Session II –
Contract Negotiation
David Echenberg P&W Legal Counsel
November 20th , 2015
Imagination at work.
Agenda
 Today’s Class: Recap, Warranties, Termination,
Dispute Resolution and Exercises
 Next Class: Differences between national and
international contracts
 Final Class: Recap and Exercises
Title or Job Number | XX Month 201X
See tutorial regarding
confidentiality disclosures.
2
Recap
For an agreement between two or more parties to be a valid
contract the following six requirements must be met.
1. Offer: one Party promises to take a specific action or
provide something of value in the future;
2. Acceptance: the offer is unconditionally accepted by
the other Party (e.g. without ‘ifs’, ‘but’ or ‘ands’) Art
1326;
3. Consideration, something of value is promised in
exchange for the specific action, (e.g., money or
effort);
4. There is the mutual intent of both Parties to carry out
the agreement;
5. Capacity of the Parties in terms of age and mental
ability;
6. Legally enforceable terms and conditions.
Pro – Bono Contract Law| 20 November 2015
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Negotiations I
In groups of two, one person being the Buyer and the other
person being the Seller, negotiate the following contract and
ensure to include all six elements in the agreement.
 Buyer wants to buy six goldfish.
Seller is willing to sell six goldfish.
 After you have agreed to the
terms of the contract, complete
the following table to capture the
parties’ agreement.
 Points will be given for each
exercise
Negotiating Contracts
Exercise 1 Goldfish
Contractual Criteria
Agreed Terms
Points
1.
2.
3,
4.
5.
6.
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Pro – Bono Contract Law| 20 November 2015
Warranties
Sellers are required to provide certain warranties regarding
the quality of the goods or services provided.
1. Title: Seller promises to be the owner of the
goods and is permitted to sell the goods to
Buyer;
2. Materials: the goods are manufactured with
the appropriate materials, e.g. ceramic frying
pan not paper frying pan;
3. Time: Seller promises the Buyer to repair or
replace the goods or re-perform the services
for a specific period of time, e.g. 2 years;
4. Consumer Contracts:, There is a mandatory
two year warranty from the time of delivery
e.g. Decreto 206/2005 “Consumer Code.
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Pro – Bono Contract Law| 20 November 2015
Termination
If either the Buyer or the Seller do not do what they promised
to do, the other Party may terminate the contract.
1. Seller: If the Buyer promises to pay but
then does not pay, the Seller may stop
performing or terminate the contract;
2. Buyer: If the Seller promise to provide
goods or services and does not do so, the
Buyer may stop payment or terminate the
contract;
3. Force Majeure: If an event occurs that
makes the contract no longer possible to
perform, the contract may be terminated.
Example: The ship transporting the goods
sinks;
Pro – Bono Contract Law| 20 November 2015
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Dispute Resolution
The Parties may have a dispute regarding the performance of
the contract.
1. Negotiation: Normally as first step the parties will enter into some
for of negotiation to resolve the dispute;
2. Mediation: If the negotiation fails, the parties may ask an expert to
try to act as Mediator between the Buyer and Seller;
3. Courts: If parties are unable to find a compromise, either party
may go to request the competent court to resolve the dispute;
4. Arbitration: The parties may have agreed in the contract to use
arbitration as a means of resolving the dispute as opposed to the
courts.
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Pro – Bono Contract Law| 20 November 2015
EXERCISE II
Group A Team members are organizing
a graduation party for the end of the
school year.
Group
B
Team
members
are
salespersons for a local disco that
offers graduation parties.
Group A and Group B are to negotiate a
valid contract at the best price that
Group A and B can obtain.
Points will be given to members of
Group A and Group B and at the end of
the course, a prize will be given for the
person with the most points.
Good Luck!
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Pro – Bono Contract Law| 20 November 2015