Characteristics of one of the main legal text: contract and exercises to practice it

1. INGLÉS JURÍDICO
III. MAIN TYPES OF LEGAL TEXTS: STRUCTURE AND
VOCABULARY
3.1. Contracts
Under the common law, a promise becomes an enforceable contract
(contrato en firme) when there is an offer by one party, normally called an
offeror that is accepted by the other party (offeree) with the exchange of
legally sufficient consideration (prestación).
For a promise to become an enforceable contract, the parties must also agree
on the essential terms of the contract such as price and subject matter.
Nevertheless, courts will enforce (dar validez) an indefinite contract under
certain circumstances such as when the conduct of the parties, as opposed to
the written instrument (escritura), manifests enough certainty as to the terms
of the agreement.
An enforceable agreement may be manifested in either written or oral words
(an express contract) or by conduct and words (an implied contract). In a
contractual dispute, certain defences (eximentes) to the formation of the
contract may allow a party to escape his / her obligations under the contract.
For example; illegality of the subject matter which can be defined as follows:
when either subject matter or the consideration of a contract is illegal. You can
also allege fraud in the inducement, that is to say, when one party is
intentionally misled (engañada) about the terms of a contract. Duress
(coacción) is another defence you can use to discharge the specific
performance of a contract. The last defence to be applied is the lack of legal
capacity, meaning that you don’t have the ability to enter into a legal contract
because you are not of legal age or you are insane.
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2. INGLÉS JURÍDICO
The common clause types which appear in no matter what kind of contract are
the following:
a) Acceleration (adelanto) requires the offeree to pay all or part of a
payable amount sooner than as agreed upon the occurrence of some
event
b) Assignment (cesión): prohibits or permits assignment under certain
conditions
c) Confidentiality (cláusula de confidencialidad): implies treating the
information as private
d) Force majeure (fuerza mayor): tries to protect against failures to
perform contractual obligations caused by unavoidable events beyond
party’s control
e) Consideration (prestación): expresses the cause, motive, price which
induces one party to enter into an agreement
f) Liquidated damages (indeminización por daños y perjuicios
exigible): refers to an amount previously established by the parties as
the total amount of compensation if there is a breach of contract
g) Entire agreement (cláusula de mutuo acuerdo): says that the written
terms of an agreement can’t be varied by prior or oral agreements
h) Severability (cláusula de divisibilidad): provides that in the event that
one or more provisions of the agreement are declared unenforceable,
the balance of the agreement remains in force
i) Termination (cláusula de rescission): establishes when and under
which circumstances the contract may be terminated
j) Payment of costs (pago de las costas): sets out which party is
responsible for payment of costs related to the preparation of the
agreement and ancillary documents (documentos secundarios)
When there has been a breach of contract, the non-breaching party will
often seek remedies available by law. Most remedies involve money
damages. In some cases, a party will be able to obtain punitive or
exemplary damages through the court which are designed to punish the
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3. INGLÉS JURÍDICO
breaching party for a conduct which is judged to be particularly
reprehensible such as fraud. This type of damages is normally only awarded
where specifically provided by statute and where a tort in some way
accompanies the breach of contract. Where monetary damages wouldn’t be
an adequate remedy, the court may order specific performance
(cumplimiento del contrato) which involves an order by the court
compelling the breaching party to perform the contract. Finally, there are
other remedies available: for example, if there has been a default
(incumplimiento) by one party, the other party may rescind or cancel the
contract
Main types of contract
Most of the civil cases are probably related to torts, among them we can
include nuisance (molestias) and trespass (intromission o violación de
la propiedad) and breach of contract (incumplimiento de contrato).
