Speech by Lord Justice Rix
Clarity seminar at Denton Wilde Sapte 10 October 2006
I am very grateful to the organisers of this event for bringing me face to face with the subject matter of this talk.
At first I received the invitation with some pleasure: it was, I thought, a compliment. But a moment’s further reflection showed me that it could be no such thing, for the simple reason that I could hardly think of another judge less suitable or less qualified to talk on tonight’s topic. Not for me the brevity and wit of Sir Christopher Staughton. My judg- ments are known, if at all, for their length.
Not for me the pithy style and snappy sentence of a Denning: I was educated for years to reproduce the complex sentence of Cicero, a style of sentence so long it was called a “period”!
And quite apart from all that, what do I know, what experience do I have, in the drafting of contracts? In truth, that difficult and creative work is performed almost exclusively by solicitors: barristers and judges spend their time, construing but unconstruc- tively, merely shaking their heads over the ensuing difficulties. And so I am beginning, I suppose, with an apology.
However, as I said in beginning, I am grateful for being set the task of confronting face to face, perhaps for the first time so far as I am concerned, the virtues or vices of the use of plain English techniques in the drafting of contracts.
And as I warmed to my theme in preparing for this event, I managed to make such progress that my talk of, I suppose, a couple of hours or so has been reduced to more manageable proportions. So don’t look too alarmed. It will be all right. I hope.
So, first, what are plain English techniques? They are such things as the use of direct and easily understood language, conveniently and logically organised, in short sentences, avoiding complexity, redundancy, archaisms,
legalese, jargon and pomposity—how’s that for a selection of complex and Latinate nouns?
Such techniques are important not only in contracts, but also in legislation, in the drafting of official forms, and all kinds of communications.
My talk will concentrate on the context of contracts. I will give you an example of the old and the new. Here is a traditional clause:
“Upon any such default, and at any time thereafter, Secured Party may declare the entire balance of the indebtedness secured hereby, plus any other sums owed hereunder, immediately due and payable without demand or notice, less any refund due, and Secured Party shall have all the remedies of the Uniform Commercial Code.”
Here is the plain language version:
“If I break any of my promises in this document, you can at any time demand that I immediately pay all that I owe.”
Now, the plain language campaign is only some 30 years old in the law. Traditionally it is said to originate in the decision taken in 1973 by an American bank, now metamor- phosed into Citibank, to rewrite its standard customer consumer loan note. This rewriting turned out to be a tremendous success: it increased the bank’s market and at the same time reduced its litigation. That was a good start.
Since then lawyers and legislators throughout the world have encouraged the use of plain language techniques. In the United States there is legislation, for instance, that warran- ties, if they are to be enforceable at all, must be written in “simple and readily understood language”. In Australia there is case law that even the signed disclaimer “I have carefully read and understood this contract” did not avail the other party.
As it is, the demand for simplicity and the complaint that lawyers obfuscate go back much further. Cervantes said: “But do not give it to a lawyer’s clerk to write, for they use a legal hand that Satan himself will not understand”. Judge Learned Hand warned: “The language of law must not be foreign to the ears of those who are to obey it”. And Dean Rodell of Yale law School cracked: “There are only two things wrong with most legal writing. One is its style. The other is its content”.
There is also recognition that simplicity, although desirable, is difficult. There is a proverb that says: “Hard writing makes easy reading”. Leonardo da Vinci said: “Simplicity is the ultimate sophistication”. He may not have been talking about writing, but it is true also about writing. And we would all do well to remember what Shakespeare said, that “Men of few words are the best men”. (I feel inclined to sit down at this moment.)
So, how is this to be applied to the writing of contracts, and, in particular—this is the question that has been posed to me, for you— is it safe to leave behind what is sometimes described as the “tried and tested” language of contract forms and precedents in order to strike out for the brave new world of plain English?
Is it safe? Well, what does one mean by safe? The dictionary will tell you that safe can mean “not exposed to risk”, or “unenterprising”, or “based on good reasons”. In other words we cannot answer the question without consid- ering risks and rewards, and the ratio between them.
