Do You Actually Need All of Those Boilerplate Contract Clauses?

Anyone who has ever written or read a contract has noticed that at a certain point, things start to feel different than the rest of the work. The language gets more generic and feels less related to what the contract is actually spelling out. If you’ve read more than one contract, you’re probably getting deja vu. These sections are called boilerplate clauses, but they might as well be called “legal gobbledygook.” 

Boilerplate language is typically used to safeguard a contract from any unforeseen issues. It refers to the fact that it is dropped into almost every contract, virtually the same across all fields. For context, here are some examples of common boilerplate clauses that get put into contracts:

• • Arbitration. This clause states that disputes between the contract holders must be settled through arbitration and out of court. This is very popular with businesses to avoid negative press from court appearances.

• • Choice of Law and Jurisdiction. The Choice of Law clause determines what state’s laws will be upheld if the contract is broken, as the policy varies from state to state. Similarly, the Jurisdiction clause determines what state a lawsuit will be filed in if the contract is broken. These states must have a firm connection to the contract in question.

• • Confidentiality. This clause states to what extent the companies involved are allowed to speak publicly about their work together. This is important if they are developing a new product meant to be kept under wraps.

• • Force Majeure. This clause, translated from the French phrase “superior power,” states what happens if a natural disaster were to stop one side from upholding their end of the contract. For instance, if their workspace was destroyed by a tornado, they would no longer be expected to hit certain requirements.

• • Severability. This clause means that if a certain clause within the contract is found to be unenforceable, that specific clause is dropped from consideration but the rest of the contract remains valid.

Reading those, you might think that these clauses are important to include in your contracts. They certainly are. The issue comes, however, from the fact that they are always included verbatim the same in every contract, along with dozens more. You do need them, but you need them actually tailored to you.

To understand the real purpose behind boilerplate clauses, we need to look at the word itself. The word “boilerplate” refers to the plate metal around a water boiler that protects its user from catching fire to their kitchen. It refers to something commonplace that is made to protect you. Boilerplate clauses have certainly become commonplace, but we may have forgotten that they are indeed intended to protect us.

So the answer is: boilerplate clauses you write are important, but they should be specific and tailored to your contract. Boilerplate clauses inside contracts you are reading are still important enough to read, because they could cause you trouble down the line. If you don’t even read it, then you don’t know the rules of the game you are playing.

Most importantly, always consult an attorney. Here at the Wallenstein Law Group, we can help draft boilerplate clauses that are actually necessary for your contract, as well as look over any included in a contract you were handed. Contact the Wallenstein Law Group today for help sifting through the mess to get to what you need to know. Our mission is simple: expert solutions at reasonable rates.