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Table of Contents

Lead Story

The POS tablet revolution

Dale S. Laszig


Industry Update

Analysts predict healthy holiday spend

SF City Attorney declares AmEx pricing illegal

Restaurants adjust to EMV tipping

NFC Forum urges EMV, NFC upgrades


Open Mobile Summit taps innovative minds

The blockchain phenomenon

Balancing high tech with high touch

Mobile opt-in hold steady


Including checks in payments modernization

Patti Murphy
ProScribes Inc.

Risk encompasses far more than chargebacks

Kevin Mendizabal
Frates Insurance and Risk Management


Street SmartsSM:
Let's make the MLS Forum even more useful

Jeffrey I. Shavitz
TrafficJamming LLC

Choose bold, new transparency for 2016

Jeff Fortney
Clearent LLC

Defending your online business from CNP fraud

Chris O'Donnell
Instabill Corp.

The one man show: Juggling your personal life

John Tucker
1st Capital Loans LLC

The facts about EMV security

Best get it in writing

Adam Atlas
Attorney at Law

Company Profile

CardWare International Inc

New Products

App to optimize, simplify EMV acceptance


Security toolbox for small to midsize merchants

Trustwave SMB Security Toolkit
Trustwave Holdings Inc.


Be a friendly competitor


Readers Speak

Letter from the Editors

Three books to strengthen leaders

Resource Guide


Skyscraper Ad

The Green Sheet Online Edition

December 14, 2015  •  Issue 15:12:01

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Legal ease:
Best get it in writing

By Adam Atlas

In ancient Egypt there was no written law. The reason for this was that the laws changed every time the Pharaoh changed, so there was no need to write down laws. Fortunately, we have made progress since then. Contracts are the law for the parties that agree to them.

Even people with the best of intentions, however, can have problems remembering promises they made. Enter the written contract. A surprising number of material disputes – including those involving trials – have stemmed from relationships for which there was no written agreement.

The purpose of this article is to provide people in our industry, including the card companies, banks, processors, ISOs and merchant level salespeople, tips on how documenting their actions can help to avoid unpleasant surprises.

Bank on writing, not talking

When negotiating ISO deals or buyouts, a lot is said on the phone, in person over drinks or elsewhere. Sometimes parties will go through weeks or months of finalizing an ISO deal or buyout on the basis of an informal oral offer as to pricing or other terms only to discover that the written deal does not match the old oral undertaking.

If someone says to you he or she will buy your portfolio for 40 times your monthly residual, don't waste a few weeks negotiating the fine points of the buyout agreement unless you first have some kind of written confirmation of the offer.

You are probably thinking that I am writing to help protect against unscrupulous buyers. This is, of course, part of my purpose. However, as much as there are dishonest people doing business, we are all forgetful, and occasionally major deal points are forgotten somewhere between the initial handshake and the signature of the transaction documents.

What is writing?

For the purposes of the law, each state has its own definition of what constitutes a written document. An exchange of scanned signatures and e-sign, cloud-based acceptance forms are the most common types of written acceptance in our industry today. Accepting contracts by electronic means is convenient, but it imposes on the parties some measure of precaution that the other side has not been hacked, that the document has not been altered against the version that was agreed upon and also that there is some audit trail on signing of the document.

E-sign services (like DocuSign or Acrobat eSign) provide audit trails, including the IP address of the person accepting the agreement. In the event you have to prove that a party to an agreement actually accepted the agreement, those audit trails will be helpful. Interestingly, a person's electronic identity (email, social media, etc.) has emerged as sometimes being more reliable than their in-person identity, which often depends on a visual inspection of a drivers' license.

Date your documents

I advised on a case involving a $50,000 fine to an ISO for purported noncompliance by one of its agents. There is a dispute as to whether the agent was an agent of the ISO at the time of the alleged infraction. One of the key factors in this case was the availability of documentary evidence as to the timing of the agency relationship between the agent and the ISO.

This example illustrates how crucial it is to date all your written agreements and related notices. The date of an agreement usually appears in the introductory language, but can also appear on the signature lines. If there are numerous dates (that is, date of the agreement, date of signature, effective date, etc.) make sure you specify which one is the actual effective date of the contract.


Contracts need to be amended from time to time. The rigor required of the original contract, in terms of formality of execution, should be applied to each amendment as well. The amendment should clearly identify the contract that is to be amended – with name, date and party names, and should clearly indicate which provision is to be amended.

An exchange of emails might not meet the state law threshold for writing when a party needs to go back and prove that an amendment happened. Similarly, a phone conversation will not suffice as evidence of an amendment to a written agreement, unless there are witnesses to the conversation and the agreement allows for oral amendment – which is hardly ever the case.

$h2Confirm conversations

While conversations do not have the weight of writing when amending agreements, they do evidence the general intent of a party. If someone calls you and tells you something significant, take a minute to send the person an e-mail confirming what he or she just told you.

Keep a copy of your sent email in a safe place. This kind of self-serving evidence could come in very handy in the event of a future dispute over the contents of the conversation. The conversation and the proof of the conversation can be used to motivate someone to enter into a written amendment that crystallizes the discussion.

Take notes

Take fastidious notes during conversations. The reason for this is to be able to refer back to promises made and the context of agreements entered into. Years down the road, you may not remember why one or another clause was written in a way that is unusual. Your negotiation notes will come in handy as a reminder of why the clause was written the way it was.


Along with an obligation to do things in writing, there is a corollary obligation to read all incoming mail and notices carefully. Important emails or letters are occasionally lumped in with junk mail. For this reason, consider a private, junk-mail-free e-mail account through which you can do most of your business correspondence, such as "" But keep track of all incoming messages sent to all of your inboxes, as generic email addresses are sometimes used as a place to send important notices.

It's also a good idea to have a second person read your agreement before you sign it. I have a hard time not recommending a lawyer, but if you have decided not to take legal advice, have a colleague read your agreement before it's signed to get a second, and perhaps more objective, perspective on the agreement.

The upshot here is not to be obsessive about writing, but instead to emphasize the importance of writing as legal evidence to support otherwise undocumented business negotiations and deals. Prudence should never be so extreme as to get in the way of the normal functioning of your business. Some jittery deal makers ask for too much in writing and end up spoiling business relationships as a result.

Remember, ideally, a contract results in value to both parties that would not exist had there been no contract; in other words, it should be a win-win. Given the fact that no one's memory is infallible, getting agreements in writing is best even for the most trusting and trustworthy parties.

In publishing The Green Sheet, neither the author nor the publisher is engaged in rendering legal, accounting or other professional services. If legal advice or other expert assistance is required, the services of a competent professional should be sought. For further information on this article, please contact Adam Atlas, Attorney at Law by email at or by phone at 514-842-0886.

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

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