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| {{essay|boilerplate|}}Any finance lawyer will be familiar with the [[conclusive evidence clause]]. These beauties are meant to support — [[dramatic look gopher]] — ''[[indemnities]]''. There’s a wealth of snarkily-presented information in [[indemnities]] [[Indemnity|in the usual place]]<ref>Go on — honestly — you’ll love it: [[Indemnity]]</ref> but the key point to remember is that, a ''[[well-crafted indemnity|well-crafted]]'' [[indemnity]]<ref>Much talked about, seldom seen.</ref> is meant to be a pre-agreement to pay an ''ascertainable sum'' of money: both parties are meant to have a fairly clear handle on what will have to be paid out. | | {{essay|boilerplate|}} |
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| Of course, as we well know, most [[indemnities]] are ''not'' well-crafted, but will be hopelessly vague, woolly, all-you-can-possibly-think-of affairs — just the kind of thing that ''isn’t'' “readily ascertainable”, at least not without the need for the a full adversarial process, with a day’s cross examination from [[Sir Jerrold Baxter-Morley, Q.C.]], to thrash them out.
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| What to do? Light-bulb moment! Have someone issue a [[certificate of indebtedness]]! Better still, have the counterparty agree, in advance, that it will be conclusive of the amount owed! Brazen though this strategy seems, it must have worked for a time, because we now find conclusive evidence clauses a part of standard [[boilerplate]] in any kinds of financing document — even, entertainingly, those without [[indemnities]] — to the point where few people know what the provision is even for, and even fewer challenge it. Well, dear reader, now you do, and you can!
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| In the traditional banking world — the one where [[lender]]s are prudent community pillars, obtain only the [[indemnities]] they need and that can be justified before a jury of their peers, and [[borrower]]s understand their place in the world — this is all straightforward: A banker ''ought'' to know how much {{sex|she}} is owed, and how much interest, and how it compounds, and ought not to be subjected to a tedious back-and-forth with a mendacious borrower trying prolong process of paying. That sort of carry-on only benefits one person, as we all know, O dear [[Mediocre lawyer|attorney]].
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| Thus, you will see that tell-tale [[caveat]]: “in the absence of [[manifest error]]”: where the sum claimed was obvious and not really in dispute; the bank did certify it but a fly got in the typewriter or some such thing and they sent out a certificate containing obviously the wrong number. Well, clearly ''that’s'' not conclusive, right?
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| But, alas, we do not live in such sensible times. The banking world is populated by idiots. These days [[indemnities]] are thrown around willy-nilly in the capital markets business, to cover all kinds of stupidly indeterminate, inappropriate things. It will not shock an [[Mediocre lawyer|experienced counsel]] to see an [[indemnity]] claimed for “any and all losses, costs, damages, liabilities, disbursements, expenses claims of whatever kind we may experience at any time in any [[space-time continuum]], merely as a function of drawing a breath”.
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| This is outrageous, but well paid [[Mediocre lawyer|members of the legal profession]] will defend it to the hilt, which they will then try to bury in someone’s back, in the process pinning a [[certificate of indebtedness]] between the adjacent shoulder blades.
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| Eventually, even those who revere correct principle over grubby pragmatism will feel cowed and will give in. Life is too short. ''Have'' your stupid conclusive evidence clause.
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| But, good luck enforcing it. And, really, good luck sticking in a clause saying “In the absence of [[manifest error]], a certificate from the Lender as to any “Loss” will be conclusive evidence of the amount owing” and getting a tribunal of fact to pay it the blindest bit of attention.
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| {{premiumsummarygeneral|{{pjchotlink|Manifest error}} as it relates to conclusive evidence}}
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| {{sa}}
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| *[[Indemnity]]
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| *[[Manifest error]]
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| *[[The Well-Crafted Indemnity]]
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| {{ref}}
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Boilerplate Anatomy™
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References