Fixed Fee Bespoke Document Drafting by The Legal Stop – Customer Testimonial

The Legal Stop is a straightforward online business using information technology for the public good. We aim to make the law and provision of legal services more accessible and transparent to people and businesses alike.

For a one-off affordable and transparent fixed fee we draft a contract specifically tailored to meet your legal and business requirements.

For more info please visit: www.thelegalstop.co.uk

AN OVERVIEW OF CONTRACT LAW

A contract is a legally binding agreement setting out the rights and obligations of the parties involved.

The word “contract” is often misunderstood as it suggests a formal written document. However, according to the law a contract can be made in writing, orally or by conduct.

Although verbal contracts are enforceable, it is always prudent to have a written document setting out the terms which can then be used as evidence if there is a disagreement later. The Legal Stop offers a wide range of downloadable contract templates and fixed fee bespoke documents drafting, please visit our website for all your legal needs.

A contract is made only when four criteria are satisfied. They are:

  • Offer
  •  Acceptance
  • Consideration, and
  • An intention to create legal relations

Offer

An offer is a promise by one party to enter into a contract on certain terms. It must be specific, unambiguous and capable of acceptance and made with the intention of being accepted. An offer can be made to an individual, a group of persons or even to the world at large and may be spoken, written or implied by conduct.

An offer must be distinguished from an “invitation to treat”, which merely invites the other party to make an offer and does not carry the intention of being bound. An example of an invitation to treat is a display of goods in a shop. The offer to buy is therefore made by the customer and the shop is free to decide whether or not to accept the offer.

An offer can be cancelled at any time before it is accepted by the other party. If the other party decides not to accept the offer, then they cannot change their mind and accept it as the offer is regarded as having been terminated.

Acceptance

Acceptance must be made in response to the offer and must correspond with the terms of the offer and it must be communicated to the other party to the contract. An offer can be accepted by a communication to the person making the offer or by conduct. Acceptance by communication can include any clear indication to accept the offer as long as this is communicated to the person making the offer. It is therefore established law that acceptance can occur by clicking ‘I accept’ on a website or even sending an e-mail.

Sometimes, rather than accept an offer, a party may decide to make a counter-offer. This will amount to a rejection of the original offer so no contract is made. It will amount to a new offer and the person who made the original offer can then choose whether or not to accept it. Where a counter-offer is accepted then those terms rather than the original terms proposed will be the terms of the contract. If this occurs it is often termed “the battle of the forms” and it will often be difficult for the court to determine which set of conditions prevail.

The general rule is that an acceptance is not effective until it is communicated to the other party who made the offer. There are two rules on acceptance:

  1. The reception rule: it covers situations which involve instant communications such as telephone conversations, face to face negotiations, etc.
  2. The postal rule: as a general rule an acceptance must be brought to the attention of the person who made the offer. However, communication through the post is an exception to this rule. The postal rule is that acceptance is deemed to be effective at the time of sending. This is the position even if the letter is lost or delayed in the post provided of course it was correctly addressed. However, it is always advisable to obtain proof of posting to reduce the risk of disagreement at a later date.

The difficulty in relation to contracts formed via a website in relation to electronic communications is regarding whether or not the postal rule applies. Please note that the Electronic Commerce Regulations 2002 require suppliers to clearly state how an electronic transaction governed by the regulations is to be completed. If an offer does not specify the method of acceptance then it can be done by any way chosen.

Consideration

If a contract lacks consideration then it can only be enforced if it is made by deed. To be considered “good consideration” it must have some value even if, in the context of the agreement, it is only a nominal amount.

As a general rule, past consideration is no consideration. If a party is merely discharging a pre-existing obligation then there is no consideration for it. An example is where A is owed £20 by B and agrees to accept £10 instead. A is not precluded from later asking B for the balance of £10 as there was no consideration for accepting a lower sum because B was already under an obligation to pay the original amount.

