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Alc Lecture6 Loc-I

This document provides an introduction to contract law, focusing on various types of contracts such as purchase agreements and construction contracts. It outlines the essential components, parties involved, terms, and remedies associated with these contracts. Additionally, it discusses specific contract types, including lump sum, cost-plus, unit price, and time and material contracts.

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HARSH KUMAR
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3 views26 pages

Alc Lecture6 Loc-I

This document provides an introduction to contract law, focusing on various types of contracts such as purchase agreements and construction contracts. It outlines the essential components, parties involved, terms, and remedies associated with these contracts. Additionally, it discusses specific contract types, including lump sum, cost-plus, unit price, and time and material contracts.

Uploaded by

HARSH KUMAR
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Law of Contract I

Lecture 6_Introduction to Contract Law


[BBA.LL.B. SEM-5Th]

By: Mr. Ganesh Deshmane


Asst. Prof. Law
Army Law College, Pune
M01-Introduction to Contract Law

The nature of contractual obligations.

Introduction to certain types of contracts and


discussion about their parties, parties’ relative
position, terms, remedies:

for example: Bank loan, Purchase of goods, Construction or works contract,


Warehousing contract, Guarantee, Sale of vehicle, Engaging cleaning or canteen
services, Hiring a bank locker, Terms of use of online sale platform, Confidentiality
agreement, Agreement for purchase land for a factory, etc. Enforcement - Primary
purpose of contract law.
Purchase of Goods
❑ Parties to the purchase of Goods Agreement / Contract.
1. Seller
2. Buyer
• Sale of Goods Agreement
• This contract for the sale of goods is entered into as of enter contract
date here, by and between YOUR FULL NAME HERE (the “Seller”),
and BUYER’S FULL NAME HERE (the “Buyer”).
• The parties agree as follows:

• Sale of Goods: Pursuant to the terms and conditions of this


Agreement, the Seller agrees to transfer ownership and deliver
possession to the Buyer, and the Buyer shall pay for and accept from
the Seller, the “Goods” listed at such prices as agreed by the Parties
in this Agreement.
– Description of Goods Sold: The Buyer is purchasing enter description of goods
and quantity sold here from the Seller.
Conti…
•
Purchase Price: As consideration for the sale of the
goods, on enter date of sale or delivery date, the
Buyer shall pay to the Seller the purchase price of
$Total Purchase Price (the “Purchase Price”). Buyer
Initial Here _________

•
Payment Terms: Unless otherwise stated, payment
for the Goods is due within number of days
permitted for payment of the date of the Seller’s
invoice. (Optional) The Buyer shall pay a late fee of
late fee amount if payment for goods exceeds
specified number of days permitted.
Conti…
• Seller’s Representations: The Seller hereby
represents and warrants to the Buyer as follows:
– The Seller has full right, power, and authority to
sell the Goods.
– (Optional) The Good will be sold as described and
this sale is made “AS IS.”
• Delivery of Goods/Shipping: The Seller shall deliver
the goods per the terms listed below:
1. Date of Delivery: The Goods shall be delivered
to the Buyer on or within specify delivery date or
expected delivery window here.
Conti…
2. Location of Delivery: The Seller shall
deliver the Goods to the location specified
by the Buyer here: Buyer should provide
delivery address here
3. Delivery Notice: (Optional) The Seller shall
provide the Buyer with the shipment
tracking information once it is available so
that the Buyer can track the Goods in
transit. The Seller will notify the Buyer of
any delays that may affect the expected
delivery date.
Conti…
4. Risk of Loss: The Seller assumes
responsibility for the Goods, and all risk
of damage, loss, or delay of the Goods,
until the Goods are delivered to or
collected by the Buyer. Once the Goods
have been delivered to or collected by
the Buyer, the Buyer assumes all
responsibility for and risk of damage to
such Goods.
Conti…
• Refund and Cancellation Policy: Select which refund
policy suits your business from the following: (a.)
Refund/Cancellation (include what is applicable from
section 6.1 & 6.2 and revise them to match your refund
policy), (b.) Warranty. (include what is applicable from
section 6.3 and revise it to match your warranty policy).
– No Refunds: (Optional) The Seller shall repair or
replace any unit or product or part of such Goods
that prove to be defective. The Buyer will be assumed
to have accepted the Goods unconditionally unless a
claim that a Good is defective is made within number
of days buyer has to inspect delivered goods days
from the date of delivery.
– Refund Policy: Goods delivered not as described to
Conti…
the Client may be refunded for up to write eligible
refund amount here Rs. Xxxxxxx for up to write
number of days they have to refund here after
service.
• Goods not as Described: Only goods delivered in
the following condition will be considered not as
described: Describe what kind of goods you are
willing to refund your buyer for (e.g. damaged in
transit, incorrect size, etc.). If you are willing to
accept any returns or refunds, state that your
customer can return any goods in exchange for
the eligible refund amount.
Conti…
Warranty Policy: No refunds will be provided
for the Goods delivered as described in the
contract. Goods delivered are warranted to
be free from defects in materials or
workmanship for specify your warranty time
frame here from the date of delivery. This
warranty does not apply to: specify warranty
conditions you do not cover here (e.g. (i.)
cosmetic damage (ii.) damage by service of
another business)
Conti…
• Force Majeure: The Seller and the Buyer shall
not be considered in default hereunder or be
liable for any failure to perform or delay in
performing any provisions of this Agreement in
the customary manner to the extent that such
failure or delay is caused by any reason beyond
its control, including any act of God. The Party
whose performance has been interrupted by
such circumstances shall use every reasonable
means to resume full performance of this
Agreement as promptly as possible.
Conti…

