Please consider a video of Lighthizer and Trump on the legal meaning of Memorandum of Understanding. The video was made at the White House on February 22. It just came my way today.
Lighthizer Response
Here’s the full video where Lighthizer corrects Trump on the legal definition of MOU, not once but numerous times.
The debate went back and forth with Lighthizer repeatedly correcting Trump.
Trump said to Lighthizer “I don’t care if you do it [an MOU] or not. To me it doesn’t mean very much. But if you do a memorandum, how long will it take to put that into a final binding contact?”
Since the MOU is a binding contract, Lighthizer answered: “What? From now on we’re not using the word memorandum of understanding anymore. No more, we’ll never use the term again. We’ll have the same document. It’s going to be called a trade agreement. We’re never gonna use MOU again.”
Trump still did not get the idea that the MOU and the trade agreement were the same thing and asked: “Are they going to put that into another agreement?”
An exasperated Lighthizer danced around for a bit talking about “major hurdles”, concluding “assuming you decide on an agreement, it will be signed by the two people and it will be a trade agreement between the United States and China.”
Trumpian Vocabulary
Trump was pleased.
Please strike MOU from your Trumpian vocabulary.
Mike “Mish” Shedlock
Trump was wrong.
From the FT
“Last week Mr Lighthizer publicly corrected Mr Trump’s definition of a memorandum of understanding, which the president said was not a binding trade deal. Mr Trump had confused a real estate MoU with what it means in trade parlance.”
Trump entered into an MOU with the Russian government re Trump Tower Moscow in the summer of 2016.
Trump doesn’t like MOUs and thinks they aren’t worth the paper they written on most likely because he has broken many of those in his business dealings and think they are the same type.
Looks to me like Trump was right:
https://www.differencebetween.com/difference-between-mou-and-vs-contract/
The key difference between MOU and contract is that MOU is an agreement between two or more parties that is not legally binding whereas a contract is a legally binding agreement between two or more parties that creates an obligation to do (or not do) a particular task. Apart from this main difference, both MOU and contract are largely similar in terms of the objectives they desire to achieve.
So it sounds like Trump is correct in his interpretation and Lighthizer is incorrect.
I’ll take “sounds like” as “not sure” & suggest you watch the full (2:28) video.
Skipping “the first stage” MOU as Trump desires, would “put the cart before horse”, as Lighthizer alluded. Lighthizer merely gave up. I suggest HE read:
Some going with#4. Many have gone with #5.
Trump lacks the U required for a MOU. Trump IS King Chaos.
I think Trump might be right. From investopedia:
” What is a Memorandum of Understanding (MOU)?
A memorandum of understanding (MOU) is a nonbinding agreement between two or more parties outlining the terms and details of an understanding, including each parties’ requirements and responsibilities. An MOU is often the first stage in the formation of a formal contract.”
I give you credit for being able to tell how dumb he is. A lot of Republicans are so dumb, they can’t tell that Trump is dumb.
According to Inveatopedia, “A memorandum of understanding (MOU) is a *nonbinding* agreement between two or more parties outlining the terms and details of an understanding, including each parties’ requirements and responsibilities. An MOU is often the first stage in the formation of a formal contract.”
From Wikipedia – “As a matter of law, the title of MoU does not necessarily mean the document is binding or not binding under international law. To determine whether a particular MoU is meant to be a legally binding document (i.e., a treaty), one needs to examine the parties’ intent as well as the signatories’ position (e.g., Minister of Foreign Affairs vs. Minister of Environment). A careful analysis of the wording will also clarify the exact nature of the document.”
Now what is so jaw dropping about Trump’s (mis?)understanding?
His bluster and swagger disgust me, but I empathize with Trump’s disdain for the damned MOU. If you ever find yourself in a dilemma where you really don’t want to do a deal just now, for whatever reason(s), then do an MOU. Just stuff it full of enough weasel words on both sides and that will prevent it having any real binding effect on either party…yet.
And if I’d ever pulled that stunt of upbraiding my chief negotiator in front of god and the world, I would have expected to be cussed out or swung at, or both. It said a lot, all bad, about how much attention Trump has paid to getting a deal done with these people.