Workshop 1 - Introduction
CODE OF CONDUCT
Professional Conduct – the rules and regulations with which a solicitor must comply.
10 Principles – set out by the SRA
1. Uphold the rule of law and the proper administration of justice
2. Act with integrity
3. Not allow your independence to be compromised
4. Act in the best interests of each client
5. Provide a proper standard of service to your clients
6. Behave in a way that maintains the trust the public places in you and in the provision of legal services
7. Comply with your legal and regulatory obligations and deal with your regulators and ombudsman in an open,
timely and co-operative manner
8. Run your business or carry out your role in the business effectively and in accordance with proper governance
and sound financial and risk management principles
9. Run your business or carry out your role in the business in a way that encourages equality of opportunity and
respect for diversity
10. Protect client money and assets
Conflict between Confidentiality and Disclosure: Question Structure
STEP 1: State which client you owe the duty of confidentiality to.
STEP 2: State which client a duty of disclosure is owed to.
STEP 3: Explain that confidentiality trumps disclosure (Outcome 4.3)
STEP 4: Consider whether you can act for both clients/the new client?
***NOTE: The duty of confidentiality takes precedence over the duty of disclosure***
Conflict of Interests
A solicitor must not act where there is a conflict, or a significant risk of conflict, between the interest of two or
more clients, or between the interest of the client and the solicitor
Where there is a conflict between two or more clients, a solicitor may act if he can satisfy the requirements of
the substantially common interest exception or the commercial exception.
UNDERTAKINGS
An enforceable promise, may be given orally or in writing.
If a solicitor breaches an undertaking, he/she may be sued personally by the recipient for compensation for any
loss caused.
If a conditional undertaking is given i.e. contingent on some future event, and it becomes apparent that the
event will no longer take place, you must notify the recipient immediately.
Keep a record of all undertakings given and discharged.
ANTI-MONEY LAUNDERING
‘Money laundering’ is the process by which criminals seek to alter or ‘launder’ their proceeds of crime so that it
appears that these funds come from a legitimate source.
s.328 – Offence of Arranging – you know the client has bought a house with proceeds of drug dealing and you
help transfer this to his children. You would need to make an authorised disclosure to your firm’s AML officer
who decides whether or not to report it to the NCA.
s.330 – Failure to disclose – you know/suspect someone is involved with money laundering – objective test.
Make an authorised disclosure to nominated officer asap. S.333 A-E – Tipping off – you know a disclosure has
been made and you tip the criminal off by giving them information that is likely to prejudice the investigation.
1
, Workshop 1 - Introduction
INTRODUCTION TO COMMERCIAL CONTRACTS
‘Commercial Law’ covers: the sale of goods, marketing agreements, transport, finance and credit arrangements,
competition law, intellectual property, insurance and related areas, such as banking or tax law.
*The thread that links together all of these interconnecting areas of law is the use of commercial contracts*
Any commercial lawyer will be routinely involved with either the drafting or interpretation of contracts.
The emphasis will be on business-to-business contracts (B2B contracts) focusing on the position and protection of
the commercial supplier.
SOURCES OF COMMERCIAL LAW
(a) The law of contract;
(b) Established custom and usage of the trade;
(c) National legislation;
(d) European Union law; and
(e) International conventions.
THE SUPPLY CHAIN
Generally, a manufacturer employs a distributor middle man or an agent.
A manufacturer will also be concerned with producing the goods as efficiently and cheaply as possible.
UPSTREAM CONTRACTS: are typically those which provide the client with the resources needed in order to
carry on his business - contracts which require some sort of financial outlay by the business
DOWNSTREAM CONTRACTS: are those under which the client passes on and exploits the fruits of his labour,
contracts for the supply of goods and services by the business – in other words, contracts which generate
income for the business. It is these contracts which will be considered in this book.
STANDARD TERMS AND CONDITIONS
An important consideration for the client will be whether to use standard terms and conditions or individually
negotiated contracts.
