The $2 Million Comma

7 Aug ’06

The Globe reports on a lawsuit between Rogers and Aliant that turned on the effect of one comma – to the tune of $2.13 million. Issue – can either party terminate early during the first five year term under this clause:

The agreement “shall continue in force for a period of five years from the date it is made, and thereafter for successive five year terms, unless and until terminated by one year prior notice in writing by either party.”

Answer: but for the second comma, no (the result Rogers wanted), but that single comma entitled Aliant to terminate at any time during the first term on one year’s notice, which gave it, after a single year, the right to renegotiate the utility pole rental rates it gave to Rogers; Rogers thought it had a fixed price for the first 5 years.


Update: it’s noteworthy that the CRTC’s decision, while perhaps the grammatically correct result, effectively frustrated the obvious purpose of the reference in the clause to five year terms. After all, if the parties had intended the contract to be terminable at any time on one year’s notice, they could have simply stated “this agreement shall continue in force indefinitely until terminated by either party on not less than one year notice.” But they didn’t – instead they drafted specific references to initial and successive five year terms. Why? Not, presumably, for kicks and giggles, but rather to serve some specific purpose? For example, protecting the franchise created by the contract in the first place?

One last point – the article suggests that Rogers needed access to the poles in order to string its cable. Given that expiry of the contract would presumably require Rogers to move its cable to some other supplier, and this this would presumably be no small undertaking, it strikes me as a little odd that the term of the contract would be only five years (or, in the CRTC’s world, effectively, one year).

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