Clause Play Episode 01: Notice Clause
This month we have started a new video series called Play Clause where our Founder & Chief Contract Enthusiasts, Verity White talks about different contract clauses and how we, as legal professionals can improve them. Join Verity as she shows off some Notice Clauses ‘in the wild’ and gives her tips on how to bring the good old Notice Clause into the 21st century.
Watch Clause Play Episode 01: Notice Clause
Video Transcript
Hello and welcome to the first session of Clause Play. Very excited to be taking you through some different ways of playing with clauses to help improve your contracts. Both the contract document, the contract experience of your internal uses, the contract experience, and the experience that your clients, customers, suppliers have with your business and just generally making the world of business a better place to be in.
And that's what our contract operations are all about. So we're going to be playing with clauses. And today, a drum roll out clause that we're going to be playing with is the notice clauses. So you might have seen notice clauses getting around in some of your different business contracts that you work with or work on. And often they look like this.
This is kind of a fairly typical example. And I often call notice clauses a bit of a canary in the mine for contract design. And the reason for that is if you can see this little fella here, facsimile, if you have a hunt for a notice clause in a contract, you will often find some of the things that have been left behind.
And it will show you whether or not a business is up to date in its practices. Facsimile is probably not happening in your business. Do you really want to be getting notices from post by via post for legal information? Will it get to you in time? If you're a large company or if your formal notice for addresses is your accountant, you might not get all of the legal notices on time.
You might actually prefer them to be via email to a specific dedicated email address. So notice clauses to back up probably a little bit before you know why they're important often goes back to this idea of the postal rule and when offers could be accepted or when you're going to terminate an agreement and if the timing is critical, if you have to for example, give 30 days notice to terminate before an automatic renewal, for example, you want to make sure that you're giving your sending off that notice within a certain amount of time.
And on the flipside, if you have the right to increase prices, for example, and you have to give 60 days notice before the end of a particular amount of time, then again, you want to make sure that, you know, when I tell my clients this information, when I tell my supplier this information, it's valid and binding. So those are some of the reasons to have good notice clauses in your agreements and some of these little particular peculiarities around faxes and things.
It's one of the reasons why it's not a bad one to just kind of get started with redesign. Also, because they're often at the back of the agreement, which is very text heavy, often slabs of text are a bit boring. So if you can jazz up that back end to the agreement and break up the text, it can be pretty powerful.
So let's go to some examples of notice clauses in action. So I thought, well, let's take a look at what the big guns are doing. BHP is the biggest company in Australia, according to Dr. Google's research, and I've gone onto their BHP website and to their supplier registration page and I've gone on to their purchase order at terms and conditions, which is supposedly now hilarious.
This is supposed to take 30 minutes to complete. I haven't looked at the perps chatter and code of conduct. I have looked at the order terms and conditions. Now, do you think that you could read this 40 page document in 30 minutes? I don't think so. I might come back to that one. If we do another contract play, closed play session on perhaps word length and what that means for timing.
But that's factually incorrect if you're expecting your suppliers to have pre read these documents. Anyway, putting that to the side, let's have a look at the notice clauses. So oh, maybe there's no notice clauses that would be awkward.
So each notice of a change doesn't it doesn't seem like they're ending the purchase order. They re go the company can end it at any time on written notice. That's pretty hardcore. Um, doesn't look like they have a specific notice clause that's set out somewhere. So there you go. That's not helpful. Normally, they're at the back or I can't find it there.
I wonder if they need it or if the notices just generally spread out. You don't necessarily need one, but it's always nice to know how long a time you need to give notices. So then I went over to Commonwealth Bank and if you scroll down to the bottom you might be expecting to see terms and conditions, but they've got this under important documents.
So when you click on important documents, you'll be taken to this kind of important information and you kind of have to figure out what important documents you want. This seems a bit strange to me. I'm surprised that in this product category, it feels like the client is supposed to know that terms and conditions would be under bank accounts anyway.
