steps in patent
The term" injury "is known. It appears regularly in the contracts, usually the termination provisions:
"Either party may terminate this agreement if the other is a violation of the term here, not to cure such breach within thirty days after receipt of written notification of the existence."
At first reading, this provision appears to be clear, fair and easily implemented. There is mutual - it protects each party. It provides notice and an opportunity to cure, in the case of violation was unintentional. It allows for termination only for serious - "material" - injuries. But what is a "material breach"?
In the legal world is a failure as a failure to satisfy the obligation in a contract. A "material breach" is a serious error, so that the risk of the value of the entire contract. For example, if a customer has a ton of steel, it will probably not want to terminate the contract if the seller delivers only 1, 998 pounds, than the 2,000 expected. Providers can use a credit or refund, or promise to the missing material immediately. Or the customer may, on the missing two pounds as inconsequential. In contrast, if the seller delivers a ton of brass rather than steel, so the customer may wish to cancel the order or termination of the supply contract. If we assume the client has the steel for an office tower, the brass is simply not sufficient, it is simply not strong enough. Clearly a violation.
Or is it?
Suppose the contract says, "Metal", but as a "steel". Brass is a metal.
Suppose that a customer wishes to terminate the contract because she needs the steel immediately, and do not have the time to wait for the provider to the right product. Timely and accurate delivery is a condition of the contract? If it is a material condition of the contract? In other words, suppliers have to know that the contract obligated him to the right product, at the right time?
What happens if the contract only calls for "steel"? Does it matter whether the vendor provides the latest space-time alloy or an abundance of rust auto parts?
We are changing industries. Customer orders a "computer".
➢ Is it important that the new device processes 16 million instructions per section, with the industry standard is 25 MIPS?
➢ Does it matter if the customer pays a discount price?
➢ Does it matter if the customer pays a premium price?
➢ Does it matter if the product is delivered "a little late?
➢ This is "slightly" over budget? What is "something"?
➢ that it is "not quite" work? What is "not entirely"?
➢ The fact that it runs fine as a stand-alone, but not with customer systems?
➢ that they are not customers of the software?
➢ Does it matter whether that software is crucial for the ancillary operations or customers?
Lawyers have a method to search for answers to questions like these. They call it "discovery." It is one of the more expensive and time consuming parts of an action. If there is enough money at stake, provider of the attorneys can not file untouched, and no employees of non-interview, in an effort to show that the alleged injury is not essential - that the failure (assuming that it was a) did not lead to real and tangible harm to customers. Alternatively, a supplier of the lawyers will argue that the product or service complained about the standards set out in the contract or the customer is not disclosed, the requirement that X would be of crucial importance for the coping. Supplier of the lawyers will suggest that in the best case, customer is wrong or confused, at worst, they suggest that customers an unfair trial, of the Contract, for whatever reason.
Returns to us with a dilemma: What is an author to do when the official term "violation" is simply an invitation to controversy and litigation?
Change the definition.
The problem is not the concept itself, but the importance of this concept of the law. But, in commercial contracts, laws, regulations and legal definitions are usually DEFAULT rules - they apply only if the parties who are not their own rules or definitions. (In borders. A contract to commit a crime is still a crime, and not enforceable.)
Which of these provisions would you prefer to administer and enforce?
"Either party may terminate this agreement if the other is a violation of the term here, not to cure such breach within thirty days after receipt of written notification of the existence."
OR
"Either party may terminate this agreement if the other is a violation of the term here, not to cure such breach within thirty days after receipt of written notification of the existence thereof.
"For the purposes of this definition," injury "is ...."
Admittedly, this is more difficult to complete. Each party must ask itself: "What would I want to get out of this deal?" Then they must ask the other parties to these provisions in the agreement. Both steps are run to a common understanding of the transaction process - "Get it done" and "Be positive." A more realistic rule is probably "Be thorough." The more time up front, which contains the details of an agreement - and the main parts of the business - the less time for arguing about perceived shortcomings.
Or, as our parents taught us always, "Do it right the first time."
tom@tomhalllaw.com
Copyright 2006, Thomas J. Hall. All rights reserved.
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