PERFECTION OF CONTRACTS, CONTRACT STAGES & CHARACTERISTICS

Views:
 
Category: Entertainment
     
 

Presentation Description

No description available.

Comments

Presentation Transcript

PERFECTION OF CONTRACTS, CONTRACT STAGES & CHARACTERISTICS OF CONTRACTS:

PERFECTION OF CONTRACTS, CONTRACT STAGES & CHARACTERISTICS OF CONTRACTS

perfection (law)   :

perfection (law)    Validation of a legal document or security interest through proper execution and filling with proper public authority. In law,  perfection  relates to the additional steps required to be taken in relation to a  security interest  in order to make it effective against third parties  or to retain its effectiveness in the event of default by the grantor of the security interest. Generally speaking, once a security interest is effectively created, it gives certain rights to the holder of the security and imposes duties on the party who grants that security .  However, in many legal systems, additional steps - perfection of the security interest- are required to enforce the security against third parties such as a  liquidator.

CONTRACT :

CONTRACT A  contract  is a meeting of the minds between two persons whereby one binds himself, with respect to the other, to give something or to render some services. A contract is also defined as “a juridical convention manifested in legal form, by virtue of which one or more persons bind themselves in favor of another or others, or reciprocally, to the fulfillment of a prestation to give, to do, or not to do.” A contract binds both contracting parties and has the force of law between them.

the 3 elements or requisites of a contract. :

the 3 elements or requisites of a contract . (1) consent of the contracting parties; (2) object certain which is the subject matter of the contract; and (3) cause of the obligation which is established.

Characteristics Of A Simple Contract :

Characteristics Of A Simple Contract There must be offer and acceptance . The offerer is the party that makes the offer and the offeree is the person that the offer is being made to. There must a clear offer and clear acceptance for a contract to be binding. Consideration  is the price paid by one party for the promise of the other. Thus if one party promises to provide goods or services, something of value must be given in exchange. This may be in the form of money, goods, services or it may be an act of forbearance. The capacity to contract  – Parties to the contract must be over 18 years, of sound mind, not under the influence of drugs or incarcerated. There must be no force, misrepresentation or fraud . Persons should not be forced to sign a contract e.g. blackmail. They should not be lied to e.g. giving the wrong year of a car. Fraud may involve forging someone’s signature. There must be an obvious intention to create legal relations .This is based on the actions of the parties e.g. offer, acceptance and consideration. A contract must be legal - thus, agreements made between parties concerning illegal drugs and any other illegal activity is not a contract.

Differences Between A Simple & A Speciality Contract :

Differences Between A Simple & A Speciality Contract A simple contract can be made orally, in writing or by the implications deemed from the actions of the parties.  A specialty contract must be signed by the parties sealed, for example with a company seal and finally it must be delivered. Examples of specialty contracts include : 1. Mortgages and leases for over three years 2. Sale of land 3. Contracts of insurance 4. Hire purchase agreements 5. Transfer of company shares 6. Assignments of copyright

Stages OF a contract :

Stages OF a contract STAGE 1: NEGOTIATIONS- I n negotiations, the parties discuss and explore the terms and conditions of their would-be agreement. They manifest their proposals to each other in the hope of having a favorable response. No contractual rights and obligations created yet. There are special contracts which have certain rules even during negotiations. -----For instance, government negotiated contracts require that prior approval by heads of agencies be secured before entering into discussions. In companies, corporate approval to negotiate and execute a contract is required to be obtained from the Board of Directors .

Slide8:

STAGE 2: PERFECTION- Perfection gives birth to a contract so to speak. This birth refers to that point in time when the parties finally consented to the terms and conditions of their agreement. Contractual rights and obligations are created and enforceable. NB: Perfection only happens when both the contracting parties are properly authorized. If a representative turns out to be unauthorized, then there is no perfected contract as the essential requisite of consent is missing.

Slide9:

STAGE 3: CONSUMMATION- Consummation is simply about delivery or following through what has been agreed upon. It is at this stage that the parties fulfill or perform their contractual obligations resulting in the extinguishment of the contract. If the parties do not comply with their contractual obligations, they open themselves to a breach of contract which carry consequences. Whatever happens in consummation does not affect a perfected contract. That is to say, a party’s non-performance in an obligation does not necessarily invalidate a contract. Despite non-performance, the contract remains to be valid, binding, and enforceable.