Nowadays most of the economic relationships among parties are secured by
contracts. Among the most important types of contract, we can find:
a) Purchase sale contract (contrato de compra-venta): This contract
can be oral or written but some of them such as the purchase-sale of
real property (compraventa de bienes immuebles) must be legalised
by a deed (escritura pública). These contracts are terminated, among
other reasons, by the following:
- the contract has been performed
- by agreement of the parties
- by novation (novación): one of the parties can ask for the contract to
be modified in order for the dispute to be settled. The affecting party
accepts to release the another party from his contractual obligations
signing another contract with a new consideration called satisfaction
(satisfacción), settlement (liquidación) or discharge (finiquito)
- by breach of contract
b) Lease or leasehold (contrato de arrendamiento): the owner of a real
property, called the lessor or landlord, grants the possession and
exclusive use of this real property to a lessee or tenant for a fixed
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4. INGLÉS JURÍDICO
period of time. This type of contract should also be legalised by a deed,
in which covenants (estipulaciones o pactos) are included. Among the
most important covenants included in this kind of contract, we can find
the following: the parties to the contract, the term or length, the
description of real state, rent (renta), insurance (seguros) and repairs
/ maintenance (reparación y mantenimiento). The tenancy can be
for a fixed term or periodic. When the tenancy is for a fixed period of
time, the lessee can assign to another person his contract for the
remaining period of time whenever there is no covenant against it. The
periodic tenancy usually lasts until the lessor or tenant gives notice
(denunciar). When it’s the landlord who gives notice, it’s called eviction
notice (notificación de desahucio). When there is no fixed period of
time for the tenancy, it can be said that there is tenancy at will
(inquilinato sin plazo fijo). In this tenancy, the terms of the contract
are brought to an end when one of the parties thus determines.
c) Contract of employment: the employees have right to health and safety
at work, to paid holidays, to statutory sick pay (baja laboral por
enfermedad) and to statutory maternity pay. When industrial disputes
arise, they can be heard in Industrial tribunals (Magistratura de
Trabajo). Most of these disputes are related to the termination
(extinction) of contracts of employment. Among the reasons of
termination, we can find the following: unfair dismissal (despido
improcedente) or redundancy (expediente de regulación de
empleo). Among the remedies applied by Industrial Tribunals when
somebody is unfairly dismissed are the following: reinstatement
(readmisión), reengagement (recolocación) and compensation
(indeminización). The employer can also make breach of contract
when an employee is demoted (rebajado en su categoría
professional), cut in his wages (se reduce su salario) or he / she is
sexually harassed (acosado sexualmente)
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5. INGLÉS JURÍDICO
EXERCISES
1- Match these defences (1-4) with their definitions (a-d):
1. illegality of the subject matter
2. fraud in the inducement
3. duress
4. lack of legal capacity
a. when one party doesn’t have the ability to enter into a legal
contract, i.e. is not of legal age, is insane or is a convict or enemy
alien
b. when one party induces another not entering into a contract by
use or threat of force, violence, economic pressure or other
similar means
c. when either the subject matter or the consideration of a contract
is illegal
d. when one party is intentionally misled about the terms, quality or
other aspects of the contractual relationship that leads the party
to enter into the transaction
2- Identify the type of clause exemplified by each of these
clauses:
1. The seller’s liability for damages shall in no case exceed the
purchase price of the particular quantity delivered with respect of
which damages are claimed
2. Whenever, within the sole judgment of Seller, the credit standing
of Buyer shall become impaired. Seller shall have the right to
demand that the remaining portion of the contract be fully
performed within 10 days
3. Neither party shall be liable in damages or have the right to
terminate this Agreement for any delay or default in performing
hereunder if such delay or default is caused by conditions beyond
its control
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6. INGLÉS JURÍDICO
4. This Agreement may not be assigned without the prior written
consent of the other party, except that the Buyer may assign the
Agreement to a subsidiary or related corporation
5. In the event Operator defaults in the performance of any
covenant or agreement made hereunder, as to payments of
amounts due hereunder or otherwise, and such defaults are nor
remedied to the Supplier’s satisfaction within 10 days after notice
of such defaults, the Supplier may thereupon terminate this
agreement
6. This Agreement, including the Schedules and Exhibits attached
