Severability of a Contract

Severability of a Contract: What it Means and Why it Matters

Contracts are an essential part of business transactions, and it`s important to ensure that they are legally binding and enforceable. However, even the most well-crafted contracts can contain provisions that may become legally invalid or unenforceable for various reasons. This is where the concept of severability comes in.

Severability is a legal doctrine that allows a court to strike out specific terms or provisions of a contract that are found to be illegal or unenforceable, while leaving the rest of the contract intact. In other words, it allows a contract to survive even if a particular provision is deemed invalid or unenforceable. This is important because it provides flexibility and avoids the need to completely rewrite or renegotiate an entire contract.

The principle of severability is often included in contracts through a specific clause or provision that states that if any part of the contract is found to be invalid or unenforceable, the rest of the contract shall remain in force. This clause serves as a safety net for both parties, protecting them from the potential consequences of an unenforceable provision.

For example, let`s say two companies enter into a contract that includes a non-compete clause, which states that one company agrees not to enter the same business as the other for a specified period of time. However, a court later finds that the non-compete clause is overly broad and therefore unenforceable. If the contract contains a severability clause, the rest of the agreement remains in effect, and both parties can continue with the other provisions of the contract.

It`s important to note that the severability doctrine doesn`t apply to all types of contracts or provisions. For example, some contracts may contain provisions that are so integral to the contract that if they were removed, the entire contract would be rendered meaningless. In such cases, courts may decline to apply the severability doctrine.

In summary, the principle of severability is an essential aspect of contract law. It provides protection for both parties in the event that a provision is found to be illegal or unenforceable, and allows the rest of the contract to remain in effect. If you`re involved in drafting or reviewing contracts, it`s important to ensure that a severability clause is included to provide added protection and flexibility.