Counterparts: Overview, definition and example
What are counterparts?
Counterparts refer to separate copies of the same contract that different parties sign. These individual signed copies are combined to form one binding agreement, even if the parties didn’t all sign the same physical document. It’s a common way to streamline the signing process, especially in remote or digital transactions.
Why are counterparts important?
Counterparts make signing contracts more convenient by allowing parties to sign separate copies rather than being physically present to sign the same document. This is particularly useful in business dealings involving multiple parties or locations. The clause ensures that all copies signed by the parties together form a single, enforceable agreement.
Understanding counterparts through an example
Imagine a business deal between a manufacturer in the U.S. and a retailer in Europe. Due to the distance, both parties can’t meet to sign a single document. Instead, the manufacturer signs one copy of the agreement, and the retailer signs another. Thanks to the counterparts clause, both signed copies are considered part of the same agreement, even though they were signed separately.
An example of a counterparts clause
“This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument.”
Conclusion
Counterparts allow contracts to be signed separately by different parties without needing everyone to gather in the same place. By including a counterparts clause, businesses ensure that separately signed documents are treated as one complete agreement, making the process more efficient and legally sound.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.