3. I. CONTRACT AND
LAW
1. Law concerned with rights and duties
2. Law has two branches: public and private
3. A contract is subject to private law
4. Most rights and duties under private law
are disposive
5. Parties create a new, legally enforceable
rights and duties that exist only between
the two
6. Parties cannot set aside rights or duties
under the public law
4. I. CONTRACT AND
LAW
7. In principle, parties are free to choose
which national private law applies to their
contract
8. Trade is often based on the general
conditions of sales or purchase => often
lead to conflict
9. The safest basis for an export agreement is
NEGOTIATED WRITTEN COTRACT.
5. 2.FAMILIES OF LAW
1. Four families: Continental, Anglo-
American, Socialist and Religious
2. Main difference between Continental and
Anglo-American Law is degree of
codification: Continental Law – fully
codified, Anglo-American Law relies on
precedents
3. Anglo-American Law, esp. private law –
largely case-law
6. 3. WHICH LAW
1. Every contract is governed by an
applicable law
2. If parties do not agree an applicable law,
the arbitrator decides on one by
considering the place of execution,
language, currency, weights and measures
3. A clear, detailed and fair contract greatly
reduces the possible impact of applicable
law.
7. 4. LANGUAGE OF
CONTRACT IN ENGLISH
Lengthy, complicated and repetitious
Reasons:
Anglo-American contract law is mostly case
law – always try to avoid/embrace
implications of past decisions
Try to cover all possibilities
9. 5. Clause Patterns in
Contract English
1.
MAIN CLAUSE + MAIN CLAUSE
E.G.: The stimulated prices are fixed, and
they are to be understood delivered paid to
the place of destination
10. 5. Clause Patterns
2.
MAIN CLAUSE + SUB. CLAUSE
E.G.: The Employer has the right to
terminate this contract if construction work
is not carried out in accordance with local
by-law
11. 5. Clause Patterns in
Contract English
2.
SUB. CLAUSE + MAIN CLAUSE
E.G.: If construction work is not carried out in
accordance with local by-law then the
Employer has the right to terminate this
contract.
12. 5. Clause Patterns in
Contract English
3. MAIN CLAUSE + SUB. CLAUSE
+ SUB. CLAUSE
+ SUB. CLAUSE
+ SUB. CLAUSE
E.G.: The delivery time has been adhered to if
the consignment is ready for dispatch ex
works within the agreed period and if notice to
this effect is sent to the purchaser.
13. 5. Clause Patterns in
Contract English
4.
SUB. MAIN SUB.
CLAUSE + CLAUSE + CLAUSE
E.G.: Where the contract provides for
deliveries in lots or installments, penalties for
late delivery shall be calculated on the basis of
the value of each lot or installment, provided
that the late delivery does not impede the
general performance of the contract.