A PLAIN LANGUAGE APPROACH TO STANDARD FORM CONTRACTS – By Bharat Manwani
A PLAIN
LANGUAGE APPROACH TO STANDARD FORM CONTRACTS
Author Name: Bharat
Manwani
Contact Details: bharatmanwani05@gmail.com or
+91-9819313731
Institution: Gujarat
National Law University (GNLU)
Designation: Second
Year student pursuing BBA LLB (Hons.)
Introduction
“What do you call a dense, overly
lengthy contract that is loaded with legal jargon and virtually impossible for
a nonlawyer to understand? The status quo.”[1]
- Harvard Business Review.
You probably have a contract for something
you signed this week. Maybe it was for a cell phone plan, or to rent an
apartment. Perhaps you agreed to buy a car. Whatever the case, the contract was
likely written in legal jargon that’s difficult to understand and feel
confident about what you’re agreeing to. Unless it’s so complicated that you
needed a lawyer to review it (which many people can’t afford), then chances are
you felt like there wasn’t enough time or information available to make sure
that everything was fair and reasonable before signing on the dotted line.
The traditional legal language has often been
critiqued for being exclusionary, since only a certain section of society has
access to it. Legal nomenclature, as well as the law itself, has been
criticized for being archaic. The refusal to stray from standard writing
procedures has resulted in legalese that is incomprehensible not just to
laymen, but also many lawyers.[2]
Legalese requires more time to draft, read, and understand, and yet it
frequently falls short of the drafter's main objective of precision. This
dissatisfaction with legalese kicked off the “plain English Movement”
back in the early 1960s.
The movement has been pushing to ensure that contracts
are understandable and clear, regardless of your background or education level.
The idea is that if people can understand what they're agreeing to when signing
contracts, they will be more likely to know their rights and whether something
is reasonable from their perspective, rather than having the agreement dictated
by one side with better access to lawyers and financial resources than the
other party does. The movement goes beyond just improving consumer rights
though; social justice advocates see plain language as essential because it
helps ensure legal fairness for everyone, not just those who are richer or more
privileged.
Defining Plain English
A term with several definitions and interpretations, Plain English needs
to be limited to a common definition in order to proceed with this topic. With
no common definition, people may not be able to build a consensus on anything.
It is imperative that the standards for Plain English be based on the outcomes
it produces, for which we would have to rely on the outcome based definition.[3]
Majority of the definitions for Plain English accommodate principles set by the
Plain Language International Association which is encompassed under their own
definition: “A communication is in plain
language if its wording, structure, and design are so clear that the intended
readers can easily find what they need, understand what they find, and use that
information.”[4]
Professor Robert Eagleson, a scholar within the domain of plain English
defined it as, “clear, straightforward expression, using only as
many words as are necessary. It is a language that avoids obscurity, inflated
vocabulary and convoluted sentence construction.”[5]
He further explained that it is neither a simplified form of the English
language nor is it ‘baby speak’. Plain English language writers persuade their
audience to pay attention to the message rather than getting distracted by
complicated terminology. They ensure that the audience easily gets the message,
which highlights the fact that his definition is based on the outcome as
well.
There
have been several guidelines issued by organizations across the world,
prescribing their own standards of the Plain English language. The variety of
these standards, however, does not insinuate vagueness. It highlights the richness and
flexibility of the approaches used by the movement instead.[6]
Despite the fact that the plainness criteria differ extensively, the movement
places a strong emphasis on the readers' minds. It requires that the language
be written in such a way that the reader is able to comprehend with ease.
The
significance of reducing words and clarity is crucial for plain English,
however these two aspects are not adequate. The precision in legal writing
forms the third important pillar, when it comes to conveying information
through plain English. Precision is needed to cover all possibilities that
would become part of a potential legal dispute, in order to provide for
recourse. The distinction between plain English and conventional legal language
in achieving precision is in the manner in which they express the terms.[7] In order
to achieve accuracy with the traditional legal English, drafters would usually
fit a large number of words in lengthy sentences. Sometimes documents may
contain verbose words in an incomprehensible sentence structure, while at its
worst, documents would be rife with repetition. The Plain English movement
maintains that precision can still be achieved with the use of minimum words in
a straightforward, clear language.
