Memorandum of understanding

The basic principles of contract Go Premium Formation: capacity and authority · representation · misrepresentation · offer · acceptance · consideration · intention to create legal relations · agreement to agree · privity of contract oral vs written contract · principal · agent Interpretation and change: governing law · mistake · implied term · amendment · assignment · novation Performance: force majeure · promise · waiver · warranty · covenant · sovereign immunity · illegality · severability · good faith · commercially reasonable manner · commercial imperative · indemnity · guarantee Breach: breach · repudiation · causation · remoteness of damage · direct loss · consequential loss · foreseeability · damages · contractual negligence · process agent Remedies: damages · adequacy of damages ·equitable remedies · injunction · specific performance · limited recourse · rescission · estoppel · concurrent liability Not contracts: Restitution — quasi-contract — quasi-agency Index: Click ᐅ to expand: Contract Tort Restitution Comments? Questions? Suggestions? Requests? Insults? We’d love to 📧 hear from you. Sign up for our newsletter.

Memorandum of understanding
/ˌmɛməˈrændəm ɒv ˌʌndəˈstændɪŋ/ (Also, an “MOU”) (n.)

A posh — and gender appropriate — way of saying a “gentlemen’s agreement.”

A lawyer will tell you — is bound to tell you, with an existential shudder, that MOUs aren’t worth the paper they are written on, but lawyers operate in general structural defiance of the commercial imperative, so who cares what they think.

And while it is generally true this is also true, in a bigger picture sense, of any contract with a commercial value less than about £10 million, however legally binding in theory, since the cost of enforcing it means no-one in possession of sound mind and competent legal advice would launch legal action for a sum smaller than that.

See also

• Commercial imperative