Three-Element Provision

A Three-Element Provision is a atomic contract provision that contains three distinct but interrelated contractual stipulations, contractual conditions, or contractual requirements.

• Context:
  • It can range from being a Three-Element Obligation Provision to being a Three-Element Permission Provision to being a Three-Element Declarative Provision.
  • It can be broken down into Simpler Provisions.
  • It can facilitate clearer contractual negotiations by explicitly separating key conditions or requirements into manageable parts.
  • ...
• Example(s):
  • Three-Element Indemnity Provision:
    • “[Party A shall indemnify Party B against any claims]¹ [arising out of Party A's use of the licensed technology]² [provided that Party B notifies Party A promptly of any such claims]³."
  • Three-Element Confidentiality and Non-Disclosure Provision:
    • “[Recipient agrees to keep the information confidential]¹ [and not to disclose it to any third party without the prior written consent of the Discloser]² [except as required by law or court order, in which case the Recipient shall provide prompt written notice to Discloser]³."
  • Three-Element Warranty Provision:
    • “[Seller warrants that the goods will be free from defects in materials and workmanship]¹ [for a period of twelve months from the date of delivery]² [provided that the goods have been used only in accordance with the manufacturer's instructions]³."
  • Three-Element Subletting Fee Provision:
    • “[If Tenant sublets]¹ [Tenant must pay Landlord 50% of excess rent collected from subtenant]² [within 30 days of receipt]³."
  • Three-Element Early Termination Fee Provision:
    • “[Tenant may terminate this Lease early]¹ [by providing 60 days written notice to Landlord]² [and paying an early termination fee equal to one month's rent]³."
  • Three-Element Late Delivery Penalty Provision:
    • “[If the delivery is delayed beyond the agreed date]¹ [the supplier must pay a penalty of 5% of the total invoice]² [for each day of delay]³."
  • Three-Element Conditional Warranty Provision:
    • “[The warranty shall be valid for one year]¹ [provided the product is used according to the user manual]² [and not subject to misuse or unauthorized modifications]³."
  • ...
• Counter-Example(s):
  • a Two-Element Provision, Four-Element Provision, Five-Element Provision.
  • a Single Sentence Contractual Provision.
• See: Conditional Contractual Element, Contract Modification, Contractual Synthesis, Interdependent Contract Clause, Legal Drafting Technique, Provision Complexity, Risk Mitigation in Contracts.

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