Section
50.10 in the Code of Federal Regulations is a classic illustration of the
ability of redrafting in plain English from traditional legal language.
“S
50.10 Trees, shrubs, plants, grass and other vegetation. (a) General
injury. No person shall prune, cut, carry away, pull up, dig, fell, bore, chop,
saw, chip, pick, move, sever, climb, molest, take, break, deface, destroy, set
fire to, burn, scorch, carve, paint, mark, or in any manner interfere with,
tamper, mutilate, misuse, disturb or damage any tree, shrub, plant, grass,
flower, or part thereof, nor shall any person permit any chemical, whether
solid, fluid, or gaseous, to seep, drip, drain or be emptied, sprayed, dusted
or injected upon, about or into any tree, shrub, plant, grass, flower, or part
thereof, except when specifically authorized by competent authority; nor shall
any person build fires, or station, or use any tar kettle, heater, road roller
or other engine within an area covered by this part in such a manner that the
vapor, fumes, or heat therefrom may injure any tree or other vegetation.”[8]
The
above clause could be redrafted as “No one may harm the plants”, which in fact
would allow for more legal protection rather than listing specific acts.
Tracing the genesis of
the Plain English Movement
When the rule of common law was introduced in the United States of America,
it brought along the drafting style of old English lawyers. In the year 1817,
Thomas Jefferson deplored the drafting style of the lawyers he practiced with
and characterised their method as to “making
every other word a ‘said’ or ‘aforesaid’ and saying everything over two or
three times, so that nobody but we of the craft can untwist the diction and
find out what it means...”[9]
The traditional legal language has often been critiqued for being exclusionary,
since only a certain section of society has access to it. Legal nomenclature,
as well as the law itself, has been criticized for being archaic. The refusal
to stray from standard writing procedures has resulted in legalese that is
incomprehensible not just to laymen, but also many lawyers.[10]
Legalese requires more time to draft, read, and understand, and yet it
frequently falls short of the drafter's main objective of precision. This dissatisfaction with legalese kicked off
the “plain English Movement” back in the early 1960s.
David Mellinkoff released his book “Language of the Law” in the year 1963,
wherein he stressed upon the need to improve the function and style of the
legal language. Although the theme was not novel as illustrated by his bibliography,
but it did well to spark the Plain English movement.[11]
During the same decade, there was a surge in consumer groups in the West, which
were responsible for protecting the rights of ordinary citizens against
government entities and corporations.[12]
As a result, grassroots organizations devoted to the elimination of
bureaucratese, officialese, and legalese have sprung up to help individuals of
ordinary intellect comprehend what they were doing when they had to fill out a
tax form, apply for housing benefits, or sign an insurance policy.
In the year 1972, President of the United States Richard Nixon decreed
that the Federal Register would be written down in layman’s terms and the
movement gained traction.[13]
The first practical application of this drive for 'plain language' in the legal
domain emerged from Citibank in 1973.[14]
They wrote a 'promissory letter' without the legalese, that is typically used
in contracts. The campaign was so well received by the public and the media
that some states began asking the federal government to draft laws along the
same lines.
Consumer protection, which is at the heart of plain language, has
historically had a vein of "anti-legalese" running through it, but
few expected someone to try to "legislate the style of society's
prose." The Sullivan Act (named after Peter Sullivan) was signed into law
by the Governor of New York in August 1977, mandating that some consumer
contracts be "written in a plain and cohesive way using terminology with
ordinary and everyday meanings."[15]
This law was enacted in 10 other states as well.
Chrissie Maher, who lobbied the British government in the early 1970s to
amend the language of convoluted forms, gave the movement a boost in England.