In practice, it is very common for a set of terms to be put into a standard contract which a business will use for
all transactions.
2
, Workshop 1 - Introduction
Whether the contract between the buyer and seller is based on the seller’s standard terms and conditions or
the buyer’s will depend on the relative bargaining positions of the parties.
WHAT THE BUYER WANTS?
(a) Will want the goods to be delivered on time, preferably to its own premises; and
(b) Will want the seller to be liable for any defects
WHAT THE SELLER WANTS?
(a) Will want flexibility for late delivery if, for example, it is let down by its own suppliers;
(b) Will want the buyer preferably to collect the goods from its factory; and
(c) Whilst it might be willing to accept some liability for defects, will not want to be liable for every trivial problem.
The use of standard terms ensures that the final contract suits the needs of whichever party has been able to
insist on their use. Standard terms and conditions have the added advantage of ensuring commercial certainty.
STAFF must be trained to ensure that their company’s terms are properly incorporated into the sales
contract and are the ones incorporated into the contract.
Although some transactions may require individually negotiated contracts to be drafted, generally the
parties will want to avoid incurring these costs for each sale.
STANDARD TERMS AND CONDITIONS
Advantages Disadvantages
Contract on terms favourable to client Lack of flexibility
Standardised procedure Effective training and procedures essential
Commercial certainty Incorporation difficulties/”battle of the forms”
Cheaper Need for regular review
Starting point for negotiation Legal constraints, eg UCTA 1977
DRAFTING AND CONTENT OF A COMMERCIAL CONTRACT
A basic checklist for a commercial agreement will be as follows:
1. Commencement and date;
2. The parties;
3. The recitals, if any;
not essential but can help put a contract in context
be careful that they do not introduce ambiguity.
4. Definitions and interpretation;
Definitions: A definitions clause should do no more than give a clear meaning to defined terms.
All defined terms to start with a capital letter
Listed alphabetically
All defined terms should be defined in the definitions section.
Care should be taken in defining things that might be subject to change within the contract.
Interpretation: non-controversial, like advising that the headings do not form part of the agreement.
5. Conditions precedent, if any; - operative part
Conditions that have to be satisfied before the agreement comes into effect.
6. Agreements; - operative part
Agreements define the rights and obligations of the parties.
p.8.
7. Representations and warranties; - operative part
Representations - are statements of factual and legal matters which one of the parties requires to
be made to it in a legally binding way.
Warranties - are promises that a given statement or fact is true. Can give provisions for repair or
replacement.
3
CODE OF CONDUCT
Professional Conduct – the rules and regulations with which a solicitor must comply.
10 Principles – set out by the SRA
1. Uphold the rule of law and the proper administration of justice
2. Act with integrity
3. Not allow your independence to be compromised
4. Act in the best interests of each client
5. Provide a proper standard of service to your clients
6. Behave in a way that maintains the trust the public places in you and in the provision of legal services
7. Comply with your legal and regulatory obligations and deal with your regulators and ombudsman in an open,
timely and co-operative manner
8. Run your business or carry out your role in the business effectively and in accordance with proper governance
and sound financial and risk management principles
9. Run your business or carry out your role in the business in a way that encourages equality of opportunity and
respect for diversity
10. Protect client money and assets
Conflict between Confidentiality and Disclosure: Question Structure
STEP 1: State which client you owe the duty of confidentiality to.
STEP 2: State which client a duty of disclosure is owed to.
STEP 3: Explain that confidentiality trumps disclosure (Outcome 4.3)
STEP 4: Consider whether you can act for both clients/the new client?
***NOTE: The duty of confidentiality takes precedence over the duty of disclosure***
Conflict of Interests
A solicitor must not act where there is a conflict, or a significant risk of conflict, between the interest of two or
more clients, or between the interest of the client and the solicitor
Where there is a conflict between two or more clients, a solicitor may act if he can satisfy the requirements of
the substantially common interest exception or the commercial exception.
