In a contract, what's the difference between a clause, provision, condition and term? They seem to all refer to the same thing to me - which is basically any self contained point or requirement.


They have subtle differences. Starting with the Oxford Dictionary definitions (using the one most appropriate for a legal context):


2.a particular and separate article, stipulation, or proviso in a treaty, bill, or contract.

A clause is a self-contained concept within the written contract; it may have a number of subclauses. It may reference other clauses but ideally it can be read and acted on on its own. Typical contracts will contain clauses on payment, time, termination, scope etc. It is a feature of the drafting of the contract document.


3.a condition or requirement in a legal document: "the first private prosecution under the provisions of the 1989 Water Act"

A provision is any condition (q.v.) or stipulation of things to be done or not be done within the contract. A provision may correspond with a clause, may span several clauses or be contained wholly within a subclause. It is a feature of the contract itself: verbal contracts will have provisions but they will not have clauses.


3.a state of affairs that must exist or be brought about before something else is possible or permitted: "for a member to borrow money, three conditions have to be met"

A condition is a set of circumstances that must arise before another action can occur. There can be a "condition precedent" which means the condition must be satisfied before there is a contract. There can (will) also be conditions within the contract, for example, there will be conditions that must be satisfied before payment is made (like issuing an invoice). Conditions are a creature of the contract not the drafting.


4.(terms) conditions under which an action may be undertaken or agreement reached; stipulated or agreed requirements: "their solicitors had agreed terms"

(I don't like this definition much but it is the best they had.)

A term is a provision (q.v.) in the contract for which one of the possible remedies for breach is termination of the contract by the innocent party . A provision where termination is not an available remedy is a warranty.

  • What's the difference between "proviso" vs "condition" then? – Pacerier Sep 23 '16 at 8:25
  • @Pacerier proviso is an abbreviation of provision – Dale M Sep 23 '16 at 9:05

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