When it comes to legal contracts, certain sections or clauses may be set off from the rest of the text. This is done for a variety of reasons, such as to draw attention to a particularly important or sensitive provision, to indicate that a certain section stands alone and cannot be modified or waived, or to provide clarity and ease of reading.
Set off text is typically distinguished from the rest of the contract by formatting, such as bold or italicized font, or by being enclosed in quotation marks or parentheses. It may also be placed in a separate section with a heading, or in a separate paragraph with extra space above and below.
One common example of set off text in contracts is the indemnification clause. This clause typically requires one party to compensate the other in the event of certain types of losses or damages. Because indemnification can have significant financial implications, it is often set off from the rest of the text to ensure that both parties are fully aware of their obligations and rights.
Likewise, non-compete and non-disclosure clauses are often set off to ensure that they receive appropriate attention and scrutiny. These types of clauses are designed to protect the interests of the party imposing them, and therefore require careful consideration and negotiation.
In some cases, set off text can also be used to create a hierarchy of provisions within the contract. For example, the definitions section or the representations and warranties section may be set off to make it clear that these are key provisions that govern the entire agreement.
Overall, set off text plays an important role in creating clear, effective, and enforceable contracts. By highlighting important provisions and ensuring that they receive the attention they deserve, set off text helps parties to fully understand their rights and responsibilities, and can ultimately prevent misunderstandings and disputes down the line.