Pennsylvania Code
Title 37 - LAW
Part V - Bureau of Consumer Protection
Chapter 307 - PLAIN LANGUAGE CONSUMER CONTRACT PREAPPROVAL- STATEMENT OF POLICY
Appendix C - ILLUSTRATIONS FOR TEST OF READABILITY
These illustrations provide guidance as to how the Test of Readability may apply to a contract.
I. ORGANIZATION
Use headings and subheadings to show the order in which information is presented and to identify the content of each section.
These headings provide few clues about organization and document content:
We agree to . ..
You agree to . ..
Both of us agree to . ..
You also agree to . ..
Both of us also agree to . ..
These headings identify and locate useful information:
Borrower's promise to pay
Interest
Monthly payments
Borrower's right to make prepayments
How much may I prepay without penalty?
What is the penalty if I pay more?
Charges for late payment
II. LANGUAGE AND STYLE
A.IDENTIFICATION OF PARTIES
Use simple names.
Define the names and pronouns.
Use names and pronouns consistently.
In the following example, the consumer is called "I" in one paragraph, then referred to as "borrower" in another paragraph, with no explanation:
I will pay you for the merchandise in _______ monthly payments of $ _______.
I will make payments on the _______ day of each month.
If borrower is more than 10 days late with a payment, lender may charge a late fee of $ _______.
In this example, the word ''BORROWER'' is used consistently:
BORROWER will pay LENDER for the merchandise in monthly payments of $ _______ . BORROWER will make payments on the day of each month.
If BORROWER is more than 10 days late with a payment, LENDER may charge BORROWER a late fee of $ _______.
B.EXPLAIN AT THE BEGINNING THAT THE FORM IS A CONTRACT BETWEEN PARTIES.
A legalese start of a contract:
This agreement, made the first day of July, 1994, between Sara Smith, the party of first part, and John Jones, the party of the second part. Witnesseth;
Clearer explanation:
July 1, 1994
This is a lease.
Sara Smith is the landlord.
John Jones is the tenant.
C. USE WORDS THAT CONVEY MEANINGS CLEARLY AND DIRECTLY.
|
USE |
DO NOT USE |
|
begin |
commence or initiate |
|
seller |
vendor |
|
buyer |
vendee |
|
cancel |
rescind |
|
end |
termination |
|
under |
pursuant to |
|
if |
in the event that |
|
give or make |
render |
|
before |
prior to |
|
after |
subsequent to |
|
sign |
execute |
|
person signing below |
undersigned |
|
postpone |
defer |
|
take back |
repossess |
|
responsible |
liable |
D.USE PRESENT TENSE AND ACTIVE VOICE WHENEVER POSSIBLE.
PASSIVE
If the outstanding balance is prepaid in full, the unearned finance charge will be refunded.
Buyer is obligated to make all payments hereunder.
Membership fees paid prior to the opening of the club will be placed in trust.
ACTIVE
If I pay the whole amount before the due date, you will refund the unearned portion of the finance charge.
I will make all payments as they become due.
If I pay membership fees before the club opens, the club will put the money in a trust account.
E.USE FAMILIAR VOCABULARY.
Rephrase legal jargon and redundant words into simple language.
This sentence obscures the meaning with jargon:
Purchaser certifies that no oral or written statements, promises, representations or guarantees, other than those herein contained, have been made in relation to this agreement.
This sentence clarifies:
This contract contains all the agreements between the BUYER and the SELLER. By signing this contract, both the BUYER and the SELLER agree to do what the contract says. Nothing which the BUYER has said orally to the SELLER or the SELLER has said orally to the BUYER changes the terms of this contract.
F.DEFINE TECHNICAL OR LEGAL TERMS THAT ARE NOT USED IN THE ORDINARY SENSE.
Example:
Any payment made before it is due is called a "prepayment."
G.CLARIFY CONDITIONS AND EXCEPTIONS.
Do not treat rights or responsibilities of the parties as conditions or exceptions.
For example, in this contract the Seller's right to hire an attorney is treated as a condition:
If the Buyer defaults and the Seller commences collection through an attorney, the Buyer will be liable for attorney's fees.
This language clarifies the Seller's right to hire an attorney:
If the BUYER is behind in making payments, the SELLER may:
1. Hire an attorney to collect the money.
AND
2. Charge the BUYER for the attorney's fees.
III. VISUAL SUGGESTIONS
A. Use margins adequate for ease of reading.
B. Use easy to read type size.
C. Use adequate space between lines and paragraphs.
D. Use boldface type for caption sections and subsections.
E. Use line length that makes the contract easy to read.
F. Use column width that makes the contract easy to read.
IV. GENERAL PRACTICE POINTERS
A. Use short words, short sentences and short paragraphs.
B. Use active voice.
C. Eliminate legalese such as:
HEREBY, THEREOF, HERETOFORE, THEREAFTER.
D. Use familiar vocabulary.
E. Rephrase legal jargon into simple language.
F. Use names or pronouns consistently.
G. Define words by using commonly understood meanings.
