The document discusses key concepts in contract law including warranty, indemnity, and force majeure. It defines a warranty as a guarantee made by one party to another, usually regarding the condition of goods or services. An indemnity is a promise by one party to compensate the other for any losses arising from the contract. It also discusses force majeure, which refers to unforeseeable events that prevent a party from fulfilling contractual obligations, such as natural disasters. The document provides examples and explanations of these concepts.

1. Contract law:
Warranty, indemnity
and force majeure

2. warranty
2
A warranty is a guarantee that
one party gives to the other
It is a statement of fact
e.g. In a contract for the hire of an industrial machine, the hirer will warrant the
owner that he or she will return the machine in the same condition and in the
date stated in the contract.
Indemnity
An indemnity is a promise that
one party makes to the other.
In a contract, one of the parties
promises to compensate the other if
there is a loss that arises from the
contract. To arise from means to
come from.
The process of indemnity is
sometimes called covering
someone against a loss.

3. In the example given, one party hires a
machine from the other and warrants
that he or she will return it in the same
condition. What happens if he or she
doesn’t do that?
The indemnity clause
states that the hirer
must compensate the
owner for his loss.
An indemnity clause
usually requires the party
who gives the indemnity
to buy a policy of
insurance to make sure
that he or she can keep
his or her promise to pay.
The contract will say
that the hirer must take
out a policy of
insurance. In the US,
an indemnity clause is
sometimes called an
indemnification clause
Indemnity

4. A force majeure is something that
happens that stops one of the parties
from fullfilling his or her contractual
obligations. It might be a problem with
very bad weather or something like a
terrorist attack.
Force majeure
Unforeseeable means that
the parties did not and could
imagine that such a thing
could happen.
A force majeure clause protects
the parties from these unexpected
circumstances. It describes the
force majeure as an
unforseeable event.
This clause states under
what unexpected
circumstances the parties
are free from fullfilling their
contractual obligation.

5. “
If you could, which monument would you visit?
City of Macchu PichuTemple of Chichen Itzá

6. Activity 1a
⬗ Put the letters in the correct order and complete the definitions
a- A clause in which one party says that he or she will compensate the other for
certain losses that may happen as a result of entering into the contract
I___________ ( demnityn)ndemnity
b- A phrase that means “comes from” or “as a result of” something.
A _____ f ____ ( riases) (romf)rises rom
c- A word that means to pay someone money so that they do not suffer the
effect of a loss C __________ ( pentasmoce)ompensate
d- A phrase that means to buy something, especially insurance
T____ O____ ( aket) (to)ake ut
e-The formal name for an insurance document. P________ (lycio)olicy

7. Activity 1b
7
f-The word that American lawyers use instead of indemnity
I ______________ (mniedincatifon)
To Chichen Itzá
ndemnification
g-An international term tht describes an event that stops a party from fullfilling a
contractual obligation. F _____ M ______ (orec) (jeurea)orce ajeure
h- A word that means “ could not have been imagined in advance”.
U ___________ ( forenabseel)nforeseable

8. Activity 2 a
⬗ Fill the gap in each sentence with the missing word
A- In the ________ clause of this contract the hirer guarantees that he or she
will comply with the terms and conditions it contains.
warranty
b- The _________ clause requires your client to cover any loss that my client
suffers as a resultof entering into this contract.
indeminity
c- Your client agrees to ___________ my client for any financial loss that he
suffers as a result of entering into this contract.
compensate
d- It is necessary to ____________ insurance when you enter into this contract.
This means the other party knows you have the money to compensate him for
any loss that he suffers.
e- Do you have a ____________ insurance? It is an important document and
you should keep it in a safe place.
take out
policy

9. Activity 2 b
9
F-When a loss __________ a breach of the terms in the contract, the indemnity
clause usually covers the injured party against the loss.
arises from
G- Our New York office has sent us a contract that uses clause heading
______________ instead of indemnity
H- Events that are usually classified as a ______________ include war,
revolution, and terrorism.
i- The terrible storm on 10 July was an _____________ event and therefore can
be classified as a force majeure.
force majeure
indemnification
unforeseeable

10. 10
Thanks!
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