Given the likelihood of small breaches to a contract, it makes good commercial and practical sense to pre-agree the compensation that party A will pay to party B for that breach. These are called liquidated damages: the paradigm case in which the law of penalties is engaged is where a
The Guardian’s Consumer Champion column told the story of a shopper who had been charged £70 for overstaying at a 90-minute car Aldi car park. Although I have some sympathies with the amount of this charge, the report didn’t tell the whole story of car parking charges… Are you sitting
Conditions precedent are requirements that must be met before either (1) the contract as a whole comes into existence, or (2) a specific right under that contract will apply. Your contract won’t always use the phrase ‘condition precedent’, which makes them harder to spot… Here’s a brief spotters’ guide: Examples
On a simple house refurbishment project in Putney, London, Mr & Mrs West ended up with an extended house with no proper waterproofing, serious defects in the plumbing and all the newly installed M&E services needing replacing. Disaster! When planning and creating their contracts that the clients were failed by
What should be the contractor’s remedy when a subcontractor is running late? Under freedom to contract, the parties can decide their rights, remedies, obligations and liabilities – they are masters of their contractual fate. The choice is between recovering an uncertain amount provided you can prove breach and loss in
When writing a contract, you may be tempted to use the kitchen sink approach ie shove in terms that you like… irrespective of whether they: help you do business build trust create clarity manage expectations avoid disputes One type of term, which surely meets none of these aims for a
Last week I was working with a specialist subcontractor client to improve their management of contractual risk (as their MD put it). As part of a workshop on Contract Awareness, I asked various staff to read a variety of T&C and answer questions such as: when are you going to
A condition precedent is a clause or term which one party MUST comply with before it is entitled to other rights or remedies. It’s like a contract bouncer – if you don’t have the right code then you don’t get in. Examples The UK standard forms contain a selection of
If you want to get paid on time, without deductions, then you need to take a strategic approach during all three key stages of contract inception, contract creation and contract operation. Plan for it Before you agree to enter into a contract with a client, you should check out whether
There are five legal essentials for a contract in English law: Offer: a promise to do something Acceptance: a nod, handshake, email or other action which accepts that offer (it has to be a ‘yes‘ (or ‘hell, yes‘) rather than a ‘yes, but…‘) Consideration: price, exchanged services or anything of