Template:M comp disc 2002 ISDA Defaulting Party and Affected Party

Defaulting Party and Non-defaulting Party

A “Defaulting Party” is one who has committed or suffered, and a “Non-defaulting Party” is one who is not implicated in the commission or sufferance of, an Event of Default. There is something judgmental and contemptuous about a defaulter, that there isn’t about one who is merely affected.

Affected Party and Non-Affected Party

Not even ISDA’s crack drafting squad™ could confect something worthwhile to say which might improve this Spartan piece of text. But note the concept of Affected Party is sprayed liberally throughout Section 5(b), and it means something different in almost every context so you’re guaranteed to have fun there.

Elsewhere there is much monkeying around as regards the concept of Illegality, particularly insofar as it relates to Credit Support Documents, and the newly introduced Force Majeure.