauses that just invalidates the invalidate provision and gives the rest of the contract full weight and effect.

http://www.library.yale.edu/~llicense/sevcls.shtml

 

[Blackjack200]

The quoted phrase seems to be addressing disclosure of contractual terms or other information and not regarding an illegal activity unless I am missing something.

I'm not sure where you are getting "contract terms" from. This language happens to be about information passing from one firm to another. It's intentionally vauge because I like my job and don't wear orange shirts into the office if you get what I mean.

Not enough context to be sure. However, you've just encountered attorneys potentially adding useless language for the sole purpose of justifying their expense to the client. Nobody wants to pay an attorney $300/hr to review a contract and have them say it's ok so they make stuff up to "correct" to justify the cost.

That's what I often suspect. There were several other changes to the original language which had absolutely no impact that I could discern.

No. Most contracts have severability clauses that just invalidates the invalidate provision and gives the rest of the contract full weight and effect.

http://www.library.yale.edu/~llicense/sevcls.shtml

That kind of language would make a bit more sense, not wanting the judge to throw the whole thing out because of one illegal clause.