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Home » What Is Blue-Penciling?

What Is Blue-Penciling?

If you have ever signed a contract and worried that one unfair line could ruin the whole agreement, you are not alone. Contracts can feel overwhelming. They are often long, full of legal language, and difficult to understand. One confusing but important concept that can affect your rights is blue-penciling.

In simple terms, blue-penciling is a legal method used by UK courts to remove or “strike out” parts of a contract that are unenforceable, while keeping the rest of the contract valid. This article explains what blue-penciling means, how it works under UK law, when courts use it, and why it matters to you.

Understanding Blue-Penciling

Imagine you sign a contract that contains one unfair or illegal part, but the rest of the agreement is perfectly reasonable. Should the entire contract fail because of that one problem? UK courts usually say no.

This is where blue-penciling comes in.

Blue-penciling allows a court to cross out the offending words or sections of a clause that cannot be enforced by law. If what remains still makes sense and reflects what both parties originally agreed, that remaining part can still be enforced.

The name comes from the old practice of judges literally striking through words with a blue pencil. Today, it is more a legal concept than a physical act, but the idea remains the same.

Why Blue-Penciling Exists

The purpose of blue-penciling is to strike a balance between fairness and practicality.

If courts cancelled entire contracts every time a small part was unenforceable, it would cause chaos. Many agreements would collapse over minor drafting errors. Blue-penciling helps courts:

  • Preserve valid agreements
  • Prevent one unfair term from destroying the whole contract
  • Respect the original intentions of the parties

At the same time, courts are careful not to help parties who try to include overly aggressive or unlawful terms. That is why blue-penciling has strict limits.

The Legal Roots of Blue-Penciling in the UK

The blue pencil test has deep roots in UK law. One of the earliest and most important cases is:

Nordenfelt v Maxim Nordenfelt Guns and Ammunition Co Ltd (1898)

In this case, the House of Lords confirmed that courts could remove unreasonable parts of a contractual restriction, as long as the rest of the clause still made sense on its own. This case laid the foundation for how blue-penciling is applied today.

Since then, UK courts have continued to apply this principle carefully, especially in cases involving exclusion clauses and restraint of trade.

When Do Courts Use the Blue Pencil Test?

Courts do not automatically apply blue-penciling. They use it only in specific situations. The most common scenarios include:

  • Exclusion clauses that go too far
  • Limitation of liability clauses that include unlawful exclusions
  • Restrictive covenants that are partly unreasonable
  • Commercial contracts with drafting errors

A good modern example comes from the case of Goodlife Foods Ltd v Hall Fire Protection Ltd [2017] EWHC 767 (TCC).

A Real Example: Blue-Penciling in Action

In Goodlife Foods Ltd v Hall Fire Protection Ltd, a contract clause tried to exclude liability for all consequences, including personal injury or death, arising from the use of a product.

Under section 2(1) of the Unfair Contract Terms Act 1977, excluding liability for death or personal injury caused by negligence is not allowed. That part of the clause was clearly unlawful.

Instead of striking down the entire exclusion clause, the court used the blue pencil test. It removed only the words referring to personal injury and death. The rest of the clause, which excluded liability for other losses, remained valid.

This case shows how blue-penciling can save part of a contract without rewarding unlawful drafting.

The Rules Courts Must Follow When Blue-Penciling

UK courts are very careful when applying the blue pencil test. They follow strict rules to ensure fairness.

The Court Cannot Rewrite the Contract

A court is not allowed to add new words or change the meaning of a clause. It can only remove words. If fixing the clause would require rewriting it, blue-penciling cannot be used.

The Remaining Clause Must Make Sense

After removing the offending words, the remaining clause must still be readable and logical. If what is left becomes confusing or meaningless, the entire clause will fail.

The Original Intention Must Remain

The clause that survives must still reflect what the parties originally intended, just without the unlawful part. If blue-penciling would change the nature of the agreement, it will not be allowed.

When Blue-Penciling Will Not Be Allowed

There are many situations where blue-penciling simply cannot be used. For example:

  • If the illegal part is too closely linked to the rest of the clause
  • If removing words leaves a clause that makes no commercial sense
  • If the clause was deliberately drafted to be excessive
  • If enforcing the remainder would be unfair

In these cases, courts may declare the entire clause unenforceable.

This is important for you to understand. Blue-penciling is not a safety net for badly drafted contracts. Courts will not rescue a party who has clearly overreached.

Blue-Penciling and Employment Contracts

Although blue-penciling is more common in commercial contracts, it can also arise in employment agreements, particularly with:

  • Restrictive covenants
  • Confidentiality clauses
  • Non-solicitation provisions

UK courts assess these clauses very carefully. If a restriction goes beyond what is reasonably necessary to protect an employer’s legitimate interests, it may be unenforceable.

However, courts are reluctant to heavily edit employment restrictions. If a clause is too wide and cannot be neatly trimmed without rewriting it, blue-penciling is unlikely to help.

For you as an employee, this means an unreasonable clause may fail entirely rather than being fixed.

Why Blue-Penciling Matters to You

Understanding blue-penciling helps you in several ways.

If You Are Signing a Contract

You should not assume that every clause is enforceable just because it appears in writing. Some parts may be invalid under UK law. Knowing this gives you confidence to question unfair terms before signing.

If You Are in a Dispute

If someone is trying to enforce a harsh clause against you, blue-penciling may limit its effect. A court might remove only the unlawful part, or it may strike out the entire clause.

If You Are Running a Business

Relying on blue-penciling is risky. Courts expect contracts to be drafted fairly and carefully. Overly aggressive clauses may backfire and become completely unenforceable.

The Link Between Blue-Penciling and Severance Clauses

Many contracts include a severance clause (also called a severability clause). This states that if one part of the contract is invalid, the rest will still apply.

While severance clauses help, they do not guarantee blue-penciling. Courts still apply the legal tests discussed above. A severance clause cannot force a court to rewrite an agreement.

Common Misunderstandings About Blue-Penciling

There are a few myths worth clearing up.

  • Blue-penciling does not mean courts will “fix” bad contracts
  • It does not allow judges to rewrite clauses to make them fair
  • It does not apply automatically
  • It does not protect deliberately unfair drafting

Understanding these limits helps you set realistic expectations.

Practical Tips for You

If you are dealing with a contract, keep these points in mind:

  • Read clauses carefully, especially exclusions and restrictions
  • Question anything that seems too broad or absolute
  • Remember that not everything written is legally enforceable
  • Seek legal advice early if a clause worries you
  • Do not rely on courts to correct poor drafting later

A little caution at the start can prevent major problems down the line.

Final Thoughts

Blue-penciling is an important concept in UK contract law, but it is often misunderstood. At its core, it allows courts to remove unlawful or unenforceable parts of a contract while preserving what is fair and workable.

For you, this means protection against overreaching clauses, but not a guarantee that courts will rescue badly drafted agreements. Blue-penciling exists to uphold fairness, not to reward carelessness.

Understanding how it works puts you in a stronger position, whether you are signing a contract, challenging one, or simply trying to protect your rights.