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Finance contract: Difference between revisions
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Amwelladmin (talk | contribs) (Created page with "{{def|Finance contract|/faɪˈnæns/ /ˈkɒntrækt/|n|}} Any contract the gist of which is for its parties to exchange large amounts of money, or money-like things, having re...") |
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|+ | |+ Why you don’t need finance contract boilerplate in other types of contract | ||
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! Clause !! What is does !! Why you don’t need it | ! Clause !! What is does !! Why you don’t need it | ||
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| No set-off or counterclaim || A provision stating that “all sums shall be paid in full, free of any restriction, condition, set-off or counter-claim, and without deduction or withholding for or on account of tax except where required by law”|| Because in the ordinary world or service contract this goes without saying, and the hassle is manageable even where it doesn’t: this is relevant when you are paying [[cashflows]], [[Manufactured dividend|manufacturing dividends]] and so on across borders, or where a certain sum arriving at a certain time in a certain place without counterparty nibblement is important. If your client deducts tax from your consulting fees, or has set them off against something you owe it, that’s a bummer for sure, but you’ll ''survive'': it won’t set an ending chain of operational payments into a vortex of destruction. As our friends in the [[stupid banker]] cases show us, you don’t have to get things that badly wrong for things to go really, apocalyptically ''badly'' wrong. | | No set-off or counterclaim || A provision stating that “all sums shall be paid in full, free of any restriction, condition, set-off or counter-claim, and without deduction or withholding for or on account of tax except where required by law”|| Because in the ordinary world or service contract this goes without saying, and the hassle is manageable even where it doesn’t: this is relevant when you are paying [[cashflows]], [[Manufactured dividend|manufacturing dividends]] and so on across borders, or where a certain sum arriving at a certain time in a certain place without counterparty nibblement is important. If your client deducts tax from your consulting fees, or has set them off against something you owe it, that’s a bummer for sure, but you’ll ''survive'': it won’t set an ending chain of operational payments into a vortex of destruction. As our friends in the [[stupid banker]] cases show us, you don’t have to get things that badly wrong for things to go really, apocalyptically ''badly'' wrong. | ||
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| No waiver || Tedious verbiage to the effect that “No failure or delay in exercising, any remedy under this Agreement will operate as a waiver, nor will any single or partial exercise of any right or remedy preclude any other or further exercise thereof or the exercise of any other right or remedy.”|| Again, this is all about ''does this dude owe me the ten million dollars or not'' rather than “will I get paid my $25,000 consulting fee”. If, [[Commercial imperative|out of the goodness of your heart]] and a realistic view of your long term revenue prospects, you let a distressed creditor off strict enforcement during a tough patch, to help it through a difficult cashflow situation, you don’t want to find you have waved away your rights to get that money later, or ''not'' grant that indulgence should it find itself “inexplicably” in the same situation again next time a margin payment is due. | | [[No waiver]] || Tedious verbiage to the effect that “No failure or delay in exercising, any remedy under this Agreement will operate as a waiver, nor will any single or partial exercise of any right or remedy preclude any other or further exercise thereof or the exercise of any other right or remedy.”|| Again, this is all about ''does this dude owe me the ten million dollars or not'' rather than “will I get paid my $25,000 consulting fee”. If, [[Commercial imperative|out of the goodness of your heart]] and a realistic view of your long term revenue prospects, you let a distressed creditor off strict enforcement during a tough patch, to help it through a difficult cashflow situation, you don’t want to find you have waved away your rights to get that money later, or ''not'' grant that indulgence should it find itself “inexplicably” in the same situation again next time a margin payment is due. | ||
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| No Assignment || Words to the effect that | | [[Assignment|No Assignment]] || Words to the effect that one party can’t assign or transfer its rights without the other’s consent. || {{no assignment capsule}} | ||
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| Partial invalidity || Claiming the illegality, invalidity or unenforceability of any provision of this Agreement does not affect the rest of its enforceability. | | Partial invalidity || Claiming the illegality, invalidity or unenforceability of any provision of this Agreement does not affect the rest of its enforceability. | ||