Legal Question in Civil Litigation in New York

Memo of Understanding vs. Letter of Agreement

I work for a non-profit that is undertaking a joint project with two other non-profits and want to establish who is going to be responsible for what. They are not interested in doing a contract so are looking into these two options. Is there a difference between a memo of agreement and a memo of understanding? Are they used to deal with different issues or is one more binding?


Asked on 6/19/03, 1:04 pm

3 Answers from Attorneys
Gary Adelman Adelman Matz, P.C.

Re: Memo of Understanding vs. Letter of Agreement

Both are just titles of agreement. It is what is contained within the agreement and of course signature by all parties which determines whether it is binding or not. Either way you may be entering into a contract anyway. There are three companies involved, you should seek legal counsel to make sure that the "agreement" actually states what all three parties are obligated to do. In the short term, not entering into a "contract" may be fiscally better and less time consuming, however contracts are entered into for at least 2 reasons, 1) to put in writing each parties obligations and 2) in case something goes wrong.

This communication is for informational purposes only, is not legal advice and is not intended to create an attorney-client relationship or any other type of relationship, which, under the policies of Gary Adelman, Esq. , can only be created by execution of a formal retainer agreement.

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Answered on 6/20/03, 3:15 pm
Andrew Nitzberg Andrew Nitzberg & Associates

Re: Memo of Understanding vs. Letter of Agreement

This must be an exciting project! I have a great deal of experience with non-profits, and the most important thing is to get everyone on the same page. The letters of understanding/agreement have the same legal significance and impact. In fact, if there is an exchange of signatures, affirmation by the boards, or other pattern that indicates all parties have agreed to the contents of the 'letter', then they are the same as a written contract.

Not all lawyers are 'dealbreakers', only lousy ones! It is important to go over the contents of such an agreement with a lawyer in order to be aware of the issues contained in the agreement. You are welcome to a consultation with me for no fee at my offices at 42 West 44th Street, NY,NY. Please call for an appointment first - (646) 591-5786

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Answered on 6/21/03, 8:38 pm
Michael Paradise Law Offices of Michael S. Paradise

Re: Memo of Understanding vs. Letter of Agreement

There is no difference. They are only titles. They would have to be signed or otherwise acknowledged for their to be a claim of a binding agreement.

Good Luck.

Michael S. Paradise

This is not legal advice and no attorney/client relationship has been established.

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Answered on 6/19/03, 1:50 pm


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