Name Sofia

Registration Number 301-1904081

Course Title Business Law
Session Fall 2020
Exam Terminal Exam

Write Your Answers here!

Case Study #1:

 According to this case study, the right to indemnity can appear in cases of
contribution and surety ship. We can come up with the following ideas from the
above cases:
1st the purchaser impliedly agrees to indemnify the seller against the encumbrances if
the property is sold subject to encumbrance and 2nd this right of indemnity can be
applied to cases of dissolution of the partnership, surety ship, contribution, etc…
which means it's not limited to sales of immoveable property. Based on the
consideration that an obligation of the conscience should be cast on the purchaser, the
right would be applied to cases of sales of property subject to a "charge". Even
though in the case it's strongly argued that since exhibit B is only a security bond and
it doesn’t carry any responsibility to discharge the decree of the high court. However
from the author's point of view the right of indemnity exists in this case which makes
the plaintiff eligible to ask the court to enforce the law.
 In law indemnity can be defined security or safety against the loss or that’s a
useful contractual agreement between 2 parties, one party accepts to pay any
damages or damages caused by the other party. The most Common example is
insurance contracts. There are 2 parties in this contact one is – indemnifier and
the 2nd party is – indemnified( indemnity holder)
Indemnifier is the person who promise or give assurance to 2nd party that compensates
for the damages.
And indemnified the person who is assured that the resulting damages will be
compensation or recover.
Ex #1: Ali took full coverage for his new car, he got into an accident and the
insurance company fully covered the repair costs and paid for the rental vehicle while
his car was being fixed.
Ex #2: Ahmad's house was damaged by a flash flooding. He had indemnity through
his insurance and he was indemnified. This means the insurance company covered the
repair costs caused by the lighting damage.
Ex #3: Vital insurance company entered into a contract with Kabul Ltd, to
compensate for loss caused by accidental fire to the company's stock of goods up to
$90,00,000 for a premium of $100,000.
 Ex #4: Ahmad is a shareholder of Kabul Company Ltd. Lost his share certificate. But
on the condition that Ahmad compensates for the loss or damage to the company if a
3rd person brings the original certificate.
Ex #5: A knee brace manufacturer enters into an agreement with a large hospital to
provide 1m knee braces at a discount price. The manufacturer asks that an indemnity
clause be included in the contract, in which the hospital agrees to protect the company
from any losses and lawsuits should patients be injured while using any of knee
braces. In doing this, the hospital indemnifies the knee brace company or hospital
guarantees indemnity for any losses or injuries that many occur.
 Indemnity and guarantee are type of contingent contracts, which are governed by
contract law. In other words, indemnity implies protection against loss, in terms
of money to be paid for loss. Indemnity is when one party promises to
compensate the loss occurred to the other party, due to the act of the promisor or
any other party. On the other hand, the guarantee is when a person assures the
other party that he/she will perform the promise or fulfill the obligation of the 3rd
party, in case he/she default.
In indemnify contract there are 2 In guarantee contract there are 3
parties. Indemnifier and indemnity parties. Creditor, principle debtor and
holder surety
In indemnify there is only on contract In guarantee there are 3 contracts,
it's between indemnifier and indemnity between creditor and surety. Contract
holder. between P D and creditor and between
surety and P D.
Indemnity contact based upon Guarantee contract based upon the
indemnifier's interest principle debtor's interest.
In indemnify contract there is a promise In the guarantee contract there is
to pay the losses and damages. multiple promise.

In indemnify contract the liability of In guarantee contract the liability of

the indemnifiers is primary. surety in secondary (2nd).
Examples:
Indemnity: Ahmad is shareholder of Kabul Company Ltd. Lost his share certificate. He
applies for a duplicate one. The company agrees, but on the condition that Ahmad
compensates for the loss or damage to the company if a third person bring the original
certificate.
Guarantee: Sharif takes loan from Azizi bank for which Karim has given the guarantee
that if Sharif defaults in the payment of the said amount he will discharge the liability.
Here Karim plays the rule of surety, Sharif is the principle of debtor and bank is the
creditor.
Indemnity: A knee brace manufacturer enters into an agreement with a large hospital to
provide I million knee braces at a discount price. The manufacturer asks that an
indemnity clause be included in the contract, in which the hospital agrees to protect the
company from any losses or lawsuits should patients be injured while using any of knee
braces. In doing this, the hospital indemnifies the knee brace company, or the hospital
guarantees indemnity for any losses or injuries that may occur.
Guarantee: Ahmad borrows $50,000 from\Nasim and agrees to pay the full amount and
5% interest within 2 months. Ahmad guarantees that he will pay $5,250 by contract
expiration date.
Indemnity: Ahmad's house was damaged by a flash flooding. He had indemnity through
his insurance and he was indemnified. This means the insurance company covered the
repair costs caused by the lighting damage.
Guarantee: Sarah takes student loan from Islamic back but his father cosigns the
agreement. If Sarah fails to make payments his father will be liable.
Indemnity: Ali took full coverage for his new car. He got into an accident and the
insurance company fully covered the repair costs and paid for the rental vehicle while his
car was being fixed.
Guarantee: Ahmad and Nasir enter in a stationary shop. Ahmad orders to deliver the
books to Basir on credit. The shopkeeper said that he can give book on credit provided
Ahmad gives the guarantee for the payment of books. Ahmad promises to guarantee the
payment.
Indemnity: vital insurance company entered into a contract with Kabul Ltd, to
compensat5e for loss caused by accidental fire to the company's stock of goods up to $90,
00,000 for a premium of $100,000.
Guarantee: Jamal takes loan of $1,000 from Kabul bank. Ahmad promises to Kabul
bank that if Jamal fails to repay the loan within the agreed timeframe he will pay it
interest.

