This contract tip is about the risks of adding random “except as otherwise provided” in your contracts.
“Except as otherwise provided in this Agreement,…” is a favorite of many lawyers, but I’ve found it often used in a confusing and vague way.
Think for a minute about how broad that language is. Adding this phrase means whatever statement or obligation follows is now secondary to some other unknown provision elsewhere in the contract.
Now, I have no problem if we reference a specific provision (“Except as provided in Section 1.2”). We can agree a particular provision should trump another one. Or if there is only one interpretation.
But in many cases, this phrase is randomly dropped in a place it doesn’t belong. This approach is extra problematic when used with provisions critical to the risk allocation.
I had one memorable negotiation in which the other side wanted to add “Except as otherwise provided in the Agreement” before the consequential damages waiver.
I asked the counterparty, “Where in the agreement is it otherwise provided?” The lawyer couldn’t identify a place but thought it was a good idea “just in case.”
Ugh.
Avoid random insertions of this phrase where it doesn’t belong.
What's your approach to this phrase?
