Contract Law

Contractual formation OFFER + ACCEPTANCE + ESSENTIAL CONSIDERATION PRECONDITIONS + FOR AN INTENTION TO BE ENFORCEABLE LEGALLY BOUND CONTRACT LEGAL CAPACITY

LEGAL CAPACITY Lawful capacity for an entity in its own name to enter into binding contracts, to sue and to be sued. Who lacks legal capacity? MINORS (under 18) MENTALLY INCAPACITATED PEOPLE PEOPLE UNDER THE INFLUENCE OF DRUGS OR ALCOHOL If a contract is made with sb who lacks the LEGAL CAPACITY to enter into contract, that contract is said to be VOIDABLE and can be anulled.

Consideration Common law jurisdictions both parties to a contract must bring something to the bargain money anything of value to the parties Eg. I Eg. II Party A – a farm (consid.) Party C– clerical work(consid.) Party B – a million dollars Party D – food and shelter (consid.) (consid.) *Civil law jurisdictions – no consideration (a promise does not need consideration to be enforceable)

Intention to be legally bound agreement + intention to be CONTRACT legally bound COMMERCIAL FAMILY AND SOCIAL AGREEMENTS AGREEMENTS -presumed to be -has to be proved that contracts it was intended to be

Different forms of a contract EXPRESS IMPLIED 3 elements are implied/presumed written oral 3 essential elements are present

Setting aside the contract Three different ways in which contracts can be set aside: VOID (a contract never came into existance) VOIDABLE (one or both parties may declare a contract ineffective at their wish) UNENFORCEABLE (lacks some particular type of evidence necessary for the enforcement – eg. lapse of time, no signature, not in writing- courts cannot force the parties to abide by it)

VOIDABLE CONTRACTS Match the terms with their definitions. MISTAKE A) A threat of harm to compel a person to do sth against his or her will or judgement (eg. threatening to kill the other party if he didn’t sign a contract) MISREPRE- SENTATION B) The restricted capacity of either natural or artificial person to either enforce contracts or have them enforced against them (eg. small children; mentally incapacitated people). DURESS C) A false statement of fact made by one party to another party and has the effect of inducing these party into the contract(eg.false statement of promises) UNDUE INFLUENCE D) One person taking advantage of a position of another person (eg. parent-child; solicitor-client). INCAPACITY E) An incorrect understanding by one or more parties to a contract.

Types of legal contracts Sale(s) agreement Loan agreement Lease agreement Contract of employment Shareholder”s agreement Manufacturing licence agreement Franchise agreement Shipping contract

Structure of a Contract – express terms Match the clauses with their definitions. Indemnity, Dispute Resolution, Payment Provisions, Force Majeure, Term of Contract, Termination Provisions, Parties, Confidentiality, Warranties, Assignment, Applicable Law _____ – clause in which the names and addresses of all the contracting parties are stated _____ – clause setting out the exact price to be paid for the goods or services provided and the date for payment to be made _____ – clause stating the length of the contract and the options to continue it _____ – clause stating the circumstances under which the parties can terminate the contract _____ – clause identifying the information which should be treated as private and be protected and the circumstances in which it can be used or disclosed. _____ – clause outlining procedure to be followed if the parties have a dispute _____ – clause referring to provision of certain warranties by the party providing goods concerning the delivery of the goods or services _____ – clauses expressing an obligation to compensate the indemnified party by making a money payment for some defined loss or damage _____ – clause designed to protect against failures to perform contractual obligation where and when the performance of the contract is impossible through an unavoidable event beyond the party's control, such as a natural disaster or civil unrest. _____ – clause prohibition or permitting transferring the contractual rights and responsibilities to another party _____ – clause indicating which law governs the contract

Remedies for breach of contract AWARD OF MONEY DAMAGES ORDER OF SPECIFIC PERFORMANCES

Essential expressions to form/enter into/ breach/enforce/set aside/terminate a contract a breach of contract consideration offer and acceptance an implied/express/ legally binding contract to set a contract aside confidentiality = diskrecija Warranty = jamstvo Force Majeure = visa sila Assignment = ustupanje, prijenos a void/voidable/ unenforceable contract Mistake = zabluda misrepresentation = lažno prikazivanje činjenica duress = prisila undue influence = protuzakoniti utjecaj incapacity = sposobnost an order of specific performances = izvrsenje ugovora u naturi indemnity = obestecenje

Vocabulary practice I – Word formation Fill in the blanks by using the appropriate words from the text: VERB NOUN ADJECTIVE to enforce avoidance performance _______

Vocabulary practice II - Collocations Choose one of the listed nouns for each of the following verbs. Use the text. a binding offer; requirements; legal capacity; a contract; a contract; requirements to comply with ………………………………. to make …………………. to fulfil…………………… to enter into ………… to set………………aside to possess………………

Translation practice Translate the following sentences into English: Ako ugovor ne ispunjava osnovne uvjete bez pravnog je učinka i ne može dovesti do stjecanja zakonskih prava i dužnosti. Ugovor je poništiv i može se anulirati na zahtjev jedne od strana u slučaju prevare, lažnog prikazivanja, protuzakonitog utjecaja ili prinude.