By Chris Thorpe, John Bailey
This ebook goals to give an explanation for the foundations of agreement legislation for the businessman, and to place these rules into their advertisement context. an individual curious about advertisement transactions wishes not less than a uncomplicated figuring out of the rules of agreement legislation - the criminal framework for all advertisement job. an absence of any such easy knowing at most sensible ends up in a enterprise that's much less aggressive and eventually much less ecocnomic than it may be, and at worst may have pricey and occasionally disastrous advertisement results
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Extra info for Commercial Contracts. A Practical Guide to Deals, Contracts, Agreements and Promises
A person's power to contract is referred to as his 'contrac tual capacity'. The general principle is that a legal person has full contractual capacity. That is to say that he, she or it can enter into any kind of contract, without limitation. There are however certain exceptions to this general rule, and these exceptions relate to certain categories of individuals, to local authorities and to companies. The contrac tual capacity of an individual is restricted if he or she is a minor, mentally disordered or drunk.
52 Entering into a contract An undertaking to do something is by far the most common type of consideration, but there is one other type. This is where a party to an agreement, rather than undertaking to do something, has already done something. 1: where someone returns a lost item in response to an advertisement offering a re ward, the act of returning that item constitutes not only his accept ance of the offer but also his consideration for the agreement. He has no further obligations under the contract, but is entitled to the reward without having to do anything else.
In either case the purchaser would be said to have acquired the business, but the effect of an asset sale is very different from that of a share sale. With a share sale the business itself and the assets which com prise it remain in the ownership of the same legal entity through out. Nothing has changed except the ownership of the shares in the company, so the existing contracts which the company has entered into for the purposes of the business are entirely unaffected. With an asset sale on the other hand, ownership of the business and the assets which comprise it has been transferred from one legal entity to another, and the seller will have no further use for the existing contracts which he has entered into for the purposes of the busi ness.