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ADR - Company and Commercial Transactions

this stands for 'alternative dispute resolution'. It is used as a way to resolve disputes without going to Court. Mediation is an example of this

Agency

a legal relationship between a person known as an agent, who acts and contracts on behalf of another person, known as the principal

Agent

a person appointed by another to act on his or her behalf.

Agreement

in law, agreement is another name for a contract, which is a legally binding oral or written agreement

Arbitration

an alternative method of resolving disputes paid for by the parties, determined by an arbitrator

Arms length transaction

any transaction in which the seller and buyer act completely independently of each other, have no common interest and have no connection or relationship with each other

Asset transaction

the purchase or sale of the assets of a sellers business (eg their equipment), rather than of the business (eg the company) itself

Beneficial owner

a beneficial owner is the true owner of a security or property, which may be registered in another name. An example is a shareholder, who may have registered his securities in the name of a broker or nominee

Bodies corporate

an entity that has legal personality, in other words is capable of enjoying and being subject to legal rights and duties. An example would be a limited company

Breach of contract

a failure by a party to a contract to abide by the terms of the contract or to perform the obligations outlined in the contract

Breach of warranty

a warranty is made by one party to another, a statement of fact usually relating to condition or quality of goods. A breach of warranty occurs when the promise is broken, i.e. product is defective or not as a reasonable buyer should expect

Clause

a separate section of a legal document such as a statute, contract or will

Confidentiality agreement

a signed document that legally binds the parties to keep the information confidential, and contractually restricts disclosure of this information to anybody else

Consequential loss

financial loss which is the result of physical damage to property, beyond the direct cost of repairing the physical damage (or replacing the damaged goods)

Consideration

to form a legal contract, an agreement must involve each party paying a price for whatever he received from the other party. This price is consideration, which can be money, an act, forbearance or a promise. A contract is not valid without consideration

Construction

the process of determining the true meaning of a written document

Contract

this is the agreement between the buyer and the seller. It sets out the main terms of what has been agreed such as the property to be bought and sold, the price and the names of the parties, and any special terms

Contractual obligations

an obligation made under a legally binding agreement, e.g. an obligation to pay, or to provide a service

Damages

money claimed by a party as compensation for being harmed in some way, or to recover financial loss

Data protection

safeguards relating to personal data, ie personal information about individuals that is stored on a computer and/or in relevant manual filing systems

Deed

a written document that must make it clear on its face that it is intended to be a deed and is validly executed as a deed

Fiduciary relationship

a relationship of trust and confidence, as between principal and agent, trustee and beneficiary, attorney and client, director and company

Force majeure

an event or effect beyond the control of the parties involved. It includes 'acts of God', such as extreme weather. Specific provision is made for the exclusion of payment for damage or injury arising from force majeure in many contracts

Guarantee

a legal commitment to repay a debt if the original borrower fails to do so. Directors may give guarantees to banks in return for the bank giving finance to their companies. Companies in a group may guarantee each others loans

Injunction

an order issued by the court preventing or requiring action, often in an emergency

Intangible property

items that represent value but are not actual, physical objects. Examples include stocks in a company, bonds, bank notes, trade secrets, patents, copyrights and trademarks

Intellectual property

property that derives from the work of the mind or intellect. May receive legal protection through such mechanisms as copyright, patents and trade marks

Know-how

information with technical significance that is not formally recognised as an intellectual property right

Licence

a legal agreement granting a person (the licensee) permission to use something for certain purposes or under certain conditions

Lien

right to retain possession of assets or documents until full settlement of a debt

Mediation

alternative process to Court (see ADR)

Misrepresentation

making a false or misleading statement on which another party relies

Non-disclosure agreement

an agreement where parties share certain sensitive or confidential information with one another, but wish that information to remain undisclosed to other parties

Notice to terminate

a formal notification that the contract is to be terminated after a period specified in the contract or the notice itself

Novation

the substitution of one of the parties to a contract by another person, which releases the obligation of the former party and imposes it on the new one. Novation can also mean the substitution of an existing contract by a new one between the same parties

Offer

a promise to do something or refrain from doing something which can be capable of leading to a legally binding contract if it is accepted by the other side. An offer can be withdrawn or revoked before its acceptance by the other party

Tangible property

physical articles, as distinguished from intangible assets such as rights, patents, copyrights and franchises. Examples include furniture, cars, jewellery and artwork (see intangible property)

Trade name

a name of a business or one of its products that identifies the product as belonging to the business

Warranty

a statement attesting to a particular state of affairs, such as the good quality of merchandise, clear title to real estate or that a fact stated in a contract is true

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