We have all read those “miscellaneous provisions” portions of contracts. Those are the portions of the contract where all of the random, seemingly uninteresting provisions are found. Often those provisions include things like choice of law, jurisdictional standing, merger and integration and the like. They can also include substantive issues, such as limitations of warranty and liquidated damages clauses. These clauses are often overlooked and include boilerplate language that many parties do not even read before signing. However, the impact of these provisions can be felt for years following the contract’s execution, because they control the remedy for breach of the contract.
For example, a choice of law provision that says Georgia law applies, along with a jurisdictional clause agreeing to Georgia courts, will mean that you will have to file an action in Georgia with a lawyer who knows Georgia contract law in the event of a breach. While many of the states’ laws regarding contracts are similar, they are not necessarily the same. You may not even know the ramifications of signing a contract with those provisions until someone breaches the contract. Another issue can arise with an integration and merger clause. If the contract is written clearly and is unambiguous, courts will interpret it exactly as it is written. So, with the addition of a merger and integration clause, if the written contract does not exactly reflect the party’s understanding of the contract it is entering into, no oral evidence will be allowed by a court when someone breaches that contract. For the court’s purposes, it does not matter what someone said during contract negotiations, it matters what written into the contract. Michigan courts take a similar stance for other miscellaneous provisions. A limitation of warranty can be a successful defense against a breach of warranty claim if properly drafted and executed.
It is important that you read and know all of the provisions of the contract you execute, because the law presumes you read and understood the entire document that you signed. Do not skip over the boring, miscellaneous provisions of your contract, because those details can cause you significant heartache later. Our firm of highly trained attorneys can help you review any type of contract so that you understand the consequences of all the provisions and avoid unintended negative consequences later.
For more information or to speak with us about your legal issue, please contact us in Ann Arbor at 734-665-4441, and in Ypsilanti at 734-483-3626. To learn more about Pear Sperling Eggan & Daniels, P.C., or any of our attorneys, please visit us at www.psedlaw.com.