Amendments to Agreement
Contract Type:
NDA
Jurisdiction:
No amendment or modification of this Agreement shall be valid unless in writing and signed by an authorized representative of both parties
Explanation
This clause specifies that any changes or modifications to the agreement must be made in writing and signed by an authorized representative of both parties to be valid and legally binding.
This clause specifies that any changes or modifications to the agreement must be made in writing and signed by an authorized representative of both parties to be valid and legally binding.
In short, it means oral amendments or unilateral changes will not be valid or enforceable. Any alterations to the terms of the agreement must be:
1) In written form (not verbal)
2) Signed by empowered representatives of both parties (to signify formal approval and adoption of the changes)
The purpose of this type of clause is to:
1) Provide certainty. Written, signed amendments provide clarity and record of exactly what changes were agreed to the agreement. Informal or implied changes could create confusion.
2) Ensure proper authorization. Requiring signatures from empowered reps of both sides confirms the amendment was formally approved through the correct company procedures.
3) Limit disputes. A clear written record of authorized changes helps prevent disagreements over exactly what was or was not amended and provides evidence if disputes still arise.
4) Uphold contract validity. For ongoing contracts, any changes must be implemented properly in accordance with the law and the agreement's own terms to remain legally valid and binding. Failing to do so could jeopardize the agreement.
So in plain English, the clause sets out that the only valid and legally enforceable way to amend the agreement is through formal, written changes signed by both parties. All else will not change the legally binding terms of the contract.
Early contracts placed little emphasis on strict formalities for changes. Informal amendments were common, as long as the intention to change terms was reasonably clear. This reflected less sophisticated legal practice as well as more casual business relationships.
Over time, informal amendments became problematic. Disagreements started arising over the exact terms of amendments and whether certain changes had actually been agreed. This resulted in ongoing confusion and disputes.
Courts sought greater certainty and evidence of mutual agreement for contract changes. They moved away from recognition of informal amendments toward requiring legally valid implementation procedures to be followed.
In response, contracts began including provisions that specified the required process for valid amendments to provide this certainty. Written documentation and signatures were commonly stipulated.
These requirements came to be seen as not just legally prudent but also standard business practice. They provided transparency and clarity for all parties when the agreement needed to evolve or change in some way.• Certain customary clauses developed around requiring changes to be in writing, signed, referencing the agreement amended, and given by duly authorized company representatives. Various standards also merged for executing amendments (e.g. "wet" signatures vs electronic).
Today, amendment clauses remain an important part of most commercial contracts. They continue adapting to business and technological developments but maintain the central aim of providing a clear and mutually agreed process for enacting legally valid and binding changes. Leaving amendment provisions ambiguous or unspecified is seen as poor practice.
So in short, the historical forces driving the adoption of written signed amendment clauses were: a move toward greater legal and business certainty in contract changes; a shift from recognition of informal amendments to requiring adherence with proper procedures; and the development of standard clauses and execution methods for contract changes over time.
Like many contractual provisions, they continue evolving with business needs but serve the same fundamental purposes that have historically motivated their use.
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