Intention to create legal relations

The final point required in order to make a valid contract is to show that the parties intended to create a contract. In commercial transactions there is a rebuttable presumption that the parties intend their agreement to be legally binding. Common ways of rebutting this presumption are by the parties writing comfort letters, letters of intent or by using the words “subject to contract”.

Letters of comfort are used in loan finance transactions. They are issued by third parties and are often given to banks in relation to loans and are letters which provide encouragement or comfort to the lender to proceed with the loan.

Letters of intent are frequently used when negotiating mergers and acquisitions. The main purpose is to record a non-binding outline of the terms that the two parties have agreed.

The use of the phrase “subject to contract” is also used to rebut the presumption of contractual intent. It means the parties have not yet reached an agreement and are still negotiating.

Provided the elements of offer, acceptance, consideration and intention to enter into legal relations are present then a contract will have been formed. Thus, an oral agreement which satisfies these conditions will amount to a binding contract and each party will then be able to rely on those terms, and if necessary can take appropriate action to enforce these.

The Legal Stop is a straightforward online business using information technology for the public good. We aim to make the law and provision of legal services more accessible and transparent to people and businesses alike.

We provide fixed fee legal services and legal and business document templates for all types and sizes of businesses. We offer a wide range of downloadable contract templates and online legal services to businesses, start-ups, and individuals. Our services include:

  • Legal and Business Document Templates
  • Request a Template Service
  • Fixed Fee Legal Advice
  • Fixed Fee Bespoke Document Drafting
  • Free Legal Documents and Information

How to Enforce Judgement

Even if your legal action is successful, you may need to enforce judgement against the other party because they still fail to pay you.

You can apply to the court for an order to obtain information from the debtor about their financial circumstances, which involves them going to court to be questioned under oath. The type of information you can ask for includes:

  • details of employment status (such as employer and earnings) and any other income;
  • details of dependants and any outgoings paid from income;
  • whether they own any property which could be sold to meet the debt; and
  • whether they hold any money in bank or building society accounts.

This information will give you a clearer picture of whether it’s worth enforcing judgement against them.

If you decide to proceed with enforcing judgement, the following options are available:

Warrant of execution  

This allows court bailiffs to take goods from your debtor’s home or business and the goods will be sold at auction.

Attachment of earnings order

This usually applies to an individual person in employment.The employer is ordered to make deductions from the person’s wages or salary.

Third-party debt order

This is where the court orders a ‘freeze’ on money held by a person, institution or organisation, which might otherwise be paid to a defendant against whom you have a judgement. The order will prevent withdrawal of the money until the court decides whether all or part of it should be paid to you.

Charging order

The court places a ‘charge’ on the debtor’s property which is equivalent to the amount you are owed. A charging order does not oblige the debtor to sell their property, but if they do, they must pay you before they can take the rest of the proceeds.

Receiver

If you believe that you can’t recover your debt using the methods above, you can apply to the court to approve a receiver, who you have selected, to conduct an ‘equitable execution’. This involves the receiver collecting money which the debtor is owed by other people, such as rent due on properties they own, in order to repay you.

Winding up or bankruptcy

As last resort you can apply for a bankruptcy or winding-up petition, to stop the individual or business from continuing to trade.

 

Free legal document templates and forms.

Copyright Licence Agreement

For a Copyright Licence Agreement please see: Copyright Licence Agreement

In the UK the law relating to copyright is set out in the Copyright, Designs and Patents Act 1988 (CDPA1988).

Copyright can protect:

  • literary works
  • dramatic works
  • musical works
  • artistic works
  • layouts or typographical arrangements
  • recordings
  • broadcasts

Please note that copyright applies to any medium. Copyright protected work cannot be reproduced in another medium without prior permission, for example painting of a photograph.

Copyright is automatic thus, there is no need to apply for copyright.

Please note that copyright does not protect ideas. It is only when the work itself is fixed, for example in writing, that copyright automatically protects it.

There is no official registration system for copyright in the UK. Provided that the work qualifies for copyright protection, it is an original work and it is fixed then the work is automatically protected by copyright.

