Conflicting provisions: Overview, definition, and example
What are conflicting provisions?
Conflicting provisions occur when different clauses in the same contract, or in related agreements, contradict each other. This can create uncertainty about which term applies, potentially leading to disputes. Contracts often include an order of precedence clause to clarify which provision takes priority if a conflict arises.
For example, if a contract’s main terms state that payment is due within 30 days, but a schedule attached to the contract states 45 days, the provisions are in conflict. Without clear guidance, the parties may disagree on the correct payment timeline.
Why are conflicting provisions important?
Conflicting provisions can create confusion, delays, and legal disputes. If a contract does not clarify which term takes precedence, resolving conflicts may require negotiation or even litigation.
To avoid issues, businesses often include an order of precedence clause, which sets a hierarchy for interpreting the contract. For example, a contract might specify that its main body takes priority over attachments or that written amendments override prior agreements.
Understanding conflicting provisions through an example
Imagine a software company signs a contract with a client. The contract’s terms and conditions say the company must provide software updates every six months, but an attached service-level agreement (SLA) states that updates will be provided every three months. Since both documents are part of the contract, the conflicting provisions could cause disputes about the company’s actual obligations.
To prevent confusion, the contract should include an order of precedence clause stating which document governs in case of a conflict. For example, it might say that the SLA takes priority over the main contract, meaning the company must provide updates every three months.
An example of a conflicting provisions clause
Here’s how an order of precedence clause might appear in a contract to resolve conflicting provisions:
“In the event of any conflict between the provisions of this Agreement and its exhibits, schedules, or attachments, the terms of this Agreement shall prevail unless otherwise stated in writing.”
Conclusion
Conflicting provisions can cause uncertainty and disputes in contracts, making it essential to clarify which terms take priority. By including an order of precedence clause, businesses can reduce ambiguity and ensure smooth contract execution. Reviewing agreements carefully for inconsistencies can help prevent misunderstandings and legal complications.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.