Case Study #2:

 Specific relief act is an act providing for an equitable remedy. In this, the court
issues an order requiring a party to perform a specific act i.e. directs performing
the contract as per the terms and conditions agreed between the parties. It's based
on the statement that there might be situations wherein the grant of the
compensation would not afford adequate relief and only specific performance of
the3 contract would render justice and provide adequate relief. By the decree for
specific performance, the court explains the real contract between the parties and
announces officially that such a contract exists and the executing court will deal
with the rest. When all the different steps can't be explained in detail, which are
necessary to implement the main part of the order directing specific performance
of the contract, then the executing courts deal with such cases to issue important
steps to be taken.
 The performance of contract means the promisee and the promiser both have
fulfilled or completed their respective obligations under the contract. And when a
contract is properly fulfilled by both parties thus the contract comes to an end it
called discharged or executed. The contract must be performed at the place, time
and date with manner specified in the contract. And the promiser must has the
willingness and ability to perform the contract and delivered the goods for which
he has concluded the contract with. There are different types of performance of
contract.
- Actual performance
- Substantial performance
- Partial performance
 - Attempted performance
 There are many ways to terminate a contract
- By performance
It means the contract expires when the both parties have fulfilled all their obligations
under the contract, including all express and implied terms and each party performed with
complete diligence exactly as specified in the contract for example
- By agreement
It's actually variation of the contract when both parties are able and agree to terminate the
contract and when they do so their mutual obligations and contract will end. And they can
have new agreement with fresh considerations
- By gap of time
It means one of the contractor isn’t capable of starting and finishing work on time.
For example builder's team is a renovation company. They were hired to remove
Ahmad's old house within 2 months. Builds team has so many other projects ongoing and
can't dedicate a team to finish the house. Ahmad is forced terminate the contract

Case Study #3:

 The case study demonstrates that the government of Maharashtra appointed a
committee to place the working conditions of security guard who are working on
contracts basis through security agencies under scrutiny. After examining and
analyzing the cases the committee came to the conclusion that the contract
framework was being utilized to misuse the circumstance of widespread
unemployment of security guards, and also the system lacks the security of
employment, healthy benefits, as well as safety measures since it is based on the
contract. To protect the security guards numbering about 70,000 employed by
about 200 to 250 security agents, the government issued a notification under the
contract labour (Regulation and Abolition) act, 1970 abrogating the contract
system of employment of security guards. Since the notification was a non-
speaking order, the court ended it officially. Therefore the government brought
independent legislation applicable to the security guards. By an ordinance issued
on 31st august 1988, the Maharashtra private security guards (Regulation Of
Employment And Welfare) ordinance, 1981 (Maharashtra Ordinance V of 1981)
and the Maharashtra Private security Guards (Regulation of Employment and
Welfare) scheme, 1981 were simultaneously brought into effect, which is referred
to as ' The Security Guards Act'.
 Termination or discharge of the contract means the termination of the contract
before it's completed by the parties. In other words before the parties fulfill all the
obligations related to them that are required in the contract, their duty to fulfill
these other obligation ceases.
Generally, the effect of termination of the contract is the discharge of the parties from
their unfulfilled obligations in the contract.
 There are several common reasons that a contract can be terminated between 2
parties:
 - When the terms of the contract aren’t acceptable by one of the parties and if it
is not changeable so contract can be terminate.
For example Azizi bank and Vital Software Company enter into negotiation to
develop a new banking system. Vital company offers to develop the tool within
12 months for $100,000 however; Azizi bank needs the system within 2 months.

- Adverse performance of all or part of the contract by other party.

For example Kabul University signed a contract with ABC publisher to print high
quality curriculums and chapter notes. The 1st batch of materials weren't legible
and graphic quality was poor.

- Baulk (refusal) by the party to perform the contract the party may change its
mind or have another better option to do contract with.
For example in reference to the example above, Kabul University terminate the
contract with ABC publishers and seeks new vendor to print materials.

- When one of the parties no longer need goods or services or can get goods or
services more cheaply elsewhere so they can terminate the contract.
The government plans to build a new building for the ministry of interior. The
project was being funded by the USAID, however, halfway through the project
the fund was allocated to other high priority projects and building construction
work was terminated.

- When the party is facing bankruptcy (insolvency) or is no longer able to

perform the contract in the time other party can terminate the contract.
For example due to declining sales and revenues Vital bank terminates contracts
with cleaning and administrative vendors.

Case Study #4:

 Agreement bailor and bailee is called bailment its form French word "Bailer"
which means hand over or delivery. Generally mean delivery of goods or item by
the owner or an individual the one who trust (bailor) to other person the one who
have the right to take items from someone or (bailee) for purpose under a
contract. 5 essential characteristics of bailment are contract, delivery of goods,
charges in possession, movable items, and return. The contract must be between 2
parties "bailor" and "bailee" and the good must deliver by one individual to
another both parties must get from it mean one is using the item and one will
receive money from that the items should be movable and the item will return
bailor and bailee can't deliver it to any other bailor. For example Sarah is parking
her car in university parking and paid a lot for. So Sarah is getting benefit from
that parking because of her car and university get benefit of the fee that is paid for
the parking.
Rights of the bailor are to terminate the contract, to take back the goods, claim to
increase the cost of goods and to perform the receiver's duties and claim damages.
Rights of the bailee are in the event of a loss due to a defective title, and claim
damages, if bailee don’t pay the charges for the stored goods so he/she can use the
right of bail i.e. storage of the goods and bailee cant mix the goods of bailor with
of his own goods etc… or another case for example Ahmad lent his jacket to Ali,
his friend for a short time use without any charges this is the bailment for the
exclusive benefit of the bailee.