What are the rewards? As I understand the literature, they have come to be well established. Plain English improves relations with the client, because the language of the documents is more open and transparent, and less obscured by the professional jargon of the legal priesthood. Plain English contracts are also more marketable with the public, which is of particular importance in the consumer context. They involve less queries, fewer dis- putes, and less litigation. As a result, they entail less time and expense. An example from the United States: according to a Ford Motor Credit press release, borrower complaints and questions decreased by 50% when the company introduced a plain language version of their vehicle financing contract.
These rewards are of particular concern to the lawyer’s client, but perhaps they may seem less enticing to the lawyers. I would suggest, however, that lawyers do not succeed by giving their clients an inferior service: and, as the plain English project gathers pace and strength, so lawyers who fall behind in it will suffer rather than prosper. Their clients will come to expect a service which they can get elsewhere.
What, on the other hand, are the risks? Again, as I understand the literature, there is a school of thought which says: our precedents are tried and tested; they reflect the wisdom of ages, their language reflects the jurisprudence of the courts. To change runs the risk that old problems which we had learned to overcome will arise again, or new problems will be created by the new language. We will not reduce disputes and litigation but create trouble where there was peace. That will be of no assistance to our clients; and it may cause severe problems to us, the lawyers, who may be susceptible to claims in profes- sional negligence.
How do I, as a judge, react to these scenarios? I emphasise the words “as a judge”, for I lack the direct in-house experience of lawyer or client.
I would start by making what I consider to be three important points.
The first is what I call “horses for courses”. Not all contracts are of the same type. I will identify three basic categories. (Of course there are more, and there are hybrid categories as well.) Thus there are consumer contracts, which are written for the consumer by mass marketing companies, like banks, insurance companies, and consumer credit companies. Next, there are commercial contracts, which are on standard trade forms, with or without additional clauses, like charterparties and bills of lading, and commodity contracts. Thirdly, there are bespoke contracts, which may also contain within them some boilerplate clauses—sometimes a lot of boilerplate clauses, but for all that the contracts are bespoke.
In the first category, consumer contracts, clarity and understandability among the public at large are particularly important. Here simplicity and the absence of jargon are real aids to marketing and the avoidance and resolution of disputes. It is of course particularly important here to remain abreast of legislative changes; and to write contracts in ways which will withstand scrutiny under fair contract terms provisions.
Commercial standard forms, on the other hand, are not so much a marketing tool as something promoted by trade organisations. They are in general use as an aid to business in the trade. There is more room here for jargon, which in any event is likely to be trade jargon rather than legal jargon. A charter- party is perhaps a decent example of such a contract type. It is a pretty concise and busi- nesslike contract in its language, and its basic clauses have had quite a going over in the courts, which is useful. Such contract forms cannot easily be changed on a unilateral basis: it takes an industry-wide effort to bring them up to date, if they need bringing up to date. And in the meantime such forms tend to accumulate an accretion of additional clauses, which are often drafted by brokers rather than lawyers, and admittedly frequently lead to disputes. It is not easy to involve lawyers at the point of contract, because in these commercial contracts the deal is made by the brokers and the clients: the lawyers are not involved. The deal is made there and then by email or telex, or on the telephone, and this is, in lawyers’ terms, lay drafting.
Finally there are the bespoke contracts, which might arise in any commercial field, and these raise all the problems of the other categories, but here lawyers tend to have a large input. A commercial lease is an example of a standard form of contract which is usu- ally negotiated between lawyers, and also contains a lot of boilerplate clauses. So it is in a way both a bespoke contract and a standard contract, and it certainly involves lawyers in its negotiation.
And so, the consumer contract has to be prepared well in advance for commercial exploitation, to a general public of consumers, for whom legislature and courts have particular concerns; the commercial standard contract is a matter for trade negotiation, but is overlaid by broker dealing; and the bespoke contract raises problems of all kinds.
