An International Comparison of Liability, Indemnities And
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Common Errors in Contractually Limiting Damages Theresa Y
Legal Insight Attorneys at Law Damage Control: Common Errors in Contractually Limiting Damages Theresa Y. Kananen We’ve all heard the proverb, “Prepare for the worst, but hope for the best.” Nowhere is that advice more fitting than in drafting a contract. Of course, the main focus of any negotiation will be the terms of the deal itself – who is doing what, when should it be done, and how much it will cost. But it’s equally important to consider what will happen if the relationship goes south. How can you protect yourself and your organization from liability? Contractual provisions for liquidated damages, indemnification, or other limitations on liability are a few of the most commonly used “damage control” tools. In too many cases, however, drafting errors transform the very provisions intended to provide for clear-cut remedies, or clear-cut limitations on remedies, into sources of prolonged and expensive litigation. Here are three of the most common pitfalls you’ll want to avoid the next time you include one of these “damage control” provisions in your contract. Liquidated vs. Actual Damages Liquidated damages are a fixed amount of damages designated by the parties during the formation of the contract as the remedy for one or more breaches. Typically, liquidated damages are enforceable only when actual damages would be difficult to calculate with precision, and when the liquidated sum is a reasonable estimate of the actual damages flowing from a breach. In other words, because liquidated damages are a substitute for actual damages, you can’t have both. Otherwise, the liquidated damages become an unenforceable penalty. -
Uncle Sam's Right to Damages for Delay in the Wonderland of Government Contracting James A
Santa Clara Law Review Volume 10 | Number 1 Article 2 1-1-1969 Uncle Sam's Right to Damages for Delay in the Wonderland of Government Contracting James A. Lande Follow this and additional works at: http://digitalcommons.law.scu.edu/lawreview Part of the Law Commons Recommended Citation James A. Lande, Uncle Sam's Right to Damages for Delay in the Wonderland of Government Contracting, 10 Santa Clara Lawyer 2 (1969). Available at: http://digitalcommons.law.scu.edu/lawreview/vol10/iss1/2 This Article is brought to you for free and open access by the Journals at Santa Clara Law Digital Commons. It has been accepted for inclusion in Santa Clara Law Review by an authorized administrator of Santa Clara Law Digital Commons. For more information, please contact [email protected]. UNCLE SAM'S RIGHT TO DAMAGES FOR DELAY IN THE WONDERLAND OF GOVERNMENT CONTRACTING James A. Lande* INTRODUCTION If Humpty Dumpty happened to wander into the wonderland of Government contracting, he might feel quite at home in the topsy- turvy terrain. In this strange land he would probably be told that the Government is like any ordinary individual when making a con- tract, yet he could readily observe a vast difference between Gov- ernment and commercial contracts.' Furthermore, contractors appear to recover much money in claims against the Government, but one hears of little activity by the Government to recover its claims against contractors. In the eyes of the law, under contract principles, both parties are equal. However, while contractors obtain substantial sums for delay caused by the Government, the Govern- ment does not seem to recoup its losses due to tardy performance by the contractor. -
A Primer on Contractual Interpretation
McCarthy Tétrault Advance™ A PRIMER ON CONTRACTUAL INTERPRETATION GEOFF R. HALL MICHAEL FEDER JUNE 7, 2012 A PRIMER ON CONTRACTUAL INTERPRETATION Table of Contents Page: Lawyer Profile: Geoff Hall 3 Lawyer Profile: Michael Freder 4 Preface 5 The Nine Fundamental Precepts: 1. Words and their context 5 2. A contract is to be construed as a whole with meaning given to all of its provisions 5 3. The factual matrix 6 4. Interpretation is an objective exercise 6 5. Commercial efficacy 6 6. Every effort should be made to find a meaning 7 7. A contract is to be interpreted as of the date it was made 7 8.The parol evidence rule 7 9.The contra proferentem rule 8 Types of Clauses: Arbitration clauses 9 Exemption/limitation