What is a Contract • • • A contract is a legally _agreement between two or more parties Form Writing Partly oral and partly written Content : total articles regulating parties’ rights and _ Sources of contract Law • • Local Law International Law 1980 United Nations Convention on Contracts for the International “Sale of Goods” – CISG UNIDROIT Principles of International Commercial Contracts 2004 – PICC (UNIDROIT : International Institute for Unification of Private Law) Vienna Convention 1980 2 • • • • Came into force in 1988 Is the work of more than 62 states and international organizations Incorporates rules from all the major legal systems Include parts General provisions Formation of contracts Rights and obligations of buyers and sellers Ratification and the entry into force Essential Elements Of A Valid Contract Agreement 3 Capacity Legality Consent Making Contract Offerer -Offeree 4 Makes offer to Accepts Agreement Offer An offer is a legally binding promise made by one party to another party 5 Hint: the offer was clear, definite, explicit and left nothing open to negotiation Offer occurs when if reaches the offeree See case Lefkowitz v Great Minneapolis Surplus Store, 251 Minn 188 86 N.W 2d 689 (1957) Great Minneapolis Surplus Store (D) published advertisements in a newspaper for a sale on fur coats, mink scarves, and lapin stole Each of the advertisements indicated that the sale items would be sold on a first come first served basis, stated the quantities of each item available, and stated that they would be sold for one dollar each Lefkowitz(P) was the first customer to present himself and offer the one dollar 6 price per the terms of the advertisement The defendant refused to sell the sale items to Lefkowitz Offer ≠ Invitation To Treat 7 • • • • Displaying goods for sale with the price attached Advertising good for sale through catalogue/media Tenders/auctions Preliminary enquiries Invitation to treat Offer or not?? See more in ACT 14.1 CISG The Fate of the Offer Offeror may withdraw the offer 8 Offeror may revoke the offer OFFER Offeree may reject the offer Offeree may accept the offer contract Offer may lapse due to passing of time Withdraw / Revoke the Offer • Offer can be withdrawn prior to their reaching the offeree • • Offer can be revoked anytime before acceptance Withdrawal and revocation must be communicated to the offeree in some reasonably reliable manner Rejecting an Offer • 10 Offer can be rejected expressly or by implication 10 • How can be understood “implication” Offeree’s conduct Offeree’s counter offer Reply with any changes Clarification of the terms Acceptance of the Offer • • • 11 Only the offeree may accept the offer Acceptance must be final and unconditional Acceptance must be communicated to the offeror 11 Silence does not amount to acceptance Offeror cannot force acceptance upon the offeree Question Vietnamese Co British Co Negotiated in England 12 12 L/C 180 days L/C at sight Vietnamese co returned home days later, British co phoned to accept L/C 180days Contract? When is the contract made? 13 13 • • • Stated on the intention of the parties If not, when communication is opened in the ordinary course of business Over the internet, when it enters an information system Postal Rule 14 14 • • • • Acceptance occurs when the letter is posted Same to public telegraph and publc telex Not apply to instantaneous mode of communtication Evidence for the postal rule-is in need Case 22/4/1992 Vietnamese 15 See art.20-2 CISG 80 Offeree 15 Offereropen until 16.30 16 th May 92 16.30 16/5/92 Next Mon, acceptance fax acceptance arrived at 23.00on 16/5 No Contract Sunday no Contract Sources of contract Law What is a Contract Vienna Convention 1980 16 16 Essential Elements Of A Valid Contract Making Contract Withdraw / Revoke the Offer The Fate of the Offer Offer ≠ Invitation To Treat Offer Offer ≠ Invitation To Treat 17 17 The Fate of the Offer Withdraw / Revoke the Offer Rejecting an Offer Acceptance of the Offer When is the contract made? Postal Rule Contract Clauses : Types and specimen clauses Overview Definitions 18 18 19 19 ... No Contract Sunday no Contract Sources of contract Law What is a Contract Vienna Convention 1980 16 16 Essential Elements Of A Valid Contract Making Contract Withdraw / Revoke the Offer The Fate... of contract Law • • Local Law International Law 1980 United Nations Convention on Contracts for the International “Sale of Goods” – CISG UNIDROIT Principles of International Commercial Contracts... the advertisements indicated that the sale items would be sold on a first come first served basis, stated the quantities of each item available, and stated that they would be sold for one dollar