02/01/2015 // Dallas, Texas, United States // Attorney Keith Clouse // Keith Clouse // (press release)
Many contracts begin with a “whereas” section. This section recites the key understandings that underlie the contract. For example, an employment contract may begin:
WHEREAS, the Company desires to employ Executive as its Chief Operating Officer in order to provide the necessary leadership for the Company; and
WHEREAS, Executive is willing to accept such employment with the Company in accordance with the terms and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual agreements contained herein, the Parties agree as follows….
Importantly, these recitals do not reflect what the parties are actually agreeing to. For that reason, a party entering into an employment contract cannot usually rely on the recitals as proof of the other party’s agreement. For instance, if a recital states that a company desires to hire an individual and to make him a fifty percent owner of the company, but the contract’s body contains no terms related to the individual’s ownership stake, the individual would likely be unable to hold the company to its “agreement” to make him a partial owner. An individual may wish to hire an employment law attorney to review a proposed employment contract to determine whether the agreement accomplishes the parties’ goals.
This article is presented by the Dallas employment attorneys at Clouse Dunn LLP. To speak to an employment lawyer about employment law issues, send an email to [email protected] or call (214) 239-2705.
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