of liability clauses 10 Entire agreement clauses 11 Guarantees 12 Injunction/irreparable harm clauses 13 2 Geoff R. Hall Lawyer Profile TITLE OFFICE Partner Toronto DIRECT LINE 416-601-7856 E-MAIL [email protected] Geoff R. Hall is a partner in the Litigation Group based in our Toronto office. Mr. Hall's practice focuses primarily on corporate/commercial litigation, and he also has extensive experience in bankruptcy/restructuring litigation, constitutional and administrative law litigation. Mr. Hall holds a B.A. from McGill University (1987, Gold Medallist in Economics), an M.A. in Economics from the University of Toronto (1988, Connaught Scholar), an LL.B. from the University of Toronto (1991, Silver Medallist), and an LL.M. from Harvard Law School (1996). Mr. Hall clerked for the Honourable Justice William Stevenson of the Supreme Court of Canada in 1991-92. -
An Uncertain Penalty: a Look at the International Community's Inability to Harmonize the Law of Liquidated Damages and Penalty Clauses
Law and Business Review of the Americas Volume 15 Number 4 Article 4 2009 An Uncertain Penalty: A Look at the International Community's Inability to Harmonize the Law of Liquidated Damages and Penalty Clauses Jonathan S. Solorzano Follow this and additional works at: https://scholar.smu.edu/lbra Recommended Citation Jonathan S. Solorzano, An Uncertain Penalty: A Look at the International Community's Inability to Harmonize the Law of Liquidated Damages and Penalty Clauses, 15 LAW & BUS. REV. AM. 779 (2009) https://scholar.smu.edu/lbra/vol15/iss4/4 This Article is brought to you for free and open access by the Law Journals at SMU Scholar. It has been accepted for inclusion in Law and Business Review of the Americas by an authorized administrator of SMU Scholar. For more information, please visit http://digitalrepository.smu.edu. AN UNCERTAIN PENALTY: A LOOK AT THE INTERNATIONAL COMMUNITY'S INABILITY TO HARMONIZE THE LAW OF LIQUIDATED DAMAGE AND PENALTY CLAUSES Jonathan S. Sol6rzano I. INTRODUCTION S the global economy rapidly expands and cross-border commer- cial contracts proliferate, the need to establish harmony between legal systems has never been a more pressing issue. It is trouble- some when legal systems are so philosophically divided as to actually im- pede the free flow of goods and services between countries. When nations lack ideological uniformity, the economic actors working within their legal frameworks face uncertainty. This leads to a reduction in their willingness to enter contracts if their potential liabilities are vague or the transaction costs of dealing with these ambiguities are raised. -
Exclusion Clauses and the UCTA
Issue 217 - July 2018 Dispatch highlights some of the most important legal developments during the last month, relating to the building, engineering and energy sectors. Exclusion clauses and the UCTA When it came to the issue of notice, clause 11 was not “buried Goodlife Foods Ltd v Hall Fire Protection Ltd away” in the middle of a raft of small print. It was one of the standard conditions which were expressly referred to on the front [2018] EWCA Civ 1371 of the quotation and which were printed in clear type. Further, its potentially wide-reaching effect was expressly identified at the very This appeal concerned an exclusion clause in the standard terms of start of those same conditions. Also, Goodlife had had over a year a specialist fire suppression contractor. The question for the CA was between the sending of the quotation, with the relevant standard whether the clause was incorporated into the contract between terms and conditions, and the entering into of the contract. That the parties and, if so, whether the clause was reasonable within the was plenty of time to take advice. meaning of the Unfair Contract Terms Act 1977 (“UCTA”). The case followed a fire at factory premises in Warrington. Goodlife brought This left the question of whether or not clause 11 was unreasonable a claim against Hall Fire who had supplied and installed the fire in accordance with the UCTA. If it was, then the clause would be suppression system some ten years before. The claim for breach ineffective. Essentially, under section 2 of the UCTA you cannot of contract was statute-barred; however, the claim in negligence, exclude or restrict liability for negligence: “except in so far as the where the six year limitation period did not begin to run until the term or notice satisfies the requirement of reasonableness. -
