Template:Isda 1(b) summ: Difference between revisions

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It wouldn’t be ISDA if there weren’t a [[hierarchy]] clause; like all [[hierarchy]] clauses, all this just states the obvious: the pre-printed {{isdama}} itself sits at the ''bottom'' of the hierarchy, and is modified by the counterparties to their hearts’ content by its {{{{{1}}}|Schedule}}; once that is negotiated and stuck into the netting database, the {{{{{1}}}|Schedule}} basically sits there unloved and unregarded until [[apocalypse|from the sky shall come the Great King of Terror]]<ref>© Nostradamus</ref> and may be (but generally isn’t) modified as needs be for each {{{{{1}}}|Transaction}} by the {{ {{{1}}}|Confirmation}}.  
It wouldn’t be ISDA if there weren’t a [[hierarchy]] clause; like all [[hierarchy]] clauses, this one states what ought to be obvious: the pre-printed {{isdama}} itself sits at the ''bottom'' of the hierarchy, is modified by the {{{{{1}}}|Schedule}}; once that is negotiated and stuck into the netting database, the {{{{{1}}}|Schedule}} sits there, ungainly, unloved and unregarded until [[apocalypse|the Great King of Terror comes down from the sky]]<ref>© Nostradamus</ref> and may be (but generally isn’t) modified as needs be for each {{{{{1}}}|Transaction}} by the {{ {{{1}}}|Confirmation}}.  
 
One quick point that only needs saying when busy-bodies from internal audit come looking for worms and earwigs under rocks: you never, never, ''never'' inline amend the {{isdama}}. If you want to amend its terms —


In point of fact the {{ {{{1}}}|Confirmation}}s don’t tend to ''modify'' anything in the Master or {{ {{{1}}}|Schedule}}, but rather builds on them, but if there is inconsistency — and with a document as pedantic and overwrought as the {{isdama}} you never know — then the most specific, recently edited document will be the one that prevails.
In point of fact the {{ {{{1}}}|Confirmation}}s don’t tend to ''modify'' anything in the Master or {{ {{{1}}}|Schedule}}, but rather builds on them, but if there is inconsistency — and with a document as pedantic and overwrought as the {{isdama}} you never know — then the most specific, recently edited document will be the one that prevails.


All of this follows from general principles of contractual interpretation and common sense communication, of course.
All of this follows from general principles of contractual interpretation and common sense communication, of course.

Revision as of 20:03, 9 March 2024

It wouldn’t be ISDA if there weren’t a hierarchy clause; like all hierarchy clauses, this one states what ought to be obvious: the pre-printed ISDA Master Agreement itself sits at the bottom of the hierarchy, is modified by the {{{{{1}}}|Schedule}}; once that is negotiated and stuck into the netting database, the {{{{{1}}}|Schedule}} sits there, ungainly, unloved and unregarded until the Great King of Terror comes down from the sky[1] and may be (but generally isn’t) modified as needs be for each {{{{{1}}}|Transaction}} by the {{ {{{1}}}|Confirmation}}.

One quick point that only needs saying when busy-bodies from internal audit come looking for worms and earwigs under rocks: you never, never, never inline amend the ISDA Master Agreement. If you want to amend its terms —

In point of fact the {{ {{{1}}}|Confirmation}}s don’t tend to modify anything in the Master or {{ {{{1}}}|Schedule}}, but rather builds on them, but if there is inconsistency — and with a document as pedantic and overwrought as the ISDA Master Agreement you never know — then the most specific, recently edited document will be the one that prevails.

All of this follows from general principles of contractual interpretation and common sense communication, of course.

  1. ↑ © Nostradamus
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