WHAT IS A CLAUSE?

A clause is a part of a written legal document in a legal frame of reference. It becomes easier to refer to pertinent information if a rigid and proficient sentence is tough to perceive with, by means of breaking it into various sections and paragraphs.

Navigation through a legal document becomes easier if such a document is broken down into a numbered section. These separate sections, paragraphs, segments, or phrases are called "clauses." Clauses find their most common use in contracts, deeds, wills, settlement agreements, and other important documents.

The agreements which are enforceable by law are contracts, and such contracts contain detailed terms, rights, and obligations. However, plenty of contracts merely requires a sentence and a couple of signatures on a piece of paper to be valid.

On that pretext, most law attorneys will advise laying out the terms and conditions explicitly in a formal written document, using clauses. All the attributes of a contract are deliberately enumerated in the clauses, i.e., who gets paid, who does the work, and what happens if any of the parties does not comply with the contract terms.

Thus, in a contract, all the specific aspects of the agreement are explicitly addressed by the provisions so incorporated as clauses. Clauses clearly dictate each party's duties, rights, and privileges under the terms of the contract.

Moreover, different types of clauses depend upon the needs of the parties. They may be a choice of venue clause. If you live in India, but the person you intend to enter into a contract with lives in Bhutan, you may add a choice of venue clause specifying that you could sue in the venue of your choice if the terms of the agreement are not complied with. This lets you decide the place where the contract will be enforced.

• Statute of the limitations clause. This clause provides the parties with a time limit for filing a lawsuit if the terms of the contract are not duly complied with. However, a statute of limitations clause cannot conflict with any existing law, and many states will not enforce a shorter statute of limitations than so prescribed in the books. Mentioned below are some other common contract clauses:

• Time of performance clause. Since some matters require to be handled within a particular time frame, a time of performance clause sets out the time for performance and non-performance of the contract. 

• Indemnification clause. The indemnification clause discharges a party from liability if losses or expenses are incurred. 

• Non-waiver clause. This clause protects parties who excuse another party when contract terms are not duly fulfilled. 

• Severability clause. A severability clause stipulates that, even if there is a clause in the contract which is not valid, the rest of the contract is enforceable. However, the absence of this clause may make the entire clause void.

• Arbitration clause. This states that any disputes must be resolved through an alternative dispute redressal method instead of being brought to the court.

• Non-disclosure clause. The presence of this clause requires one party not to disclose confidential information belonging to the other party.

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  Author: Papiha Ghoshal