ONE YEAR ADVANCED DIPLOMA IN DRAFTING, NEGOTIATION & ENFORCEMENT OF CONTRACTS

1.1. GENERAL PRINCIPLES OF LAW OF CONTRACTS

 

Module I: General Introduction and Formation of an Agreement

History and nature of contractual obligations

Definition of agreement and contract - definition - communication and revocation - offer and acceptance - postal rule of communication - offer and invitation to treat

Place of formation of contract and jurisdiction of courts - formation of e-contracts

Module II: Consideration

Meaning - basis and the nature of consideration - kinds (past, executed and executory) - doctrine of privity of contract - doctrine of consideration - exceptions to doctrine of consideration - adequacy of consideration - unlawful consideration and its effects.

Performance of existing obligations - forbearance to sue - composition and promissory estoppel

Capacity to contract

Natural Person, Corporations and Unincorporated Bodies, Public Authorities

Module III: Free Consent

Definition of free consent - vitiating factors and their effect - coercion - definition, techniques of causing coercion

Undue influence - definition - between which parties can it exist? - Burden of proof - presumption of undue influence - rescission

Misrepresentation - definition - unwarranted statements - breach of duty - inducing mistake about subject matter - suppression of vital facts - means of discovering truth

Fraud - definition - essential elements – suggestion - falsisuppressioveri - when does silence amount to fraud? - active concealment of truth - importance of intention

Mistake - definition - kinds - fundamental error - mistake of law and of fact - their effects - when does a mistake vitiate free consent and when does it not vitiate free consent

Module IV: Limitations on Freedom of Contract

Void and valid agreements - lawful and unlawful consideration - lawful and unlawful object - distinction between void and voidable agreement - illegal and unlawful agreements - effect of illegal and unlawful agreements

Unlawful consideration and object - forbidden by law - defeating the provision of any law - fraudulent - injurious to person or property - immoral - against public policy

Void agreements - agreements without consideration - agreements in restraint of trade - exceptions - sale of goodwill - restrictions under the partnership Act - trade combinations - exclusive dealing agreements - restraints on employees under agreements of service

Agreements in restraint of legal proceedings - its exceptions - uncertain and ambiguous agreements

Module V: Discharge of a contract and its various modes

By performance - conditions of valid tender of performance - how? by whom? Where? when? in what manner? - performance of reciprocal promises - time as the essence of a contract - assignment of contract - death and bankruptcy

By breach - anticipatory breach and present breach

Supervening impossibility of performance - specific grounds of frustration - application to leases theories of frustration - effect of frustration - frustration and restitution

By expiry of period of limitation

By agreement and novation - rescission and alteration - the effect of - remission and waiver of performance - extension of time - accord and satisfaction

Module VI: Standard Form Contracts

Suggested Readings

1. Atiyah’s Introduction to the Law of Contract, Stepehen A Smith ed. OUP, 2006
2. Avatar Singh, Contract and Specific Relief, Eastern Book Company, Lucknow, 11th ed. 2017
3. Chitty on Contracts, 33rd ed. Sweet and Maxwell
4. Pollack and Mulla, The Indian Contract and Specific Relief Act, R YashodVardhan and ChitraNaarayan (ed.) Lexis Nexis, 2018

1.2. LAW RELATED TO SPECIFIC CONTRACTS

 

Module I- Indemnity and Guarantee

Indemnity - definition of indemnity - nature and extent of indemnifier’s liability - commencement of liability of the indemnifier

Guarantee - definition of guarantee - essentials for a valid guarantee contract - continuing guarantee, nature of surety's liability - duration and termination of such liability, rights of surety, extent of surety's liability, discharge of surety's liability

Bank guarantee

Module II: Bailment & Pledge

Definition of bailment, Kinds of bailees, Duties of bailor and bailee towards each other, Rights of bailor and bailee, Particular lien & general lien. Pledge: comparison with bailment, Definition of pledge under the Indian contract Act, Rights of the pawner and pawnee, Pownee's right of sale as compared to that of an ordinary bailee, Pledge by certain specified persons mentioned in the Indian Contract Act.

Module III: Agency

‘Agent’ and ‘Principal’ defined, Who may employ an agent- who may be appointed as agent, Kinds of agents and agencies- essentials of an agency transaction, Distinction between agent and servant, Various methods of creation of agency, Rights, duties and liabilities of principal and agent- scope and limitation, Delegation- ratification and revocation of authority, Methods of termination of agency contract, Liability of the principal and agent before and after such termination.

Module IV: Contracts with Government & Tenders

Government Contract a category in itself - Article 299 of the Constitution - the grund norm for government contracts, ratification and government contract, modification of government contract, no implied contract with government.