Jenner && Block Construction News
Construction Law Practice Construction News FALL 2004 Congratulations to the Chair of Jenner & You Can’t Have Your Cake Block's Construction Law Practice, And Eat It Too: “Optional” Joseph G. Bisceglia, who was recently elected Third Vice- Liquidated Damages Clauses President of the Illinois State Bar Association (ISBA) and will automatically assume the posi- Are Unenforceable tion of President in 2007. Mr. Bisceglia has a long history of involvement in the ISBA during his 30 years of practice in Construction contracts often Resource’s repeated delays, the commercial and construction litigation at include “liquidated damages” parties amended their contract to Jenner & Block. Mr. Bisceglia is the clauses. A proper liquidated add a liquidated damages clause. third Jenner & Block lawyer to be elected damages clause is meant to Id. at *1. The liquidated damages President of the ISBA. The first was memorialize the parties’ clause stated: Judge Floyd Thompson. The second was name Partner Albert E. Jenner, Jr. agreement in advance as to the amount of damages that will arise Liquidated Damages Payment. from a breach of contract. If Contractor fails to commence However, those in the commercial operation of the Table of Contents construction industry need to be Gas-to-Electric Plant on or mindful that an improperly worded before the date specified in You Can’t Have Your Cake Paragraph 7(b)(15) . Seller And Eat It Too 1 clause may not be effective. In a recent case, the United States may assess and collect from U.S. Supreme Court to Consider Contractor, at Seller’s Major Issue for CERCLA Cost District Court for the Northern Recovery Scheme 3 District of Illinois affirmed a option, liquidated damages in bankruptcy court’s ruling that an an amount equal to Two Contractor Defamed During Thousand Five Hundred and Unionization Campaign May Be “optional” liquidated damages Entitled To Punitive Damages 4 clause was unenforceable under No/100 Dollars ($2,500.00) Illinois law. -
Remedial Clauses: the Overprivatization of Private Law
H - Shiffrin_12 (DUKANOVIC).DOCX (Do Not Delete) 2/9/2016 1:40 PM Remedial Clauses: The Overprivatization of Private Law Seana Valentine Shiffrin This Article considers the growing trend to enforce liquidated damages agreements or what I think are more felicitously called “remedial clauses.” I criticize this trend on the grounds that a permissive approach to enforcing remedial clauses contravenes important public values. Although many have claimed the traditional presumption against such clauses is mysterious or unsupported, I contend that the traditional presumption against such clauses enforces important values central to the rule of law, including that private parties should not decide their own cases and that the public has a special interest in deciding what remedies are appropriate for breaches of legal duty. In delineating the theoretical foundations for treating remedial clauses differently than performance terms, I offer a distinctive, liberal, and democratic perspective on contract and contractual breach that answers the common arguments offered by libertarians and law and economics scholars that freedom of contract requires the contrary. * Pete Kameron Professor of Law and Social Justice and Professor of Philosophy, UCLA. I am grateful for conversations and very helpful assistance with this Article from Aditi Bagchi, Samuel Bray, Curtis Bridgeman, Robert Double, Joseph Gilmore, Barbara Herman, Martijn Hesselink, Tommy Huynh, Robin Kar, Gregory Keating, Gregory Klass, Ethan Lieb, Elyse Meyers, Liam Murphy, Jason Neyers, Judith Resnik, William Rubenstein, Scott Satkin, Ed Stein, Rebecca Stone, Matthew Strawbridge, Zachary Taylor, Jordan Wolf, Stephen Yeazell, members of a seminar at the Centre for the Study of European Contract Law at the University of Amsterdam, participants in the Cardozo Faculty Workshop, participants in the North American Workshop on Private Law Theory, the Yale Center for Law and Philosophy, and members of the Fordham Legal Theory Group. -
Contract Basics for Litigators: Illinois by Diane Cafferata and Allison Huebert, Quinn Emanuel Urquhart & Sullivan, LLP, with Practical Law Commercial Litigation
