Be Careful what you sign

Topics: Contract, Defense, Void Pages: 3 (1036 words) Published: January 20, 2014
Be Careful What You Sign

There are many cases decided by courts across the country addressing the enforceability of evergreen clauses pertaining to different business transactions. In most cases, particularly in the context of commercial business-to-business contracts, courts strictly construe these provisions where the contract language is clear and unambiguous. If the contract language is not followed and notice is not given within the required time to terminate, the contract extends for another term automatically There are many cases decided by courts across the country addressing the enforceability of evergreen clauses pertaining to different business transactions. In most cases, particularly in the context of commercial business-to-business contracts, courts strictly construe these provisions where the contract language is clear and unambiguous. If the contract language is not followed and notice is not given within the required time to terminate, the contract extends for another term automatically. While case law may favor those parties attempting to enforce these clauses, a few state legislatures have passed laws that may make it difficult for these parties to rely on automatic renewal clauses. For example, in 2000, Illinois adopted the “Automatic Contract Renewal Act” which makes an evergreen clause unenforceable unless the clause is “clear and conspicuous.” Although that law does not define “conspicuous,” the Uniform Commercial Code generally requires all capital letters and boldface type be used. - mclane I Personally, I think they're non-sense. Don't make me jump through hoops in order to leave your service. Actually, that should be a warning sign to anyone that's thinking about working with a processor. Every merchant should ask his or her processor, "How hard will it be for me to leave you if I'm not satisfied with your service?" First thing you want to do if it auto renews is find out if the contract is enforceable. Visit the government...

References: Auto Renewal of Merchant Agreements and Contracts « Merchant Maverick. (n.d.). Retrieved from http://www.merchantmaverick.com/articles-tips-and-advice/merchant-agreement-auto-renewal-clause/
McLane, Graf, Raulerson & Middleton : Article Detail. (n.d.). Retrieved from http://www.mclane.com/resources/article-detail.aspx?id=840
Office Issues - The Job Doc Blog - Boston.com. (n.d.). Retrieved from http://www.boston.com/jobs/news/jobdoc/office_issues/
U.C.C. - ARTICLE 2A - LEASES (2003 Revision - WITHDRAWN) | LII / Legal Information Institute. (n.d.). Retrieved from http://www.law.cornell.edu/ucc/2A/article2A
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