That was my first important point. The second important point I want to make is that reviewing or rewriting contracts to render them into plain English is very hard work. It cannot be done without preparation. It cannot be done quickly. It therefore cannot be a cheap process. In 1987 the Government began a five-year programme to rewrite 5,000 pages of tax legislation in plain English. That five-year programme is still in being, and the cost so far, as I understand it, is something like £26,000 per page, still rising.
I quoted earlier the saying “Hard writing makes easy reading”. I want to emphasise the “hard writing” aspect of that proverb.
The process is indeed a hard one. You have to know what you want to say. As Lord Bingham says in his foreword to the new edition of Mark Adler’s Clarity for Lawyers: “You cannot write clearly unless you know clearly what it is you want to say”. A beautifully crafted and pungently clear sentence. But knowing clearly what you want to say is hard work. You have to know what you want to say; and why; and what the law is, or might turn out to be; and why the precedents say what they say, and whether those reasons, if they still exist, are good or bad. I do not want in any way to minimise the difficulty of that task for the reviewing lawyer—a task that cannot be undertaken lightly, or by drafters who are inexperienced or untrained in their task, or rushed in time. In such work, there is plainly room for error.
Who will pay for such work? If, as in the case of the Citibank or Ford Motor rewrites, a specific client commissions the task, it will be properly rewarded. But if the preparation is uncommissioned, for instance work on a firm of solicitors’ contract precedents, then there is an element of faith in the future. I am sure, myself, that that faith is justified. The point I want to make is that you cannot expect the genie of plain English to come on the instant out of the bottle marked “Drink Me”.
My third major point in answering the risk/ reward question is that it is important to be clear-eyed about the causes of disputes. Not all contractual disputes arise out of difficulties of language, however they may be dressed up. Of course, nearly all contractual disputes are dressed up as difficulties over language— but I am making a different point. They do not in truth arise out of such difficulties.
Disputes occur for all kinds of reasons: because markets have changed and disap- pointed expectations; because one or other party fails financially; because one party wishes to get out of its contract; because events have shown that the contract is unbalanced; because of misfortune; because it is simply impossible to anticipate everything; because of non- or misperformance.
Can clarity in drafting avoid all these disputes? In my opinion, no. But, of course, the less room there is for argument in matters of construction of the contract, the easier it may be to avoid or settle such disputes, or to renegotiate terms, when they arise. It must also be remembered that many contracts are only concluded because a penumbra of uncertainty or ambiguity has been allowed to remain in the drafting. Disputes which arise out of that cause cannot be avoided by clarity in drafting: the whole point of the contract being successfully concluded is that a certain amount of ambiguity has been built into it. So one must not claim too much for the techniques of plain English.
Having made those three points, I am now in a position to answer the question whether it is safe to bring plain English techniques to bear on so-called tried and tested contract precedents. It is a ratio of risk and reward. It cannot be said that the hard work necessary to achieve the rewriting will be accomplished faultlessly. And, however immaculate the draftsmanship, it cannot be guaranteed that new wording will not create its own problems and its own disputes.
An example which comes to mind—although it is not a contractual one, it arises in a commercial setting—is the comparatively modern 1996 Arbitration Act. That Act was a long time in gestation; it was given the most careful thought; it had the most prestigious of draftsmen, including Lord Steyn and Lord Saville; it was drafted in a modern and user- friendly style. Nevertheless, it has engendered quite a bit of litigation, for all of the reasons which I have touched upon.
Even so, the rewards are, I think, great. I have stated them earlier, and I believe them to be genuinely claimed, although I cannot of course speak from personal experience. Intuitively, however, they make good sense to me.
And so the balance needs to be struck. It seems to me that, although one cannot elimi- nate all risk, and certainly cannot do so without hard work and intelligence, the balance is well on the right side of the line.
Like our homes, and our clothes, and everything about us, there is a constant need for maintenance and refurbishment. You cannot rely on the old for ever; you cannot keep on patching; from time to time you have to have a proper overhaul. That is what plain English is about. And if you do not carry out that overhaul, then the risk of simply carrying on in the old way is greater than the risk of under- taking the new. And if the work is done with care and intelligence, the risk of error which might involve a claim of negligence is likely to be small. And it is there in any event: and is perhaps all the greater where you follow unthinkingly in an old path, rather than rethink everything in a fundamental and intelligent way.
