Understanding the Fine Print: 5 Common Boilerplate Provisions

As consumers, we are all familiar with the boilerplate language at the end of a standard form contract. Whether it is a cell phone agreement, real estate contract, or a car loan document, all form contracts include boilerplate fine print. Although consumers skim over these provisions, paying little attention to their significance, the fine print boilerplate provisions are actually quite important. It is important that consumers understand the legal significance of boilerplate provisions, so that they can understand their legal rights and obligations.

The following is a list of 5 common boilerplate provisions and their legal significance:

1. Choice of law. Most contracts include a provision that stipulates which laws will apply in the event that there is a dispute between the parties. Often times, state law will dictate that a contract should be determined according to the laws of the place where it was performed or executed, but given our reliance on electronic communications and document execution, it is often unclear where a contract was executed or where it is performed. Accordingly, the boilerplate language will stipulate which state or country’s law will be used to interpret the contract.

2. Jurisdiction. This boilerplate provision will stipulate the jurisdiction in which a lawsuit may be brought in the event that a dispute arises.

3. Venue. The fine print provision regarding venue governs which courts have the authority to hear and decide any business disputes regarding the contract. For instance, just because a contract dispute is to be governed according to Illinois law, the case may not necessarily be heard in an Illinois court depending on the circumstances of the contract and the dispute. The venue boilerplate language makes clear which state or federal court(s) have the authority to hear any disputes regarding the contract.

4. Attorney fee clauses. In some states, boilerplate provisions allowing for unilateral attorneys are allowed. Other states apply reciprocity for unilateral attorney fee provisions so that if one party is allowed to recover attorney fees in a successful claim, the other party is allowed to recover attorney fees, as well. Although attorney fee provisions are relatively common boilerplate language, there is no “one-size-fits-all” approach to attorney fee provisions.

5. Arbitration. Many form contracts include arbitration clauses that require parties to submit to arbitration in the event of a dispute. Arbitration clauses can become particularly complex when claims are brought as part of a class action and the boilerplate language provides that the parties must submit to arbitration. The U.S. Supreme Court recently decided in the landmark decision AT& Mobility v. Concepcion that the terms of an arbitration provision cannot be invalidated as unconscionable because the provision contained a class action waiver. The extent to which the AT&T Mobility decision is applicable is still in flux, however, so it is advisable to seek legal counsel regarding the practical effects of a particular arbitration provision if you have any doubts.

The Chicago consumer protection attorneys at Lubin Austermuehle focus on representing clients in a wide variety of business law disputes, including disputes regarding the application of consumer contracts and boilerplate fine print language. Contact our office at 630-333-0333 to schedule an appointment with one of our knowledgeable Chicago and Oak Brook area consumer protection and commercial litigation attorneys.