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ISDA Anatomy™
In a Nutshell™ Section 12:
12. Notices
12(a) Effectiveness. Any communication under this Agreement may be given in any manner described below (except that communications about Events of Default and Termination Events or Early Termination may not be given by electronic messaging system or e-mail) as set out in the Schedule) and will be effective when delivered:―
- (i) By hand: when delivered;
- (ii) By telex: are you kidding me? Who has a telex these days? OK when the recipient’s answerback is received;
- (iii) By fax: FAX??? When were you born Grampa? Ok when received in legible form (the burden of proof being on the sender and, no, a transmission report won’t do);
- (iv) By registered mail: when delivered (or when delivery is attempted);
- (v) By electronic messaging system: when received; or
- (vi) By e-mail: when delivered delivered,
unless delivery or receipt happenens outside ordinary business hours on a Local Business Day, in which case it will be deemed effective on the following Local Business Day.
12(b) Change of Details. Either party may change its contact details by notice.
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2002 ISDA full text of Section 12:
12. Notices
12(a) Effectiveness. Any notice or other communication in respect of this Agreement may be given in any manner described below (except that a notice or other communication under Section 5 or 6 may not be given by electronic messaging system or e-mail) to the address or number or in accordance with the electronic messaging system or e-mail details provided (see the Schedule) and will be deemed effective as indicated:―
- (i) if in writing and delivered in person or by courier, on the date it is delivered;
- (ii) if sent by telex, on the date the recipient’s answerback is received;
- (iii) if sent by facsimile transmission, on the date it is received by a responsible employee of the recipient in legible form (it being agreed that the burden of proving receipt will be on the sender and will not be met by a transmission report generated by the sender’s facsimile machine);
- (iv) if sent by certified or registered mail (airmail, if overseas) or the equivalent (return receipt requested), on the date it is delivered or its delivery is attempted;
- (v) if sent by electronic messaging system, on the date it is received; or
- (vi) if sent by e-mail, on the date it is delivered,
unless the date of that delivery (or attempted delivery) or that receipt, as applicable, is not a Local Business Day or that communication is delivered (or attempted) or received, as applicable, after the close of business on a Local Business Day, in which case that communication will be deemed given and effective on the first following day that is a Local Business Day.
12(b) Change of Details. Either party may by notice to the other change the address, telex or facsimile number or electronic messaging system or e-mail details at which notices or other communications are to be given to it.
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Click here for the text of Section 12 in the 1992 ISDA
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Who would have thought a notices provision would be so controversial? Especially the question "what is an electronic messaging system"? No-one, it is humbly submitted, until Andrews, J. of the Chancery decision was invited to opine on Greenclose v National Westminster Bank plc, the kind of "little old lady" case that makes bad law. The learned judge does nothing to dispel the assumption that lawyers are technological luddites who would apply Tip-Ex to their VDUs if they didn't have someone to do their typing for them (and if they knew what a VDU was).
For there it was held that “email” is not an “electronic messaging system” and, as such, was an invalid means for serving a close-out notice under the 1992 ISDA.
While we’re on the subject who seriously has a telex in this day and age?
Read in depth about that case here.
CSA
Note that the 1995 CSA subjects its notice provisions to this provision (see Paragraph 9(c) and 11(g).