GAP FILLING Flashcards
1
delivery is the point at which ___ passes from the seller to the buyer.
RISK
Delivery may take place at any agreed ___ along the transportation route
POINTS
Incoterms allow the contract to state the place of delivery simply: delivery of
the goods shall be made ___ (mombasa).
FOB
For F-terms and C-terms this is the place of ___.
SHIPMENT
A common modification allows the seller to deliver under an FOB contract
even if the importer’s ship ___ to arrive. The seller delivers instead to a ___ warehouse at the ___.
FAILS
BONDED
DOCKS
delay normally ___ to the buyer.
DAMAGES
the seller must ___ for any such loss.
COMPENSATE
the duty to compensate may be excused if the contract contains a ___.
FORCE MAJEURE
Failure to perform by one side allows the other sides to seek a ___
remedy.
LEGAL
Courts in continental (civil) law countries order ___ first, with
damages if performance is impossible (as in the case of late delivery).
PERFORMANCE
Courts in anglo-american (common) law countries ___
first with specific performance only if an award does not fully correct the situation.
ORDER PERFORMANCE
a figure for ___ damages may be fixed before loss occurs, or afterwards a ___ sum fixed before loss occurs is payable as liquidated damages.
COMPENSATORY
PRECALCULATED
liquidated damages are typically ___ for delay in delivery.
PAID
If the parties must wait for the contract to become ___, the delivery date often depends on the date of coming into force.
effective
Some contracts (especially fixed-price contracts) set a ___ date after which the contract cannot come into force.
cut-off
A grace period is sometimes used to ___ early delivery.
Sometimes delay in delivery is caused by a ___ event, i.e., an event beyond the control of the exporter.
facilitate
force majeure
A force majeure clause often ___ the exporter of his duty to deliver until the force majeure event is over.
relieves
If the force Majeure event continues for too long, both parties should have the right to ___ the contract,
terminate
Late delivery causes loss to the buyer-loss that must be ___. To avoid the cost and uncertainty of legal proceedings, many contracts regulate in advance the ___ for late delivery.
compensated
compensation
Many export contracts cannot “come into force” (become effective) until certain ___ (for example, government approvals) are met
preconditions
A loss caused by late delivery is not easily quantified, so lump-sum compensation is normal. The lump-sum may be set too high (___), about right (liquidated damages), or too low (quasi-indemnity). The motive behind the penalty is to force (“___”) one party into full performance.
penalty
terrorize
A penalty is not enforceable in Anglo-American courts, though the quasiindemnity is usually ___.
enforced
The place (and time) of delivery must be unambiguously agreed because many contract events (including payment and transfer of risk and title) are ___ to delivery.
tied
The place of delivery should not be confused with the ___ of the goods.
destination
Delivery of goods under most___contracts takes place in the country of the exporter, at the docks in the case of sea transport, and when the goods are handed over to the carrier in most other cases.
export
CIF and CIP contracts are especially confusing since they name the point of destination, e.g., CIF (Lagos). Lagos, in this example, is the point to which the exporter is responsible for costs, not the ___ of delivery.
place
Ownership of goods in a foreign country is often of no practical value; therefore; many contract stipulate: Title to the goods shall ___ with risk,.
pass
The seller usually insures up to the___ of delivery; the buyer thereafter.
point
Under CIF and CIP contracts, the seller must pay insurance from the point of delivery to an agreed destination. This insurance (under Incoterms) is minimum ___ clause C -unless the parties agree otherwise.
coverage-Cargo
Although the Seller pays for ___; the risk is entirely the Buyer’s
insurance
Delivery of the goods shall be made . The ___ date of delivery shall pass from the Seller to the Buyer on delivery.
scheduled
in negotiating price and payment, exporters should___ a price that relates to the complete set of contract terms.
QUOTE
As items in the contract are negotiated, the exporter should assess the influence of each factor on price and ___ the price accordingly.
ADJUST
Payment should be negotiated so that the exporter secures ___, and correct payment.
PROMPT
Payment on ___ is often timed so that early payment secure a discount for the buyer, this benefits the exporter by improving cashflow.
OPEN ACCOUNT
The exporter prefers the place of payment to be his own bank account,
payment is not deemed to be made until the money is at his ___.
DISPOSAL
For the seller, the most favourable method of payment is the AT SIGHT
CONFIRMED ___ L/C; for the importer, EXPORT ___ INSURANCE is most favourable.
