Terms of Enlightenment

final12A team of attorneys I once worked for in Manhattan specialized in the purchase and sale of aircraft between countries. Transactions often involved a slew of lawyers from different corners of the world and required that the legal team as a whole put together a set of documents so an aircraft could be properly transferred from Seller to Buyer: Escrow, Contract, Sale, Purchase, blah blah blah.

Since definitions of important terms differed slightly from country to country, and because even minor misunderstandings could lead to serious problems as the deal meandered on, the first order of business was for these lawyers to pool their definitions of relevant terms. When agreement on the meaning of terms was reached, a document would be created that would stay in place for the entire deal.

The document listing these agreed-upon definitions was known as the Definition of Termsand only when it was finalized did the deal take off into the stratosphere. During the transaction (which could go on for months or even years), members on the transaction team could easily clarify confusions regarding specific terms by referring to this key document. Continue reading