Capacity: Difference between revisions
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Now this presents issues if you will look to your {{t|contract}} to enforce this warranty. For if your client was without the [[capacity]] to enter into your {{t|contract}} — to be sure, for commercial enterprises in sensible jurisdictions, a vanishingly remote contingency these days, but it can happen if you ply your trade with [[local authorities]] — then its ''contractual'' warranty that it ''had'' that [[capacity]] doesn’t get off the launch pad: You have a [[chicken-licken]] and egg problem. | Now this presents issues if you will look to your {{t|contract}} to enforce this warranty. For if your client was without the [[capacity]] to enter into your {{t|contract}} — to be sure, for commercial enterprises in sensible jurisdictions, a vanishingly remote contingency these days, but it can happen if you ply your trade with [[local authorities]] — then its ''contractual'' warranty that it ''had'' that [[capacity]] doesn’t get off the launch pad: You have a [[chicken-licken]] and egg problem. | ||
Revision as of 09:38, 24 June 2019
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Representations and Warranties Anatomy™
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A good subject for a representation, a bad one for a warranty.
Whether your counterparty is even constitutionally capable of entering into obligations of the type contemplated by your contract, is a question of its capacity (as to which see also ultra vires). In this day and age, capacity — once a rich source of legal paranoia — is largely a dead letter among commercial enterprises in sensible jurisdictions, but it is still a banana skin for municipal bodies and local governments. Even thirty years on, the words “Orange County” or “Hammersmith and Fulham council” will be enough to get buttocks clenching in your risk department.
Now this presents issues if you will look to your contract to enforce this warranty. For if your client was without the capacity to enter into your contract — to be sure, for commercial enterprises in sensible jurisdictions, a vanishingly remote contingency these days, but it can happen if you ply your trade with local authorities — then its contractual warranty that it had that capacity doesn’t get off the launch pad: You have a chicken-licken and egg problem.