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As a supplier of products or services, it is vital to understand the importance of well-drafted contracts. Binding contracts aim to safeguard your business interests and set clear customer expectations. However, language plays a crucial role in contracts, and using ‘legalese’ rather than simple English can cause risk issues. This article will explore whether you should use legalese in your contracts and the key issues to consider under English law.
What is Legalese?
‘Legalese’ within written agreements refers to the specific technical language and terminology of legal documents. This can include complicated phrases, technical jargon, and archaic legal words which lawyers have used for many years historically.
Legalese commonly aims to use specific language to establish traditional legal principles. Although legalese can enhance legal clarity for lawyers, excessive use can present challenges for individuals without legal knowledge. It is vital to balance using legalese where strictly necessary yet ensuring that contract language is accessible and understandable to the target audience.
Contracts are vital documents to protect you from risk as a supplier. Whether you should avoid legalese in your contracts will depend on various considerations.
Critical Issues
1. Do You Need Legalese for Specific Contract Purposes?
As a supplier, there might be situations where your contracts require specific legal language to allocate risk and protect your business.
For example, the phrase ‘time is of the essence’ is a specific legalese phrase that offers remedies if a time-bound obligation is breached. However, as a supplier, this wording might be vital. For instance, stating that time is of the essence regarding a customer’s obligation to pay could mean you have various remedies for late payment.
Other favourable legalese wording could include clauses such as:
- a force majeure clause—while this sounds like legalese, it relieves a supplier of obligations if outside events prevent contractual performance, such as storms or floods;
- an indemnity clause – an indemnity clause often uses complicated legalese wording. However, allowing a supplier to recover losses and damages from a customer in certain circumstances can be necessary. For instance, when the customer unlawfully shares personal data with the supplier, the supplier is penalised for using such data.
As such, certain parts of your supplier contracts may require specific legalese for particular circumstances to protect your business from risk. However, you should consider using legalese sparingly for the reasons explored below.
2. Will Legalese Cause Confusion and Legal Disputes?
In today’s increasingly modern world, businesses tend to move away from traditional legalese and prefer plain language for clarity.
Confusing and complicated legal language can lead to mismatched expectations, such as customers failing to understand specific contractual terms and what they mean. In the worst case, arguments over the legal interpretation of contract clauses can lead to time-consuming and stressful contractual disputes.
While lawyers can understand complex legal language, your team or customers may not. You should be aware that excessive legalese could result in confusion, which could give rise to various risks for your business. Your business should take measures to avoid potential disputes, which requires careful consideration of your contract terms and ensuring they do not confuse customers.
3. Will Legalese Risk New Business Opportunities?
Excessive legalese could result in complications and convoluted negotiations with potential customers.
For instance, complicated legal language in contracts could foster a sense of mistrust, particularly with customers without legal knowledge or legal teams to review contracts on their behalf.
Customers will want to ensure that they clearly understand what they are signing up for when working with your business and will want to avoid ambiguity and grounds for potential disputes.
Download this free Commercial Contracts Checklist to ensure your contracts will meet your business’ needs.
You could find yourself engaging in lots of back-and-forth correspondence with customers who need clarification about what your contracts mean. This could require significant time and resources. In the worst case, disgruntled customers who do not have time may walk away from doing business with you if your contracts are too convoluted.
You can prevent these issues by presenting your contracts in clear and plain language so customers understand where they stand.
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How Can a Solicitor Help Strike the Right Balance in Written Contracts?
Getting a contract’s language right and achieving the correct balance between legalese and plain, simple language can be challenging.
If you require support with this exercise, you should work with an experienced commercial solicitor to draft your contracts. Legal advice on your contracts and their language can be invaluable and help prevent risks and contract disputes in the long run.
A commercial solicitor can help your business strike the right balance in many ways, including:
- understanding your business activities and guiding you on the appropriate types of contracts you require;
- understanding your customer base and suggesting a contract format and process for you to execute contracts smoothly and efficiently; and
- drafting contracts that are clear enough for your customers to understand but also include legal language to protect your business where necessary.
A lawyer can also explain legalese to you so you understand and can tell your customers exactly what it means if questioned.
Key Takeaways
Legal terminology, though sometimes complicated, can prove vital for safeguarding your business from potential risks. Therefore, assessing your business operations and identifying the technical legal language necessary to be incorporated into your contracts for your protection is crucial.
Achieving a balance between contractual legalese and simple language is essential to ensure your contracts are transparent and understandable. Excessive use of technical legalese may lead to complications, including confusion, mismatched expectations, and potential business loss. Working with an experienced commercial lawyer can help your business navigate these complexities and balance your contracts appropriately.
If you need help drafting a clear contract, you can contact LegalVision’s experienced contract lawyers as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.
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