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Law vs Contract

4 replies [Last post]
Tue, 2004-11-23 10:30
Shahzad Munawar
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Lawyers and Legal Councils say that when there is an ambiguity in the Contract Stipulations then such matters are taken into account as per Law which means that Law supercedes on the Contract.

Enlighten the fact that why the Law supersedes on Contract stipulations in case of ambiguities or non existence of any specific Clause etc.?
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Replies

Sat, 2004-11-27 06:23
#1
Stuart Ness
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Razi,
You must be a lawyer!! ;-)

IMVHO, the law does not always supersede the terms of a Contract.
The parties to a Contract are free to agree any terms and conditions between themselves, except of course provided that such terms and conditions are not illegal or against public order.

Take for example, the terms of Force Majeure.
The parties to a construction contract are completely free to agree between themselves what constitutes and defines Force Majeure within the context of their mutually agreed Contract. If an event later occurs during the Contract, which the Contractor considers is Force Majeure although it was excluded as such in the Contract, he cannot later apply to the court to have Force Majeure invoked (even if the local statutes do include the event as Force Majeure) because it was already mutually agreed between the parties that such an event does not constitute Force Majeure.

Moreover, by the parties agreeing to exclude the event in question as Force Majeure, the Contract Price would be deemed to include the effects of its exclusion (sorry about the gobbledy-gook language!)

In the event of ambiguity or omissions in the Contract language, where an application is made to the Courts for clarification of interpretation, there is an increased use of applying the Contract terms in line with normal business use and efficacy, rather than apply the law in a clinical way which is not related to the context of the purpose of the Contract.

Of course, the only people who will argue that you have to apply to the Courts for resolution of these Contract interpretation matters – and those who advocate that the law overrides the terms of a Contract – are crap lawyers chasing high fees for doing f-a work!

Cheers,

Stuart

www.rosmartin.com
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Sat, 2004-11-27 01:26
#2
Razi Khan
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Law always supercedes contract for simple reason "Law is command of Sovereign" where as "Contract is simple mutual agreement between subjects"........... my opinion. Isn’t it right ?
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Fri, 2004-11-26 13:45
#3
David Bordoli
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Geoff/Shazad

I think we must try to differentiate between case law and statute.

If there is a precedent set by case law then contracts can be drafted to resist that precedent. As Shazad implies if the contract is drafted correctly it will stand. If there is ambiguity, or a specific contrary clause has not been included in the contract, then the general precedent will hold. I don’t really see how it could be any other way?

David
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Fri, 2004-11-26 12:39
#4
Geoffrey Boulton
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Hi Shahzad

All work must be carried out in accordance with the LAW.
The rights and duties you derive out of the Contract are protected by the LAW. You cannot enforce an action that is illegal.
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