IRREVOCABLE
CREDIT
Terms os payment are a key factor in setting ___
PRICE
Delay in payment is always ___ for the seller
EXPENSIVE
A DISCOUNT for ___ settlement can speed up payment
EARLY
Export credit insurance (if available) allow the exporter to recover the cost of goods exported but not paid for ___is not covered.
benefit
This insurance allow the exporter to trade on open account which can be a useful ___ point.
selling
Under a payment guarantee, the bank ___ to pay the exporter if the buyer fails to pay.
promises
Bank guarantee are expensive to ___ and are not common in normal export agreements in the developing world.
set up
Bank guarantee are also used in other situation: to secure an offer (bid bond); to secure an ___payment; to secure correct payment.
advance
A letter of credit is a contract between the ___ bank and seller.
issuing
It is a promise by the bank to pay a sum of money to the seller when the seller present a given set of ___ in good order.
document
Because it allows payment to be made immediately after ___ in the seller own country, it is the most popular means of payment.
delivery
The ___ rights and duties of the parties are clearly laid down in the UCP (uniform customs and practice for documentary credits.)
legal
A guaranty is a three-sided arrangement usually (1) a bank
involving
Principal (Seller or buyer) makes a (2) to the beneficiary (the Buyer or Seller)
promise
Principal ask the Guarantor (a bank, insurance company) to issue a (3)
guarantee
The guarantor (a bank) promises to pay (4) to the Beneficiary if the principal breaks his (5)
money
premises.
A warranty is a (6) arrangement ussually involving only the buyer and the seller.
two-sided
The seller promises to (7) defects to the buyer
cure
The cleares term is probably “(8)
defect liability”
Goods (1) must jumpt to at least 6 quality hurdles.
delivered
Open package inspection can result in (2) of goods.
rejection
Problems during defects liability period are always (3) to cure.
expensive
The parties should work systematically through a negotiating scheme to be sure that all the main points in the (4) are regulated.
defect liability provision
Naturally the points can be handled in any (5) and the discussion will be recursive.
order
Detailed specification (6) both importer and seller.
protects
The importer is protected against (7) equipment.
defective
The seller is protected against unjustified (8) of the goods.
rejection
Definitions: In this Contract the words below have the (1) ascribed to them unless the context (2) clearly dictates.
meanings
otherwise
Unless expressly (3) by the parties, “FOB” “CIF” and other trade terms have the meanings and (4) ascribed to them in Incoterms 1990, Publication 460 of the international Chamber of Commerce,Paris.
modified
obligations
“Contract” means this contract, its preamble and (5) , as well as all documents expressly (6) , as Contract documents or otherwise expressly (7) in this contract.
appendix
listed
mentioned
Unless the contract specifies otherwise, assignment of rights is allowed but (1) of duties is not normally allowed.
delegation
In international contracts, try to (2) both assignment of rights and delegation of duties without your written (3) .
exclude
consent
The parties shall agree a date and place for an amicable (1) meeting
settelment
Attending the meeting shall be the one (2) represeting each party and one lawyer representing each party.
executive
The (3) shall not be allowed to speak at the meeting.
lawyers
The meeting shall take place in 3 sessions. In the first session, each party shal state its (4) on the subject of the disagreement. In the second session the parties shall suggest (5) of resolving the disagreement. In the third session the parties shall attempt finally to (6) the disagreement.
position
ways
resolve
In the event that the parties fail to solve their disagreement amicably, they shall (7) to arbitration on the terms specified (8) .
proceed
herebelow
Public law is territorrial. It (1) only within the territory of one state.
operates
Company must (2) the public law of any territory where they operate. Public law is (3) stringent.
obey
strictly
Public law (4) such matter as: taxation, crime, immigration, factory conditions, pollution and so on…
controls
Public law affects the export (5) in that the law of some countries control the export and import of some ( or all) items, matters (6) public health; availability of foreign currency and so on…
contract
affecting
Public law is also (7) : incentive cheme, tax credit, and so on encourage trade.
positive
Every question not regulated in the contract is regulated by the (1) law.
applicable
Big contract fish displace ( take place of) most of the (2) water
legal
If the two sides write a big contract, very few question (3) open for decision under applicable law.
left
The most common mistake made by inexpreienced (4) is to write a minicontract regulating almost nothing beyond scope, price and (5) . The total agreement between the parties is the (6) contract plus the applicable (7) law ( the water)
drafter
delivery
written
private
In principle, the parties to a contract are free to decide the (8) law that will supplement their contract, the party are free to choose the water their fish (9) in.
applicable
swims
The conventions applies to (1) sales only.
Int’
Many questions about the seal meaning of the Convention must be answered in the (2) . So far the answers have been (3) in coming.
courts
slow
Even so, the importer might wish to accept the (4) if the law applicable to the contract is weak or (5) or if it (6) the seller too strongly.
convention
undeveloped
favors
The importer can not inspect the goods on (1) because delivery
takes place in the country of seller.
delivery
The importer inspects the goods on their (2)
arrival
The inspection must be carried out “ within as short a period as (3)
practical
The inspection must be reasonably thorough : if the importer (4) to
observe a defect that he should have observed, he can not later (5) the goods
fails
inspect
If the goods are not in (6) with the contract, the importer may (7) them
conformity
reject
Inspection on arrival will discover (8) defects. Hidden
defects (9) come in to light later when the goods are in (10).
patent/apparent
latent
use
Delivered goods are (11) three implied warranties
subjected to
The (12) exist unless expressly disclaimed
implied warranties
If the contract says nothing, then the (13) law decides if rejection of a consignment can be partial or (14)
applicable
total
English law requires total rejection; German law and the United Nations
Convention on Contracts for the international Sale of Goods allow (15) of only the defective goods in the consignment; the Uniform Commercial Code of the United States allows the (16) to decide
rejection
buyer
The importer has a duty to tale (1) care of the goods for a certain amount of time
reasonable
Perishable goods should be (2) as quickly as possible.
