What is it?
This term functions as a doctrinal qualifier used heavily in contract law and torts to determine materiality or weight of an event.
significant
UCC / CommercialLegal glossary term
Quick answer
Significant usually means having substantial legal weight or impact. In contracts, it matters because minor issues might slip through, but a significant one triggers specific remedies or voids the agreement entirely. Before signing, check for how the contract defines 'significant' behavior.
Definitions
What is significant?
Legal Definition
Significant denotes an action, breach, or obligation that carries substantial weight under the law. When a contractual term is deemed significant, it often triggers specific rights, remedies, or defenses for the involved parties. Courts frequently determine significance based on materiality—whether the issue would influence a reasonable person's decision to contract.
Plain-English Translation
A hall pass being 'significant' means you can't just wander off; your absence matters enough that the teacher has to track it seriously. It shows up when something is important, not trivial.
Contract relevance
Why significant matters in contracts
Ignoring whether an issue meets the threshold of significance can lead directly to voiding a contract clause or losing the right to sue for damages. The risk rests primarily with the breaching party or the injured claimant, depending on context.
Document context
Where significant appears in documents
| Document type | Section | Why it matters |
|---|---|---|
| Master Service Agreement | Termination Clause § 7.2 | Determines if a breach warrants immediate termination rather than cure period notice. |
| Lease Agreement | Breach of Covenant Section 3 | Defines whether late rent payment is merely an inconvenience or grounds for eviction. |
| Employment Contract | Performance Metrics Appendix A | Indicates if failing to meet a goal is a minor performance issue or grounds for termination for cause. |
| Loan Agreement | Default Definition Clause | Establishes the threshold of missed payments that triggers acceleration of the principal balance. |
Contract language
Common contract wording
| Contract wording | Plain-English meaning | What to check |
|---|---|---|
| Material Breach | A failure so substantial it defeats the core purpose of the agreement. | Ensure you know what level of failure qualifies as 'material' in your specific contract. |
| Substantial Performance | Meeting almost all obligations, though minor flaws remain. | If performance is substantial but not perfect, verify if the contract allows for a reduced damages claim instead of full rejection. |
| Significant Deviation from Scope | Any change requested by one party that materially alters the original project plan. | Confirm your right to compensation or termination when the deviation becomes significant enough. |
| Significantly Adverse Change | A shift in market conditions or regulatory environment impacting profitability substantially. | Look for clauses defining *how* this adverse change must be quantified. |
Red flags
Red flags to watch for
Wording examples
Clearer wording examples
Vague wording
Significant breach
Clearer wording
Material breach that renders performance substantially impossible.
Vague wording
Materially significant deviation
Clearer wording
A change in scope exceeding X% of the original agreed-upon deliverables/budget.
Vague wording
Substantially significant event
Clearer wording
An occurrence whose impact meets or exceeds a pre-defined financial threshold (e.g., $50,000 loss).
Note: “clearer” means easier to read — not legally reviewed or guaranteed safe.
Pre-signature checklist
What to check before signing
1
Does the contract define 'significant' anywhere?
2
If defined, what measurable criteria does it use ($, %, time)?
3
What specific legal consequence follows if an event is deemed significant?
4
Is the determination of significance bilateral or unilateral?
5
Does the definition apply universally or only to certain sections (e.g., payment vs. quality)?
6
Are there examples provided in an appendix illustrating what qualifies as 'significant'?
7
If a dispute arises, which party gets the final say on whether something is significant?
Party impact
How significant affects each party
| Party | What this party should check |
|---|---|
| Buyer | Must ensure that *their* standard of significance aligns with the seller’s; they want low barriers to claiming breach. |
| Seller | Wants high thresholds for significance so minor issues don't trigger costly remedies or termination. |
| Tenant | Should confirm that habitability failures are defined as 'significant' enough to justify rent abatement. |
| Employer | Needs clear metrics so they can prove an employee’s failure is significant enough to warrant termination without cause. |
Comparison
significant vs similar terms
| Related term | Plain meaning | Main difference from significant |
|---|---|---|
| Material | The core concept; generally means the issue affects the economic value or nature of the bargain. | Significant implies materiality, but 'significant' can be used even when the impact is arguably minor. |
| Trivial/Minor | An issue that has little to no practical bearing on the overall deal structure. | If something is trivial, it might not meet the threshold for being deemed significant by a court. |
| Substantial | Often interchangeable with material; implies the performance was mostly complete but imperfect. | Significant describes the *weight* of the deviation; substantial describes the *degree* of completion. |
Missing or vague
If significant is missing or vague
If 'significant' lacks a clear definition, parties will argue over its scope during disputes. A seller might claim a $10,000 delay is significant enough to justify termination, while the buyer argues that amount is trivial. This ambiguity forces litigation to establish a standard of materiality from scratch, wasting time and legal fees.
It can also lead to inconsistent application across the contract; one clause might treat a 'significant' late delivery as merely actionable, whereas another treats it as grounds for immediate forfeiture.
Document map
Document section map
| Contract section | What to inspect |
|---|---|
| Definitions Section | Look here first. A good contract will have a dedicated definition of 'Significant'. |
| Representations & Warranties | Check how the parties define what constitutes a 'significant' warranty breach. |
| Remedies Clause | See which remedies (damages, specific performance) are triggered when something is deemed significant. |
| Termination Clause | This dictates whether significance allows for termination *for cause* or just notice of default. |
| Indemnification Section | Verify if the indemnified party must prove the loss was 'significant' before demanding payment from the other side. |
Visual model
Understand significant fast
An explainer image has not been generated for this term yet.
01
Landlord refuses to fix a major leak; the tenant argues the breach is significant enough to withhold rent.
02
A borrower misses one small payment on a $500,000 loan; the lender claims it's significant enough to trigger default provisions.
03
Franchisor fails to provide required marketing materials; the franchisee proves this failure was significant enough to claim damages under their agreement.
Document context
How significant shows up in legal documents
Why does it matter?
Ignoring whether an issue meets the threshold of significance can lead directly to voiding a contract clause or losing the right to sue for damages. The risk rests primarily with the breaching party or the injured claimant, depending on context.
When does it matter?
Significance is assessed when a breach occurs, a claim arises in litigation, or during the interpretation phase of drafting a commercial agreement.
Where is it usually seen?
It appears frequently within UCC § 2-315 (Merchant's Firm Offer), standard indemnity clauses, and federal court motions seeking summary judgment.
Who is affected?
A creditor might argue a missed payment is 'significant' to secure collateral. Conversely, an indemnitor risks liability if the breach they covered was deemed insignificant by the other party.
How does it work?
First, the judge or jury weighs the impact of the event against the whole agreement. Then, they assess whether the deviation would alter the bargain substantially. Finally, this determination dictates which specific remedy—like termination versus damages—the court will grant.
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Wikipedia
Significant figures
Significant figures, also referred to as significant digits, are specific digits within a number that is written in positional notation that carry both reliability and necessity in conveying a particular quantity. When presenting the outcome of a measurement...
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Where significant connects to real contract work
This layer links the term to nearby glossary entries, document use cases, and contract-risk guides so readers can move from definition to context without dead ends.
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BGRisk context hubGlossary meaning, document paths, and adjacent risk pages connected around this clause.
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Source & disclosure
This page is an AI-assisted plain-English explanation based on LexPredict Legal Dictionary context and contract-review patterns. It is not legal advice. Meaning may vary by jurisdiction, industry, and exact clause wording.
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