5: Obligations and Contracts

obligation

a juridcal necessity to give to, do to, or not to do

Active Subject

power to demand the prestation (obligee/creditor)

Passive Subject

bound to perform the prestation (obligator/debtor)

Prestation or object

not a thing but a particular conduct of the debtor

to give

consists in the delivery of movable or immovable thing, in order to create a real right or for the use of the recipient or for its simple possession or in order to return to its owner

to do

all kinds of work or services, whether mental or physical

not to do

consists in abstaining from some act, includes “not to give,” both being negative obligations

contract

meeting of mind between two persons whereby one bind himself, with respect to the other, to give something or to render some service.

Enforceability

The law will enforce the provision of a valid contract; the law will not intervene to impose more favourable contract terms

Changes

An existing contract can be altered by mutual agreement, providing it is within the framework of the existing contract

Expressed terms

The conditions which are written in the contract

Implied Terms

valid conditions which are not explicitly stated

Contra Proferentem

Where a contract is ambiguous, it will be interpreted against the party that drafted it — rule of?

Retention

money held by the Employer/Client as a safeguard against defects which may subsequently develop and which the Contractor may fail to remedy.

10%; 5%

Retention is usually set at either ____ of the value of the works or ___ in the case of some (usually larger) contracts. This percentage is then deducted from all the interim payments made to the main contractor.

Breach of Contract

This occurs when either party fails to comply with their respective obligations

Damage

A non-defaulting party is entitled to damages incurred

Direct Damages

Losses directly suffered as a result of the breach

Indirect Damages

Losses consequential to the breach

Liquidated damages

are specified daily charges deducted from money otherwise payable to the contractor for each day the contractor fails to meet a milestone and/or contract completion date