Friday, January 7, 2011

Subsequent Documents



There can be a number of documents or correspondence between a Buyer and Supplier.
In general a later writing in time that is signed by both parties to an agreement will have precedence. To manage against potential problems that could occur, many times contract will require that any changes to an existing agreement must be done by amendment signed by parties that were authorized to sign the Agreement itself. When that is done
subsequent  documents cannot change or amend the terms of the Agreement unless they are identified as an amendment to the Agreement, reference the Agreement and are signed by authorized representatives of both parties, or the parties have agreed that other actions, documents or writings may constitute an amendment. 

Why is this important?  Without it if there is a document that is signed by authorized parties to the Agreement after the Effective Date of the Agreement with the same Agreement number listed, you have a later writing between the parties to the Agreement and later writings have priority over earlier writings. This could amend the Agreement. When you do have a writing signed after the Effective Date, you must make it very clear what the writing applies to. If the change only applies to one Product or a group of Products, you need to make that clear. Otherwise your later writing could amend the requirements for all Products.  Purchase Orders issued after the Effective Date may alter the terms of the Agreement for those purchases made under those Purchase Orders. It all depends upon whether the terms conflict and the order of Precedence.

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