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{{boileranat|Severability|{{financecontractenvy}} | {{boileranat|Severability|{{financecontractenvy}} | ||
{{image|Shears|png|Some [[dagging]] shears yesterday, suitable for severing things.}} | {{image|Shears|png|Some [[dagging]] shears yesterday, suitable for severing things.}} | ||
}}{{ | }}{{D|Severability|/sɪˌvɪərəˈbɪləti/|n}}The tolerance for having something chopped off and carrying on. With one exception, self-harming fusspottery. | ||
If ''one'' aspect of my {{t|contract}} becomes, through the machinations of the steampunk state, illegal, what does that mean for the ''rest'' of it? | |||
The general proposition for illegality is this: | |||
{{Quote|“a [[contract]] which obliges its participants to do illegal things is void: unenforceable as a matter of pubic policy.”}} | |||
So, should you hire an assassin to kill, say, your spouse and the assassin takes your money but fails to carry out the job, don’t expect [[Queen’s Bench Division|his majesty’s commercial courts]] to award you [[damages]], much less the [[courts of chancery]] to order [[specific performance]]. | |||
And if, otherwise, not, might it help if | Straightforward enough. But still, hypotheticals fester — tey do, at least, in the minds of [[Legal eagle|our learned friends]] the world over. Commercial solicitors are given to fixating upon the unknowable hereafter. They divine our possible futures and prepare us for every contingency they might shower upon us, however remote. | ||
So, what if only a ''teeny'' little bit of the contract becomes [[Illegality|illegal]]? Or all of it is, but only ''slightly''? Say it is punishable neither by imprisonment nor a fine, but is just sort of ''gauche''? | |||
If a mere corner of the accord transgresses some informal, but technically binding, guidance, can the parties still get on with the ''rest'' of the deal? | |||
And if, otherwise, not, might it help if they say, “in this contract that any bit which later becomes illegal — or even turns out to have been illegal the whole time — just ''doesn’t count'' any more, so we can carry on with all the remaining good bits”? | |||
===On crystal balls and unexpected inequities=== | ===On crystal balls and unexpected inequities=== | ||
The [[JC]]’s general | The [[JC]]’s general remarks about [[boilerplate]] are here writ large. | ||
So, firstly, that a severability clause is even on the table speaks to some apprehension on the parties’ part as the business they are proposing to do. Doesn’t it? Either that, or a '' | So, firstly, that a severability clause is even on the table speaks to some apprehension on the parties’ part as the business they are proposing to do. Doesn’t it? Either that, or a ''mis''apprehension: they labour under the incorrect impression that what they have in mind is, and will stay, legal for the period they are proposing to do it. | ||
Second, even if their enterprise was fully kosher when they resolved upon it, we must presume | Second, even if their enterprise was fully kosher when they resolved upon it, we must presume they wouldn’t seriously expect the country’s commercial courts to continue to uphold an enterprise that its criminal courts, in the meantime, would put them jail for. So we must be talking about technical infringements and not fundamental ones. | ||
Fundamental illegality — like our assassination hypothetical — would be enough to undermine a [[Consensus ad idem|meeting of minds]] in the first place | Fundamental illegality — like our assassination hypothetical — would be surely enough to undermine a [[Consensus ad idem|meeting of minds]] in the first place, but even if it did not, it would be quite the stroke of luck if the ''benefit'' that fell away by amputating a newly outlawed passage fell equally between the parties. | ||
Odds are, that is to say, that the | Odds are, that is to say, that the “severing” a contract will in fact favour one party over the other, in a way that, logically, they cannot predict before it happens. | ||
Say I have agreed, for a monthly fee of ten pounds, to provide you with five services, one of which later transpires to be illegal. The other four services remain valid, as does your obligation to pay me an amount of money once a month. So is the contract simply severed to cut out the illegal service? Must you now pay me ten pounds for ''four'' services? | Say I have agreed, for a monthly fee of ten pounds, to provide you with five services, one of which later transpires to be illegal. The other four services remain valid, as does your obligation to pay me an amount of money once a month. So is the contract simply severed to cut out the illegal service? Must you now pay me ten pounds for ''four'' services? | ||
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There is an element, too, of the lady protesting too much here: why would you enter a contract if you thought part of it might be illegal? What kind of operation are you running? | There is an element, too, of the lady protesting too much here: why would you enter a contract if you thought part of it might be illegal? What kind of operation are you running? | ||
If the choice is between blindly allocating unforeseeable losses at the start of the relationship with a [[severability]] clause, and hoping the parties can be adult enough to come together in good faith to sort out a compromise as and when the unforeseeable becomes a reality later — ''trusting'' each other, in other words, to [[Be a good egg|be good eggs]] and [[Non mentula esse|not dicks]] — then the [[JC]] knows where he’d rather be, and who he would rather be trading with. | If the choice is between blindly allocating unforeseeable losses at the start of the relationship with a [[severability]] clause, and hoping the parties can be adult enough to come together in good faith to sort out a compromise as and when the unforeseeable becomes a reality later — ''trusting'' each other, in other words, to [[Be a good egg|be good eggs]] and [[Non mentula esse|not ''dicks'']] — then the [[JC]] knows where he’d rather be, and who he would rather be trading with. | ||
===[[Finance contract boilerplate]]=== | ===[[Finance contract boilerplate]]=== | ||
So, why do we even have it? ''[[Finance contract envy]]''. That’s why. | |||
{{Severability boilerplate capsule}} | {{Severability boilerplate capsule}} | ||