In 1979, The Plain English Campaign came into effect in Liverpool and its
consequence in ostracizing "gobbledygook" quickly expanded owing to
several publicity stunts, among which was shredding thousands of official
documents outside Westminster.[16]
All major English-speaking countries by the mid-1980s, including
Australia, Canada, New Zealand, and, by the early 1990s, South Africa, had
commenced their Plain Language movements. Furthermore, the campaign is not
limited to English; similar projects have gained traction in a number of
nations, notably Sweden's Plain Swedish Group (Klarsprksgruppen) and (most
recently) Italy's Progetto Chiaro.
Standard Form Contracts
The most prevalent sort of economic contract is standard-form contracts,
sometimes referred to as fine print or boilerplate. They are utilised in several
billions of annual financial transactions. In the most usual case, the
purchaser acquires the product or service and is supplied with the pre-printed
form contract that includes conditions such as dispute resolution, warranties,
among other things, along with limited room for negotiation.[17]
Warranties bundled with consumer items, safety disclaimers on the back of
sports tickets, conditions of use and privacy policies for websites, or maybe
even photocopying limits in the front of magazines are just a few examples.
Almost everyone has unwillingly been made a party to thousands of such standard-form
contracts.
The overwhelming majority of modern transactions are handled using
conventional agreements supplied on pre-printed forms, with little or no chance
to discuss the agreement's provisions. Standard form contracts are expected to
account for roughly 99 percent of all consumer contracts.[18]
The effectiveness of form contracts is one of the main reasons for their
widespread use. Standard form contracts are an important part of modern
business since the expenses of creating individual contracts typically outweigh
the potential profit from many regular transactions.[19]
The common law system emphasizes the need for agreement between the
parties of the contract, for which they have to negotiate upon every term
included in the contract. In reality, this does not happen since many
private-sector entities employ standard-form contracts. During the
laissez-faire economic era in the nineteenth century, standard-form contracts
gradually achieved recognition and widespread application. The norms of
contract law, on the other hand, were created before the appearance of
standard-form contracts and were based on the notion of a negotiated agreement.
Individual negotiation between the parties was the contractual mechanism's
cornerstone and a way of securing contractual fairness. Because the feature of
negotiation is lacking from standard-form contracts, they do not match to this
conception of the contractual relationship. Kahn provides an Orwellian
description of the standard-form contract, as a “depersonalized contract which
is a one-sided product of an economically superior party imposing rules that
favour him, especially exemption from liability provisions”. Taking into account
the above-mentioned inequalities, it is crucial for the consumer to read
through the terms and conditions of such contracts. They establish the legal
status of the contracting parties, their rights and responsibilities, and
frequently the repercussions of a breach of the terms and conditions, therefore
consumers should read these papers carefully.
Problems with traditional
Standard Form Contracts
Informed consent is the cornerstone of consumer well-being when it comes
to contractual agreements. Informed consent is frequently obtained by
explicitly asking customers, through a contract or agreement, if they
understand their contractual duties and rights. While this is a test of
consumers' reflective ability in regard to their opinion that they have grasped
something, it is possible that it is not genuinely gauging whether the consumer
has grasped the agreement. In other words, a person may pretend to comprehend
the repercussions of signing a contract, but they may not realize the full
extent of the ramifications until they are confronted with a specific
difficulty stemming from or linked to the contract's provisions.
It has also been argued that it is helpful for the customer to
understand the terms and conditions of a contract. Consumers having access to
an appropriate amount of information that they can understand and process in
the context of the agreement will protect them from suboptimal outcomes such as
being forced to make purchase decisions based on peripheral information, like
pricing and brand signals. However, it has also been significantly proven that
consumers often do not adequately understand the contents of contracts, even if
they read them.