A few years ago, I visited a country in a state of semi-war, accompanied by others from London. Our visit was a private one, but for our protection on occasions we were in mili- tary hands. Travelling down a road one day in a military armoured jeep, my companion with me in the back seat of the jeep asked the driver if it was safe. The driver looked at his colleague who had his machine gun resting on his knee, and who looked back at the driver. It was the driver who spoke. “Safe?
Yes, it’s safe. Not safe, safe. But safe.” That may be a possible comment on the question I have posed.
The sponsors of this talk have suggested to me certain other questions which I might like to consider: such as the use of “must” rather than “shall”; such as whether the style of documents coming before the judges has changed over the years; and such as whether plain language is harder or easier to interpret than complex language. But I would prefer, if I may, to leave such issues, or any others that you may have, to question-time after I have sat down.
In the meantime, I think I would like to end by propounding my own Ten Commandments for the drafting of contracts. To some extent they reflect the insights of plain English; but altogether they reflect my own experience in practice and for the last 13 years or so on the bench. So here goes:
- Be clear in your own mind about what you are seeking to achieve, including about the nature of the contract you are drafting. Different contracts require different techniques.
- Use short sentences, or at any rate as short as the context will allow. I think Einstein praised the virtues of simplicity but also said “don’t be more simple than is necessary”. It is best, of course, if a sentence is concerned with only one thought at a time.
- The clarity of your contract, and the ease of construing it sensibly, will be increased if you state in the contract its fundamental purpose or purposes. That will assist in construing the problems that might arise.
- Use definitions accurately to assist in concise drafting. Check that the definition in question works in each place where the defined word or phrase is used. (It is too easy to think you have got a good definition, and so you slot it in here, there and every- where and then, if you were to read back the definition in full, in the place where you used the word or phrase which is the handle for your definition, you would find that things are going wrong.)
- Clarify in your own mind the role of concepts or variables discussed in the contract. (I think you know what I mean by a concept on which the contract may play, or a variable—it might be a time variable or it might be a variable of some other kind. Contracts play with these variables and concepts, and it is important that you are very clear in your mind what the role of these concepts are, particularly when they might come together, when you have two variables acting upon one another, or a variable acting on a concept, or a different variable acting on a concept, or two concepts perhaps coming in clash with one another.) Make sure that these concepts and variables are accurately deployed in the drafting. Problems often arise because it is not clear how such concepts or variables operate in tandem with one another.
- Clarify in your own mind and in the contract the role of conditions and conditions precedent. What is vital to the operation of the contract? What breach will or ought to imperil the continuation of the contract? I am thinking here of a condition in the technical sense—in the Sale of Goods Act sense—as an obligation, any breach of which will entitle the other party to bring the contract to an end. There is always litigation about this question, and one ought to get it clear.
- When you have drafted your contract, stand back and adopt a “What if?” approach. This will often test your draftsmanship, sometimes to destruction. Of course, you cannot anticipate everything, and in any event it may detract from the success of your contract that you seek to cover unlikely events or possibilities, particularly events or possibilities which are very unlikely. In this context, do not allow the best to become the enemy of the good.
- Take care to clarify your proper law, your forum, your dispute resolution provisions. Litigation on such subjects is often hugely expensive; and the answer could be vital to the substantive result.
- Get a second view, ie an outsider to review and help you to edit your draft. He or she will see things that you are too close to see for yourself. If you have to explain to an outsider why you have drafted things as you have, or why you have left something uncovered, light will shine where there has been dark- ness or confusion.
- Institute a proper system of maintenance. Disputes or decided cases will test your contract. Adjust for the next time what needs adjustment. Keep up to date.
I will leave this inexhaustible subject there, if I may. And if you want to know how the editors of the Dictionary of National Biog- raphy express to potential contributors the principle of conciseness, which they require of their contributors, it is, I am told, by this example: “No flowers, by request”!
Thank you very much.