COMMERCIAL CONTRACTS vol 7

COMMERCIAL CONTRACTS vol 7(2)

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About this title—authors, overview

Commentary

Price index clauses

1 Scope of title

2 Introduction to professional conduct duties

4 Other sources of information

6 Why should the contract be in writing and signed?

7 Some possible consequences of not having the contract in writing or signed

8 In general

9 When writing must be used

10 When a deed must be used

12 Circumstance when a deed should not be used

13 In general

14.1 Contracts for the sale of land

14.2 Execution of contracts by a company

15 Signature: commercial practice

16 What may constitute ‘signature’

17 Increasing the likelihood that signature will be valid

18 Introduction

19 Description and expression requirements

20.1 Execution requirements for individuals

20.2 Execution requirements for companies

20.3 Foreign companies

20.4 Partnerships

20.5 Limited liability partnerships

21 Documents the legal effect of which is unclear

23 Practice points for agreements under hand

24.1 General purpose ‘executed as a contract’ clause

24.2 Specific purpose: to make clear that body corporate or company signing (through authorised person)

25.1 Individual

25.2 Where person is signing on behalf of a body corporate or a company registered under or regulated by the Companies Act 2006

26 Form

27 Practicalities

28 Presentation of document

29 Matters particular to a deed

30.1 Individuals

30.2 Companies

30.3 Body corporate

30.4 Limited liability partnership (‘llp’)

30.5 Partnership

31.2 Companies formed under or regulated by Companies Act 1985 or Companies Act 2006

31.3 Bodies corporate

31.4 Limited liability partnership

31.5 Partnership

32.1 Individual

32.2 Companies formed under or regulated by Companies Act 1985 or Companies Act 2006

32.3 Body corporate

32.4 Limited liability partnership

32.5 Partnership

34 Introduction

35 Labelling the agreement (when in draft)

36 Dealing with consumers

37 Date of agreement

38 Parties

40 Linking words

41 Conditions precedent

43 General

44 ‘Affiliate’