So if you click on bank accounts, then you've got to know what type of bank account you want. Finally, his document says terms and conditions. So let's go to our terms and conditions. So that's the document that we're in here again. How many pages are we looking at here? 34 pages for these terms and conditions. It's pretty long again, I think there'd be quite a bit of reading in it.
Oh, there's a few visuals that's kind of fun. Are these clickable? No, that would be handy if these are clickable boxes. Some graphics there. That could be really helpful if I could go to that section. Anyway, I digress. Let's find out. Notice because I found it before, so hopefully it's there. So here we can see we've got two statements and notices.
However, one of the things that I've noticed on this notice is that it seems to be one-sided. It's all about how CommBank can give their customers notices, but it doesn't seem like there's any particular method for the user to give a notice. So it's not mutual. So they can give notices and statements electronically, how they give them how we give paper statements, we can change it.
You can ask for a one off paper statement, paper statement fees. So it's not super clear. Again what is going on with this notice. If yeah, we can give you notices, if the terms and conditions don't say that your statements will be given in a non electronic way. So quite confusing and complex language that not something that you would necessarily expect everyone to understand.
Let's go to Canva, one of my favorite brands. I'm sure it's a favorite of many people. Here we go. So here is the at least here we're saying that Canva will here's the address for you to contact Canva. So everyone who is not in the US can send a legal notice to Surry Hills and if you're in the US you can send it to this address here, which is quite interesting, although I'm surprised, as you might be, that Canva is like, yes, in its legal notices to a physical address.
That's quite interesting. As a digital based design platform, you would think that they would be all about having an email and kind of tracking the notices that they get and kind of keeping contact with them. Then strangely, they've got this is how you send notices to us, but then they've got their notices down here, so we can send notices to you via email or other legally permissible means.
So that's kind of a little bit I mean, why not have them together right then? I wanted to show you one of the ways that I've done a redesign of a contract notice clause before. So if I put this up, you can see that it's the same clothes that I had shown up in before. And one of the things that I mentioned is that you can use this notice clause to break up that back end of your document and make it a bit more engaging.
So if I can, this is the kind of after let me make my little head a bit smaller. So you can see here this wouldn't work in all branded situations, but you can instead of having emojis, you can have icons, you can change the way that you want. And most people wouldn't necessarily accept hand delivery anymore. Well, maybe they would.
But it's interesting that even just looking at it there, it breaks it up and makes it really clear what else you might notice is that this is mutual. So you can see that we've got a mutual close. Anyone giving notice under this agreement. So that way it's, you know, that it works for both parties.
And it's not saying, well, you have to, you know, buy a stamp and send us a letter versus we can just send you an email. And then it's got those specific times there which over here is kind of broken up into these different the different clauses in the sub clauses, whereas here it's in a table, it's much easier to break it down and say, well, I want to send a notice via email and here's how I do it.
So I'm interested in your thoughts. How would you redesign? I notice because often I've even kind of gotten rid of notice clauses depending on the type of agreement that I'm working on. As long as there's a clear way to contact and whatever the specific contact method is, generally it's email these days. But if you've got a specific date and this is often the case for large enterprise contracting relationships, if you're a supplier or if you've got lots of customers and you might have a you might need to receive notices on to, you know, change notices, ordering more things, canceling services.
You want to have a nice, lean, easy to manage process and or web application. And if it's via a web application that people can turn things on and off. Is that reflected in your terms and conditions? So just some fun thing? Well, I think they're fun things to think about. And yeah, we'd love to hear your thoughts on any of those play items.
And that has been the first episode of Clause Play. Dee Dee Dee Dee Dee. So hope you've had fun playing around with notice clauses.
I’m Verity White and I am the chief contract enthusiast at Checklist Legal which is a B Corp certified commercial law firm where we redesign contracts to make life better. Tell me your thoughts. How would you play with the notice clause?
If you've got ideas on any clause that you would like us to play with or any particular company’s contract that you'd like to see us have a little get our little mitts into reach out via @checklistlegal on Instagram, Linkedin or comment below.
