The terms “promptly”, “immediately”, “without delay” or similar terms are often used in contracts and their precise meaning is not clear.  Here are some of the popular terms:

• immediately,
• promptly,
• forthwith,
• without delay,
• the shortest possible time,
• as soon as possible,
• as soon as practicable,
• as soon as possible (or practicable) having regard to the circumstances, and
• within reasonable time.

As with other broad terms (such as materiality, reasonable efforts etc) courts determine their meaning based on circumstances or facts of the dispute involving those terms.  Indeed, it is no surprise that “promptly”, “immediately”, “without delay” may have different meanings (such as right now or at the first possible opportunity) or they may mean the same thing (e.g., in reasonable time having regard to the circumstances) depending on the circumstances they are used and applied [1].  This means that whatever the meaning a party intended for the term, its application by courts will depend on specific circumstances.

Does that mean a drafter should not care about which term to use in the agreement?  It seems to us based on the research we have done that there is no clear response to this question.  In similar situations experienced contract drafters would just go with whatever they believe a term implies in ordinary usage and hope for the best.  In doing so, we may want to bear in mind the following:

Bear in mind the type of clause

Bear in mind the type of clause in which the term is used.  For instance, “party shall promptly (or immediately) remove defects” is an obligation clause.  A clause along the lines of “upon lender’s notice, the loan shall be cancelled immediately” is a declaration clause.  Often performing obligations “immediately” or “promptly” (meaning right now) may not be practical.  For instance, it may not be possible to remove defects literally immediately.  A decent court would not demand from a party something that is not possible. Cancellation of a loan, on the other hand, may occur immediately.  It follows then application of those terms in practice will depend on the type of clause they are used.  This may influence the exact term a contract drafter (or negotiator) would be willing to allow into a clause.

3 types of circumstances – classification

The following is an interesting and useful article:  https://www.justice.gc.ca/eng/rp-pr/csj-sjc/legis-redact/legistics/p1p33.html.   It makes a distinction between the types of circumstances in which the terms “immediately”, “promptly”, “without delay” can be used.  In particular, it distinguishes three types of situations: (i) when something must occur in the shortest time, (ii) when it is necessary to do something as soon as possible with due regard to the circumstances (less strict than previous), and (iii) within reasonable time, which is a loose requirement compared to the first two.

While the distinction in 3 above is useful, the issue often is which term belongs to which category.  Our approach is as follows:

• we use “immediately” or “promptly” to imply category (i) above (i.e., the shortest time), despite some suggest these terms can have different meanings,
• we use “the shortest time possible” or “without delay” or “as soon as practicable” together with “having regard to the circumstances” to imply (ii) above, and
• the best way to impose loose time period is to use “within reasonable time”.

Despite uncertainty, it may be worth paying attention at specific words

The fact that application of a term by courts can be based on particular facts and circumstances often does not eliminate the need for diligence.  It may still be very useful to use “immediately”, instead of “as soon as practicable” in an obligation clause to signal the requirement to the party act very fast.  This is because all interpretations (including interpretations based on facts) almost always will start from the text and the text may have significant bearing on a court’s conclusion.

Compare “Without delay” and “as soon as possible”

Let us compare these two phrases in order to get a better sense of their meaning.

Example:

Under a license agreement if a licensee detects infringement of the licensor’s IP rights, the licensee must notify the licensor “without delay” or “as soon as possible”.  The licensee believes there is such infringement, but notifies the licensor only 3 months after first noticing the infringement. The licensee justifies its delay by the fact that it needed to hire a lawyer in order to finally determine the nature infringement and the money required for hiring a lawyer was not available until after 2 months of the date when the licensee became aware of the infringement.

Could these events be considered causing a “delay” or “impossibility”?  There is no clear response – as noted above, it depends on the circumstances.  From semantic point of view (I am not a linguist by any means) perhaps there is not much difference between these terms – the licensee can say “I did not delay the notice” the same way it can say “it was impossible to provide notice earlier“.  In in both cases the justification is that the lawyer was not available to investigate the possible infringement.   

But in the context of most contract languages that contain the word “delay”, the word generally suggests lack of diligence.  For instance, in a sentence “you must do this without delay” is likely to mean that a person must not delay something unless there are objective circumstances causing the delay.  In contrast, “as soon as possible” goes beyond diligence and implies stricter requirement – you have to do something unless it is impossible.  For instance, if you did not have money for the lawyer, you could have borrowed it.  

Clarity may takes more than one sentence

As with many other broad terms in contracts, it is possible to bring more clarity by adding additional provisions.  Consider the following example:

The seller shall deliver the products as soon as possible, but in any event no later than 10 days after receiving the payment.

If the seller does not deliver the products, say in 5 days due to its lack of diligence, the buyer may sue for damages – it does not have to wait for the 10 days period to expire.  But he would need to show (subject to standards of proof) that delivery of products within 5 days was possible, which makes bringing a successful claim harder for him (and that’s the reason the seller inserted that term there).  Upon expiry of 10 days, however, the buyer does not need to go through the work of proving that delivery of the products after the 10 days period was possible (again, subject to applicable substantive and procedural laws of a country).

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[1] See for instance: https://www.adamsdrafting.com/promptly-and-immediately/