Location Image

397 Central Park Rd, Strubenkop Security Village, Pretoria, 0081

Time Image

08:00am - 5:00pm

The risks of an agreement that was copied and pasted: The whole agreement or non-variation clause

Many agreements, whether referring to lease agreements, employment agreements, agreements of purchase and sale, service level agreements or other types of agreements include boilerplate clauses. A boilerplate clause is a clause that appears in most if not all written agreements. These are clauses used often by legal professionals. Most professional legal examinations test students on boilerplate clauses as they are considered as very important in the legal profession.

Although one may in principle utilise any and all boilerplate clauses, these clauses may cause problems if they are not relevant to a specific situation. It may be risky to rely on boilerplate clauses without considering the needs of the specific parties as such clauses do not require an attorney to apply his or her mind to the specific instruction.

One example of a boilerplate clause which may have a significant impact on the parties is called a whole agreement clause. As the name suggests, this clause stipulates that the whole agreement is described in its written form and limits the parties to the written agreement in that no part of the agreement exists outside the written agreement. The point of this clause is to regulate any changes or variations to the agreement. A whole agreement clause requires that the agreement only be varied or that a part only be added thereto if the amendment is consented to by both parties and in written form.

In the case of Everfresh Market Virginia (Pty) Ltd v Shoprite Checkers (Pty) Ltd (CFT105/10 [2011]) the court discussed and extended the meaning of what constitutes to “consent in writing to an amendment”. It is important to note that a simple electronic signature at the bottom of an e-mail may be sufficient to constitute a party’s signature and therefore to constitute a written amendment. Therefore, it is best to have amendments made in writing after a verbal discussion has taken place and not to do so via e-mail correspondence.

Although some agreements obviously require a whole agreement clause, it is not desirous to have this clause in all agreements. There are circumstances where it would be more sensible not to have a whole agreement clause as parties wish to amend the agreement between them verbally and not by way of formal amendments. The intention of both parties will indicate what would be best in a specific situation.

For example, if the parties are uncertain with respect to the exact EXECUTION OF PERFORMANCE required it may be best to allow for verbal discussions between the parties instead of written amendments. Similarly, if either or both parties do not have legal representation present during contractual negotiations it may be best exclude this clause as the contents of the agreement may not be complete and correct in the first place and therefore the parties may not be best protected by being limited to the written agreement only.

Although some situations may call for the absence of a whole agreement clause, it is still safest and best to describe TYPE AND LEVEL OF PERFORMANCE required by the agreement in as much detail as possible. 

For example, a construction agreement may exclude a whole agreement clause as the construction stages and progress will be determined by additional schedules rather than in the actual agreement. The absence of the said clause may be better than attempting to pre-set all time periods for the stages of the project.

However, the size and style of the construction project is part of the type and level of performance and should therefore be made very clear in the written agreement and not be left undescribed. The level and quality of the project and the physical outcome of the product is part of the type and level of performance and should therefore be part of the written agreement.

It is advisable to consult a legal practitioner for assistance during any contractual negotiations. It is also advisable that you be clear as to what you expect from the agreement between yourself and another party so that the attorney can ensure that the agreement is drafted in accordance with your intentions and expectations.