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Filed under: Business •Legal •

Law, nonsense, and predatory dinosaurs

Next stop, Wonderland…

The first (and last) time I negotiated a real estate deal, I received the “Contract of Sale” by fax.  It was old school—a paper form with blanks that had been re-used and re-filled in for years, and after generations of photocopying parts had faded into illegibility.  Experienced recipients didn’t mind—they’d seen that form before.  The company which makes the form, which favors the seller, also sells a form for the buyer to respond with that contains buyer-favoring clauses.  So the seller’s lawyer faxes the seller-favoring form, and the buyer’s lawyer sends back the buyer-favoring form, and over time the back and forth of negotiation has become increasingly ritualistic, a robotic ping-pong fax exchange of increasingly unreadable and unread forms.

You think I exaggerate?  Maybe. Today, many forms are available electronically, for example like this, which eliminates the illegibility problem.  Someone must be reading and customizing them.

But consider the following section from a nondisclosure agreement:

By disclosing such information to you, the
undersigned does not grant any express, implied, or other license
or right you to use the Company’s Confidential Information other
than as permitted in writing by the confidential information to you in
order to determine whether there is sufficient basis for a
subsequent agreement between you and the undersigned for the
further development and exploitation of the Products, without any
obligation on the part of whether you or the undersigned to enter
into any such agreement, while maintaining the confidential nature
of such information regardless of whether any such agreement is
entered into.

Wow.

It apparently concerns two parties who are discussing a potential deal.  It appears to say that the information one of them discloses should only be used by the other in connection with the discussions until a deal is reached.  Only it doesn’t actually say that.  Take a look at the first part again:

By disclosing such information to you, the
undersigned does not grant any express, implied,
or other license or right you to use the Company’s
Confidential Information other than as permitted
in writing by the confidential information.

It says something about how the information disclosed can be used (as permitted in writing), but it is confusingly circular (“Confidential Information can only be used as the confidential information says it can be used”).  It also deviates from ordinary practice, which also protects secrets disclosed verbally when reduced to writing shortly after, and usually protects disclosure by all the parties discussing the deal (not just the information of the “undersigned”).  Then the next part (starting with the words “to you” shown here in bold) gets really odd:

By disclosing such information to you, the
undersigned does not grant any express, implied, or other license
or right you to use the Company’s Confidential Information other
than as permitted in writing by the confidential information to you in
order to determine whether there is sufficient basis for a
subsequent agreement between you and the undersigned for the
further development and exploitation of the Products, without any
obligation on the part of [something missing?] whether
you or the undersigned to enter into any such agreement,
while maintaining the confidential nature of such information
regardless of whether any such agreement is entered into.

Either the highlighted words “to you” don’t belong, or something is missing there.  Something is definitely missing further down, after the phrase “without any obligation on the part of” (on the part of who?).

The section must be the victim of word processor malfunction, or OCR failure, or a badly fragmented hard drive which like a radiation-induced mutation re-arranged or erased some of the original words.  The mystery is why so few notice.  That form has been signed many times, probably because instead of reading it the parties assumed it said what such terms usually say, or because the party signing felt he had no choice, or because the agreement was so meaningless he decided he was better off leaving it unchanged.

Recall that one of those rules of construction mentioned earlier was “agreements are generally interpreted against the person that drafted it.”  That means when an agreement has multiple possible meanings, the interpretation of the person who drafted it is disfavored (because he had his chance to make it clear); or, put another way, the interpretation of the person who signed without asking for changes is favored.  That sometimes gives an incentive to sign without asking for any changes.

Re-read until you see the dinosaurs…

One playful lawyer I know deliberately spikes his agreements with nonsense, particularly in the boilerplate “force majeure” section.  That section says, in effect, that a party will be excused from his obligations under the agreement if the reason is something he can’t control and couldn’t anticipate.  To the usual force majeure litany (war, earthquakes, floods) he adds funny excuses for non-performance: the return of predatory dinosaurs, attacks by synchronized hat-exchanging disco dancers, the appearance of men with hands of blue walking two by two…

Even the largest law firms, although proudful about their precision and their hundreds of attorneys available to read and re-read, glide over those force majeure dinosaurs again and again, draft after draft, without murmur or complaint.

The danger of this trick (apart from the possibility someone could assert the words must mean something) is the possibility someone might eventually notice, and be irked.

But it’s a dandy way to tell if anyone is actually reading everything, because a lot of the time, they ain’t.

- Charles

PS: Next up, probably, will be something about trademarks and trademark searches.  But what would you like to read about here?  Suggestions welcome!

===========================================
Charles B. Kramer, Esq.
===========================================
For discussion purposes, not legal advice.
===========================================

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Hi, Graham!  And thanks for the welcome.

And thanks for suggesting the relationship of film v. architectural copyrights (and film v. the copyright in billboards) as a subject for an article.  A related and more difficult problem arises in computer games where the scenery is based on a real city.

Charles

PS: This isn’t a complete answer, but check out:

(1) http://www.bitlaw.com/source/17usc/120.html (USA’s Copyright Act S.120) which among other things says:

“The copyright in an architectural work that has been constructed does not include the right to prevent the making, distributing, or public display of pictures, paintings, photographs, or other pictorial representations of the work, if the building in which the work is embodied is located in or ordinarily visible from a public place.”

(2) http://www.copyright.gov/title37/202.html (Regualations for the Copyright Act S.220)which among other things says:

(d) Works excluded [from Copyright Registration]. The following structures, features, or works cannot be registered:

(1) Structures other than buildings. Structures other than buildings, such as bridges, cloverleafs, dams, walkways, tents, recreational vehicles, mobile homes, and boats.

(2) Standard features. Standard configurations of spaces, and individual standard features, such as windows, doors, and other staple building components.

(3) Pre-December 1, 1990 building designs —(i) Published building designs. The designs of buildings where the plans or drawings of the building were published before December 1, 1990, or the buildings were constructed or otherwise published before December 1, 1990.

Posted by CharlesBKramer  on  01/28  at  06:18 AM

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So, you “critiqued” some piece of complete gibberish; what’s your point?  It was probably hashed together by some sloppy, careless egomaniac who is arrogant and underestimating enough of other people to figure that they’re “not smart enough” to figure it out(and, obviously, albeit ironically, that he or she is).  And, if you’re naive enough to take it seriously, then the author no doubt has some bridge down by Brooklyn that he or she is willing to sell you at a bargain basement price…such people do, in fact, exist.  Hint: take a look around you.

Posted by .(JavaScript must be enabled to view this email address)  on  12/08  at  02:30 AM

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Hi, NYSecjd, thanks for reading my piece, but perhaps you missed the point that *lots* of lawyers copy forms mindlessly—to the point where common phrases are accepted just because they are common.  I’ve had the experience of quite senior lawyers trying to justify clauses because “every contract” contains them—which is true.  But they’re still wrong.

Charles B. Kramer

Posted by CharlesBKramer  on  12/26  at  09:49 PM

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