A truly stunning display of ignorance, Trump doesn't know what an MOU is

[underpants]

A Memorandum of Understanding (MOU) is a standard binding contract used by government entities either between government entities or, more commonly, with private sector vendors. It IS a binding contract.

This was one of the most stunning things I've ever seen. To compare it as a joke with someone showing their ass in a meeting is a gross mistake. Lighthizer tried to bail him out but Trump HAS to fully display his ignorance to the point that Lighthizer tries to change legal terms and the Chinese Vice Premier is laughing at Trump IN the Oval Office.

Link to tweet

Trump told reporters they would “be very short term. I don’t like MOUs because they don’t mean anything. To me, they don’t mean anything.”

“An MOU is a binding agreement between two people,” Lighthizer responded.

Turning to members of the news media assembled in the Oval Office, he continued, “It’s detailed. It covers everything in great detail. It’s a legal term. It’s a contract.”

“By the way I disagree,” Trump fired back. “We’re doing a memorandum of understanding that will be put into a final contract, I assume. But to me, the final contract is really the thing Bob, and I think you mean that too, is really the thing that means something. A memorandum of understanding is exactly that, it’s a memorandum of what our understanding is.”

“The real question is, Bob … how long will it take to put that into a final binding contract?”

Lighthizer quickly adopted a new term after the pushback from the president.

“From now on, we’re not using the word ‘memorandum of understanding' anymore,” Lighthizer said. “We’re going to use the term ‘trade agreement’ … We’re never going to use MOU again.”

Chinese Vice Premier Liu He laughed as the exchange carried on.

https://pbs.twimg.com/media/D0CpituXQAE6woI?format=png&name=small

https://thehill.com/homenews/administration/431283-trump-trade-chief-changes-trade-terminology-after-president

[TheBlackAdder]

1. To Trump, Binding Agreements DON'T MEAN ANYTHING! Just ask the thousands of contractors he's fucked.

[Tanuki]

6. Or ask his first two wives.

[George II]

17. Or junior's wife.

[Tanuki]

52. Or his current wife, come to think of it.

[PatSeg]

13. There you go

Trump has never encountered an agreement that he felt compelled to honor.

[TeamPooka]

23. Then he and the Chinese will get along just fine. They both have the same attitude.

[Snotcicles]

41. The only think he finds binding is cheese. nt

[Hekate]

2. The world is laughing at us...

Good gods.

[JHB]

36. Right in front of him. To his face.

[True Dough]

3. In fairness

Drumpy only claimed to have the best WORDS, not the best acronyms!

[littlemissmartypants]

27. .

[mikehiggins]

5. Nothing is binding to this clown, not an MOU, not a contract, not a promise

Yes, hundreds if not thousands of businesses learned that lesson the hard way since the Trump Cartel started business. It is no wonder so few legitimate banks would advance him money.

[littlemissmartypants]

28. Exactly.

He had a more binding deal with the toilet paper on his shoe.

[PatrickforO]

7. This is just shamefully embarrassing.

Trump really has brought shame upon this nation and upon all Americans.

[TeamPooka]

24. I hate that word. and yet, after moments like this and many others he truly does seem

to have some sort of developmental handicap.

[Maru Kitteh]

9. When he doesn't know what something is, it "doesn't mean anything"

If you think about it, it's a perfectly logical consequence of his narcissism. If he doesn't know a thing, that thing has no meaning, of course. It's just like when he said "nobody" knew Abraham Lincoln was a Republican, and "nobody" knew healthcare was going to be complicated.

[JBoy]

12. Exactly right. Same with when he doesn't understand why something is important.

If he can't understand why something is important, like NATO or cooperating with allies, then it's obviously unimportant.

[UTUSN]

10. There is *NO* surprise anymore about his ignorance, just about his supporters & collaborators.

[Pepsidog]

11. Ignorant mother F'er.

[Roy Rolling]

14. MOU not LOI

In business, a letter of intent is issued and then a final contract is signed.

Di*ks like Trump issue LOIs and then change the terms before a final contract. So he thinks an LOI is not binding.

He also thinks an MOU is the same as an LOI because he knows nothing about government.

And is not shy about telling the whole world how much he doesn't know.

[underpants]

15. Thank you

That explains it for me.

[belpejic]

20. This

God, he's stupid. He can't even get the corporate law straight. This is worse than when Nikki Haley compared UN-level negotiations to accounting. The US is a laughingstock.

[William Seger]

16. It's his REFUSAL to be educated about anything that's the real problem

Just like everything else he deals with, he simply refused to be corrected because he has delusions of grandeur and infallibility.

[erpowers]

19. Another Problem

Another problem is the unwillingness of people around him to stand up to him. Robert Lightizer, like many of Trump advisors and supporters, eventually changed to accommodate Donald Trump. Lightizer should have stood firm and told Trump a MOU was a binding agreement. Maybe if more people stood up to him, Trump would change.

