No partnership clause: Difference between revisions
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{{a|boilerplate|{{subtable|Nothing in this Agreement shall be construed as creating any partnership, joint venture or agency relationship between the parties.}}}} | {{a|boilerplate|{{subtable|Nothing in this Agreement shall be construed as creating any [[partnership]], [[joint venture]] or [[agency]] relationship between the parties.}}}}Standard fare on dreary commercial contracts, the “no partnership” covenant is designed to stop merchants inadvertently stumbling into relationships with which they have [[joint and several liability]] for not only their own acts and omissions, but those of their counterparty. | ||
In the classic [[partnership]], each party is liable, in full, for any losses incurred or brought about by any of the other partners when acting on behalf of the enterprise. The moral of the story is “don’t go into partnership with morons or psychopaths” — this isn’t bad life advice generally, come to think of it — and so sticking it in a commercial contract which on its face does no such thing does no real harm beyond offending the sensibilities of those with a passion for elegant minimalism in their contracts. Such as yours truly. | |||
For the thing is this: either your [[NDA]], on its face, does not even pretend to set up the sort of dynamic that could be regarded as a [[partnership]]<ref>While partnerships can arise inadvertently, their general characteristics — profit sharing, common ownership of property and contribution of capital, joint management of the enterprise — are a world away from the terms of the average arm’s length commercial contract, so you would have to be quite careless to do it.</ref> — why would me giving you confidential information do that? — in which case you don’t need the clause, or it does, in which case you shouldn’t have it. | |||
Revision as of 08:04, 30 May 2022
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Boilerplate Anatomy™
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Standard fare on dreary commercial contracts, the “no partnership” covenant is designed to stop merchants inadvertently stumbling into relationships with which they have joint and several liability for not only their own acts and omissions, but those of their counterparty.
In the classic partnership, each party is liable, in full, for any losses incurred or brought about by any of the other partners when acting on behalf of the enterprise. The moral of the story is “don’t go into partnership with morons or psychopaths” — this isn’t bad life advice generally, come to think of it — and so sticking it in a commercial contract which on its face does no such thing does no real harm beyond offending the sensibilities of those with a passion for elegant minimalism in their contracts. Such as yours truly.
For the thing is this: either your NDA, on its face, does not even pretend to set up the sort of dynamic that could be regarded as a partnership[1] — why would me giving you confidential information do that? — in which case you don’t need the clause, or it does, in which case you shouldn’t have it.
- ↑ While partnerships can arise inadvertently, their general characteristics — profit sharing, common ownership of property and contribution of capital, joint management of the enterprise — are a world away from the terms of the average arm’s length commercial contract, so you would have to be quite careless to do it.