Corporate & Securities Law

A Voice in Favor of Ambiguity?

By Ken Adams

Via Twitter, I came across a blog post entitled “Effective Contract Drafting: A Subversive Manifesto.” It’s by William Carleton, partner at a Seattle law firm.

It begins as follows:

It’s always best to say what you mean as clearly and as simply as you can, right?

Maybe.

…

Ambiguity, however, is indispensable to the drafter of commercial contracts.

At this point you might expect me, as a painstaking chronicler of contract ambiguity, to start hopping up and down in rage. But I believe that what we have here is differences in terminology.

The point William makes in his blog post is that contract negotiation can often be as much about what you don’t include in a contract as what you do include. I certainly wouldn’t argue with that. For example, it’s been suggested that Conan O’Brien’s lawyers intentionally didn’t ask that his contract with NBC specify that The Tonight Show would start at 11:35 p.m. (That’s discussed in this American Lawyer article by Brian Baxter.)

Since the tactic William writes about is based on omitting issues from a contract, it’s best understood as not involving ambiguity, which is a function of alternative meanings offered by a given word or phrase. Instead, it creates a void that the parties can fill with their competing interpretations if the issue subsequently raises its head.

In particular, that’s very different from what I refer to as “creative ambiguity”?intentionally adding ambiguous language to a contract so that you can, if it works to your advantage, reopen an issue that the other side assumed had been settled. That’s something I discussed in this January 2009 post.

In chapter 6 of MSCD I discuss the tendency of lawyers and judges to attribute to ambiguity all sources of uncertainty in contract language. This March 2008 blog post contains my first crack at this topic.

Full post as published by AdamsDrafting on January 22, 2010 (boomark / email).