Non-contravention: Overview, definition, and example
What is non-contravention?
Non-contravention refers to a provision in contracts where a party affirms that the terms of the agreement do not violate or conflict with any other existing agreements, laws, or regulations to which they are subject. In other words, it assures that entering into or performing the contract will not lead to a breach of any pre-existing commitments or legal obligations. This provision is important for ensuring that the contract does not inadvertently cause legal or contractual conflicts.
For example, a company may confirm that entering into a new partnership agreement does not violate its current contracts with other business partners or clients.
Why is non-contravention important?
Non-contravention is important because it helps parties ensure that they are not violating existing contracts, laws, or obligations when entering into a new agreement. By including this provision, businesses can avoid legal complications, disputes, or potential penalties that could arise from conflicting commitments.
For businesses, confirming non-contravention provides a level of legal assurance, reducing the risk of unintentional breaches and the associated legal consequences.
Understanding non-contravention through an example
Imagine a company that is entering into a merger agreement. The company includes a non-contravention clause in the contract, affirming that this merger does not violate any of its existing agreements, such as partnership contracts or supplier arrangements. This protects the company from inadvertently breaching any of its other obligations while proceeding with the merger.
In another example, a business enters into a new lease agreement for office space, and the lease includes a non-contravention clause. This clause ensures that the lease does not violate any other real estate agreements or zoning laws, preventing any legal disputes in the future.
An example of a non-contravention clause
Here’s how a non-contravention clause might look in a contract:
“The Parties represent and warrant that the execution and performance of this Agreement do not and will not conflict with or result in a breach of any other agreement, contract, or legal obligation to which they are a party.”
Conclusion
Non-contravention clauses are essential for ensuring that the execution of a new contract or agreement does not interfere with existing obligations or legal responsibilities. By including this provision, businesses can protect themselves from unintentional breaches and mitigate the risk of legal issues arising from conflicting agreements.
Including a non-contravention clause in contracts provides clarity and legal certainty, helping businesses navigate their commitments and avoid potential conflicts or legal challenges.
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.