(Part ni Joyce)

CONTRACT DEFINED
2. Accion Directa
 A contract is a legally binding or valid Under Art. 1652 of the Civil Code, the sublessee is
agreement between two parties. The law subsidiarily liable to the lessor for any rent due from
will consider a contract to be valid if the the lessee.
agreement contains all of the following
elements:
3. Accion Subrogatoria
 offer and acceptance; Subrogation is the substitution of one
 an intention between the parties to create person or group by another in respect of a
binding relations; debt or insurance claim, accompanied by
 consideration to be paid for the promise the transfer of any associated rights and
made; duties.
 legal capacity of the parties to act;
 genuine consent of the parties; and Requisites:
 legality of the agreement.
1. The debtor’s assets must be insufficient
An agreement that lacks one or more of the to satisfy claims against him
elements listed above is not a valid contract. 2. The creditor must have pursued all
properties of the debtor subject to execution
CONTRACTS ARE DIVIDED INTO EXPRESS OR 3. The right of action must not be purely
IMPLIED. personal
4. The debtor whose right of action is
exercised must be indebted to the creditor.
o An express contract is one where the
terms of the agreement are openly uttered
4. Accion Pauliana
and avowed at the time of making, as to pay
a stated price for certain goods. A transfer of property that is made to swindl
e, 
hinder, or delay a creditor, or to put such pr
o Express contracts are of three sorts: operty beyond his or her reach.
1. By parol, or in writing, as
contradistinguished from specialties. Requisites:
2. By specialty or under seal. 1. Defendant must be indebted to plaintiff
3. Of record. 2. The fraudulent act performed by the
debtor subsequent to the contract gives
advantage to another
o Implied contracts are such as reason and 3. The creditor is prejudiced by such act.
justice dictates, and which, therefore, the 4. The creditor must have pursued all
law presumes every man undertakes to
perform; as if a man employs another to do properties of the debtor subject to
any business for him or perform any work, execution
the law implies that the former contracted or 5. The creditor has no other legal remedy.
undertook to pay the latter as much as his
labor is worth
(Part ni YONG)
LAW OF CONTRACT
OBLIGATIONS
1. “Nemo dat quod non habet”
 is a judicial necessity to give, to do or
Article 1458 of the New Civil Code provides: "By
not to do the unilateral act of the debtor
the contract of sale one of the contracting parties
obligates himself to transfer the ownership of and to either to give, to do or not to do as a
deliver a determinate thing, and the other to pay patrimonial obligation in which the debtor
therefor a price certain in money or its equivalent." (bound to the fulfillment of the obligation)
 has the obligation while the  the combination of money and
creditor/obligee (person entitled to other benefits (= rewards) that
demand) has its right . an employee receives for doing their job
 is a course of action that someone is  is the total amount of the monetary and
required to take, whether legal or moral. non-monetary pay provided to an employee
 the condition of being morally or legally by an employer in return for work
bound to do something. performed as required. Essentially, it's a
combination of the value of your pay,
EXTINGUISHING AN OBLIGATION vacation, bonuses, health insurance, and
any other perk you may receive, such as
 PAYMENT -not only the delivery of
free lunches, free events, and parking.
money but includes the performance of
an obligation in any other manner
PAYMENT

 LOSS OF THE THING DUE -the obligor

 Compensation , discharge or performance
is liable even for fortuitous events, the
of an obligation, or reimbursement, by
loss of the thing does not extinguish
givng over something thats of satisfactory
the obligation, and he shall be
value to its recipient, such as money
responsible for damages
(source