Copyright is an asset to businesses and individuals alike as it gives the owner numerous economic rights.

Copyright owners have the opportunity to make commercial gain from the exploitation of their work. Copyright owners generally have the right to authorise or prohibit any of the following things in relation to their works:

  • copying the work in any way;
  • issuing copies of the work to the public;
  • renting or lending copies of the work to the public;
  • performing, showing or playing the work in public;
  • broadcasting the work or other communication to the public by electronic transmission;
  • making an adaptation of the work, such as by translating a literary or dramatic work, transcribing a musical work and converting a computer program into a different computer language or code.

Copyright is infringed when any of the above acts are done without permission, whether directly or indirectly and whether the whole or a substantial part of a work is used. If copyright is infringed then the owner of the work has the right to claim damages.

A copyright owner has the right to decide whether and how the copyright work is used. A copyright owner can:

  • sell the copyright but retain the moral rights (assignment of copyright);
  • license the copyright for use by others but retain the ownership.

A Copyright Licence is a contractual agreement between the copyright owner and user; it sets out how the copyright work can be used.

A Copyright Licence Agreement is designed to be used where the licensor owns the copyright in one or more works and the licensee wishes to use those works. It allows the parties to decide whether the copyright licence is exclusive or non-exclusive. Also, the Agreement can be used to licence existing copyright or future copyright (works yet to be created).

DIRECTORS’ DUTIES UNDER THE COMPANIES ACT 2006

The duties of company directors have, until recently, been defined by case law. The Companies Act 2006 changed this, under the new 2006 Act directors’ duties have been for the first time codified and set out in statute.

WHO IS A DIRECTOR?

Under the 2006 Act any person occupying the position of director is considered to be a director of the company and is subject to the general duties, whether or not they are actually named ‘director’ and or have been validly appointed.

In addition, shadow directors are also subject to the general duties. A shadow director is a person who has not been appointed as a director of the company but in accordance with whose directors or instructions the directors of the company are accustomed to act.

Every director of a company owes each of the general duties to that company. Compliance with each of the general duties is the personal responsibility of each director.

GENERAL DUTIES

The general duties are:

  1. duty to act in accordance with the company’s constitution and only exercise powers for the purposes for which they are conferred
  2. duty to promote the success of the company for the benefit of its members as a whole
  3. duty to exercise independent judgment
  4. duty to exercise reasonable care, skill and diligence
  5. duty to avoid conflicts of interest
  6. duty not to accept benefits from third parties
  7. duty to declare an interest in a proposed transaction or arrangement with the company

Duty to act in accordance with the constitution and properly exercise powers (s 171 CA 2006)

Each director must ensure that they:

  • only exercise their powers for the purposes for which they are conferred, and
  • act in accordance with the company’s constitution.

For these purposes, a company’s constitution includes (but is not limited to):

  • the company’s articles of association, and
  • any resolution or agreements affecting the company’s constitution.

It means that directors should be aware of the content of the company’s constitution, they must act in accordance with the company’s articles of association and must pursue the objectives listed in the Memorandum of Association.

Duty to promote the success of the company for the benefit of its members as a whole (s 172 CA 2006)

To be able to comply with this duty directors need to consider a number of statutory factors, including the long-term consequence of decisions, the company’s reputation and the interests of other stakeholders, such as employees and the community. This list is not exhaustive; it is important that the directors give due consideration to every relevant factor in discharging this general duty.

Duty to exercise independent judgement (s 173 CA 2006)

It means that directors must not blindly follow the advice or instructions of a third party. Advice can be sought as long as the director uses his judgement to decide how to proceed.

Duty to exercise reasonable care, skill and diligence (s 174 CA 2006)

A director has a duty to exercise the same reasonable care, skill and diligence that would be exercised by a reasonably diligent person with:

  • the general knowledge, skill and experience that may reasonably be expected of a person carrying out the functions carried out by the director in relation to the company, and
  • the general knowledge, skill and experience that the director has.

