contract-law
What does &#39;to the order of&#39; mean (excluding contexts of bills, promissory notes)?
<p><sub>Source: p 33 Middle, <a href="https://www.amazon.co.uk/gp/product/0414041801/ref=pd_sbs_14_t_1?ie=UTF8&amp;psc=1&amp;refRID=8AWSERSMKG5WTHNPGVKS" rel="nofollow noreferrer"><em>JC Smith's The Law of Contract</em></a> (2016) by <a href="https://www.law.ox.ac.uk/people/paul%C2%A0s-davies" rel="nofollow noreferrer">Paul S. Davies</a>.</sub></p>
<blockquote>
<p>If the procedure envisaged in <em>Eccles v Bryant</em> is followed and each contract is concluded
only when an exchange through the post is complete, there is a grave risk that X may find
that he has committed himself to buy Y 's house, but that W has changed his mind and
refuses to buy X's house, with the result that X has two houses on his hands. And Y may find
that he has committed himself to sell to X, but that Z has changed his mind, meaning that
Y is left without a house at all. The risks are inevitable because of the delay involved in the
process of exchange. If the solicitors of all four parties could meet together and exchange
the signed parts of the contracts virtually simultaneously, all risk could be eliminated; but
it will usually be impracticable for them to meet. A solution has been found in a system of
'exchange' by telephone. If all the contracts have been signed and all the parties are ready
to proceed, W 's solicitor may agree to hold the contract signed by W <strong>to the order of</strong> X's
solicitor who in turn will agree to hold X 's signed contract to sell to W <strong>to the order of</strong> W 's
solicitor. X 's solicitor will also agree to hold X's signed contract to buy from Y <strong>to the order
of</strong> Y 's solicitor—and so on down the chain. Some of the contracts may have been physically
delivered in advance and held to the order of the delivering solicitor until the time agreed
for the 'constructive' (or notional) transfer. But it seems that there need be no physical delivery at all.</p>
</blockquote>
<p>The OED lacks the correct definition, as the following do not pertain:</p>
<blockquote>
<p>[23.] <a href="http://www.oed.com/view/Entry/132334?rskey=qd1pq4&amp;result=1&amp;isAdvanced=false#eid33289311" rel="nofollow noreferrer">a.</a> <em>Law.</em> A decision of a court or judge, made or entered in writing. In the Supreme Court: a direction of the court or a judge other than a final judgment.</p>
<p><a href="http://www.oed.com/view/Entry/132334?rskey=qd1pq4&amp;result=1&amp;isAdvanced=false#eid33289408" rel="nofollow noreferrer">b.</a>  <em>Banking and Finance.</em> A written direction to pay money or deliver property, made by a person legally entitled to do so.</p>
</blockquote>

<p>The definition in the OED is actually basically correct. In this context "to the order of" means that the lawyer holding the physical signed original contract document (which is a form of tangible personal property in this sense rather than a true intangible property right) agrees in a binding oral contract to deliver that physical signed original contract document according to the instructions of the other lawyer who represents another party with whom the contract was made.</p>

<p>Because the recipient of the "to the order of" promise has a right to direct the disposition of the signed original piece of paper, that recipient of the "to the order of" promise is legally considered to be in possession of that piece of paper.</p>

<p>Possession of the piece of paper is important because a written contract or instrument is not normally binding until it is "signed" (ordinary meaning), "sealed" (either notarized or marked with a corporate seal for contracts that required either of these at the time), and "delivered" (transferred from the legal possession of the person signing to another party to the contract or beneficiary of the instrument or to an attorney or agent for that person).</p>

<p>Thus, for example, if you sign and notarize a deed giving Blackacre to your nephew, the deed is still not effective until you <strong>deliver</strong> the deed to your nephew or an agent or attorney acting on his behalf. (The exception to that general rule is a will which is effective when signed and witnessed even if it is never delivered prior to death.)</p>

<p>Historically, a signed original was much more important for enforcement of contracts than it is today, when a copy or scan is easily made and equally effective in most circumstances. The class of "real documents" which physically embody a legal right rather than merely being evidence of an agreement or action of the parties, is increasingly small. For the most part it consists of live checks, promissory notes, mortgages, deeds of trust, wills, warehouse receipts, bearer bonds, certificates of title (sometimes), and unrecorded deeds.</p>

<p>This reference is to a transitional arrangement using legal fictions to overcome obsolete requirements for "real documents." We are currently at the tail end of the process of this transition.</p>