 CONDONATION OR REMISSION -form

of donation (gratuitous abandonment by
the creditor of his right against the CONTRACT WRITING
debtor)
 Drafting a contract requires a great deal of
 CONFUSION OR MERGER OF foresight and sometimes requires
RIGHTS OF THE CREDITOR AND knowledge of the law as well.  For this
DEBTOR -meeting in one person of the reason, it may be necessary to have a
qualities of creditor & debtor w/ respect lawyer draft or review the contract for you. 
to the same obligation Also, it’s a good idea to have a contract
reduced to writing even if it is not required-
 COMPENSATION -extinguishment to the that way, you have a record of the
concurrent amount of the debts of 2 agreement for reference in the future.
persons (debtors & creditors)  The persons who are of legal age and
deemed mentally competent are allowed to
 NOVATION -modify an existing create a contract. 
obligation and substitute a new one in  Contract writing requirements are usually
its place contained in a specific set of contract laws
called “statute of frauds” laws. 
 Statute of frauds laws exist in order to help
(Part ni Rayos) prevent contract fraud through the writing
requirement.  The idea is that written
COMPENSATION contracts tend to be more reliable than oral
agreements, since the parties can refer
 money that is paid to someone back to the document in the event of a
in exchange for something that has disagreement. 
been lost or damaged or for some problem  Contracts that are subject to the writing
requirement should: state the basic
conditions and terms of the parties’
agreement, clearly identify the parties, and
 identify the subject matter of the agreement 6. Include Language on How to Terminate
(such as the goods or services). the Contract- Contracts aren't meant to last
forever. If one party continually misses
 HOW TO WRITE A BUSINESS CONTRACT payments or fails to perform their duties,
you want to have a mechanism in place so
1. Get it in Writing- Anytime you enter into a that you can (relatively) easily terminate the
business contract, you want written proof of contract. It could be a mutual termination
the agreement as well as specific terms by agreement (when the objectives of each
which each party is bound. Oral agreements side have been met through the contract) or
do occur in the small business context, but more likely an agreement that either side
such agreements are difficult to enforce and can terminate if the other side violates a
people's memories can be faulty and terms major term of the contract, after giving
easily misremembered or misinterpreted. proper notice of its intent to terminate.
2. Use Language You Can Understand- The 7. Consider State Laws Governing the
easiest way to write a contract is to number Contract- Contracts can stipulate
and label each paragraph and only include which state's laws will govern in the event
that topic in the paragraph. By segmenting there's a dispute. If the other party is
the contract into individual units, it will be located in another state, you should include
more easily understood by the parties (and a clause that states which state laws will
by a court should it come to that).  govern. If you don't, and there's a dispute,
3. Be Detailed- The rights and obligations of there may be a whole other legal argument
each party should be laid out in specific (which costs more money) about which
languagethat leaves little room for state's laws should be applied to the
interpretation. If you and the other party contract. Avoid this headache and agree to
agree to a new term or decide to change an it at the inception of the contract, when both
existing term in the agreement, be sure to parties are agreeable.
add a written amendment to the contract 8. Include Remedies and Attorneys' Fees-
rather than relying on an oral agreement. A Especially if you believe that it's more likely
court may or may not accept the oral that you'll sue over the contract (as opposed
agreement as part of the contract. to the other party suing you), you might
4. Include Payment Details- It's important to want to include a clause that awards
specify how payments are to be made. If attorneys' fees to the winning party. Without
you want to pay half up front and the other this clause, each party will have to pay for
half in equal installments during the life of their own attorneys.
the contract, state that, as well as the terms 9. Consider a Mediation and Arbitration
under which you will release payment. Clause- In the event of a dispute, it may be
Contract disputes often center on money, so advantageous to include a provision that
you'll want to be as specific as possible. requires the parties enter either mediation
5. Consider Confidentiality- Often when or arbitration, or both. Mediation is a
entering a business contract, the other party voluntary process where both parties try to
will gain access and insight into your work out their issues directly, with the help
business practices and possible trade of a neutral third party mediator. Any
secrets. If you do not want the other party settlement must be approved by both
sharing this information, you should include parties. Arbitration is a more adversarial
a clause that binds the other party from process where the arbitrator hears both
disclosing your business information or sides' arguments and makes a decision that
information included in the contract to other both parties must abide by. It's akin to a trial
parties. setting, but the arbitration process is much
quicker and cheaper than litigating in court. 
 10. Consider the Help of a Legal o Intention of the parties and previous
Professional- Writing a business contract course of dealing- a course of dealing is
that protects your interests while balancing a sequence of previous conduct
your business objectives is critical to your between the parties to a particular
business' success. Learning how to write a transaction which is regarded as
business contract is the first step on the establishing a common basis of
road to success. But while you should get understanding for interpreting their
acquainted with the legal terms and expressions and other conduct.
processes for writing a contract, sometimes o Interpretation; ordinary meaning and
it's best to have an attorney review your trade usage- Contract provisions may
contract before it takes on the force of law. be considered ambiguous if
consideration of the plain meaning and
(Part ni gale) context of the provision can lead to two
or more reasonable constructions
INTERPRETATION OF CONTRACT:

 The interpretation of contract means the

GUIDELINES AND COMPONENTS OF A
determination of its true objective meaning
CONTRACT:
at law.
 IT becomes necessary to interpret the  Elements of a Contract:
contract when, for instance, there is a  A Contract is a meeting of the minds
dispute about the meaning of a term or between two persons whereby one
where mutually contradictory terms exist. binds himself, with respect to the
 Courts interpret contracts by using the other, to give something or to render
“objective test”. This means that the court’s some services.
interpretation of a contract must be  Consent. Contracts are generally perfected
“consistent with a reasonably intelligent by mere consent, which is the reason why
person familiar with all the facts and there’s such a thing as oral contracts.
circumstances surrounding contract  Subject Matter. A thing, right or service
formation.” may be the object or subject matter of a
 To help reach conclusions, courts take contract. All things that are outside the
several factors into consideration. commerce of man may not be the object of
o The contract must be read as a a contract. Rights that are transmissible be
whole the subject of a contract. Services, on the
o Key contract terms must be clearly other hand, must not be contrary to law,
defined. morals, good customs, public order of public
 Order of Precedence described in FAR policy
52.214-29 and FAR 52.215-8 dictates that  Cause. The cause varies according to the
the precedence is given in the following: type of contracts: (a) for onerous contracts,
o The Schedule the cause is the promise of a thing or
o Representation and other service by the other; (b) for remunatory
instructions contracts, the cause is the service or benefit
o Contract Clauses which is being remunerated; and (c) for
o Oher Documents, exhibits and contracts of pure beneficence, the cause is
attachments the mere liberality of the benefactor.
o The specification
(Part ni imma)
 Certain rules used by courts in interpreting
written contracts: BID PROPOSAL
  A bid proposal is an explanation of the Response to an invitation to bid (ITB) that is
services or products offered at an estimated unacceptable, because
cost to a company. When the bid proposal
is unsolicited, there is no contractual (1) another bid has been chosen,
agreement between the bid recipient and (2) bid fails to fall within the established
its author. competitive range,
 If the proposal is submitted in response to
a request for proposal (RFP), it can be (3) absence of competitive bids invalidates the
accepted as a bid later in the contracting bidding exercise,
process.
 The bid proposal is often submitted with (4) Invitation to bid (ITB) is readvertised,
the use of a bid form. This can be
(5) irresponsibility (see responsible bidder) of the
handwritten or printed from software used bidder voids it, or
for professional bidding. Generally, the
form is completed in duplicate, with the (6) collusion among bidders (see bid rigging) or
one copy being kept on file by the bidder some other fraud is discovered.
and the other sent to the business
requesting the bid.

THE PROFESSIONAL BID PROPOSAL OFTEN

INCLUDES MANY KEY ELEMENTS.

 The bidder may choose to begin the form

with an executive summary, which can be
used to explain why the bidder should be
chosen for the job.
 This may be followed with a list of
qualifications, the names of any
subcontractors to be used on the project,
and an overview of how the bidder will
accomplish the major points of the bid
request.
 Next, a bidder can explain the terms of the
bid and include a list of similar jobs that
have been completed, along with details of
any past projects that are relevant to the
proposed work.
 A safety plan may also be added, if
applicable, to describe the steps that will be
taken to minimize injury and any loss of
work time. Such a plan is typically included
only if a job will require physical work.
 After the bid form is
written, proofreading the information may
help to ensure it is complete and eliminate
any spelling or grammatical errors that
could be seen as unprofessional.

REJECTED BID