[Sgent]

26. To be fair

Trump's negotiator was an ass. You don't correct the president in front of the Vice Premier of China.

[William Seger]

34. No, he HAD to correct him

We'd been negotiating an MOU with China, and here's Trump saying he doesn't care about MOUs because they don't mean anything, and asking when the "final contract" will be ready. How do you answer that without correcting him?

[magicarpet]

51. With trDump,...

What is - isn't,..
And what isn't - is.

How do you rationalize that backwards and upside down thinking.

This King Orange of Shit Gibbon does not belong in or near the people's White House.

trDump is White Trash stupid without hope for redemption. He isn't pResidential yet and never will be,.. he is just too dirt stupid.

[William Seger]

53. Yeah, Lighthizer gave up pretty quickly: "trade agreements, ok?"

Trump: "I like that terminology much better."

[DirtEdonE]

18. The only thing truly binding with trump is his stupidity. nt

[Demovictory9]

21. haha. Trump clearly didn't even know what the letters "MOU" stood for, tries to save face. ha ha

[Retrograde]

22. MOUs are common in non-government business as well

Back when I was working in the tech area I was part of MOU negotiations with various vendors. It may not have had the same status as a contract (IANAL) but it was considered a document with legal implications: it usually meant we were operating under the terms that would eventually be in a formal contract.

[defacto7]

25. What an idiot. That is THE stupidest thing I have heard

since the last time he opened his mouth.

[RockRaven]

29. Hell, it isn't just that he doesn't know, it that he REFUSES TO LISTEN OR LEARN

this anecdote is not just about how he uses a term incorrectly, or draws the incorrect inference from the use of a term... that is a marginal side-story.

The critical piece of this story is about how when he is confronted with what a term means -- to everyone else in the entire world -- he crosses his arms and pouts and yells "no it doesn't, no it doesn't, no it doesn't!!!"

[Yavin4]

30. U. Penn.

U. Penn graduate.

[littlemissmartypants]

31. I like to say Pres-tidigitation is an idiot and he is.

It's all just sleight of hand, smoke and mirrors, willful ignorance with him. Thank goodness he's not looking well and he could just drop dead at any moment.

My dream for #HoldTheDate would go something like this:

(ignore the wrinkles, it's the thought that counts)

[OneBro]

32. Nope. MOUs generally are NOT binding.

As much as I hate to be on the same side of anything with the Traitor-n-Chief, an MOU generally is not a binding contract, and I know of no exceptions when dealing with the government.

[underpants]

38. Yes they are.

They are followed up by a purchase order but the PO refers to the MOU (which is signed by both parties) for specifics and is an internal instrument for payment and cost tracking. The MOU's include the Who, What, When (term of service), Where, and the How. MOU's are very specific about what will be done and often want won't be done.

[OneBro]

58. Well, good luck to any litigant who sues based solely on an MOU.

It's not something I care enough about to research, but I'd love to read ANY case where a court has found a contract and/or liability based solely on an MOU.

[KY_EnviroGuy]

33. Question: On the web site Google Translate....

I can't find a language called "Trumpish".......

Can anyone help here?.........

[Ms. Toad]

35. Word to the wise: even a broken clock is right twice a day.

And just because Trump says it does not always make it wrong. Trump is actually closer to correct than his trade chief is on this point.

Memorandums are not generally binding - they document where the parties agree as of the date of the MOU. Sometimes there are binding provisions - often confidentiality provisions that cover the exchange of information until a contract is in place (although when I drafted them regularly, a MOU was accompanied by a separate NDA contract largely because the MOU just recited the skeleton of the deal that was yet to be worked out.

I will admit that I have not written any government to government MOUs, although I have written them between a state (and political subdivisions thereof) and privae companies (and between two private companies). I am not aware of any reason a government to government MOU would have different legal implications than one between a government and a private entity.

[underpants]

37. The MOU's I've dealt with are binding contracts

They are followed up by a purchase order but the PO refers to the MOU (which is signed by both parties) for specifics and is an internal instrument for payment and cost tracking. The MOU's include the Who, What, When (term of service), Where, and the How. MOU's are very specific about what will be done and often want won't be done.

My experience have involved State business with private contractors.

[Ms. Toad]

47. Go look up the legal definition of MOU.

Pretty sure you'll find definitions closer to Trump's than yours, regardless of how you are using the term.

People use all sorts of things as the basis of interacting with each other. If the facts of that basis for interacting satisfy the legal elements of a contract, then it is one (regardless of what you call it.). If it is a contract, it is binding. If not, it isn't.

Your MOUs may actually be contracts - or you may be surprised if either party decides to ignore the terms of the MOU. But a detailed description of the parties' understanding of how they intend to do business is not inherently binding.

