Pennsylvania Code › Title 37 - LAW › Part V - Bureau of Consumer Protection › Chapter 307 - PLAIN LANGUAGE CONSUMER CONTRACT PREAPPROVAL- STATEMENT OF POLICY › Appendix C - ILLUSTRATIONS FOR TEST OF READABILITY

Current through Register Vol. 54, No. 28, July 13, 2024
These illustrations provide guidance as to how the Test of
				  Readability may apply to a contract.
I. ORGANIZATION
Use headings and subheadings to show the order in which
				  information is presented and to identify the content of each section.
These headings provide few clues about organization and
				  document content:
We agree to . ..
You agree to . ..
Both of us agree to . ..
You also agree to . ..
Both of us also agree to . ..
These headings identify and locate useful information:
Borrower's promise to pay
Interest
Monthly payments
Borrower's right to make prepayments
How much may I prepay without penalty?
What is the penalty if I pay more?
Charges for late payment
II. LANGUAGE AND STYLE
A.
IDENTIFICATION OF PARTIES
Use simple names.
Define the names and pronouns.
Use names and pronouns consistently.
In the following example, the consumer is called "I" in one
				  paragraph, then referred to as "borrower" in another paragraph, with no
				  explanation:
I will pay you for the merchandise in _______ monthly
				  payments of $ _______.
I will make payments on the _______ day of each month.
If borrower is more than 10 days late with a payment, lender
				  may charge a late fee of $ _______.
In this example, the word ''BORROWER'' is used
				  consistently:
BORROWER will pay LENDER for the merchandise in monthly
				  payments of $ _______ . BORROWER will make payments on the day of each
				  month.
If BORROWER is more than 10 days late with a payment, LENDER
				  may charge BORROWER a late fee of $ _______.
B.
EXPLAIN AT THE BEGINNING THAT THE FORM IS A
				  CONTRACT BETWEEN PARTIES.
A legalese start of a contract:
This agreement, made the first day of July, 1994, between
				  Sara Smith, the party of first part, and John Jones, the party of the second
				  part. Witnesseth;
Clearer explanation:
July 1, 1994
This is a lease.
Sara Smith is the landlord.
John Jones is the tenant.
C.
USE WORDS THAT CONVEY MEANINGS CLEARLY AND
				  DIRECTLY.
USE
DO NOT USE
begin
commence or initiate
seller
vendor
buyer
vendee
cancel
rescind
end
termination
under
pursuant to
if
in the event that
give or make
render
before
prior to
after
subsequent to
sign
execute
person signing below
undersigned
postpone
defer
take back
repossess
responsible
liable
D.
USE PRESENT TENSE AND ACTIVE VOICE WHENEVER
				  POSSIBLE.
PASSIVE
If the outstanding balance is prepaid in full, the unearned
				  finance charge will be refunded.
Buyer is obligated to make all payments hereunder.
Membership fees paid prior to the opening of the club will be
				  placed in trust.
ACTIVE
If I pay the whole amount before the due date, you will
				  refund the unearned portion of the finance charge.
I will make all payments as they become due.
If I pay membership fees before the club opens, the club will
				  put the money in a trust account.
E.
USE FAMILIAR VOCABULARY.
Rephrase legal jargon and redundant words into simple
				  language.
This sentence obscures the meaning with jargon:
Purchaser certifies that no oral or written statements,
				  promises, representations or guarantees, other than those herein contained,
				  have been made in relation to this agreement.
This sentence clarifies:
This contract contains all the agreements between the BUYER
				  and the SELLER. By signing this contract, both the BUYER and the SELLER agree
				  to do what the contract says. Nothing which the BUYER has said orally to the
				  SELLER or the SELLER has said orally to the BUYER changes the terms of this
				  contract.
F.
DEFINE TECHNICAL OR LEGAL TERMS THAT ARE NOT USED
				  IN THE ORDINARY SENSE.
Example:
Any payment made before it is due is called a
				  "prepayment."
G.
CLARIFY CONDITIONS AND EXCEPTIONS.
Do not treat rights or responsibilities of the parties as
				  conditions or exceptions.
For example, in this contract the Seller's right to hire an
				  attorney is treated as a condition:
If the Buyer defaults and the Seller commences collection
				  through an attorney, the Buyer will be liable for attorney's fees.
This language clarifies the Seller's right to hire an
				  attorney:
If the BUYER is behind in making payments, the SELLER
				  may:
1. Hire an attorney to collect the money.
AND
2. Charge the BUYER for the attorney's fees.
III. VISUAL SUGGESTIONS
A. Use margins adequate for ease of reading.
B. Use easy to read type size.
C. Use adequate space between lines and paragraphs.
D. Use boldface type for caption sections and
				  subsections.
E. Use line length that makes the contract easy to
				  read.
F. Use column width that makes the contract easy to
				  read.
IV. GENERAL PRACTICE POINTERS
A. Use short words, short sentences and short
				  paragraphs.
B. Use active voice.
C. Eliminate legalese such as:
HEREBY, THEREOF, HERETOFORE, THEREAFTER.
D. Use familiar vocabulary.
E. Rephrase legal jargon into simple language.
F. Use names or pronouns consistently.
G. Define words by using commonly understood meanings.