Legal Speak

LEGAL SPEAK

“FLOATING CHARGE”

Does not involve water, cavalry advances or sea horses.  It is a type of mortgage which does not attach to any specific property until the happening of a certain condition or event.   At that stage, the charge is said to “crystallise”.

“CAVEAT EMPTOR”

Literally means let the buyer beware.  A purchaser must look after his own best interests and satisfy himself that he is getting everything he expects.

“A TRUST”

Exists when somebody who has legal title to or controls property is obliged to deal with it for the benefit of other person(s).  It has nothing to do with whether or not the person is honest or credible.

“BRIEFS”

Have nothing to do with items of personal clothing.  A brief comprises written instructions from a solicitor to a barrister retaining him/her to act in legal proceedings. They can however be rather voluminous.

“A CIVIL BILL”

Institutes legal proceedings in the Circuit Court in an equivalent way to a High Court Summons.  It does not therefore refer to a polite demand for money.

“STATUS QUO ANTE”

Has nothing to do with a relative of members of a famous rock band – it simply means “the same state as before”.  Think “undo” on your keyboard.

“FEE SIMPLE”

Isn’t a straightforward solicitor’s invoice; it is in fact the most extensive freehold title which can be owned in land.  It can be contrasted with a leasehold title whereby land is owned only for a specified period, usually a number of years

“AN ASSURANCE”

Is not a pat on the back but a document or deed transferring land.

“A PARTY”

Does not involve loud music, alcohol and lots of fun but is rather someone who takes part in a legal transaction or deed or sues or is sued.

“A THIRD PARTY”:                          

This is not yet another venue to head to on a Friday night – simply another person or entity involved in an incident, transaction or litigation.

“EXECUTION”

Does not refer to the death penalty but rather to the signing and sealing of a deed or the carrying into effect of a court judgment.

“AN INTEREST IN LAND”

Is not a fascination with sods of turf but is in fact a broad term used to describe types of ownership of land.

“A SATISFACTION PIECE”

Is a document to show that a debt has been paid and not a bit of a “Snickers” bar.

“EASEMENTS”

Do not make life any easier for your solicitor.  It is in fact a generic term for rights such as rights of way, fishing rights, etc.

“IN CAMERA”

A confusing term which refers to court cases heard in private (yes, no cameras), usually involving family law or sensitive state secrets and has nothing to do with the film industry.

“TIME IMMEMORIAL”

Is 1189 AD as fixed by the Statue of Westminster 1275, being the first year in the reign of Richard I.  You can remember that one for the next pub quiz.

“TUPE”

(pronounced “to-pay”) – not an ill-fitting hairpiece – rather it is the acronym for the Transfer of Undertakings Protection of Employees regulations introduced by the EC in 2003.

“DATA ROOM”

Does not necessarily mean a room packed full of files and records relating to a company.  Physical data rooms used to be common in the due diligence process but have now been largely replaced by virtual data rooms.  This renders the due diligence process during a merger/acquisition transaction, loan syndication transaction or private equity/venture capital transaction to be carried out in a much more structured and cost efficient way.  Secure virtual data rooms are provided by third party commercial providers.

“GOODWILL”

In commercial terms does not mean being friendly, nice, helpful, benevolent or compassionate towards a fellow human.  In commercial law terms, the expression refers to the established reputation of a business which is regarded as a quantifiable asset and can be extremely valuable to the owner of the business.

“RACHET”                                         

Not to be confused with the misspelling of the instrument used in the game of tennis.  It is a term used in the world of corporate finance where a rachet clause can provide that the rights of the involved parties are adjusted according to a pre-agreed formula upon completion of a transaction or at various stages provided for in a contract.

“D.I.R.T.”

No cleaning required.  The acronym stands for Deposit Interest Retention Tax which is charged on all interest payments by financial service providers such as banks.  It is currently charged at the rate of 39% of all such payments and it is paid directly to the Irish Revenue.

“RECEIVER”

Has nothing to do with the apparatus formerly known as the telephone.  A receiver is in fact a person usually appointed by a secured creditor (e.g. a bank) to run a company for a short period of time.  A receiver’s function is to liquidate all assets the subject of the security and pay as much debt as possible back to the secured creditor.  A receiver can also be appointed over the assets of an individual in certain circumstances.

“SICAF”

No need to call in the vet! This has nothing to do with a bovine illness.  It is in fact a type of investment fund structure along with a SICAV used principally in Luxembourg but also found in many other western European countries.  The acronym derives from the French –  “Société d’Investissement à Capital Variable” and the “Société d’Investissement á Capital Fixe”.  These investment funds do not have an independent legal personality  The Irish Government has now introduced the ICAV under the Irish Collective Asset – Management Vehicles Act, 2015.  It is a specially designed vehicle for Irish investment funds.  Unlike the SICAV or the SICAF, the ICAV has a specific statutory personality established under the 2015.

“BOILERPLATE CLAUSES”

Now we’re cooking!  These are the more general clauses inserted into a commercial contract which can be added to, deleted or amended as necessary to reflect the contract being drafted. The “operative” part of the agreement appears at the beginning of the document and is entirely specific to the agreement being drafted.  However, the boilerplate clauses should not be overlooked as they can contain important provisions.

(c) Sharon Scally, Amorys Solicitors 5th September 2017