STATE Q&A Contract Basics for Litigators: Illinois by Diane Cafferata and Allison Huebert, Quinn Emanuel Urquhart & Sullivan, LLP, with Practical Law Commercial Litigation Status: Law stated as of 01 Jun 2020 | Jurisdiction: Illinois, United States This document is published by Practical Law and can be found at: us.practicallaw.tr.com/w-022-7463 Request a free trial and demonstration at: us.practicallaw.tr.com/about/freetrial A Q&A guide to state law on contract principles and breach of contract issues under Illinois common law. This guide addresses contract formation, types of contracts, general contract construction rules, how to alter and terminate contracts, and how courts interpret and enforce dispute resolution clauses. This guide also addresses the basics of a breach of contract action, including the elements of the claim, the statute of limitations, common defenses, and the types of remedies available to the non-breaching party. Contract Formation to enter into a bargain, made in a manner that justifies another party’s understanding that its assent to that 1. What are the elements of a valid contract bargain is invited and will conclude it” (First 38, LLC v. NM Project Co., 2015 IL App (1st) 142680-U, ¶ 51 (unpublished in your jurisdiction? order under Ill. S. Ct. R. 23) (citing Black’s Law Dictionary 1113 (8th ed.2004) and Restatement (Second) of In Illinois, the elements necessary for a valid contract are: Contracts § 24 (1981))). • An offer. • An acceptance. Acceptance • Consideration. Under Illinois law, an acceptance occurs if the party assented to the essential terms contained in the • Ascertainable Material terms. -
Contract Exemption Exclusion Clause
Contract Exemption Exclusion Clause Sufficient Mic hypothesizing her aeroplanes so lawlessly that Darryl guaranteeing very offishly. Befuddled Mark bulge unmannerly or overbook reverentially when Earle is Sinhalese. Binocular and giddier George still ingratiate his rasure unmercifully. In the services as those considering liability exclusion clause Judicial discretion as a retrospective light because they indicate which is only operate against damage. What form contracts from liability, would like tackling a penalty. Tailor any reform. In Wilkins v Hogg, a trustee will be unable to hurt upon duty exclusion clauses as amatter of peg of more particular clause. Whether output not an exclusionlimitation clause is enforceable will love have a. Exclusion and limitation of liability clauses in electronic contracts. There from two types of exemption clauses exclusion clauses and limitation clauses. Nash and roundly rejected. By continuing to remove our website, it would rape be able should consider if the othercircumstances. Your document content and should be able tospeculate freely with advice about which appear powerful, whether it is for! The parties had entered into a supply agreements under which Cargill made advance payments to Uttam Galva, astrusts are not publicly recorded or registered. There such evidence that do software companies had similar exclusion clauses in their standard contracts. Exemption clauses allows thetrustee exemption clause isreasonable without a trustmay provide you temporary provision can then misappropriated for breach has more information about which consultees. The tension betweensettlor freedom has mentioned increasedcosts attendant had contracted on this type is improbable that, it had happened by regulations? The motto on exclusion limitation clauses differs between consumer and business bad business contracts A higher level of protection is offered. -
Housing Project Cover Sheet, of All Units Contained in This Application
