READING part
Read the following text and do the exercise after the text.
Formation of a contract requires the presence of four essential elements:
Offer
The contract must contain the basic terms of the agreement and be capable of acceptance without further negotiations. This does not mean that the initial communication between parties will in itself constitute an offer. For example, in an auction situation, the seller, known as the vendor, may make an invitation to treat – invite an offer – by setting out the conditions of sale (for example when payment will be made) with an exception of the price. The offer is submitted by the purchaser, who offers to purchase at a specified price and will usually incorporate the terms of the invitation to treat into his/her offer.
Acceptance
There must be an unqualified agreement to proceed on the basis set out in the offer and it must be communicated to the offeror - the person making the offer – in order to be effective. If the offeree - the person receiving the offer – states that he or she accepts the offer subject to contract, that is, some variation of the terms, then no contract is formed.
This would be a qualified acceptance, which constitutes a counter offer.
Issues may arise as to whether the acceptance has been communicated. Two rules determine this:
• The reception rule applies to instantaneous forms of communication, for example telephone calls. The contract is said to be formed when the acceptance is received by the offeror.
• The postal acceptance rule, where there is a delay between the communication being sent and received, for example by post. The contract is formed when the acceptance is sent by the offeree.
To avoid uncertainty, the offeror may specify the method and timing of acceptance. Agreement on essential terms, for example price and delivery, must be certain and not vague.
Consideration
For a contract to be enforceable something of value must be given, for example a price, even if it is of nominal value, say £1.
Intention
It is assumed that contracting parties intend to create legal relations, particularly in commercial circumstances. This is, however, a rebuttal presumption an assumption that can he contradicted if there is contrary evidence.
Exercise 1.
Match the following phrases with their definitions.
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1. Draft the provisions |
A имеющий юридическую силу |
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2. Hire purchase agreement |
B разработать положения (контракта) |
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3. Enforceable |
C презумпция опровержения |
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4. Lease agreement |
D приглашение провести переговоры |
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5. Terms of the agreement |
E договор займа |
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6. Rebuttal presumption |
F условия соглашения |
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7. Invitation to treat |
G договор о найме |
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8. Hire contract |
H договор аренды с правом выкупа |
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9. Loan agreement |
I соглашение, имеющее обязательную юридическую силу |
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10 Binding agreement |
J договор аренды |
USE of English part
Exercise 2.
Read this extract from a webpage about contract terms. Think of the best word to fill each gap.
BUYERS` TERMS AND CONDITIONS AND UNFAIR CONTRACT TERMS
The Unfair Contract Terms Act
Transactions between businesses are covered (1)__________ the Unfair Contract Terms Act 1977 (UCTA). In general, businesses are assumed to be free to enter into (2)__________contracts they agree between themselves — so you should make (3)___________you`re happy with the contracts you agree with other businesses.
However, UCTA places a number of restrictions on the contract term businesses can agree to.
Specifically, (4)___________________lays down rules for the ways in (5)____________________ vendor businesses can use exclusion clauses to limit liability in certain areas:
• excluding liability for death or injury is not permitted in (6)_____________ circumstances;
• excluding liability for losses (7)_________________by negligence is permitted only if it is reasonable.
• excluding liability for defective or poor-quality goods is also permitted only if it is reasonable.
The test of reasonableness
UCTA doesn`t define precisely (8)____________ is meant by `reasonable`, but courts will usually take into account:
• the information available to both parties when the contract was drawn (9)_________________;
• whether the contract was negotiated (10)___________ is in a standard form;
• whether the purchaser had the bargaining power to negotiate better terms.
Businesses don`t have the same protection as individual consumers. A consumer contract excluding liability for defective goods (11)_____________ be automatically invalid. But as a business purchaser, it`s up to you to check in advance what terms and conditions you`re agreeing to.
At present, there are separate rules dealing with unfair consumer contracts - the Unfair Terms in Consumer Contracts Regulations.
Sole traders are regarded as businesses (12)___________ than consumers for any purchases they make in connection with their business activities. However, if the trader offers you credit terms up to £25,000, you receive the same protection as individual under the Consumer Credit Act 1974 for this element of the contract.
Exercise 3.
Read this website extract about restitution. Use the words on the right to make one word that fits the numbered gap in the text.
Restitution
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Restitution is where the claimant has conferred a benefit on the defendant in performing their (1)____________ duties and wants to claim that benefit back. An example of this is where the claimant has paid in advance for goods which have not been delivered. The loss is measured with regard to the value of the actual benefit as opposed to the claimant’s loss, but will only be permitted if there is a serious breach and a total failure of (2)______________ . The purpose of a claim under this ___________(3) is to put both parties into the position they would have been in had the contract never been entered into, although in some situations the claimant may be placed in a better position. The claimant is entitled to choose the (4) ______ upon which to make their claim, but there are certain (5) ___________. Where the claimant has made a ‘bad bargain’, they will not be able to claim damages by relying (6) _________ on the loss if it puts them in a better position than they would have been in had the contract been performed. In any event, it is for the defendant to prove that the claimant has made a bad bargain. In the case of C.&P. Haulage v. Middleton (1983), the claimant had hired a garage for six months, and it was agreed that any (7) ___________ would be the property of the defendant. When the defendant breached the contract, the claimant sued for the cost of these. The court held that even if the contract had not been breached, the (8) ________ would have been wasted. In some situations, it may also be possible to recover twice for the same loss under the various bases as outlined above, as long as the loss itself is not duplicated. In general, though, the claimant will seek damages assessed on the (9)_________ basis, as this usually proves to be more (10)_____________
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1 CONTRACT 2 CONSIDER 3 HEAD 4 BASE 5 RESTRICT 6 SOLE 7 IMPROVE 8 EXPEND 9 EXPECT 10 PROFIT
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LISTENING part
Exercise 4.
You will hear a speaker giving a welcome and overview of a one-day conference on Contract and Commercial Law. Listen and complete the sentences.
Conference on Contract and Commercial Law
Being aware of latest developments in this field will help reduce (1)________ for law firms and their clients.
The course has been designed to be intensive to assist those who have limited (2)_________.
The course is aimed at both (3) ___________ and private-practice lawyers.
Participants will receive advice on dialing with (4)_________contracts in particular.
One speaker today is well known because of his involvement in a case that turned on (5)_________.
‘How to avoid expensive (6) _______________’ will be the focus of another session.
A very important concern for contract and commercial lawyers is drafting (7)__________ indemnities.
Participants will benefit from the (8)______________and techniques of experts throughout the day.
Mr Frans Viedrict is the (9)_________________speaker of the day.
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