As a lawyer, I generally prefer clarity and precision in drafting contracts, unless the client specifically requests otherwise. After all, certainty of terms is a fundamental element of any contract.

Some provisions in contracts are ambiguous because the parties have not fully considered what should happen in the scenario addressed by that provision.

One area where ambiguity often arises in share sale and purchase agreements is in provisions restricting the seller from certain actions without the purchaser’s consent between signing and completion. For example, some clauses state that the seller shall procure the target company not to undertake a “material disposal” or similar wording

This raises the question as to what counts as “material”?

If a clear threshold can be defined, it is often better to state the amount or objective criteria in the contract.

Otherwise, if a dispute arises, the court may have to determine what those words mean by examining the facts, the parties’ dealings and relevant case law.

In most cases, it’s better for the parties to make that decision when signing, rather than leaving it to litigation.

This post was first posted on LinkedIn in March 2026.