This question has to do with business law.  In the statement "John Doe
faxed a memorandum of understanding to Jane Smith", does the word
'understanding' have legal significance?  I have searched several
sources and can not find it listed as a legal term.  If you can define
it from a legal point of view, how does it relate to contract law? If
it has legal significance and you have it handy, a source or two
couldn't hurt, but is not necessary.  THANKS!
Thank you for your help.

pamelagh --


Thanks for the invitation to post an answer to your question, and
thanks for your kind words.  As you suggested, I will adapt the crux
of my earlier comment as the core of my answer, and then you give you
a very good online source where you can find the same essential
information and more about Memorandums of Understanding.

The reason you couldn?t find a definition of Memorandum of
Understanding from an online legal reference source is that it is not
a legal term, as such, with a single meaning. Rather, such documents
come in all ?shapes and sizes? and are typically similar to other
preliminary ?understandings? or ?agreements? such as ?letters of
intent? or ?letter agreements.? All of them are binding and
enforceable only to the extent that they say so and normally contain
language that specifically deals with whether they are be intended to
be contractually binding in whole or in part.  Whether they in fact
are binding then depends on whether they meet all the other
requirements of an enforceable contract (besides that expressed
"intent").

In my research looking toward finding for you online sources for an
explanation of the term Memorandum of Understanding, I discovered that
the term seems to be in especially common usage in international trade
negotiations and in governmental negotiations in general.

Therefore, it is not surprising that I found by far the best summary
of the nature and use of these documents in the context of
international trade, at the website of a very prominent Australian law
firm with an Asia-centered practice.  I think that it will be very
useful for you to review the whole document, which is very informative
and clearly written.

Here are some brief excerpts from it, followed by a link to its complete text:

?At the outset of a project, parties often record the basic terms
under which they agree to work together for the particular project.
This preliminary agreement is commonly referred to as a memorandum of
understanding ("MOU").

.  .  .  .

?There are no "usual" terms of an MOU. However, the terms that are
commonly found in an MOU include [a list follows in the document] :

.  .  .  . 

?At the time of drawing up the MOU, it is important for the parties to
decide whether they wish to be bound by the terms of the MOU. This is
a decision which will change from project to project. However, it is
common practice for an MOU to be part binding and part non-binding.

?Whether an MOU is binding is a question of general contract law. A
contract will be binding if there is offer, acceptance, intention to
be legally bound and consideration. For an MOU, what is particularly
important is the intention of the parties at the time of signing the
MOU.?

Mallesons Stephen Jacque: Memorandum of Understanding
http://www.mallesons.com/publications/Asian_Projects_and_Construction_Update/6366684W.htm


You have said that you aren?t seeking legal advice about a particular
Memorandum of Understanding, so I think that this document will give
all you are looking for in general explanatory material about the
concept of these documents.  Needless to say, the interpretation of
particular ?understandings? generally depends on state law (I am
assuming that you are in the U.S.) as interpreted by a judge in a
court with jurisdiction over the matter.



Search Strategy:

I have a general knowledge of the use of documents like the one that
interests you.  I used a variety of Google searches to find the online
reference cited above and to give me reasonable confidence that there
is no better online source.  These two were among the most useful:

"memorandum of understanding" "legal effect"
://www.google.com/search?sourceid=navclient&ie=UTF-8&rls=GGLD,GGLD:2004-01,GGLD:en&q=%22memorandum+of+understanding%22+%22legal+effect%22

"a memorandum of understanding is"
://www.google.com/search?sourceid=navclient&ie=UTF-8&rls=GGLD,GGLD:2004-01,GGLD:en&q=%22a+memorandum+of+understanding+is%22+


I am confident that is the information you are seeking, but if
anything is unclear or incomplete, please ask for clarification before
rating the answer.


markj-ga

Bless you.  Bless your children and your children's children.  As I
plow through this paper I may yet be looking for some more assistance,
mostly involved with vocabulary and I may be back!! ... soon

pamelagh --

Reading between the lines of your question, I tend to doubt whether we
could give you a helpful answer without knowing what is in the
"Memorandum of Understanding" that interests you. That is because the
title of any legal document is generally much less important than what
it contains. And, even if we did know what it contained, we are not
authorized to give the legal advice that might be involved in
interpreting the language of the memorandum.

I suspect that you are interested in to what extent such a document is
enforceable. Memoranda of understanding, along with close relatives
sometimes called "letters of intent" or "letter agreements" come in
all "shapes and sizes" and normally contain language that deals with
whether they are be intended to contractually binding in whole or in
part.  Whether they in fact are binding then depends on whether they
meet all the other requirements of an enforceable contract (besides
that expressed "intent").

markj-ga

dear markj-ga:  I am not looking for legal advice in the sense that I
need it for myself or anyone else.  I needed the information to
clarify a point in a paper I am writing and I could not find a
"definition" in any of the online law dictionaries or anything!  Your
answer was wonderful - if you happen to have a reference to a
documentable source that restates your definition I would appreciate
it.  Also, please put your reply in the form of an answer, because you
answered my question wonderfully!  p.s. I didn't know how to contact
you directly :-(

pamelagh --

Thanks for your comment.  I have to "leave my post" for a couple of
hours, but I will look for a citable source or two on this subject
later today.


markj-ga

pamelagh --

Thanks much for the blessings, the five stars and the tip.

markj-ga