Understanding is key in the reading process, and thus comprehension. If
the reader finds the material incomprehensible, it will be ignored. Only if the
reader comprehends what he or she reads will information be transferred to his
or her long-term memory. Once it is in memory, they can use their acquired
information to do cognitive tasks such as problem solving. It is important in
text presentation that everyday vocabulary is used, and that the text is
organized in a neat manner. In the case of a consumer transaction, the process
of entering into a formal agreement begins with the reader being exposed to a
written document, such as a contract or purchase agreement. Once the reader is
made aware of the document's existence, he or she must agree to its terms in
order for a binding contract to be formed. This is most often done by signing
one's name on the dotted line.
A consumer may decide not to read a paper if it appears to be overly
complicated. This usual reaction, obviously, has major consequences for the
vendor. If a buyer signs a small print contract without reading it, he or she
may be agreeing to terms they don't comprehend. However, if they refuse to
accept the terms, they will lose access to some perks. Many organizations, as
you may have seen, use small print contracts that are written in a lot of
technical jargon. Because the technique is so common, terms like "buyer
beware" are frequently placed onto these contracts to protect the
corporation from litigation. In short, legal documents violate the most
important principles for making documents easy to comprehend. The documents are
full of difficult vocabulary and are poorly structured grammatically. Legal
documents seem difficult to read, with poor organization and very small type.
However, all this is actually by design. If a document is painless to read,
there is a better chance that it will be painless to understand as well.
The majority of commercial contracts are extensive, poorly designed, and
filled with needless and unintelligible verbiage.[20]
Negotiating a contract should not take a long time. Business executives should
not need to consult an attorney to read a contract that they are responsible
for enforcing. We should ideally live in a world where plain English is used to
write contracts and potential business partners can discuss them without their
attorneys and read, comprehend, and sign a contract. An ideal world where
ambiguity is no longer a source of conflict.
A Plain English
approach to Standard Form Contracts
Contracting in plain English isn't a novel phenomenon. It's a movement
that began many years ago since
President Nixon mandated the use of "layman's terminology" in
the Federal Register in 1972.[21]
President Jimmy Carter issued an executive order six years later requiring that
federal rules be "as plain and straightforward as practicable."[22]
In 1998, the Clinton administration went a step farther by requiring federal
agencies to utilize plain English.[23]
During that same year, the Securities and Exchange Commission of the United
States produced A Plain English Handbook for persons preparing security
disclosure forms, which is still in use today. The Plain Writing Act was
approved by Congress in 2010 and signed by President Barack Obama, with the
stated goal of "supporting straightforward government communication that
the public can understand and use."[24]
As Obama’s administrator of the Office of Information and Regulatory Affairs
noted, “Plain language can make a huge difference” by saving money and making
it “far easier for people to understand what they are being asked to do.”
Guidance was issued on plain language that remains in effect by the agency that
was responsible for administering the law.
The application of Plain English language in standard form contracts can
result in apparent efficiency gains for both, the legal practitioners and
contracting parties. Standard form contracts drafted with the use of Plain
English are easier to read and help save time. Lawyers reviewed counterpart
copies of the same contract, one written in plain English and the other in
conventional language, in a study for the Law Reform Commission of Victoria.
The time it took to comprehend the plain English version was between 33% and
50% less than it took to comprehend the conventional form.[25]
Furthermore, because plain language publications are easy to comprehend,
there are less questions regarding interpretation. Many firms and governmental
entities claim to have saved significant amounts of money by converting their
standard-form contracts to plain English in the United States and elsewhere.
Professor Joseph Kimble conducted a recent assessment in the United States and
found several examples of significant cost reductions as a result of the
adoption of plain language documents.[26]
A vast number of studies have been conducted, analysing the differences
in comprehension of legal documents when written down in traditional legal
language and plain English language. Almost all of them have proved the fact
that documents written with the use of the plain English language are easier to
read and understand in comparison to the traditional legal language. The most
significant ones are briefly described below.
