When it comes to legal contracts, it’s important to understand the nuances of different types of agreements. Two such agreements are supplemental agreements and deeds of variation. Though they may seem similar at first glance, there are key differences between these two types of legal documents.

Supplemental Agreement

A supplemental agreement is a document that modifies an existing contract between two or more parties. The changes made in a supplemental agreement may be minor or major, but they cannot alter the fundamental terms of the original agreement. Instead, a supplemental agreement is used to add additional clauses, provisions, or terms to the existing contract.

Supplemental agreements are commonly used when the parties to the original agreement want to make changes that are not significant enough to require a new contract. For example, a supplemental agreement may be used to add additional products or services to a vendor contract, or to change the payment terms in a service agreement.

Deed of Variation

A deed of variation, on the other hand, is a legal agreement that allows the parties to an existing contract to make significant changes to the terms of the original agreement. Unlike a supplemental agreement, a deed of variation can alter the fundamental terms of the original contract, including the price, delivery terms, and scope of work.

Deeds of variation are often used in situations where a contract has already been signed, but one or both parties want to make significant changes. This could be because of unforeseen circumstances, such as changes in market conditions or regulatory requirements, or because one party wants to renegotiate more favorable terms.

Key Differences Between Supplemental Agreements and Deeds of Variation

While both supplemental agreements and deeds of variation are used to modify existing contracts, there are several key differences between them.

1. Scope of Changes

A supplemental agreement is used to add minor or non-fundamental changes to an existing contract. In contrast, a deed of variation can change the fundamental terms of the original contract.

2. Legal Formality

A supplemental agreement can be made in either written or verbal form, and may not require formal signing or witnessing. A deed of variation, however, requires a formal written document that is signed and witnessed by both parties.

3. Legal Implications

A supplemental agreement does not change the legal nature of the original contract. In other words, it does not create a new agreement. However, a deed of variation creates a new contract that supersedes the original contract. This means that the legal implications of a deed of variation are greater than those of a supplemental agreement.

In conclusion, it’s important to understand the key differences between a supplemental agreement and a deed of variation. If you’re unsure which type of agreement is appropriate for your situation, it’s always a good idea to seek legal advice before making any changes to an existing contract. With a clear understanding of the nuances between these legal documents, you can make informed decisions and protect your legal interests.