What are recitals in contracts?
How do you legally define it?
What are the important elements you should know!
In this article, we will break down the legal definition of Recitals so you know all there is to know about it!
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What does recitals mean
Recitals in a contract are typically found right after the parties’ appearance and before the contract’s operative contractual clauses.
The parties provide background information or outline the key characteristics of why they are entering into a contract.
The term “recitals” comes from the Latin term “Recitare” which means “to read out”.
Essentially, the parties drafting a contract are reading out the parties’ intention so the reader is made aware.
Recitals of a contract are the contract preamble or the whereas clause.
The content of the recitals is generally linked to:
- Factual background
- Expression of the intention of the parties
- Purpose of why the contract is signed
Typically, the parties do not draft the recitals in a highly technical way or extensively define legal terms.
The idea is to present an overall or high-level perspective as to why the contract is signed.
It is not mandatory for a contract to have recitals, although most do.
In business transactions where the parties are signing multiple interconnected contracts, it can be helpful to describe in short and non-legal terms the context of the specific agreement being signed.
The recitals to a contract represent introductory statements where the parties generally outline their intention or provide a factual or legal background as to why they are contracting.
Typically, recitals in an agreement are explanatory and do not result in formal legal obligations.
However, they do have legal value as they help a reader (potentially a judge) understand the parties’ intention when the contract was signed.
This can be valuable in complex commercial transactions where it may be worth outlining the purpose of the transaction.
Drafting a recitals clause
What are recitals in a contract?
The recitals generally appear at the beginning of a contract right after the parties’ block (or parties’ appearance) and before the contract’s formal terms and conditions.
What’s interesting is that some contract recitals are titled as literally “recital” and in other cases, you’ll see the term “witnesseth”.
There is no pre-established format to respect or specific contract language to use.
Generally, the legal recitals are short, concise and describe the contract in high-level terms.
Lawyers or legal professionals drafting recitals should take care not to include legal obligations in the recitals.
Rather, clauses outlining legal obligations are better placed in the contract’s body along with the operative terms and conditions.
By convention, the paragraphs within the recital section of a contract will start with the term “whereas”.
For this reason, many will call the recital provisions the “whereas provisions”.
Types of contract recitals
What are the different types of recitals in a contract?
The recitals’ primary objective is to provide an introductory background to why the parties are entering into a contract.
In this context, the parties to a contract can draft recitals in the following ways:
- Provide additional details as to the business operations of the parties and their expertise
- Provide context as to the circumstances leading the parties to enter into a contract with one another
- Refer to other contracts or legal background relevant to why this contract is being signed
- Provide details as to where this specific contract sits within a series of different contracts
- Refer to past recitals
- Refer to a previous contractual obligation
- Provide a compliance-related background about the contract
Example of recitals
Let’s look at a few examples of recitals to see how they are presented in a contract.
Here is a recital in the context of a Contribution Agreement:
Here are recitals presented as a “Preamble” in a Rental Contract:
Here is an example of recitals in contract where it is presented as “Witnesseth”:
Recitals in legislation
In addition to recitals being used in contracts, deeds, agreements, or legally binding instruments, legislators also use recitals to set out the purpose, objective, or mission of the law or statute.
Some laws may have hundreds of paragraphs in their preamble clarifying the statute’s intention to guide the courts in their interpretation.
For example, the GDPR in its current version has 173 paragraphs of in its recitals.
What is a recital in a contract?
What do you mean by agreement recitals?
Let’s look at a summary of our findings.
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