Group 3

Outline: The common structure of a business contract.

In general, a business contract has 3 main bases:
1.

Background
Exchange
Legal framework
Background:
Background information often occurs in the form of a whereas- recital
general the parties also regulate some aspects of the legal framework, we
have said several times, if the parties do not regulate the framework then the
information is available law.
2. Exchange :
The exchange is the kernel of the contract, it is essentially documented in two
provisions: scope and price.
scope

Price

Delivery

Payment

(how and
when)

(how and
when)A delivery
clause.

- A delivery clause supports the scope

clause is in turn
supported by a warranty allowing/ requiring the seller to make good defects.
The contract usually states the consequences of failure to make good defects.
- A payment clause support the price clause. The contract usually states the
consequences of late payment.
3. Legal framework
The legal framework provisions of a typical procurement contract fall into 6
groups:
- The applicable law.
- Definition section.

Provision concerning the parties.

Provision on the lifetime of the contract.
Provision on the legal status of the contract.
Provision on the legal status of the contract: language.
Provision on the settlement of disputes.

A full legal framework exists for every contract. Sometimes the parties create it,
in whole or in part, in the contract, any missing regulations are supplied by the
applicable law.