resold
The seller must tell the importer within a reasonable time how to return
or (3) of the goods.
dispose
The importer may ( 4) the seller for the work involved.
charge
All the costs of handling and/ or returning rejected goods are to the (5) of the seller
account
Delivery of poor quality products to export markets is particularly dangerous because the cost of (1) defect is (2) .
curing
high
To guard against high costs, the exporter should be particularly careful about (3 ) assurance
quality
In negotiating quality clauses, the exporter should pay special attention to (4) of the goods
detailed, realistic, specification
Inspection provisions both before and after delivery must be negotiating with (5)
care
The final quality hurdle is the defects (6) during which the exporter is (7) to cure defects that come to (8) in the goods.
liability period
liable
light
The buyer has the right ( in some legal systems, the duty) to (9) delivered goods.
inspect
Three “ (10) warrantied” apply to most delivered goods, even if the exporter has given no express warranty: (a) warranty of conformity with the contract; (b) warranty of (11)
implied
merchant liability
Warranty of conformity with the contract: in principle, the buyer can (13) goods of they do not conform with the contract
reject
Warranty of Merchantability: the Buyer can reject goods that are not of (14) quality
merchantable
Warranty of Suitability for an intended purpose: If the exporter knew the intended purpose, and if the buyer (15) on the exporter’s judgment, the buyer can reject goods that are not (16) for their intended purpose.
relied
suitable
The question of warranty is dispose: exporters can (17) all warranties.
exclude
System vary in their thinking about whether rejection of contract goods must be total or can be (18)
partial
The right of exporter to (19) any defects in his delivery is controversial ; if Anny exporter wants the right, the contract should contain necessary (20)
cure
provision
Exporting creates risks for all parties: exporter, buyer, and (1) alike
government
Governments protect the interests of the country by passing (2) over which the exporter has, in effect, no influence.
laws
The relationship between the exporter and the buyer is on the other hand , largely at the (3) of the parties concerned.
disposal/ discretion
Exporters protect themselves against the risk of non payment be (4), by guarantees and retentions
insurance
For the buyer, some protection against poor quality is offered by performance (5) and retentions.
guarantee
For both exporter and buyer, their ( 6) and law which supplements is are their main protection.
contract
The United Nations Convention on Contracts for the International Sale of Goods, (the
(7) ) is the law of any country that (8)
it. When the Convention conflicts with (9) national law, the Convention (10).
Convention
adopts
existing
prevails
The delivery of Goods under this contract may be (1) by the Buyer in accordance with this clause in whole, or in (2) , whenever the Buyer shall determine that such termination is in his best (3) . Any such termination shall be effected be delivery to the seller of a (4) of Termination specifying the (5) to which supply of Goods under the contract is terminated, and the date upon which such termination becomes ( 6).
terminated part interest notice extent effective
In the event of termination for whatever( 7) , the Seller shall be
(8) to receive full payment for all goods and services (9) by the Seller at the date of (10)
reason
entitle
delivered
termination
The buyer may be by (1) notice of default to the Seller, terminate the (2) or any part of this contract in any one of the following circumstances:
written
whole
If the seller fails to make delivery of the Goods within the time
specified (3)
herein
If the seller fails to perform any of the other provisions of this contract, or
so fails to make (4) as to endanger performance of this contract in accordance with its (5 )and in either of these two circumstances does not (6) such failure within a period of 10 days
progress
terms
cure
If there is no “ meeting of minds”, there is no contract, Duress, fraud, and (1) all create create no-contract situations
mistake
A contract must come about through a process of offer and (2) ; in agreements that are not reduced to a written, (3) contract, this process is hard to trace and offer breaks down completely.
acceptance
signed
Under the public law ( company law) of many countries, a company can only sign a contract that is within its (4). A contract that is ultra vi res ( beyond its power) is (5)
power
unenforceable
A contract is not (6) if it has an illegal purpose. To avoid problems with contracts that might infringe (7), most contracts include a partial (8) clause
enforceable
government regulation
invalidity
Within most Anglo- American jurisdictions, a contract must be two-sided: both sides must have rights and (9). Unless the parties agree otherwise, rights can be assigned but duties cannot be (10)
duties
delegated
This contract constitutes the (1) agreement and understanding between the parties. There are no agreements, understanding, conditions, (2), or representations, oral or written, that are not (3) in this contract or that have not been (4) by this contract.
entired
reservations
embodied
superseded
In international practice, the two sides often wish to (5) outside material into contract: letters, general conditions, the Incoterms,..
incorporate
This agreement is made in both Swahili and English. The Swahili and English versions have (3) legal status
equal
This contract and the contract documents are (4) in English. Any translation into another language is for information (5) only and has no legal status.
written
reference
Correspondence between the parties shall be (6) exclusively in English
conducted
