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CS Professional · Drafting, Pleadings and Appearances · General Principles of Drafting

Sunita is drafting a loan agreement for Bharat Finserv. The draft says 'the borrower shall repay the loan and interest on or before 31st March or 15th April as convenient.' Which is the best correction to avoid ambiguity?

The best correction is to fix one definite repayment date and, if extension is intended, set out the exact conditions and process for it. Alternative dates left to convenience are uncertain and can cause disputes over default and interest.

  1. ARetain both dates but add 'subject to convenience of either party'
  2. BState one definite repayment date and, if flexibility is intended, spell out the precise conditions for any extensionCorrect
  3. CDelete the date and leave it to the lender
  4. DUse only the word 'soon'

Explanation

Alternative dates without a rule on who chooses create uncertainty. The fix is a single certain date, with any extension permitted only on clearly stated conditions. The other options add or retain vagueness.

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