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This is a provision in CONTRACT FOR THE INTERNATIONAL COMMERCIAL SALE OF GOODS

  1. Effects of avoidance in general

12.1 Avoidance of this contract releases both parties from their obligation to effect and to receive future performance, subject to any damages that may be due.

12.2 Avoidance of this contract does not preclude a claim for damages for non-performance.

12.3 Avoidance of this contract does not affect any provision in this contract for the settlement of disputes or any other term of this contract that is to operate even after avoidance.

Can I use dispute resolution here to replace settlement?

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  • What benefit would there be in tinkering with it? What is driving you to question the fine wording of many aspects of a contract? Are you trying to achieve some particular goal by doing so? Do you see a problem with particular language? Normally, you consider changing contract language because you identify some problem with what your form says.
    – ohwilleke
    Mar 10, 2023 at 14:10
  • I'm just wondering if it'll change the meaning in a different way or if they're synonyms and can be used interchangeably.
    – Hai Duong
    Mar 17, 2023 at 6:44

1 Answer 1

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Can I use dispute resolution here to replace settlement?

It depends on whether you as the draftsman of the contract intend settlement to be a preferred method of dispute resolution.

The term settlement suggests that the parties are the ones who decide how to solve their dispute. That is the purpose of methods such as mediation. By contrast, other methods such as arbitration or judicial proceedings delegate to a non-party the decision of the dispute.

The act of replacing the term settlement does not by itself preclude settlement as method for dispute resolution. However, that would make harder for a party to persuade the court that the intent of the contract was to give preference to settlement-based methods.

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