Recitals form one of the most important parts of a contract, as they act as an introduction to the contract.
When incorporating recital clauses in contracts, it's crucial to include safeguards to ensure that these clauses not only reflect the intentions of the parties effectively but also provide context for the contractual obligations.
Here are some key safeguards to consider:
Accuracy and Clarity. You must ensure that the recital clauses accurately reflect the background, context, and intentions of the parties entering into the contract.
Language. Use clear and concise language to convey the relevant information effectively.
Relevance to the Contract. Recital clauses must be directly relevant to the purpose and terms of the contract. Therefore, any extraneous or irrelevant information that could potentially confuse the interpretation of the contract must be avoided.
Consistency with Operative /Boilerplate Provisions: Ensure that the recital clauses are consistent with the operative and boilerplate provisions of the contract. Verify that the statements made in the recitals align with respective rights, obligations, and responsibilities of the parties outlined in the main body of the contract.
No Additional Obligations.You should ensure that the recital clauses do not impose any new or independent obligations on the parties beyond what is explicitly stated in the operational provisions of the contract.
Only explanatory / contextual. Ensure that the recitals serve a purely explanatory and contextual function.
Non-Binding. Secure that the legal obligations of the parties arise from the substantive terms and conditions of the contract itself.
Avoid any Ambiguity. Eliminate any sort of ambiguity in the recital clauses by using precise language and avoiding open-ended or vague statements. Clearly define terms and concepts to prevent potential misinterpretation or misunderstanding.
By incorporating these safeguards when drafting recital clauses in contracts, you can enhance the clarity, accuracy, and effectiveness of these introductory statements while minimising the risk of misinterpretation or disputes.
Originally published by LinkedIn, 13 March 2024
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