INTRODUCTION As businesses become increasingly globalized, it is only natural that international commercial transactions and contractual obligations follow. While parties entering into such transactions may not always be aware of applicable foreign laws, they still desire freedom, predictability, and convenience in contracting. The need for a uniform set of laws is especially significant in the area of international contracts because ascertaining the applicable law is more difficult in this area than in almost any other area of law. A dispute about an international contract may have foreign elements and thus one or both of the parties may be foreign, or the making or performance of the contract, or its terms, may be connected with one or …show more content…
Specifically, the presence of these connecting factors makes it difficult for any party or court to identify a single factor that determines the applicable law. Second, there is a question as to which law should determine, among other things, the interpretation, validity, and discharge of the contractual obligation. And third, due to the number of different types of contracts that exist, including contracts for the sale of goods, employment contracts, and insurance contracts, an issue arises as to whether different types of contracts should be governed by a uniform law or whether different laws should govern each particular type of contract. Both contracting parties and courts must consider these issues in creating, interpreting, and enforcing international …show more content…
If the contract is a domestic contract then the Indian law applies but the moment the foreign element comes into picture, the question arises as to which law will govern the relations between the parties of the contract or whether the proper law of contract would regulate the contract. To know which law is the governing law one sees the formation of contract and the effect of the contract. It must also be noted that even in cases of domestic law, foreign law can apply. On the other hand, proper law of contract is that law by which the contract is intended to be governed. English judges assert that it is that law which the English court is to apply to determine the obligation under the contract. The law by which the parties have intended to be governed is ascertained from the terms of the contract, the situation of the parties and all other circumstances. There are basically two approaches in this context: 1. Westley or Westlake
The primary purpose of the “Statute of Frauds” (SOF) is to protect the interests of parties once they are involved in litigating a contract dispute (Spagnola, 2008). The relevant statutes are reliant upon state jurisdictions to determine whether the contract falls under the SOF, and whether the writing of the contract satisfies the requirements of the statute of frauds (Spagnola, 2008). However, all contracts are not covered under the SOF. In essence, for a contract to be deemed as legal by definition of the SOF, there must be verification of the following requirements for formation of the contract, which are as follows: (1) There must be least two parties to the contract, (2) There must be a mutual agreement and acceptance on the price to pay for goods and services offered, (3) The subject matter or reason for entering the contract, must be clearly understood by all parties to the contract, (4) and there must be a stipulated time for performance of duties under the contractual obligations (Spagnola, 2008). Lastly, there are five categories of contracts that are covered under the SOF, which are as follows: (1) The transfer of real property interests, (2) Contracts that are not performable within one year, (3) Contracts in consideration of marriage, (4) Surtees and guarantees (answering to the debt of another), and (5) Uniform Commercial Code (U.C.C.) provisions regarding the sale of goods or services, legally valued over five hundred dollars ($500.00) (Spagnola, 2008).
When discussing the concept of contract law, there exist two bodies of legal rules that may apply to the contract. These bodies are the common law of contracts and Article 2 of the Uniform Commercial Code or the UCC. The common law of contracts is court made and is constantly changing, but the UCC is required in every state within the U.S.A. It is important to know which one to use and when, as well as what the differences between them are.
With commercial dealings on the rise in Australia and globally, so too are the complications. If some sort of codification is not established and built from the principals that already exist, commercial opportunities could be in jeopardy due to the uncertainty and risk of not having a clear outline or set of laws to cover contracts generally.
1) The Common Law: Most contracts are controlled by the state’s common law, which is a traditional based set of laws that are mostly judge-made, from precedent court decisions.
For the purpose of this paper this author will discuss the process or mechanics of contract law. Moreover, in this paper this author used the scenario presented as a foundation for the discussion. The scenario discusses a head chef that was hired by a hotel under a two-year employment contract. Two years later the chef was offered a job by a second hotel. The issue for the chef was a section of the current contract he signed with the “Fabulous Hotel” that stated: “The below-signed agrees not to work as a chef for another hotel in the same metropolitan area for a period of two years after leaving our employ.” Using this scenario this author will examine and explain the “five elements of a contract” that are a necessity for the contract to be enforceable.
While this offers a contract law that is more flexible than the common law, it also requires a higher level of responsibility from the merchants it serves. Those who make a living by crafting agreements are expected to understand the legal consequences of their words and deeds. Many sections of the code offer two rules on for the person who routinely deals in the particular good involved or who appears to have special knowledge or skill in those goods or who uses agents with special knowledge or skill in those goods. This code is frequently held for a merchant to a high standard of conduct than a
The location or distance involved. IF the contract prohibits you from working in the Western Hemisphere, that scope is too great, but the same county may be small enough to consider the agreement enforceable.
When it comes to contracts, there are certain elements or requirements, which need to be met in order for the contract to be valid. Defined, a contract is “an agreement that can be enforced in a court; formed by two or more parties who agree to perform or refrain from performing some act now or in the future” (Hollowell & Miller, 2014, p. 110). With contract law, there is the enforcement of promises made between two parties, even if made in private. Additionally if a promise is made, there is the possibility of the obligation falling into a moral liability rather than a legal liability. All in all, when it comes to business agreements, contract laws will apply to avoid any possible problems that may arise.
Contractual agreement has always been viewed in terms of offer and acceptance. The universal principle to contract law has always been parties may get into an agreement in whichever way they deem fit and they are subject to certain terms as they choose. As far as legal requirements vital to their formation are binding contracts may be formed. Moreover a binding agreement may be manifested in terms of writing or in verbal form.
Adding to it was the problems relating to, four interconnected elements of private international law, like the choice of law, jurisdiction, court’s option of declining jurisdiction and recognition and enforcement of decree.
The very beginnings of the concept of contract law can be traced back to several Latin legal principles. One of the most important of such principles is the ‘consensus as idem’, which approximately translates into an agreement between parties. This agreement synthesizes a legal relationship between the parties and involves certain
In any kind of legal relations, subject always play an important role, and it is one of the signals to determine the relation that pertaining the adjustment of any legislation system. International law is a legislation system that is a set of thousands of documents from various sources. The research about the subjects is necessary since it helps to find out the source of law, which relation pertains the adjustment of law. The subjects of international law include sovereign states and analogous entities, intergovernmental organizations, the individuals, and multinational corporations.
International law has generally been accepted and respected by the States to be the fundamental element in ensuring peace and diplomacy when dealing with matters concerning international relations. It should be noted that, within international law, there are various subjects who are considered to have international legal personality, to wit: States, international organizations, dependent territories, belligerent groups, multinational enterprises, non-governmental organizations, and individuals (Walter, 2007). However, the rights and obligations of these referenced subjects were considered and developed as international law itself evolved. More specifically, the international rights, duties, and obligations of individuals as subjects of international law were not effectively established until after the 20th century.
Mitchell, A. & Beard, J. (2009). International law in principle. Pyrmont, Sydney: Thomson Reuters (Professional)
The basic law of a contract is an agreement between two parties or more, to deliver a service or a product. And reach a consensus about the terms and conditions that is enforced by law and a contract can be only valid if it is lawful other than that there can’t be a contract. For a contract to exist the parties must have serious intentions, agreement, contractual capacity meaning a party must be able to carry a responsibility, lawful, possibility of performance and formalities. Any duress, false statements, undue influence or unconscionable dealings could make a contract unlawful and voidable.