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Lesson 9 - Contract Clauses

31.7.2020, , Zdroj: Verlag Dashöfer

Lesson 9 – Contract Clauses

Mgr. Filip Hajný, Mgr. Daniel Makovický

Introduction and Objectives of the Lesson

The structure of this lesson is very simple and straightforward. Assuming that you already know and understand some essential terms of the Law of Contract, this lesson focuses on a sample contract and its typical clauses. You are expected to go over the clauses, understand their purpose and read matching examples. You may use these clauses as a template for the contracts you will conclude in English in the future.

This lesson also offers a great opportunity to repeat conditionals or modals shall and may and see how they are used in practice.

At the end of the lesson, you can familiarise yourself with another typical feature of Legal English, namely word pairs. We hope this lesson will serve as a practical manual and will help you with drafting contracts and understanding them.

Standard Clauses

We would like to present to you the most typical contract clauses that you may encounter during your legal practice. If you draw up contracts, you know what we mean. No matter what contract you are in contact with, there is a great probability you will come across the following clauses. We call them standard clauses or boilerplate clauses. The term boilerplate clauses in particular mean standardised clauses found typically at the end of the contract. They are often preprinted in templates and not commonly negotiated, because they are considered routine. For the purpose of this lesson, we have also included other standard clauses that most contracts have. Some of them are a standard part of final provisions in Czech contracts. The clauses are not necessarily in chronological order.

A. Recitals

Also known as preamble, recitals is a statement of background facts related to the contract. The recitals set forth the reason why the parties are about to conclude the contract and reveal intentions of the parties with respect to the contract. The wording may be quite general and does not involve any conditions, rights or duties. Sentences in the recitals often start with the word WHEREAS.

WHEREAS the Party A is an expert in advertising and promotional strategy; and

WHEREAS the Party B wishes to boost sales and brand recognition; and

WHEREAS the Parties do cooperate on a long term basis.

NOW THEREFORE the Party A and the Party B agree as follows:

B. Subject of Contract

Depending on the specific type of contract, this clause specifies the subject matter of the contract and refers to the scope of the contract. It may already include some rights and duties of the parties.

Lessor hereby undertakes to allow Lessee, and Lessee hereby undertakes to accept, the temporary use of movable objects stipulated in Art. II

Pursuant to terms and conditions stipulated hereunder, Lessor shall allow Lessee the temporary use of Subject of the Lease for the purpose of…

C. Definitions

As the name suggest, definitions stipulate the meaning of certain terms which are essential for the performance of the contract. General terms may have a specific meaning in the context of different contracts. When a term is not defined, it is presumed that it has its ordinary and general meaning.

Subcontractor shall mean any person or company