Amendments - ISDA Provision: Difference between revisions

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{{isdaanat|9(b)}}
{{newisdamanual|9(b)}}
Three lookouts here.
 
'''One''': according to her majesty’s judiciary, [[email]] is not included and ''does not count as an [[electronic messaging system]]''. Let your klaxons blare. It seems absurd at first glance — [[Jolly Contrarian|some]] would say it seems absurd having read the whole judgment in {{Casenote|Greenclose|National Westminster Bank plc}} — but there it is: that is the law of the land at the time of writing.
 
'''Two''': This might not so much matter were it not for another spectacular outing for her majesty's judiciary<ref>{{casenote|Rock Advertising Limited|MWB Business Exchange Centres Limited}}</ref>, in which Lord Sumption decided that a “[[no oral modification]]” clause means what it says. Hitherto is has been assumed to be an easy give to pedantic lawyers who have nothing more constructive to say. Strictly interpreting a [[NOM]] clause probably makes sense if you are contemplating the eternal verities on the hard benches of a law library — or your judicial chambers — but it makes none if your job is to manage the cut and thrust of daily operational contract management.
 
To be sure, most financial institutions have a military-industrial complex handling the negotiation of {{isdama}}s and other trading contracts, so a formal amendment is not likely to pass with copperplate script execution. But where the Agreement contains a manifest error, and the parties perform notwithstanding to the intended commercial bargain - who can say?
 
And as for [[waiver|waivers]] — especially when your [[credit department]] is in the thrall of setting [[NAV trigger|NAV triggers]] it doesn’t monitor and isn’t likely to to exercise — are a different story.
 
'''Three''': Good luck reconciling the above with the {{isdaprov|Counterparts and Confirmations}} clause, which says, rightly, that the binding action on a {{isdaprov|Transaction}} is ''the moment the parties first agree it'' — that is, as likely as not, a phone call or Bloomberg chat, or in volume products, an electronic handshake between booking systems. Since a {{isdaprov|Transaction}} ''is'' a modification to the {{isdama}} the words above ring a bit hollow.
 
{{Seealso}}
*{{Casenote|Greenclose|National Westminster Bank plc}}, on whether email is an electronic messaging system;
*{{casenote|Rock Advertising Limited|MWB Business Exchange Centres Limited}} on whether one can [[orally]] [[amend]] a contract with a “[[no oral modification]]” clause
 
{{ISDA 2002 Section 9 TOC}}
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