Tenders

Notice inviting tenders - requirements of a valid tender - strict compliance with stipulations of notice - effect of minor deviations

Suggested Readings

1. Avatar Singh, Contract and Specific Relief, Eastern Book Company, Lucknow, 11th ed. 2017
2. Chitty on Contracts, 33rd ed. Sweet and Maxwell
3. Pollack and Mulla, The Indian Contract and Specific Relief Act, R YashodVardhan and ChitraNaarayan (ed.) Lexis Nexis, 2018
4. T R Desai, Law Relating to Tenders and Government contracts, Justice J D Kapoor 4th ed. Universal Law Publishing Co.

 

1.3. DRAFTING AND NEGOTIATING CONTRACTS

 

Module I: Introduction to Contract Drafting

(a) Why should you draft a contract? (b) Understanding the drafting process, (c) Glossary of important terms used in a contract.

This chapter will explain why parties should pay attention to their contracts and why understanding the client, business, and the transaction are important before proceeding to draft contracts. It will address the need of why a contract needs to be drafted, address issues related to the kind of research that should be undertaken before drafting and will explain through definitions some of the important commonly used terms in a contract in the form of a glossary. For example, terms like Battle of the Forms, Boilerplate, Covenant, Collateral, Entire Agreement, Franchise, Governing Law, Joint Venture, Letter of Intent, Recitals, Period/Term, Sunset Clause, Severability, Underwriter, etc.

Fundamental Rules of Drafting Contract:

(a) Elements of a contract (b) Structuring a contract, (c) Role of language, (d) Drafting techniques, (e) Pre drafting checklist

This chapter will address the fundamental principles of drafting and will explain each component of a contract comprehensively. It will explain the elements of a contract and how such elements are structured while drafting it. For instance, a contract broadly comprises introductory clauses, substantive clauses, endgame clauses, and boilerplate clauses. This chapter will focus on why these clauses exist and how are they drafted. What kind of language needs to be used while drafting and how important is to carefully use the right words and phrases while drafting. It will discuss various drafting techniques and practical tips to keep in mind before drafting.

Module II: Clauses of a Contract

Introductory Clauses:

(a) Preamble, (b) Parties, (c) Recitals, (d) Interpretation, (e) Definitions

This chapter will address the introductory part of a contract and its relevance. It will discuss various introductory clauses such as title, date, parties, defining parties, recitals etc. and the kind of language need to be used to draft them. A detailed conceptual explanation along with examples and practical considerations is the method used in this chapter.

Substantive Clauses

(a)Term, (b) Payment, Obligations, (c) Representation, (d) Warranties, (e) Declarations, (f) Condition precedent, (g) Condition subsequent, (h) Risk allocation clauses.

This chapter will cover the core of contract provisions. It will discuss the operative part of a contract that confers rights and obligations over parties and how it is played out in real life. Important clauses such as the term of a contract, consideration and payment clauses, obligations conferring clauses, representation, and warranties clauses, etc. will be dealt with in detail. Moreover, an in-depth study of certain specific clauses such as representation and warranties, covenants and declarations, and how in each transaction their language changes, why lawyers should be aware of deal maximization potentials while drafting these clauses, and how these clauses affect contractual remedies will be discussed.

Endgame clauses:

(a) Exit Clauses, (b) Termination, (c) Penalty, (d) Indemnity, (e) Liability, (f) Dispute Resolution, (g) Force Majeure

This chapter will cover the clauses that are common while concluding a contract. These clauses relate to how to exit a contract, how can a contract be terminated, what remedies are there in an event of a breach, how are disputes going to be resolved, liability clauses etc. It will also cover an important clause of force majeure.

Boilerplate clauses:

Assignment, Choice of law, Choice of forum, Confidentiality, Notice, Severability, Amendments

This chapter will cover several miscellaneous clauses, its relevance and how they are understood. How these clauses change depending on jurisdiction and nature of transaction and why it deserves sufficient attention while drafting it.

Module III: Concluding a Contract and Post Contractual Obligations:

(a) Closing a contract, (b) Contractual validity, (c) Attestation, (d)) Registration, (e) Notarization, (d) Stamping, (e) Enforcement, (f) Novation, (g) Alteration, (h) Post drafting checklist.

This chapter will discuss how a contract and its drafting process is completed. It will also ensure the steps that need to be taken after a contract is drafted to ensure its validity and enforcement. These steps include but not limited to its registration, notarization, stamping etc.

Module IV: Negotiating a Contract:

(a) Relationship between negotiation and contract drafting, (b) Different approaches to a negotiation, (c) Planning for a negotiation, (d) Stages of negotiation, (e) Proposals, Influence, and persuasion, (f) Post negotiation process

This chapter will discuss the role of negotiation and its relation and relevance to contract drafting. It will focus on key negotiation terms, stages of negotiations, tools and techniques for an effective negotiation, different strategies for a negotiation, identifying other party’s goals and interests and other important concepts like BATNA, WATNA, MLATNA, caucus, bargaining power, etc.