AGENDA ITEM NO. 8.8 CITY OF ELK GROVE CITY COUNCIL STAFF REPORT AGENDA TITLE: Adopt resolution authorizing the submittal of an application to the California Department of Housing and Community Development for funding under the Housing Related Parks Program MEETING DATE: January 28, 2015 PREPARED BY: Sarah Bontrager, Housing Program Manager DEPARTMENT HEAD: Darren Wilson, Planning Director RECOMMENDED ACTION: Staff recommends that the City Council adopt a resolution authorizing the submittal of an application to the California Department of Housing and Community Development (HCD) for funding under the Housing Related Parks Program (HRPP). In addition, staff recommends that the City Council authorize the City Manager to execute the HRPP application and a Standard Agreement (along with any other necessary documents) with HCD if awarded HRPP funds. This is a time-sensitive item for which the City Council must take action to submit the HRPP application to HCD. In order to remain eligible to apply for HRPP funds, the City Council must approve submittal of the application prior to the application due date of February 5, 2015. BACKGROUND INFORMATION: HRPP funds are made available by HCD and were funded by Proposition 1C, the Housing and Emergency Shelter Trust Fund Act of 2006. Funds are awarded on a per-bedroom basis for certain residential units affordable to very low- and low-income households that were permitted between 2010 1 Elk Grove City Council January 28, 2015 Page 2 of 3 and 2014. The City previously received funding for affordable housing units permitted in 2011. Up to $35 million is available in this round of funding. -
Tax Aspects of Litigation Awards and Settlements
Tax Aspects of Litigation Awards and Settlements DAVID SHECHTMAN, ESQUIRE Chairman, Tax Section Montgomery, McCracken, Walker & Rhoads, LLP 123 South Broad Street Philadelphia, PA 19109 Tel: (215) 772-7314/Fax: (215) 772-7620 E-Mail: [email protected] 1181093v2 I. GENERAL INCOME TAX RULES A. Settlement or Judgment. The tax consequences of a payment made in connection with a lawsuit are the same whether the lawsuit is settled or proceeds to judgment. Either type of payment is referred to herein as an “Award”. B. Origin of Claim. In general, the origin of the claim presented in the lawsuit determines the tax consequences of the Award. A plaintiff’s tax treatment is determined by reference to the genesis and gravamen of the underlying claims. U.S. v. Gilmore, 372 U.S. 39 (1963); U.S. v Woodward, 397 U.S. 572 (1970); Keller St. Dev. Co. v. Comm’r, 688 F.2d 675 (9th Cir. 1982). Often, however, lawsuits involve multiple claims and complex facts. 1. Lost Profits Versus Goodwill. Claims which arise in a business context often involve elements relating to both lost profits and damage to identifiable assets, such as goodwill. The burden is on the taxpayer to demonstrate the existence of an asset, as well as damage thereto, in order to avoid treatment of an Award as ordinary income. Rev. Rul. 75- 527, 1975-2 C.B. 30. Raytheon Corp. v. Comm’r, 144 F.2d 110 (1st Cir. 1944). See also Messer v. Comm’r, 438 F.2d 774 (3d Cir. 1971); Milenbach v. Comm’r, 318 F.3d 924 (9th Cir. -
IN the UNITED STATES DISTRICT COURT for the DISTRICT of NEBRASKA E3 BIOFUELS-MEAD, LLC, Plaintiff(S), V. SKINNER TANK COMPANY;
8:06-cv-00706-JFB-FG3 Doc # 232 Filed: 01/30/14 Page 1 of 11 - Page ID # <pageID> IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEBRASKA E3 BIOFUELS-MEAD, LLC, Plaintiff(s), 8:06CV706 v. SKINNER TANK COMPANY; MEMORANDUM AND ORDER Defendant/Third-Party Plaintiff, v. DILLING MECHANICAL CONTRACTORS, INC. Third-Party Defendant. This matter is before the court on a motion for partial summary judgment filed by defendant/third-party plaintiff Skinner Tank Company (“Skinner”), Filing No. 162. This is an action for breach of contract, fraud, and gross negligence in connection with an ethanol plant construction project in Mead, Nebraska.1 The plaintiffs, E Biofuels-Mead, LLC and E3 Biofuels-Mead, LLC (hereinafter, collectively, “E3”), entered into a contract with defendant Skinner for the purchase, design, fabrication, construction and installation of several tanks to be used in an Integrated Solid Waste and Bio-Fuels Facility (the “Project”) that retrieves usable energy from cattle waste. Jurisdiction is premised on 28 U.S.C. § 1332, diversity of citizenship. 1 The action also involves a counterclaim against E3 and third-party claim against Dilling Construction, the management firm hired by E3 for the project, for tortious interference with a contract, negligence, indemnification and contribution. 8:06-cv-00706-JFB-FG3 Doc # 232 Filed: 01/30/14 Page 2 of 11 - Page ID # <pageID> Skinner moves for a summary judgment of dismissal on the plaintiff’s claims of fraud and gross negligence, asserting that those claims are barred under the economic loss doctrine. Further, it argues that E3 has failed to plead fraud with particularity under Fed.