Legal Jargon in Contracts – A Quick Breakdown

Written by Emily Zheng
JD Candidate 2024 | UCalgary Law

Whether you are looking through a waiver, an agreement, or a policy, you will often find the same words and phrases used throughout the document, such as “material breach” and “reasonable standards.” This legal jargon – an ironic mix of vague but somewhat understandable sets of words – may be familiar to those studying and practicing law, but how are other members of the public supposed to read them? This blog post will explain a few common phrases often used in standard form agreements.
“…in consideration of…”
Every contract must have three elements: offer, acceptance, and consideration. “Consideration” means that something is given in exchange for something being received, and contracts often use the term in its preamble or during the first few clauses to explicitly acknowledge this exchange.
“reasonable degree of care/commercially reasonable degree of care/reasonable efforts”
In everyday life, what is reasonable or unreasonable is different for each individual. However, when it comes to reasonableness from a legal standpoint, the expectation that courts use to evaluate an individual or a company’s action or inaction is built on whether a person (or commercial entity) used the same degree of care that can reasonably be expected of someone with the same status or circumstance. For example, medical practitioners will be compared to other practitioners with the same experience and standing, and CEOs will be compared to other similar CEOs. The comparison spectrum will also change depending on whether the court compares two businessmen versus two individuals with no business backgrounds. Hence, some iterations of this phrase include the word “commercially.”
“material breach”
A contract can be broken (or “breached”) in several ways at varying degrees of severity. The use of the word “material” means that the breach is serious, substantial, or fundamental to the point where it goes to the “root” (or primary purpose) of the contract.[1]
To read more about the types of clauses commonly seen in commercial agreements, click here and here.


[1] Guarantee Co of North America v Gordon Capital Corp, 1999 3 SCR 423.