45 Subsidiary

46 General

47 Supply details

48 Delivery

49 Price and payment

50 Compliance with specifications

51 Risk

53 Intellectual property

54 Start date of the contract, length of the contract and termination provisions

55 Confidentiality

56 Warranties

57 Liability

58 Law and jurisdiction

59 Arbitration and alternative dispute resolution (ADR)

60 Notices

61 Contracts (Rights of Third Parties) Act 1999

62 Entire agreement

64 Amendment

65 Assignment and sub-contracting

66 Waiver and release

67 Severance

68 Force majeure

69 Agency

70 Announcements

71 Further assurance

72 Schedules

73 Executed as a contract clause

74 Signature blocks

75 Why and when should letter format be used for agreements?

76 Letterhead

77 Name of other party in address block

78 Subject line of letter

79 First paragraph of letter

82 Final paragraph of letter agreement

83 Signature block

84 On second copy of letter

86 Introduction

87 Date of agreement, face of agreement and delivery considerations

88 Parties

89 Recitals

90 Linking wording

91 Operative provisions

92 Further assurance

93 Law and jurisdiction

94 ‘Executed as a deed’ clause

95 Signature blocks

96 Scope of section

97 Treaty on the functioning of the European Union (‘TFEU’) Article 101

98 Points to note

99 Competition Act 1998 Section 2 (‘Chapter I’ prohibition)

100 Points to note

102 Form of contract

103.1 Meaning of ‘goods’

103.2 What items are not classified as ‘goods’

104.1 Common law relating to contracts for goods

104.10 How price in contract of sale can be determined

104.11 Payment of reasonable price

104.2 Capacity etc

104.3 Ability to exclude implied terms

104.4 Existing and future goods

104.5 Conditional or absolute contracts

104.6 Part owners

104.7 Goods that perish

104.8 Goods perishing before sale but after agreement to sell

104.9 Time not of essence

105 Terminology and definitions

106.1 Seller has right to sell goods

106.2 Goods will be free of encumbrances

106.3 Buyer to enjoy quiet possession of goods

106.4 Transfer of only such title as the seller has

106.5 Ability to exclude

107.1 Correspondence with description

107.2 What can amount to description of goods?

107.3 Liability is strict

107.4 Exceptions to implied term

107.5 Ability to exclude

108.1 No implied term about quality or fitness other than in Section 14

108.10 Differences between Sections 14(2) and 14(3)

108.11 Annexation of implied terms by usage

108.12 Implied term is condition

108.13 Ability to exclude

108.2 Satisfactory quality

108.3 Meaning of ‘goods supplied under the contract’

108.4 Meaning of ‘satisfactory quality’

108.5 Strict liability

108.6 Objective standard to be used in accessing satisfactory quality

108.7 When must goods be of satisfactory quality

108.8 Implied term does not apply to specified defects or examined goods

108.9 Goods fit for particular purpose

109.1 What is sale by sample

109.2 Bulk to correspond with sample

109.3 Goods to be free of any defect

109.4 Implied term is a condition

109.5 Ability to exclude

110 Minor breaches of implied terms

111.1 Meaning of delivery

111.10 Reasonable time for delivery

111.11 Expenses of delivery-borne by seller

111.12 If seller delivers wrong amount of goods

111.13 Delivery in instalments

111.14 Delivery by carrier

111.15 Risk where delivery at distant place

111.2 General duty to deliver and pay

111.3 Duties to deliver and pay are concurrent conditions

111.4 Contract to determine meaning of delivery

111.5 Default rule for place of delivery if contract is silent

111.6 Where contract requires delivery to the buyer’s premises

111.8 Demand and tender of delivery

111.9 When delivery must take place

112.1 Purpose of inspection

112.2 Place of inspection

113.1 Acceptance by buyer informing seller

113.2 Acceptance does not take place until buyer has had reasonable opportunity to examine

113.3 Deemed acceptance

113.4 Reasonable time

113.5 Acceptance not to be deemed merely by buyer agreeing to repairs etc

113.6 Rejecting some goods does not mean loss of right to reject rest

113.7 No requirement on buyer to return rejected goods

113.8 Buyer liable to seller if he refuses delivery

114.1 Ownership of goods passes when parties intend it to—specific or ascertained goods only

114.2 Unascertained goods

114.3 Rules for ascertaining intention

115 Risk

116 Right of disposal

117 Types of contract to which Supply of Goods and Services Act 1982 applies

118 Can terms implied by 1982 Act be excluded?

119 Implied term as to care and skill

120 Implied term as to time for performance

121 Implied term as to consideration

123.1 Contracts to which Sections 2 and 3 do not apply

123.2 Contracts concerning marine salvage, charterparty of ship or hovercraft, carriage of goods by ship or hovercraft

123.3 Contracts concerning goods carried by ship or hovercraft

123.4 Employment

123.5 Indemnity

124.1 Meaning of negligence

124.2 Excluding or restricting negligence liability

125.1 Contractual provisions which cannot be excluded or restricted at all

125.2 Other provisions that cannot be excluded or restricted unless reasonable—implied terms

125.3 Other provisions that cannot be excluded or restricted unless reasonable—liability arising in contract

125.4 Difference between Section 3 and Sections 6 and 7

125.5 The ‘reasonableness’ test

125.6 Secondary contracts

126 Guidelines for application of ‘reasonableness’ test

127 ‘Reasonableness’—points to consider

128.3 Other points to note about meaning of ‘written standard terms of business’

128.4 ‘Render a contractual performance substantially different from that which was reasonably expected’

