Butera Beausang Cohen & Brennan
Addendum or Amendment?
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Sooner or later, written contracts may get modified, updated or revised due to changes in the business terms or changes in the circumstances. Rather than re-write the whole contract we sometimes draft an additional document that becomes part of the contract. Sometimes we call it an amendment, sometimes it’s called an addendum. What is the difference?
An amendment typically changes one or more terms of the contract. For example, in a long term supply contract for oil, the price per gallon may be changed by amendment. The original price is replaced by a new price term. The contract is thus changed.
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An addendum typically adds a term to the contract that was not present originally. An example would be a contract to deliver office supplies to a business at its current office location. If the business opens a satellite office, an addendum might be used to add the new location to the contract. (The contract terms stay the same – with the additional location also included.)
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One other change to contracts is called a “novation” – where a new contract wholly replaces an existing contract.
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