Consideration & Appropriate Form

Can you please explain these two terms? What should be in a good contract?

Consideration- 1

·      "Consideration" is a legal term

·         For something promised

·         Given or done by one party

·         In exchange for a reciprocal and valuable commitment

·         By the other

·      Once again

·         Both parties must be free

·         To enter into the arrangement voluntarily

Consideration- 2

·      In practical terms

·         An acquirer offers to pay money

·         For a service or product

·      However

·         The apparent fairness of the payment for the product

·         Or vice versa

·         Is not legally relevant

·         So long as both have some semblance of value

Consideration- 3

In many jurisdictions

·         There are limitations on the arrangements

·         Such as there must have been some bargain and exchange

·         And a contract will not exist

·         If the commitment has been entirely one sided

·         I.e. reached under duress

·         The obligations by either party

·         Cannot be one that is already legally obligated

·         Also, a "moral duty"

·         Is not sufficient consideration to support a contract

Appropriate form - 1

·      As we said in Issacon #1407 (p5)

·         Contracts are not enforced by law

·         They are interpreted by the law

·         Upon an action by one part or the other

·      To do this, courts in most jurisdictions

·         Apply various "legal rules"

·         When required to interpret cases

·         Of conflict or ambiguity

·         Between the contracting parties

Appropriate form - 2

·      Consequently

·         To enable interpretation of a contract

·         It is advisable to ensure

·         That a number of "standard" clauses

·         Are included in the contract documents

·      Such clauses are, or should be

·         Designed to clarify the roles and responsibilities

·         Of both parties

·         To their mutual benefit

·      Standard clauses are often called "boiler plate"

Appropriate form - 3

First and foremost, there must be

·         A full technical description

·         Of the work to be done

·         The functionality or features to be delivered in the product

·         As best known and agreed at the time of contract

·         Failure to reveal all the available technical information

·         Could also be a source of conflict

·         And subsequent litigation