129 Requirement to provide information

130 Complaints

131 Excluded services

132 When and how must the information be provided?

133 Type of recipients covered by the Regulations

134 Enforcement of breaches

135 Introduction

137 Current position

138 Structure of this Section

139 Generally

140 Goods

141 Digital content

142 Services

143 Unfair terms and notices

144 Pre-contract information

145 Right to cancel

146 Preliminary

147 Does the Sale of Goods Act 1979 still apply to consumer contracts?

148 The structure of the Consumer Rights Act 2015 and its relationship to other legislation

149 Relation of parts of the Consumer Rights Act 2015 to each other

150.1 Consumer

150.2 Trader

150.3 Digital content

150.4 Goods

150.5 Included/including

150.6 Condition

152 Types of contracts

153 Sales contract

154 Contracts for the hire of goods

155 A hire purchase agreement

156 Contracts for the transfer of goods

157 Types of contracts for the supply of goods not covered by the Consumer Rights Act 2015

158 Ownership of goods

159 Statutory rights in a contract to supply goods

160 Liability that is not possible to exclude or restrict

161.1 Factors to be considered

161.2 ‘All other relevant circumstances’

161.3 Matters which do not make goods of unsatisfactory quality

162 Meaning of ‘fit for a particular purpose’

163 Goods to match description

164 Goods to match sample

165 Goods to match model

166 Installation and conformity of goods with a contract

167 Conformity of digital content which are part of goods

168.1 General position

168.2 Exception

170 Provision of pre-contract information

171 Delivery of goods

172 Risk

173.1 Meaning of ‘guarantee’

173.3 Language and content requirements for a guarantee

173.4 Provision of guarantee in writing

174.1 Main remedies

174.2 Meaning of ‘conform to a contract’

174.3 Which remedies are available for which breaches of rights

175.1 Circumstances in which alternative remedies are available

175.2 Alternative remedies available

175.3 When a consumer may or may not treat the contract as at an end

175.4 Presumption that where there is fault it was present at the date of delivery

175.5 Supply of material by consumer and conforming to a contract

176.1 Types of rejection available to the consumer

176.2 How the right to reject is carried out

176.3 Responsibilities following rejection by a consumer

176.4 Meaning, timing and method of refund

176.5 Severable contracts

176.6 Partial rejection

177.1 Obligation on trader to carry out repair or replacement

177.2 Circumstances when right of repair or replacement is not available

177.3 Choice of one remedy by a consumer prevents consumer choosing other remedy

178.1 Availability and choice of price reduction or final right to reject

178.2 What amounts to a price reduction

178.4 Right to final rejection and reduction in amount refunded

179.1 Failure to deliver

179.2 Delivery of quantities other than specified in the contract

179.3 Delivery in instalments—defective delivery

179.4 Delivery in instalments—failure by consumer to take or pay for an instalment

180 Introduction

181 What is digital content?

182 Types of contracts for the supply of digital content covered by the Consumer Rights Act 2015

183 Statutory rights in a contract to supply digital content

184 Liability that is not possible to exclude or restrict

185 Type of liability it is possible to exclude or restrict

186.1 Factors to be taken into account to establish satisfactory quality

186.2 ‘All other relevant circumstances’

186.3 Matters which do not make goods of unsatisfactory quality

188.1 When digital content will not match its description

188.2 Information about the main characteristics, functionality and compatibility of the digital content

189 Provision of pre-contract information

190 The trader must have right to supply digital content

192 Digital content subject to modifications

193 What remedies are available

194 When remedies not available

195.2 Meaning of ‘conform to contract’

195.3 Presumption that where there is fault it was present at date of supply

195.4 Remedy available if digital content does not conform to contract but is supplied with goods

196.1 Obligation on the trader to carry out repair or replacement

196.2 Circumstances when right of repair or replacement is not available

197.1 When is the right to a price reduction available

197.2 What a price reduction entails

198 Right to refund if trader does not have right to supply digital content

199.1 Circumstances when right to repair or compensation will arise

201 Other remedies available to consumer

202 Meaning of a ‘contract to supply a service’

203 Statutory rights in a contract to supply a service

204 Relation of provisions relating to services to other laws

205 Introduction

206 Remedies where service does not conform to contract

207 Right to repeat performance

208.1 When the right to a price reduction is available

208.2 What a price reduction entails

209 Situations when only the right to a price reduction is available to the consumer

210 Rights not to the exclusion of other remedies available to consumer

211 Relationship of the provisions regarding unfair terms in the Consumer Rights Act 2015 to previous legislation

212 Consumer contracts

213 Consumer notices

214 Contract terms and notices which are outside the scope of consideration whether they are fair or unfair

215 Effect of an unfair term on a consumer contract

216 Meaning of an unfair term

217 Effect of other provisions of Consumer Rights Act 2015 which forbid or restrict operation of the Consumer Rights Act 2015

