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Chapter 13: Practical Contracts (Boilerplate (attorney fees, integration,…
Chapter 13: Practical Contracts
Lawyer and Clients
Businesspeople are optimists. they believe that they have negotiated a great deal and everthing is going to go well. sales will boom and the company will prosper
lawyers are trained to be pessimists. they try to foresee and protect against everything that can possibly go wrong
The Contract: Who Drafts It
Both sides would prefer to control the pen because that drafter has the right to choose a structure and wording that best represents his interest
The party with the most bargaining power prepares the drafts
Mistakes in a Contract
Ambiguity
Vagueness
Typos
Structure of a Contract
Intro Paragraph: the date, names of the parties, and the nature of the contract
Covenants: the contracts "Heart" what are the parties agreeing to
TitleL should be as descriptive as possible
Breach of a Contract
Good faith means an honest effort to meet both the spirit and letter of the contract
Reciprical promises and conditions means that they are each enforceable independently
Material Breach is important enough to defeat an essential purpose of the contract
Representations and Warranties
their financial statements are accurate, they have revealed all material litigation
they own all relevant assets
They legally exist, they have the authority to enter into the contract
Boilerplate
attorney fees
integration
arbitration
severability
assignment of rights and delegation of duties
force majeure
modification
notices
Choice of law and forum
closing and signatures