When you’re dealing with contracts and license agreements written to operate under United States law, one key indicator of trouble is the phrase “without limitation”. Usually it appears as “including, without limitation…” – a second form “including, but not limited to …” is very similar.
One or two instances in a lengthy document aren’t really that much of a problem, but take the time to count them. A large number of them indicates that the creator of the agreement is somewhat out of touch with US contract law and precedent.
There are essentially three possible ways of constructing the phrase:
1. “W including X, Y and Z”
2. “W including without limitation X, Y and Z”
3. “W, including but not limited to X, Y and Z”
Technically and grammatically, versions 2 and 3 mean the same thing as version 1. They’re both somewhat more overblown ways of saying “including.”
It’s an illustrative usage, like “Video recorders, including VCRs, DVD recorders, digital video recorders and PVRs” by which we show that all of these things fit the term we are using (video recorders), but that other things that we have not listed but are clearly video recorders may be considered a part of that group as well.
Legally, versions 2 and 3 seem to mean that also which should be obvious, right? After all, they’re explicitly (and someone redundantly) beating that illustrative use drum. So, why are they even there?
The second and third forms largely came about from a 1940s ruling in Oklahoma which suggested that lawmakers should not specify “including X, Y, and Z” if they really meant just W in its unrestricted sense. There is another such ruling for New Hampshire, but again, it really only applies to legislation, not contract law.
To cloud the issue, the courts in Kentucky in the 1980s for Horse Cave State Bank v. Nolin Production Credit Ass’n that the W was just so darn vague (essentially encompassing things that were clearly not reasonable or intended by either party) that only the listed “X, Y and Z” should apply.
While this did not actually have any serious effect on version 1 (at least not unless you were incredibly sloppy with your definitions, leading to surplusage), versions 2 and 3 started to become more popular among those drafting contracts and agreements.
If your definitions are in order, however, you don’t actually need those illustrative examples anyway, and if your definitions are full of surplusage, then frankly, your agreement is in trouble as soon as it lands in front of a court for scrutiny.
However, there are problems with versions 2 and 3. US case law however, generally holds that “including without limitation” and “including but not limited to” just mean plain, boring old “including” and that the extra phrasing doesn’t actually change the meaning.
Moreover, “including without limitation” and “including but not limited to” don’t allow you to add any examples that are inconsistent with W. For example you can’t say “Video recorders, including but not limited to VCRs, DVD recorders, digital video recorders, PVRs and pygmy marmosets.”
The pygmy marmoset is clearly not a video recorder, and you cannot add them with an illustrative list, even if you add “without limitation” or “but not limited to.” – at least not under US law and precedent as they stand.
Now, the short version:
- If you’re drafting a contract make sure that W is solid and easy to understand and does not unreasonably extend to cover more than you intend it to, otherwise you may find the court will consider “includes” to be restrictive (confined to your examples only) rather than illustrative.
- Don’t add examples that are not indisputably covered by W. If you need to specify more, you can do that, but not in the same illustrative list.
- Further, adding the phrases “without limitation” or “but not limited to” don’t improve the odds that a court will find your usage of “including” to be illustrative.
- If W is clear and specific enough, you don’t actually need an illustrative list at all. Does it really make the substance of the agreement easier to understand? If it doesn’t, then you’re probably better off without it, and you have a better chance of avoiding a conclusion that it is restrictive.