In order to avoid contract disputes a contract should be drafted by a solicitor. A solicitor will know what clauses to include (depending on the type of contract you need) and how to keep the terms of the contract unambiguous. The majority of contract disputes end up before the courts as they are not properly drafted. Do not fall into the trap of downloading contract templates from the internet.
In a contract there are two types of clauses – one is a condition and the other is a warranty. Conditions are important in contracts and if not adhered to the contract cannot be followed. On the other hand, a warranty is less important and a breach of warranty does not mean the contract cannot continue.
There are two types of breach in a contract, these are:
Breach of Condition – this breach will affect the heart of the contract and the correct remedy would be repudiation and damages.
Breach of Warranty – not a serious breach but may cause some loss. A suitable remedy would be damages but the contract can continue.
There are three remedies, these are:
Specific Performance – Usually by an application to the Court, Ordering the party in breach to carry out the specific performance. This remedy is uncommon as by the time the court makes such Order, the contract will have broken down irrevocably.
Repudiation & Damages – This is the most common type of remedy. To claim damages for financial losses following a breach of contract, evidence of losses is required by the court for damages to be ordered.
Unfair Contract Terms Act – Supply of Goods and Services Act 1982 is the most important legislation for anyone who is supplying a service for a payment in return. You should expect any service provided under the 1982 Act to be done with:
- Reasonable care and skill;
- In a reasonable time (subject to no time being agreed);
- For a reasonable charge (subject to no fixed costs being agreed in advance).
- Goods supplied must be of satisfactory quality.
- Goods supplied must be fit for purpose, as described.