Legal documents often seem to go out of their way to be complex and confusing. One tool in the complexity toolbox consists of numerical section cross-references, where the document refers to some other section of the document by number. Those cross-references distract the reader without helping to explain what’s actually going on in the document. They also will always sound right, even if they’re wrong. A recent New York case demonstrated just how wrong a section cross-reference can be and the consequences that can follow.
The litigation involved a mostly ordinary operating agreement of a small limited liability company. Article 8, Paragraph 1 said the company would be dissolved—shut down and terminated—if one of four events occurred. Article 8, Paragraph 2, the very next paragraph, said, however, that the “events specified in Article 7 paragraph 1” would not cause dissolution unless certain members of the company voted to dissolve.
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