The Wisconsin Bar Association has a number of different sections for its various members. One such section is the Business Law Section. This section puts out periodic newsletters. In the December, 2013, edition of the Business Law News, Attorneys James M. Ledvina and Brick N Murphy, both of the Law Firm of Conway, Olejniczak & Jerry, S.C., of Green Bay, tackled an interesting topic raised by an unpublished, but none-the-less important, Wisconsin Court of Appeals decision. This deals with what is commonly known as an “integration clause.”
In the case of C&M Hardware, LLC v. Ture Value Co., 2013 WI App 84, 348 Wis. 2nd 761, 833 N.W.2d 872 review denied, 2013 WI 87, 350 Wis.2d 727, 838 N.W.2d 635, the Court of Appeals looked at the issue of whether a contract clause which purports to say that the contract includes all matters between the parties, really does, thereby stopping a party from bringing in evidence outside the contract?
In this case, C&M alleged that provisions in the contract that said it was “the entire agreement” were not conspicuous nor did they specify the specific tort claims that C&M would be releasing if it signed such a contract. The Court of Appeals agreed with C&M. As a result, Ledvina and Murphy suggest adding the following language to all such clauses:
THE PARTIES ACKNOWLEDGE AND AGREE THAT BY AGREEING TO THIS SECTION THE PARTIES ARE WAIVING RIGHTS THAT THEY MAY OTHERWISE HAVE TO ASSERT CLAIMS FOR CONTRACTUAL BREACH OF REPRESENTATIONS OR WARRANTIES, MISREPRESENTATION AS A TORT, NEGLIGENCE, NEGLIGENT MISREPRESENTATION, FRAUD, AND OTHER TORT CLAIMS.
While this is an unpublished opinion, and is only useable for argument sake, it still doesn’t make a lot of sense. Parties that sign contracts should read them. If they sign them, we should be able to rely on the fact that they did read them. If we even put in a paragraph that says, “this is the whole agreement,” we should all be able to rely on it. This decision basically says, you now have to provide a very visible paragraph that sets forth what someone is giving up if they sign a contact that says, “this is it.” Extend this further: maybe we need such a paragraph for each and every term of a contract. Maybe we should just get opinion letters from the other side indicating their clients have read and understand the contract. Isn’t that what they hired their lawyers for to begin with?