In a study of medical-consent forms, readers were able to properly
answer 2.36 questions out of 5 on the original form; on the updated version,
they were able to correctly answer 4.52 questions out of 5, a 91 percent
improvement. Furthermore, the average reaction time decreased from 2.65 to 1.64
minutes.[27]
Plain language enhanced understanding by 140 percent in one test, from
15 percent to 36 percent, and by 31 percent in another test, from 50.5 percent
to 66 percent, in another research of various legal documents that primarily
focused on the comprehension of standard form contracts.[28]
Professor Joseph Kimble in his research paper titled, “Answering the
Critics of Plain Language” conducted his own experiment with the use of a
standard form contract.[29]
He sampled the independent contractor agreement that was routinely used by the
Michigan State Agency. He conducted his knowledge-based assessment, in order to
check comprehension of the plain language format on a total of 65 people. This
demographic was broken down into two categories, 27 of whom worked in Michigan
State Agency itself while the other 38 participants were law students. The
results of this test were as follows.
The above results clearly indicate the positive effect of using plain
English language in a standard form contract. For the agency staff that
participated in this study, there was 45.5% increase in the accuracy i.e., the
comprehension of this contract along with 16.2% rise in the speed of their
assessment. With respect to the law students who were part of this experiment,
they reported a 23.5% increase in comprehension and a 19.7% decrease in time
taken to complete the assessment. These results go on to show that a standard
form contract written down with the help of plain English has significantly
increased the comprehension and savings in time.
The applications of implementing plain language with standard form
contracts seem promising. Some firms have already started employing this
writing style and gaining from it. The implementation of plain language
contracts at GE Aviation’s digital services has resulted in a 60% decrease in
negotiation time than the legalese versions, along with positive customer feedback.[32] The experiments mentioned in the above sections have also proved to
deliver efficiency gains due to the influence of the plain English
movement.
The benefits of standard form contracts in plain language are twofold.
First, they make it easier for people to understand what they're agreeing to.
This means that people can make better informed choices about what's right for
them. As a result, they're also more likely to be satisfied with the products
and services they purchase, which in turn should reduce complaints and
disputes. This helps businesses too by reducing the costs associated with
defending disputes and building customer satisfaction.
Second, plain language contracts help people understand their rights and
obligations so that when a problem does arise, people are better able to
resolve it efficiently themselves or at least know when to seek legal advice.
If the contract is clear on each party's rights and obligations from the outset
of their agreement it will be much easier for them to identify any breach of
contract as soon as it occurs and work together towards a resolution (or at
least know whether or not a breach has occurred).
Conclusion
A primary goal of the Plain English Movement is to make
contracts easier for people to understand. Legal drafting has changed as a
result, with drafting becoming more focused on making contract language
accessible to lay people for whom the contract is intended. The Plain English Movement is also a social justice issue in the sense
that it can help disadvantaged groups. As discussed above, many people are
required to sign contracts and agreements without fully understanding them.
These groups may face issues such as language barriers, literacy issues, or
accessibility concerns. Eliminating the use of overly complex language in
standard form agreements can protect these individuals from exploitation by
making sure they understand what they are signing.
[1] Why It’s Time to Kill Legalese. (2018, June 19). Harvard Business
Review. https://hbr.org/2018/01/the-case-for-plain-language-contracts
[2] Kimble, J. (2006). Lifting the Fog of Legalese. Amsterdam
University Press.
[3] Schriver, Karen & Cheek, Annetta & Mercer, Melodee. (2010).
The research basis of plain language techniques: Implications for establishing
standards. Journal of the international association for promoting plain legal
language, 63(1), 26-32.
[4] International Plain Language Federation. (2017, May 4). What is
plain language? Plain Language Association International (PLAIN). https://plainlanguagenetwork.org/plain-language/what-is-plain-language/
[5] Xanthaki, H. (2020). Enhancing Legislative Drafting in the
Commonwealth (1st ed.). Routledge. https://www.routledge.com/Enhancing-Legislative-Drafting-in-theCommonwealth/Xanthaki/p/book/9781315759180
[6] Id. at 6.
