Why Legal Contracts Yell at You in All Caps

by Kelley Keller

If someone sent you an email, text, or tweet in all caps, you’d immediately be offended and possibly quite worried. Why? Because caps equal yelling in electronic communications.

That’s not the case with legal contracts.

If a graphic designer created a design in any medium that included a big block of text in all caps, they’d probably be fired (or fail the class if they were still in design school). Why? Because large blocks of text in all caps have been found in typography research to actually reduce readability.

That’s not the case with legal contracts.

So why exactly do legal contracts include paragraphs of text in all caps if doing so equates to yelling and reduces readability?

It all comes from the Uniform Commercial Code (UCC) and an early visual interpretation of “conspicuous.”

What is the UCC?

The Uniform Commercial Code is a set of statutes related to commercial transactions, which include the sale of goods and services, secured transactions and negotiable instruments. Its purpose is to create consistency across all U.S. states.

Several sections of the UCC reference the need for “conspicuous” text in contracts such as the limitations on warranties section and the indemnification provisions. However, nowhere in the UCC is a specific method of making text conspicuous described.

In fact, the UCC is actually quite vague on what exactly makes text conspicuous. One section of the code says that conspicuous text should use larger type or contrast surrounding text using a different font or color. Another section adds that conspicuous text could be set off from surrounding text of the same size by symbols or other marks that draw attention to it.

Bottom-line, all caps came from a legal requirement to make certain language within contracts conspicuous. If that language in your contracts is in question and isn’t found to be conspicuous in a court of law, you could be in big trouble.

How Did “Conspicuous” Turn into All Caps?

Remember when we didn’t have computers? To bold text in a document, you’d have to hit the same letter key and strike the same position on a piece of paper multiple times. Even then, typewriter ribbons simply weren’t up to the task of creating bold text. And forget about italics, boxes, and other text enhancements. Typewriters didn’t have those keys.

So what was a lawyer to do back in the day? They had to make specific legal text in contracts conspicuous, but their options were limited.

Enter all caps.

The legal industry is slow to evolve, and no lawyer wants to see their contract fail to stand up in a courtroom because it deviates from the current standard of what judges and juries deem to be acceptable. “Conspicuous” has always meant all caps in the world of contracts, and the majority of attorneys, judges, and juries aren’t willing to go rogue and replace those caps with something else.

So are all caps in contracts ugly? Yes.

Are all caps in contracts harder to read than other text enhancements? Yes.

Are all caps in contracts yelling at you? No, but they are trying really hard to get your attention.

Are all caps in contracts going away anytime soon? No. We’re a long way from saying goodbye to all caps in contracts.

What Should You Do?

And now for the big question. Can you change the all caps sections in your contracts to all bold, italics, or something else?

The short answer is you can as long as the text is still conspicuous, but it’s a lot less risky to do what everyone else is doing. If lawyers, judges, and juries are used to all caps and like all caps, then you should stick with all caps.

Remember, the legal industry is slow to change. It’s up to you to decide if you want to go with the accepted standards of “conspicuous” (i.e., all caps) or try to break the mold and live with the potentially unpleasant results.