A Watched Pot Never Boils: Preventing Boilerplate Provisions from Bubbling Over


When documenting a potential deal, attorneys and clients tend to focus on the "deal terms," like the sales price, and overlook seemingly innocuous boilerplate provisions. Failure to watch out for the potential pitfalls associated with typical boilerplate provisions can result in problematic litigation when the deal falls apart or a dispute arises. Transactional attorneys should avoid the false sense of security in boilerplate provisions, and consider such provisions with an eye toward future litigation.

The efficacy of any agreement remains unknown until the agreement comes under scrutiny in litigation. Once under a microscope, conflicting choice of law, forum selection, dispute resolution or arbitration provisions, unintelligible variable interest rate provisions, insufficient merger or entirety clauses, or incomplete force majeure clauses can create costly and unnecessary litigation headaches. This article considers the litigation pitfalls that arise when transactional attorneys fail to watch the pot, and offers potential solutions to keep the pot from boiling over.

Excerpted from the Houston Lawyer, September/October 2010. To read the full article, click here.

Topics in this article include:

  • Watch for Consistency: Conflicting Provisions in Separate Agreements
  • Watch the Forum: Crafting an Arbitration Agreement
  • Watch for Cracks: Making a Merger Clause Count
  • Watch the Unforeseen: Defining Force Majeure
  • Watch for Clarity: Keep Variable Interest Simple
  • Watch the Note: Who's got it?

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