[7] Syafrani,
A. (2018). Plain English Movement And Penman’s Criticism To Strengthening The
Movement. SALAM: Jurnal Sosial Dan Budaya
Syar-i, 5(1), 77–90. https://doi.org/10.15408/sjsbs.v5i1.7907
[8] Code of Federal Regulations:
1949-1984. (1976). United States: U.S. General Services Administration,
National Archives and Records Service, Office of the Federal Register.
[9] Wydick, R. C. (1978). Plain English for Lawyers. California Law
Review, 66(4), 727. https://doi.org/10.2307/3479966
[10] Supra. at 2.
[11] Goldfarb, R. L., & Mellinkoff, D. (1964). The Language of the
Law. Michigan Law Review, 63(1), 180. https://doi.org/10.2307/1286463
[12] Williams, C.. (2004). Legal English and Plain Language: an
introduction, 1, 111-124.
[13] The Plain Language Action and Information Network (PLAIN). (2000).
Revisiting Plain Language. Plainlanguage.gov https://www.plainlanguage.gov/resources/articles/revisiting-plain-language/
[14] Williams, C.. (2004). Legal English and Plain Language: an introduction, 1, 111-124.
[15] V. (2020,
August 27). Plain Language Drafting
Movement: Time for Revival in India. RGNUL Student Research Review (RSRR). https://rsrr.in/2020/04/28/plain-language-drafting-movement-time-for-revival-in-india/
[16] Plain
English Campaign (UK). (2003). Chrissie
Maher OBE. Plain English UK. http://www.plainenglish.co.uk/about-us/history/chrissie-maher-obe.html
[17] Bakos,
Y., Marotta-Wurgler, F., & Trossen, D. R. (2014). Does Anyone Read the Fine
Print? Consumer Attention to Standard-Form Contracts. The Journal of Legal Studies, 43(1),
1–35. https://doi.org/10.1086/674424
[18] Ware, S. J.
(1989). critique of the reasonable expectations doctrine. University of Chicago
Law Review, 56(4), 1461-1494.
[19] Stolle, D. P.,
& Slain, A. J. (1997). Standard Form Contracts and Contract Schemas: A
Preliminary Investigation of the Effects of Exculpatory Clauses on Consumers’
Propensity to Sue. Behavioral Sciences & the Law, 15(1), 83–94.
[22] Executive Order 12044—Improving Government Regulations. (1978, March 23). The American Presidency Project. https://www.presidency.ucsb.edu/documents/executive-order-12044-improving-government-regulations
[23] Barron,
D. (2014, February 1). Plain English:
It’s the Law. The Web of Language. https://blogs.illinois.edu/view/25/109299
[24] Siegel,
J. (2010, October 18). Obama Signs “Plain
Writing” Law. ABC News. https://abcnews.go.com/WN/obama-signs-law-understand/story?id=1190284
1
[26] Kimble,
J. (2012). Writing for Dollars, Writing to Please: The Case for Plain Language
in Business, Government, and Law (1st ed.). Carolina Academic Press.
[27] Kaufer,
D. S., Steinberg, E. R., & Toney, S. D. (1983). Revising Medical Consent
Forms: An Empirical Model and Test. Law, Medicine and Health Care, 11(4),
155–184. https://doi.org/10.1111/j.1748-720x.1983.tb01731.x
[28] Masson,
M. E. J., & Waldron, M. A. (1994). Comprehension of legal contracts by
non-experts: Effectiveness of plain language redrafting. Applied Cognitive
Psychology, 8(1), 67–85. https://doi.org/10.1002/acp.2350080107
[29] Kimble,
J. (1994). Answering the Critics of Plain Language. The Scribes Journal of
Legal Writing, 5(1), 51–62. https://heinonline.org/HOL/LandingPage?handle=hein.journals/scrib5&div=7&id=&page
[30] Kimble,
J. (1994). Answering the Critics of Plain Language. The Scribes Journal of Legal Writing, 5(1), 51–62. https://heinonline.org/HOL/LandingPage?handle=hein.journals/scrib5&div=7&id=&page