Execution date
|
In the annals of tedium, few subjects are less apt to exite the animal juices than that of the execution date of an agreement. But this will not stop diligent legal beagles from trying.
It is one of those irritating chicken-and-egg factual problems that attends the execution, across different locations and in different time zones, of modern financial services contracts. When the JC was a lad, everyone pitched up at the arranger’s office in EC2 with a closing agenda and a flight case full of engrossments, exchanged posh biros and that sort of thing, the date on which they did it was hardly the sort of thing you could doubt, even if you wanted to. But now, when the desk head, if she can be found at all, is working remotely from her chalet in Verbier and might be “indisposed” of a given afternoon — a fresh dump of pow, let’s say — and can’t be geolocated or otherwise persuaded to sign her name on the account control agreement on the day everyone else is signing it, you have this existential conundrum. When is the agreement to be dated?
The lucky fellow “holding the pen” won’t write in the date but will leave it blank, to be filled in by hand when the festivities are complete. It is a bit sloppy to forget to write it in after all that, but hardly unheard of — deal fatigue spikes asymptotically the moment ink touches paper, and folks can forget the niceties as they stampede for the door. And it is not all bad: one fellow’s clerical oversight is another’s gainful employment, and hunting down and castigating people for creating undated agreements will provide rich fodder, for years, for our friends in internal audit.
But does it really matter? To be sure, the execution date is of some moment in, for example, a loan, since it might designate the date on which your first interest rate fixes and interest begins to accrue. But is less important on a a master trading agreement or any kind of general relationship agreement that simply sets up the legal terms governing a relationship, but doesn’t specifically create liability in and of itself. At a push, the JC would decree an undated relationship agreement to be effective either (i) the date when the last person who needed to sign it, did sign it, or failing that (ii) the date, after that last person signed it, under which the parties interacted in a way that would only be explained by reference to a binding legal agreement between them.
There is usually no dispute between the parties. If this happens. for good order, it is best to just agree what everyone think the date should be (or have been), and then write it in the agreement. As long as it is not before the date everyone did sign, nothing turns on it and, in all reality, unless it is a loan or something like that, nothing much[1] turns on it even if dated before, as long as all parties agree.