Introduction

Ever found yourself flipping through a contract and stumbled across a section labeled "Recitals"? It’s usually at the top, right after the title, and before you get into the real nitty-gritty of the agreement. If you’ve ever wondered what on earth recitals are and why they even matter, you’re not alone.

Here’s a quick, no fuss guide to understanding just exactly what recitals are.

Read: How to read business contracts like a lawyer

What the hell are recitals, anyway?

Recitals are like the storytelling section of a contract. They’re the “Once upon a time” part that sets the stage for what’s to come. In legal terms, recitals provide the background, context, or purpose of the contract. They explain why the parties are entering into the agreement, what they hope to achieve, and any relevant history that led up to this point.

Think of recitals as the introduction to a book. They aren’t the main plot (that’s the contract itself), but they help the reader understand the plot better.

What do recitals look like?

Recitals are typically found at the very beginning of a contract, usually after the title and parties’ details but before the main body of the contract begins. They’re often written in numbered or lettered paragraphs, each starting with a good old-fashioned “Whereas.”

Here’s an example recital:

• WHEREAS, Party A is in the business of providing marketing services; and

• WHEREAS, Party B desires to engage Party A to provide said services under the terms of this Agreement; and

• WHEREAS, both parties wish to set forth the terms and conditions of their agreement in writing.

Recitals often start with these “WHEREAS” clauses to set the context, but they don’t always have to. They might look a bit like your great-grandfather’s diary entry, but there’s a method to the madness.

Why are recitals important?

Recitals might look like unnecessary fluff, but they serve a few important purposes:

Provide context

Recitals help explain the background of the contract. They give the reader (and, potentially, a judge or mediator) an idea of what’s going on and why the parties are entering into the agreement. This can be crucial if there’s ever a dispute down the road.

Clarify intent

Recitals spell out what both parties intended when they signed the contract. If a dispute pops up and the contract’s terms are unclear, the recitals can help make sense of things by showing what everyone meant at the time of signing.

Create a narrative

They help set the narrative. Let’s say you’re entering into a joint venture. The recitals can lay out the business purpose, the goals, and the general understanding that led to the agreement. This can be especially helpful for future reference.

Establish precedent

Sometimes, recitals reference previous agreements or contracts. This can be important in showing how the current contract is related to, or different from, prior ones.

Read: Do legal documents have to be written in English?

What recitals don’t do

Now, don’t get too carried away—recitals aren’t magic. They’re not binding like the other parts of the contract. Here’s what they don’t do:

Create legal obligations (i.e., responsibilities)

Recitals aren’t typically enforceable terms. If it’s just in the recital and not in the main body of the contract, it might not hold up in court. If you want something to be legally binding, make sure it’s in the operative clauses of the contract.

Replace specific terms

Recitals provide context, not specifics. They set the stage, but they don’t replace the need for clear, specific terms in the body of the contract. Don’t rely on recitals to do the heavy lifting.

What to include in your recitals

So, what should you actually put in your contract recitals? Here are some tips:

The purpose of the contract

Start by clearly outlining the purpose of the contract. What are the parties hoping to achieve? Are you buying goods, forming a partnership, licensing intellectual property? Lay it out simply.

Background information

Include any relevant background information that helps explain why the contract is being entered into. This could be a brief history of negotiations, previous agreements, or the circumstances leading to the contract.

The parties’ intentions

Spell out what each party wants to get from the contract. For example, “Party A wants to buy 1,000 units of Product X from Party B to sell in its retail stores.”

Relevant facts or events

Include any important facts or events related to the agreement. For example, if the contract depends on something else happening first (like getting regulatory approval), it's a good idea to mention that in the recitals.

Read: What is a unilateral contract?

How to draft effective recitals

Now that you know what to include, how do you draft recitals that actually add value? Here are some tips:

Be concise

Keep it short and sweet. Recitals should provide just enough context to understand the contract’s purpose without getting bogged down in unnecessary details. Think of it like a movie trailer—not the whole film.

Use clear language

Skip the fancy legal language and use plain, straightforward language. You don’t need to sound like a 19th-century barrister to write effective recitals.

Stick to the facts

Stick to the facts and the parties' intentions. Leave out any opinions, assumptions, or wishful thinking.

Align with the main contract terms

Ensure the recitals match the main terms of the contract. Don’t include anything in the recitals that conflicts with the agreement's core terms. This can create confusion and might even make parts of the contract unenforceable.

Review carefully

Carefully review your recitals to make sure they accurately capture the context, purpose, and intentions of both parties. Incorrect or misleading recitals can create more issues than they fix.

Conclusion

Recitals might seem like the opening act no one cares about, but they’re actually pretty useful for setting the stage and clarifying the purpose and intent behind a contract. They help provide context, establish the background, and can be a valuable reference if a dispute arises down the road.

Just remember: while recitals help tell the story, they don’t replace the need for clear, specific, and enforceable terms in the main body of the contract. So, next time you see those “WHEREAS” clauses, don’t skip over them. Give them a read—you might just find they make the rest of the contract a lot easier to understand.

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