[underpants]

50. Well you are right.

I have to say I’ve been in government procurement for several years and we’ve always used MOU’s as the vendor’s final agreement on terms. After they sign (their last step after negotiations) we internally create a PO which has no involvement from the vendor at that point.

This says it is non-binding which is news to me.
https://legaldictionary.net/memorandum-of-understanding/

Whether a document constitutes a binding contract depends only on the presence or absence of well-defined legal elements in the text proper of the document (the so-called "four corners&quot . The required elements are: offer and acceptance, consideration, and the intention to be legally bound (animus contrahendi). In the U.S., the specifics can differ slightly depending on whether the contract is for goods (falls under the Uniform Commercial Code [UCC]) or services (falls under the common law of the state).
https://en.wikipedia.org/wiki/Memorandum_of_understanding

[Ms. Toad]

56. I have an advantage -

as former outside counsel for a company that liked to describe themselves as a "fortune 1000" company and dealt regularly with both other companies and with state and federal governmental units I've written quite a few, none of them binding. I also currently teach contract law (among other subjects).

As to your first scenario, your PO is an offer, which the vendor accepts by either promising to ship or shipping (assuming the subject matter is the goods). You're actually likely creating multiple binding contracts is PO + the MOU provisions that are incorporated by reference that were accepted by eihter shipment or promise to ship by the vendor. The catch is that you could send a PO (an offer), and the vendor could just refuse to respond, and not be in breach (as a general rule) because the MOU does not (generally) create a binding obligation.

As to your second note - determation of whether something (scribbles on a napkin, a phone call, or even an MOU) is a contract all depends on what a reasonable person would determine the parties intended. So yes - an MOU can be a contract if the parties intend it to be one and its terms are specific enough to permit enforcement. But companies I've worked with generallly use them because they are expressly trying to avoid a contract for one reason or another.

[William Seger]

43. No, he still wasn't right, because whatever you call it...

... it's the only agreement we'll have -- there's no "final contract" after that.

[Ms. Toad]

44. The fact that is the only agreement

Doesn't transform a memorandum of understanding (generally non-binding), into a binding contract.

My point had nothing to do with whether a later contract actually materializes, but with the nature of an MOU (the point on which Trump was generally correct)

[William Seger]

46. But this is a specific case of an MOU

... which is legally binding in international law, and is the only "contract" we'll have. Trump might be forgiven for not knowing that, but the unforgivable part is his refusal to learn.

[Ms. Toad]

48. What is your basis for saying it is legally binding

When that is contrary to the general nature of MOUs?

[William Seger]

49. An MOU is considered to be a contract if...

https://en.wikipedia.org/wiki/Memorandum_of_understanding

Whether a document constitutes a binding contract depends only on the presence or absence of well-defined legal elements in the text proper of the document (the so-called "four corners" ). The required elements are: offer and acceptance, consideration, and the intention to be legally bound (animus contrahendi).

...
In international relations, MoUs fall under the broad category of treaties and should be registered in the United Nations treaty collection.[6] In practice and in spite of the United Nations Office of Legal Affairs' insistence that registration be done to avoid 'secret diplomacy', MoUs are sometimes kept confidential. 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. The International Court of Justice has provided some insight into the determination of the legal status of a document in the landmark case of Qatar v. Bahrain, 1 July 1994.[7]

And again, the real problem is that when Lighthizer tried to tell Trump that the MOU under discussion will be a binding contract, he simply refused to understand that.

[Ms. Toad]

57. The conversation I listened to wasn't specific to this deal.

It was a generic statement about MOUs ("an MOU is a contract . . . it's legal term, it's a contract&quot , and as to that - Trump was closer to correct than Lighthizer. (Lighthizer was also way off on other legal principles on which he was expounding.)

Anything can be a contract - even scribbles on a napkin. But - as a general rule - MOUs are not binding.

I think my JD is probably a little more reliable than Wikipedia, Esq. (the snippet you have quoted is generally accurate - but is lacks the larger context that MOUs are generally not binding agreements, i.e. those are the exception, rather than the rule.)

[Hortensis]

39. :) , but same old depraved whack job, nothing new.

On the plus side, all governments realize he's a passing aberration, product of a national moment of insanity. They're angry at us and scared of what we'll do next, of course.

[BSdetect]

40. His malignant narcissism in full view.

[raging moderate]

42. Wait a minute. This is a real weak weakness in Trump.

Maybe some very clever people will eventually use this to curtail our national blunder?

[femmocrat]

45. Stunning stupidity.

Lighthizer should polish up his resume.

[Yo_Mama_Been_Loggin]

54. So much for him knowing the "Art of the deal".

An MOU is very much a part of that.

[localroger]

55. The 'art' is cleverly changing the terms before drawing up the final paperwork

...and then throwing a fit if the victim protests. It's how he's treated Letters of Intent, which he probably thinks are the same, for his whole life.