• Representations:
–Authority to Sign: Each party
promises to the other party that it
has the authority to enter into this
Contract and to perform all of its
obligations under this Contract.
Conti…
• General:
– Modification(s): To change anything in this
Contract, the Client and the Business must agree
to the change in writing and sign a document
showing their contract.
– Signatures: The Client and the Business must sign
the document either electronically or in hardcopy.
If this document is signed in hard copy, it must be
returned to the Business for valid record.
Electronic signatures count as originals for all
purposes.
Conti…
• Term and Termination: If one of the parties chooses
to end the Agreement prior to product delivery, the
Buyer is responsible for paying for all work and costs
incurred up until that date.
• The Parties hereto agree to the foregoing as
evidenced by their signatures below.
• Date_____ _________________________
Date______ _____________________

• Seller Name & Sign Buyer Name & Sign


Conti…
• Position of relatives.
• Remedies Available.
– Seller's Remedies:
1. Suit for recovery of money
2. Suit for damages
-Buyer’s Remedies
3. Suit for damages
4. Consumer complaint etc.
Construction / Work Contract
• Components of a construction contract:
❖The basic construction contract will typically
identify/include the following parts:
1. Owner - Who is hiring the contractor.
2. General Contractor - Individual or
construction company that is responsible for
the oversight of the construction.
3. License Number - The general contractor’s
state license number.
Construction / Work Contract
4. Work site - Where the construction is to be
completed.
5. Project Description - A detailed description of the
work and construction to be completed by the
contractor. This can also include project plans and
specifications.
6. Contract Price - The total price to be paid for the
project.
7. Payment Basis - When and how the payments will
be made. Terms for final payment. This will also
define any penalty and interest for late payments.
Construction / Work Contract
8. Construction Schedule - The dates that the
construction will begin and when the
construction will be substantially completed by.
This will also detail how the project schedule
will be divided.
9. Contract Document List - Any drawings,
blueprints, exhibits, or other documents that
are part of the contract.
10.Construction Scope - A description of all
construction activities that will be part of the
project.
Construction / Work Contract
11.Conditions & Responsibilities - Details responsibilities
for the owner and contractor, including who is
responsible for providing certain documents and
information.
12.Contract Laws - Details the governing laws, lien
requirements, claims procedures, arbitration
procedures, insurance, and liquidated damages.
13.A construction contract may also include details
about: indemnification, dispute resolution,
termination, inspection, insurance, liquidated
damages, and force majeure or “Acts of God.
Types of construction contracts
❑ Lump Sum
• A lump sum contract is the most common pricing
arrangement for construction contracts. It is also
known as a “fixed price” contract. In a lump sum
contract, the parties agree to one price based on the
contractor’s estimate of the total costs of the project.
A lump sum contract includes all the materials, labor,
subcontracts, profit, and all other related costs. Lump
sum contracts can include incentives for early
termination and penalties for late termination.
• Lump sum contracts are used when the owner wants to
transfer risk to the builder and avoid change orders for
unspecified work.
Types of construction contracts
❑ Cost or Cost Plus
• A cost-plus contract is an agreement for the owner to pay
for all the costs associated with a construction project plus
an additional fixed fee for a profit margin. This means that
the owner will first pay for all the actual costs incurred
during construction such as costs for materials and labor.
The owner will then pay the contractor an additional
agreed upon fee, which is usually either a flat fee or a fixed
percentage that is based on a percentage of the total costs.
• Cost plus contracts are used when the scope of work is not
clearly defined. It becomes the owner’s responsibility to
establish some limits on how much a contractor bills.
Types of construction contracts
❑Unit Price
• In a unit price construction contract, the
parties set a price for every unit of work. A
unit price contract can be based on hours,
linear feet, cubic yards, or by item.
• Unit price contracts are often used by federal
agencies. Unit price contracts allow an owner
to set prices during a bidding process by
requesting specific quantities and pricing of a
set number of items.
Types of construction contracts
❑ Time and Material Contracts
• Time and material contracts are used when parties
agree to pay a predetermined rate for a unit. These
contracts are used when it is not possible to present
an accurate estimate or when it is difficult to define a
schedule. A time and materials contract is the
riskiest type of contract for the owner and the most
secure type of contract for the contractor.
• A time and materials contract should specify labor
costs, material mark-up, not-to-exceed or maximum
amount charged, and maximum labor hours.

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