This is a lesson from my book, Million Dollar Words.
“Material” looks harmless. It sits quietly in a contract — material breach, material adverse effect, material change — and nobody argues about it at signing. They argue about it later, when the money is on the line.
That is the trick. “Material” has no fixed size. It means important enough to matter. And “important enough” is exactly what two sides fight over when a deal starts to wobble.
One side says the change was material, so they can walk away. The other side says it wasn’t, so the deal must close. Same word. Opposite outcomes. The difference is the price of the company.
Smart drafters pin it down. They give it numbers, named triggers, and a closed list of examples. The ones who leave “material” bare have not written a definition. They have written an invitation to litigate.
So read it like this: what would have to happen for this word to move the money? If you can’t answer that in one sentence, the word isn’t doing its job yet.
For thirty years I have trained lawyers that words cost millions. “Material” is one of the quietest words in the contract and one of the most expensive in the courtroom.
Million Dollar Words takes it one word at a time, with the price tag attached. Get it on Kindle for $9.99 here: https://www.amazon.com/dp/B0HMP9XZT1
More from the author: https://amazon.com/author/denafalken.com
Dena Falken — J.D., Columbus School of Law, Catholic University of America; B.A. in Law and Society, American University. Founder of Legal-Ease International. Author of Million Dollar Words.