The first part of this test is objective and sets a minimum standard for a director based on their particular role and responsibilities. The second part of the test is subjective and takes into account the particular director’s actual experience, knowledge, skills and specialism.

Duty to avoid conflicts of interest (s 175 CA 2006)

A director must avoid a situation in which he has, or can have, a direct or indirect interest that conflicts, or may possibly conflict, with the interests of the company. The prohibition relates to the situation rather than the actual conflict and the duty does not apply to a conflict of interest arising in relation to a transaction or arrangement with the company.

Thus, the scope of this duty is very wide but the CA 2006 also sets out provisions giving directors the power to authorise situational conflicts of interest.

Please note that authorisation cannot be given retrospectively and it applies to the conflict situation only and not other breaches of duty. For example, the fact that a conflict situation is authorised will not absolve a director from a breach of his duty to act with reasonable care, skill and diligence, which the directors cannot authorise.

Duty not to accept benefits from third parties (s 176 CA 2006)

A director is under a duty not to accept a benefit from a third party that is conferred because:

  • he is a director, or
  • he has done (or not done) anything as a director.

This duty does not catch benefits accepted by a director from the company, an associated body corporate or a person acting on behalf of the company or an associated body corporate.

Duty to declare an interest in a proposed transaction or arrangement with the company (s 177 CA 2006)

A director who is in any way, directly or indirectly, interested in a proposed transaction or arrangement with the company has a duty to declare the nature and extent of that interest to the other directors before the company enters into the transaction or arrangement, except where:

  • the director is not aware of his interest or the transaction or arrangement in question
  • the interest cannot reasonably be regarded as being likely to give rise to a conflict of interest
  • the other directors are already aware of the interest; or
  • it concerns the terms of his service contract that are to be considered by a meeting of the directors or a committee of the directors.

The declaration of interest must be made as soon as reasonably practicable after the director becomes aware of the interest.

Directors have to declare indirect interests as well as direct interests and it is not necessary that the director is a party to the relevant transaction or arrangement.

What constitutes an ‘indirect’ interest is not defined in the CA 2006, so the directors should consider which interests, if any, might be relevant, which may include the interests of persons connected with them.

CONSEQUENCES OF BREACH     

The consequences of a breach of duty can be severe, and may amongst other things, include:

  • damages or compensation where the company has suffered loss
  • restoration of the company’s property
  • an account of profits made by the director
  • rescission of a contract, and
  • injunction to stop the director from carrying out or continuing with the breach.

The Legal Stop Affiliates Programme

We just launched The Legal Stop affiliates programme.

If you have a website and want to take your site to the next level while making money off your traffic then certainly you will find our affiliates programme interesting.

If you have a website and/or a blog you can join The Legal Stop affiliates programme and provide your users with a valuable service and in the process you can earn generous commission.

The market for legal documents is big, all businesses need legal documents and it is often a legal requirement to have them in place. If you want to make passive income then join our affiliates programme for FREE.

There are several reasons for joining, here are a few of them:

  1. We have a large number of legal and business documents to meet every legal need
  2. We provide high quality affordable legal and business document templates
  3. We have a very lucrative three-tier commission structure 25%, 5% and 2%
  4. We have a wide selection of marketing tools which can help you promote the documents
  5. Visitors continue to buy long after their first visit. Our system tracks customers coming from your website and purchasing our documents for 60 days. Customers who purchase within that time are counted as yours and you receive commission on documents they purchase
  6. You monitor your performance. You have access to detail real-time statistics 24/7, this means that you can check up how you are doing at any time and you do not lose revenue
  7. We pay sales commission on time and we do not make prior deduction for bank costs
  8. It costs nothing to join and getting started is easy

 

For further information please visit: http://www.thelegalstop.co.uk/affiliates.html

 

NEW CUSTOMER TESTIMONIAL for The Legal Stop – Legal & Business Document Templates

A New testimonial from one of our customers that recently bought our business documents for his website.  Russell has an E-commerce website and used our legal document templates to help him save time and money. Thank you Russell for your endorsement!