hereto, constitutes and contains the entire agreement of the
parties with respect of the subject matter hereof and collectively
supersedes any and all prior negotiations, correspondence,
understandings and agreements between the parties respecting
the subject matter hereof. No party is relying on or shall be
deemed to have made any representations or promises not
expressly set forth or referred to in this Agreement
3- In your own words, explain the following words and
expressions in italics from the clauses in exercise 2
a) liability for damages (clause 1)
b) within the sole judgment of Seller (clause 2)
c) delay or default (clause 3)
d) prior written consent (clause 4)
e) In the event Operator defaults in the performance ….. (clause 5)
f) Schedules and Exhibits (clause 6)
g) Deemed (clause 6)
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7. INGLÉS JURÍDICO
4- Read the following clause and for each of these words,
find the word or expression in the clause that most closely
matches the meaning
1. in the form of
2. specified in writing
3. more than
4. jointly
5. is owed to
6. including
7. as stated above
8. subtracted form
FAILURE TO FINISH THE WORK ON TIME
It is mutually agreed by and between the parties hereto that time is of the
essence and that in the event of the Contractor’s failure to complete the
contract within the time stipulated and agreed upon, the Owner will be
damaged thereby; and because it is difficult to definitely ascertain and prove
the amount of such damages, inclusive of expenses for inspection, necessary
travelling expenses and other similar expenses, it is hereby agreed that the
amount of such damages shall be the liquidated sum of Two thousand
Dollars per calendar day for each day of delay in finishing the Work in excess
of the number of working days prescribed; and the Contractor hereby agrees
that such sum shall be deducted from amounts due to the contractor under the
contract or, if no amount is due the Contractor, the Contractor hereby agrees to
pay to the Owner as liquidated damages, and not by way of penalty, such total
sum as shall be due for such delay, calculated as aforesaid.
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8. INGLÉS JURÍDICO
LISTENING ACTIVITIES:
5- You will hear Arthur Johansson, a junior lawyer who
attended the in-company seminar on negotiating
techniques, negotiating the terms of an agreement for a
client with the other party’s lawyer, Ms. Orwatz.
a) What kind of agreement are they talking about? Which clauses do they
mention?
b) Decide whether these statements are true or false:
1. the clause they are discussing wouldn’t allow the franchises to operate
any kind of restaurant within the prescribed area for a stipulated period
of time
2. the lawyer representing the franchisor argues that the purpose of the
clause is to guard her client’s legitimate business interests
3. the franchisee’s lawyer believes that his client is in a strong position in
the negotiation
4. the franchisee’s lawyer offers to strike the arbitration clause in exchange
for a reduction in the number of years set forth in the non-competition
clause
6- Listen to an attorney informing a client about the various
remedies available to him
1. What was wrong with the software program delivered to the client?
a) it was completed too late to meet the deadline
b) it didn’t work on all the ferry company’s PC’s
c) it wasn’t designed in accordance with the specifications of the clients
2. According to the lawyer, what should her client have done to mitigate his
damages?
a) he should have offered his customer less than a 10% discount
b) he should have looked for a cheaper local programmer
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9. INGLÉS JURÍDICO
c) he should have had an attorney draw up the contract
3. Provided the contract doesn’t waive the right to consequential damages,
under which circumstances might the client be entitled to receive such
damages?
a) if the reputation of the client in his town suffers
b) if the quality of the software turns out to be unsuitable for the purposes
of the customer
c) if the loss of the customer and the necessity to grant a discount could
have been foreseen
4. Why can’t the client expect to be awarded punitive damages?
a) weight gain doesn’t qualify as emotional injury
b) punitive damages aren’t awarded in a breach of contract case of this
type
c) the possibility of personal injury was not foreseen in the contract
7- You will hear Ron, the lawyer preparing the case, talking
with Sam, a senior partner, about the facts of the case.
Tick the facts of the case Ron mentions
1. The Jones corporation (the lessor) wanted to sell a restaurant to Keats
(the lessee)
2. Keats requires consent from the Jones Corporation to assign the lease to
a third party
3. Prior written consent to assignment is not necessary
4. The Jones Corporation is not permitted to withhold consent unreasonably
5. Keats couldn’t provide the information about the buyer that Jones
requested
6. the prospective buyer withdrew his offer for the restaurant
7. the buyer is suing Keats for breach of contract
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