Contract Law 1/2/3

Most of the time in case of a project, a Work and Services contract is concluded in order to produce certain effect of work result. E.g. 

• Construction of house
• Development of customized software
• Composition of piece of music

• As soon as delivered or completed. Here the Buyer must as well inspect the work and confirm the quality stated in the contract.
• The warranty period starts, the buyer must immediately notify the seller in case of defects
• The acceptance after the inspection triggers the payment

• reduce of the price
• terminate the agreement
• requirenments of repair
  • Here it depends on the product delivered or the work performed

Payment of th price

• fixied price
  • is agreed in the contract
• no ficed price
  • if on time and material basis
  • estimated price
  • valuw of the work (calculated by a outstanding person)
• Cost ceiling (upper limit of the price)
• Payment terms
  • payd in stages (milestones) during the performance of the work

• drafting of the specifications
• appointment of a customer project manager
• access (building, building lot, IT environment)

Here the work result is not seeked, however the performing agent must provide his services in a dilligent manner and use reasonalbe skills. We must pay the agent and refund acured expenses.

E.g. You expect from a doctor the required skills

The contractor tries to avoid the responsibility for the work results they produce. He is nonetheless responsible to work loyally and diligently.  

• Refund damage caused
• Reduction of the fee

By a fixes price or estimated by time and material used.

May be terminated at any time by either party because it is based on trustworthyness.
Any damages must be recompensated if the mandate is terminated in a unreasonable moment.

• Unilateral/bilateral confidentiality
• Clauses covering any information/only information labelled as “confidential”
   

It is a fixed amount to be paid in case of a breach of contract.

For Example:
Any delay with the delivery of an industrial plant causes considerable damage to the customer. Therefore, the contractor often is obliged to pay a penalty for each day he is late in the delivery of it.

Limitations set in the contract to exclude any unappropriate damages

• simple negligence (of an employer)
• loss of profit
• etc.

Personal injuries cannot be excluded.
Breach of warranty, termination, reduction of price, claim for remedy of a defect or the contract cannot be covered

In common law countries, breach of contract is committed sometimes to increase profit.

It is a international sales law that governs contracts for the sale of goods that are between sellers and buyers whose places of business are in different countries that have made the CISG part of their law.

1. Freedom to conclude the contract
2. Freedom to choose the contractual partner
3. Freedom of formality
4. Freedom to establish the contract‘s content
    

In a bilateral contract, both parties promise to fulfil their obligations.
In a unilateral contract only one party makes that promise - e.g. "non dislosure agreement"

It is a call for a periodic performance with a termination date
e.g. leasing contract

1. Offer / acceptance
2. Exchange of offer/acceptance
3. Offer/acceptance correspond (concerning all essential points); implied promises
4. Capacity to act 1.Age (exception minors: necessaries [goods or services needed for minor’s livelihood])
5. 2.Capacity to consent

1. The offer must be communicated to the person to whom it is adressed
2. The offer must manifest a willingness to enter the contract.
3. The offer must make clear, that acceptance will create the contract.
   1. Exception: Proposals are non-binding

1. If it is written - there must be a signature
2. If the object of the contract is immovable a publig register must note the contract/transaction

Every party must act in good faith in excercise of its rights and the performance of its obligations

•  Mistake of fact
  • An original paintin turns out to be forgery
•  Failure of expression - A disacord in what the party really meant to what it actually expressed
  • a typing mistake = 100.- instead of 1000.
  •  

• Pre-formulated provisions used for an indefinite number of contracts that must be agreed upon before in order to conclude a contract.

• Place of performance
  • Usually in the contract
  • if not, at the resident of the creditor at the time of the performance
• Time of performance
• Costs of performance
  • Usually in the contract
• Right to subcontract
• Corporation Obligations
  • the customer must let the other contractor perform his/hers duty

Non-performance or defective performance

Default:
If the supplier is unable to deliver the goods on time

Performance impossible:
e.g. if the seller isn't allowed by law to ship the goods in the purchsers's country