INTRODUCTION
Because of their nature as being protracted contracts of an excessive cost, shipbuilding contracts may entail a number of serious risks for both their counterparts, that may result to great damage in their financial standing.
While at the past years the shipbuilding market witnessed a period of economic boom, with a great number of shipowners ordering ships from the shipyards of China, Korea and Japan (the dominants of the newbuilding sector) and signing the relevant shipbuilding contracts, the economic crisis of 2008, affecting the world/global/worldwide market as well as the shipbuilding market, came to cause great pressure and anxiety to the Buyers in the above mentioned shipbuilding contracts, who felt now more than ever
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These two types of guarantees differ on the following points:
-An on demand guarantee, which is the most straightforward of guarantees, will be paid upon demand of the Buyer, and will not be dependent a) upon the shipbuilder’s liability (original debtor) and b) upon the outcome of the arbitration/trial between the Builder and Buyer. In that type of guarantee the liability will be triggered by a written demand of the Buyer for the payment of the pre-instalments that have been already made, which has to be made in good faith. Without any other prerequisite the guarantor will be bound to pay the amount of that guarantee.
-On the other hand, a suretyship guarantee will not give the right to the Buyer to demand the guarantee immediately and independently of the Builder’s liability, as well as the guarantor will not be obliged to pay the amount of the guarantee prior to the establishment (by the tribunal or after the Buyer’s admission and consent) of a breach of the contractual rights of the
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DIFFERENT TYPES OF CONTRACTUAL TERMS - PROPER DRAFTING FOR THE IDENTIFICATION OF CONDITIONS AND INNOMINATE TERMS
An other challenge for the draftsmen of a shipbuilding contact is to manage to illustrate clearly and undoubtedly the true willing of the counterparts and more importantly the terms of the contract that are of such importance to the parties that without their inclusion in the contract they would not have contracted at the first place or a breach of whom makes the contract substantially different from that the parties intended.
In a breach of such a term the parties do no longer have an interest on continuing the contract, since that term is vital for the whole agreement.
Such a term is considered to be a condition that usually refers to the main points and aspects of the contract, in the root of the deal/agreement, rather than in details of little
However, the fact remains that the Trident submarine is a new ship, and the shipbuilders could be faced with unrealized production challenges, such as mirror welds, which could slow down the build time and increase labor costs. These types of unexpected costs are the basis for the cost-reimbursement contract approach and remain a risk within every fixed cost contract. Fixed cost contracts also run the risk of reducing the quality of work in favor of remaining under budget.
An offeror will have made an offer where it appears to a reasonable person in the position of the offeree that an offer was intended.
* Terms allowing parties to vary the contract price known as a price variation clause.
Insurances The contract allows either the contractor or the owner to insure. Provision is also made for one party to take out and maintain the insurance where the nominated party fails to do so or fails to provide acceptable evidence that the insurance in is place
a. Contracts executed by the parties normally include provisions that clearly specify the enforceable rights regarding goods or services to be provided and received by the parties, the consideration to be exchanged, and the manner and terms of settlement.
The terms (legal parts) of the contract can be in a variety of forms, including:
"Subject to the Buyer by ( embed date ) inspecting and affirming the Residential Tenancy Agreement(s) in a matter of seconds essentially and covering the
In construction projects, mostly the firms (in this case the firms become client) do not have the skills or develop skills inside the firms to undertake the projects due to amount of the projects should be conducted or the complexity of the projects (Reve and Levitt, 1984). Therefore, the economic decision to conduct the projects is to procure them to third parties. However, more commonly the client agonize the final quality of the projects will meet standard requirements. Thus, impacts to involvement of complex contracts of construction procurement.
Ocean Carriers Inc. was approached in January of 2001 with a contract proposal for the leasing of one of their ships for a term of 3 years beginning in 2003. Ocean Carriers currently has no ship to accommodate the customer. To commission the construction of a new vessel would take 2 years from start to completion. The average rate in the spot market is $22,000 per day. Ocean Carriers deployed a younger fleet than average carriers and generally earned a 15% premium over the average daily rate placing them in position to capitalize in strong economies. However, the industry is volatile and suseptable to extremes both low and high. Many ship owners sought to sign contracts with time charters in order to shield themselves from the swings
5. From the firm’s point of view, the policy of not operating ships over 15 years old is designed to protect against uncertainty and to pursue a higher premium over the market by having more relatively young vessels rather than old ships. However, based on our calculation of the NPV of the project, under the assumption that the company will continue to operate the ships until the 25 years of service, the results
The contract in English law enhances principle of freedom of contract. Indeed, the terms of the contract is freely determined and agreed by the parties. However, there are various circumstances in which additional terms may be implied into the agreement. The aim of implied terms is often to provide a supplement to a contractual agreement in the interest of making bargain more effective, to achieve fairness between the parties and to alleviate hardship.
Under Section 12(4) which provides that “whether a stipulation in a contract of sale is a condition or a warranty depends in each case on the construction of the contract. A stipulation may be a condition though called a warranty in the contract”. Therefore, every contract is to be assessed in the light of circumstances including intention of the parties and also terminology used in the construction of the contract.
Introduction: In this assignment I will go over a few legal terms in relation to contract law. I will also talk about a few precedents that help explain the law.
Contractual agreement has always been viewed in terms of offer and acceptance. The universal principle to contract law has always been parties may get into an agreement in whichever way they deem fit and they are subject to certain terms as they choose. As far as legal requirements vital to their formation are binding contracts may be formed. Moreover a binding agreement may be manifested in terms of writing or in verbal form.
For this assignment the writer is going to discuss the nature and types of construction contracts and will explain the legal responsibilities of the various parties involved in the design and the construction process.