218.1 Terms assessable for fairness

218.2 Terms not assessable for fairness

218.3 Effect of a term which is not transparent and prominent or on the grey list

219.1 ‘Transparent’

219.2 Prominent

220 A term which has different meanings

221 Obligation on courts to consider fairness of contractual terms

222 Secondary contracts

223 Choice of law

224 Enforcement

225 Type of notices subject to assessment for fairness

226 Effect of an unfair notice

227 Meaning of an unfair notice

229 Liability that a trader cannot exclude or restrict

230 Scope of bar on excluding or restricting negligence liability

231.1 Schedule 2 Part 1 (the ‘grey list’)

231.2 Schedule 2 Part 2: Scope of Part 1

232 Introduction

233 Organisation of the 2013 Regulations

234 Business premises

236 Distance selling contract

237 Off-premises contract

238 On-premises contract

239 Durable medium

241 Situations where only part of the contract is affected

242 Situations where the whole of the contract is affected

243 Type of contracts to which the requirements to provide information apply

244 Assumption of compliance and burden of proof

245 Prescribed information for on-premises contracts

246 Obligation on trader to provide information before consumer is bound by an off-premises contract

247 Provision of a copy, or confirmation, of an off-premises contract

248.1 Applicable contracts

248.2 First condition

248.3 Second condition

248.4 Third condition

249 Obligation on trader to provide information before consumer is bound by a distance contract

250 Information concerning cancellation

252.1 Information to be given before order placed

252.2 Trader to ensure consumer acknowledges that making an order means that the consumer has to pay

252.3 Websites

253 Requirements on trader if contract is concluded by a telephone call

254 Failure to provide information regarding charges and costs

255 Digital content

256 On-premises contracts

257 Off-premises and distance contracts

258 Type of contracts to which the right to cancel applies

259 Situations when the right to cancel ceases to apply

260 Repair and maintenance contracts

261 The right to cancel

262.1 If the trader has provided the required information

262.2 If the trader has not provided the required information

263 Method of cancellation

264 Consequences and actions that follow after a cancellation

265.1 Obligation on trader to reimburse all payments made by consumer

265.2 Reduction for handling by consumer

266.1 Person responsible

266.2 Cost of returning the goods

267.1 Services

267.2 Digital content

268.1 Meaning of an ancillary contract

268.2 Consequences for ancillary contracts

269 Additional payments

270 Help line charges over basic rate

271 Specifying price

272 When it is required to indicate the price under the Price Marking Order 2004

273 When it is not required to indicate the price

274 Applicability of the 2002 Regulations

275 Contracts or services not covered by 2002 Regulations

276 General information to be provided by person providing information society service

277 What information must be provided to consumer prior to an order being placed by electronic means?

278 What a service provider must do when an order is being placed

279 General requirements for commercial communications constituting or forming part of information society service

281 Unfair trading and consumer protection

282 The average consumer

283 Ban on unfair commercial practices

284 Commercial practices that constitute ‘misleading actions’

285 Commercial practices that constitute ‘misleading omissions’

286 Commercial practices that are characterised as ‘aggressive’

287.1 New power

287.2 First condition

287.3 Second condition

287.4 Third condition

288 Excluded sectors

289 What rights to redress are available?

290.1 How does consumer exercise the right?

290.2 What occurs when the contract is unwound

290.3 Right to a refund

291 Right to discount and business-to-consumer contracts

292 Right to unwind a consumer-to-business contract

293 Right to unwind a consumer payment

294 Damages

295 List of commercial practices that are unfair

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