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No Oral Modification Clauses: The Riddle...

Pathak, Akhileshwa...

Technical Note

No Oral Modification Clauses: The Riddle of Party Autonomy

Pathak, Akhileshwar

IIMA-STR0461TEC | Published March 31, 2021 | 9 pages Technical Note

Collection: Indian Institute of Management, Ahmedabad

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Contract documents have come to have a no oral modification (NOM) clause which prohibits oral modification of a contract. The validity of the term was in doubt, however, as the contracting parties are autonomous and nothing, including their earlier terms, can come in the way of their will. The Rock Advertising Case worked out the riddle and ruled that the NOM clause is binding. NOM clauses, however, exclude written signed modifications. At the same time, an email is construed by courts as a written signed document. Questions arise as to whether these meet the requirements of a NOM clause.

No oral modification clauses are binding NOM clauses bring certainty and Reading electronic communication and NOM clauses together