MOU which is short acronym for Memoranda / Memorandum of understanding are somewhat of an anomaly. This is because they are often used in private and international law. In the UK many government departments have a tendency to use them when they want to capitalise on and create some publicity for working together.
MOUs – What’s All The Fuss?
Without turning this short article into a law lecture on the nuances of enforceability of contracts and intentions, the MOU is usually nothing more than an expression of the intention of the parties.
MOUs – Change of Intentions or Subject to Contract
The problem as I have seen all too often is that when things have gone horribly wrong because the MOU has been intended to serve as a contract, it fails to deliver. It fails to deliver because it is too general in many aspects that it covers.
MOUs – When To Use The MOUs
If and only if, the MOU must be created, for some pressing need, then I would recommend the use of the MOU tool in the document armoury to be deployed for use between government organisations and perhaps on rare occasions non-governmental organisations. MOUs are far more commonplace between international governments too. Other usage circumstances might include the mutual co-operation between governments to secure borders and or prevent illegal migration. Others still might also reasonably include where project finance is sought and there is the need for sovereign backing for the procurement of the same. One key feature though is that where there is an express intention intended by the government and reliance is placed on the same, there is the possibility for some form of liability to the party which may have procured to enter into a contract.
MOUs – The Contents
Because of all sorts of liability issues that generally can arise even in the simplest of scenarios between just two contracting parties, for me, the MOUs should fundamentally include headlines. It could sensibly be used as a sort of a checklist, a pre-cursor to a fully fledged agreement. What tends to happen is that the person drafting it does so after a conversation in a pub, so often the MOUs lack the sort of information that a good lawyer might wish to include.
MOUs – Prevention Is Better Than Cure
It is always advisable to consult a good lawyer to assist in the creation and oversight of the contractual documentation before a document is created, negotiated and subsequently finalised.