ctivnan
11/11/07, 10:50 AM
CONTRACTS
Nearly all of us form contracts every day. A contract can be something as simple as buying a sandwich (an unwritten contract), or as complicated as buying a house (a written contract). Both types of contract involve an offer and an acceptance of this offer between two or more parties, and performance in accordance with the contract's terms.
As contracts form the basis of doing business, it is essential that all parties understand their rights and duties, and the remedies available to them should problems arise. There may be a breach of contract, or the contract may be declared null and void because of misinterpretation, fraud, or even a discrepancy of words or terms. For this reason, the language of contracts must be precise and leave no room for mistakes or misinterpretation.
A recent example of contract dispute involving misinterpretation can be seen between the actor, Randy Quaid and the producers of last year's popular Academy Award-winning film, Brokeback Mountain. Quaid claims that the producers misrepresented the potential of the film. In this way, he says, they convinced him to work for "economically unfavorable" terms. Quaid is suing the film's producers for $10 million.
Going to court is a very expensive and time-consuming way to solve disputes; however contracts may also contain terms that require the use of alternative methods, such as arbitration.
Contracts between partners in different countries are often very complex. International contracts generally include a statement that the terms of the contract are in accordance with the laws of the country of one of the parties (usually the stronger one). This can be seen for example, in the end-user license agreement for downloads of software, such as Google Earth. End users must accept the terms specified by the software provider before they are allowed to complete the download.
By Mike Hogan
from Business Spotlight, July - Aug, 2006.
Nearly all of us form contracts every day. A contract can be something as simple as buying a sandwich (an unwritten contract), or as complicated as buying a house (a written contract). Both types of contract involve an offer and an acceptance of this offer between two or more parties, and performance in accordance with the contract's terms.
As contracts form the basis of doing business, it is essential that all parties understand their rights and duties, and the remedies available to them should problems arise. There may be a breach of contract, or the contract may be declared null and void because of misinterpretation, fraud, or even a discrepancy of words or terms. For this reason, the language of contracts must be precise and leave no room for mistakes or misinterpretation.
A recent example of contract dispute involving misinterpretation can be seen between the actor, Randy Quaid and the producers of last year's popular Academy Award-winning film, Brokeback Mountain. Quaid claims that the producers misrepresented the potential of the film. In this way, he says, they convinced him to work for "economically unfavorable" terms. Quaid is suing the film's producers for $10 million.
Going to court is a very expensive and time-consuming way to solve disputes; however contracts may also contain terms that require the use of alternative methods, such as arbitration.
Contracts between partners in different countries are often very complex. International contracts generally include a statement that the terms of the contract are in accordance with the laws of the country of one of the parties (usually the stronger one). This can be seen for example, in the end-user license agreement for downloads of software, such as Google Earth. End users must accept the terms specified by the software provider before they are allowed to complete the download.
By Mike Hogan
from Business Spotlight, July - Aug, 2006.