From: Saprai, Prince <>
To: Gerard Sadlier <>
Date: 31/01/2015 20:20:37 UTC
Subject: Re: Collateral Contracts and Variation in Writing only Clauses

Dear Gerard,

There is an excellent article in Current Legal Problems by my colleague Florian Wagner-von Papp on the enforceability of these (‘NOM') clauses in Europe. Available here on SSRN:

He shares your sense that they should be enforced, and I think his arguments are compelling. I recommend the paper highly.

Best wishes,


> On 31 Jan 2015, at 16:57, Gerard Sadlier <> wrote:
> Dear all,
> In response to my query on the list some days ago, Jason Neyers
> provided the following most helpful information. I am sharing this
> with the list with Jason's permission.
> Arising from the cases Jason referred to, I have also found a helpful
> judgment of Finn J in the Federal Court of Australia, in GEC Marconi
> Systems Pty Limited v BHP Information Technology Pty Limited [2003]
> FCA 50.
> At paragraph 222, Finn J concludes that an oral variation is possible,
> notwithstanding as a 'no oral variation clause'. He concludes that
> parties cannot agree to put it out of their power to agree
> subsequently or agree that they will only agree subsequently in a
> certain way, thereby varying their agreement. A no oral variation
> clause is relevant in considering whether subsequent conduct
> constituted a variation however.
> While I accept that these are clear authorities, I do feel that their
> reasoning on this point beg the question and examine the issue through
> the wrong end of the telescope! The practical reasons why a 'no oral
> variation clause' are included in contracts still seem both obvious
> and sensible to me.
> Any comments are of course welcome.
> Thanks again to Jason.
> Kind regards
> Ger
> ---------- Forwarded message ----------
> From: Jason Neyers <>
> Date: Fri, 30 Jan 2015 19:15:05 +1100
> Subject: Re: Collateral Contracts and Variation in Writing only Clauses
> To: Gerard Sadlier <>
> Dear Ger:
> This is what Cardozo JA had to say once:
> The question would answer itself if it were not for the covenant that
> there shall be no waiver or amendment not evidenced by a writing. The
> employer sets up this covenant to nullify its oral consent. The
> employee asserts that the covenant is nugatory. Those who make a
> contract, may unmake it. The clause which forbids a change, may be
> changed like any other. The prohibition of oral waiver, may itself be
> waived. "Every such agreement is ended by the new one which
> contradicts it" (Westchester F. Ins. Co. v. Earle, 33 Mich. 143, 153).
> What is excluded by one act, is restored by another. You may put it
> out by the door; it is back through the window. Whenever two men
> contract, no limitation self-imposed can destroy their power to
> contract again
> Beatty v. Guggenheim Exploration Co. (1919) 225 NY 380
> You might want to look also at his opinion in Imperator Realty
> Company, Inc. v. Tull 228 N.Y. 447, 127 N.E. 263 (1920).
> On 01/28/15, Gerard Sadlier <> wrote:
>> Dear all,
>> I would be grateful for any references to authorities on the following
>> hypothetical:
>> Suppose that in their contract, (the "Original Contract") the parties
>> agree that the contract can only be changed or varied (I'm interested
>> in either, if in fact there is a difference) in writing, signed by
>> specified persons.
>> In what circumstances could a further contract ("Contract 2") be made
>> either (i) orally or (ii) by parties other than those specified
>> (assuming that apart from the contractual stipulation in the Original
>> Contract the parties to the Contract 2 had authority) or both (i) and
>> (ii)?
>> On principle, it seems to me that Contract 2 could be valid only if:
>> 1. It dealt with subject matter substantially different to that
>> considered in the Original Contract. Whether any overlap would be
>> permissible being a difficult question. or
>> 2. Possibly if Contract 2 rescinded the Original Contract and then
>> created a wholly new arrangement. (I must say I find this an
>> unconvincing way of reading the hypothetical stipulation above but I
>> suppose it's arguable.)
>> There must be many contracts in which such clauses are present but I
>> can find no cases on this issue. It seems a matter of practical
>> importance, since if enforceable such a clause would significantly
>> limit the scope for arguing that collateral contracts had been entered
>> into etc.
>> Any comments welcome.
>> Kind regards
>> Ger
> --
> --
> Jason Neyers
> Professor of Law
> Faculty of Law
> Western University
> N6A 3K7
> (519) 661-2111 x. 88435