Module V: Sample Agreements

This module will discuss the sample agreement of all the below-mentioned agreements. Such sample agreements will have the most common and core provisions that are must in a respective agreement.

1. Purchase and Supply Agreement
2. Power of Attorney
3. Franchisee and Licensing Agreement
4. Escrow Agreement
5. Employment Agreement/ Service Agreements
6. Term Loan Agreements
7. Government Contracts
8. Rent and Lease Agreements

Suggested Readings

1. Charles M. Fox, WORKING WITH CONTRACTS: WHAT LAW SCHOOL DOESN’T TEACH YOU (2ndedn. 2008).
2. Power of Attorney
3. Fabio Bortolotti,DRAFTING AND NEGOTIATING INTERNATIONAL COMMERCIAL CONTRACTS – A PRACTICAL GUIDE (ICC, 2013).
4. G. Richard Shell, BARGAINING FOR ADVANTAGE: NEGOTIATION STRATEGIES FOR REASONABLE PEOPLE (3rdedn. 2018).
5. Giuditta Cordero-Moss, INTERNATIONAL COMMERCIAL CONTRACTS (Cambridge University Press, 2014).
6. Roger Fischer and William Ury, GETTING TO YES (2ndedn. 1991).
7. Government Contracts
8. Tina L. Stark, DRAFTING CONTRACTS – HOW AND WHY LAWYERS DO WHAT THEY DO (Aspen Publishers, 2007).

 

1.4. REMEDIES FOR ENFORCEMENT, BREACH AND PERFORMANCE OF CONTRACTS

 

Module I: Introduction to Commercial Law and Equity

Purpose of Contract Law and economic analysis of contract law and contracts

Module II: Injunctions

Nature of the Remedy, Types of injunctions – Temporary injunctions, Mandatory injunctions, Quia timet injunctions; Principles governing the grant of different injunctions; Relationship amongst the three factors; prima facie case, balance of convenience and irreparable harm; The importance of an undertaking in damages; Freezing Injunctions, Injuctions aganist invocation of bank gaurantees, Injunction to perform negative agreement.

Module III: Enforcing Contracts : The remedy of Specific Performance

Development of the remedy, Meaning of specific performance, The statutory amendment in 2018 – rationale and effect, Who may obtain specific performance, Contracts which can be specifically enforced, Contracts not specifically enforceable, Specific performance of part of contract, Defences respecting suits for relief based on contracts, Personal bars to relief, Non- enforcement except with variation, Possible defendants, Substituted performance of contract, Power to award compensation in certain cases

Power to grant relief for possession, partition, refund of earnest money, etc., Liquidation of damages not a bar specific performance, Bar of suit for compensation for breach after dismissal of suit for specific performance

Module IV: Damages for Breach of Contract

Nature of the remedy, Function of damages, Distinction between damages and compensation, Difference between damages in contract and tort, Excluding the right to claim damages, Breach of a contract, Effect of termination,

Kinds of damages, General, special, nominal, substantial, aggravated, exemplary, liquidated and unliquidated damages

Measure of damages- expectation or reliance or restitution,

Assessment of damages- cost of cure or difference in market value, damages assessed once and for all, difficulty of assessment not a bar, date of assessment, damages in some particular contracts- carriage contracts, construction contract, contract for work and labour, employment contract, sale of goods

Causal connection, Remoteness of damages – the Hadley v. Baxendale rule in Indian law, Duty of mitigation, Rule of contributory negligence

Liquidated damages, Advantages of a providing for liquidated damages, the rule against penalties, The requirement of actual loss, Forfeiture of earnest money, security deposit, Stipulation for interest

Module V: Remedies arising out of void/voidable contracts

An introduction to Sections 64 to 72 of the Indian Contract Act, 1872, Rectification, Rescission, Cancellation and Restitution, The existence of the law of unjust enrichment in India, Defences to unjust enrichment

Suggested Readings

1. Sarkar, Specific Relief Act, 17thedn.SudiptoSarkar and R Yashovardhan (ed.) Lexis Nexis, 2016
2. Avatar Singh, Contract and Specific Relief, Eastern Book Company, 11th ed. 2017
3. Pollack and Mulla, The Indian Contract and Specific Relief Act, R YashodVardhan and ChitraNaarayan (ed.) LexisNexis, 2018
4. Pollack and Mulla, The Specific Relief Act, ChitraNaarayan (ed.) LexisNexis, 2018
5. Supreme Court on Specific Relief Act, Surendra Malik and Sudeep Malik, Eastern Book Company, 2015