UNDERTAKINGS
An enforceable promise, may be given orally or in writing.
If a solicitor breaches an undertaking, he/she may be sued personally by the recipient for compensation for any
loss caused.
If a conditional undertaking is given i.e. contingent on some future event, and it becomes apparent that the
event will no longer take place, you must notify the recipient immediately.
Keep a record of all undertakings given and discharged.
ANTI-MONEY LAUNDERING
‘Money laundering’ is the process by which criminals seek to alter or ‘launder’ their proceeds of crime so that it
appears that these funds come from a legitimate source.
s.328 – Offence of Arranging – you know the client has bought a house with proceeds of drug dealing and you
help transfer this to his children. You would need to make an authorised disclosure to your firm’s AML officer
who decides whether or not to report it to the NCA.
s.330 – Failure to disclose – you know/suspect someone is involved with money laundering – objective test.
Make an authorised disclosure to nominated officer asap. S.333 A-E – Tipping off – you know a disclosure has
been made and you tip the criminal off by giving them information that is likely to prejudice the investigation.
1
, Workshop 1 - Introduction
INTRODUCTION TO COMMERCIAL CONTRACTS
‘Commercial Law’ covers: the sale of goods, marketing agreements, transport, finance and credit arrangements,
competition law, intellectual property, insurance and related areas, such as banking or tax law.
*The thread that links together all of these interconnecting areas of law is the use of commercial contracts*
Any commercial lawyer will be routinely involved with either the drafting or interpretation of contracts.
The emphasis will be on business-to-business contracts (B2B contracts) focusing on the position and protection of
the commercial supplier.
SOURCES OF COMMERCIAL LAW
(a) The law of contract;
(b) Established custom and usage of the trade;
(c) National legislation;
(d) European Union law; and
(e) International conventions.
THE SUPPLY CHAIN
Generally, a manufacturer employs a distributor middle man or an agent.
A manufacturer will also be concerned with producing the goods as efficiently and cheaply as possible.
UPSTREAM CONTRACTS: are typically those which provide the client with the resources needed in order to
carry on his business - contracts which require some sort of financial outlay by the business
DOWNSTREAM CONTRACTS: are those under which the client passes on and exploits the fruits of his labour,
contracts for the supply of goods and services by the business – in other words, contracts which generate
income for the business. It is these contracts which will be considered in this book.
STANDARD TERMS AND CONDITIONS
An important consideration for the client will be whether to use standard terms and conditions or individually
negotiated contracts.
In practice, it is very common for a set of terms to be put into a standard contract which a business will use for
all transactions.
2
, Workshop 1 - Introduction
Whether the contract between the buyer and seller is based on the seller’s standard terms and conditions or
the buyer’s will depend on the relative bargaining positions of the parties.
WHAT THE BUYER WANTS?
(a) Will want the goods to be delivered on time, preferably to its own premises; and
(b) Will want the seller to be liable for any defects
WHAT THE SELLER WANTS?
(a) Will want flexibility for late delivery if, for example, it is let down by its own suppliers;
(b) Will want the buyer preferably to collect the goods from its factory; and
(c) Whilst it might be willing to accept some liability for defects, will not want to be liable for every trivial problem.
The use of standard terms ensures that the final contract suits the needs of whichever party has been able to
insist on their use. Standard terms and conditions have the added advantage of ensuring commercial certainty.
STAFF must be trained to ensure that their company’s terms are properly incorporated into the sales
contract and are the ones incorporated into the contract.
Although some transactions may require individually negotiated contracts to be drafted, generally the
parties will want to avoid incurring these costs for each sale.
STANDARD TERMS AND CONDITIONS
Advantages Disadvantages
Contract on terms favourable to client Lack of flexibility
Standardised procedure Effective training and procedures essential
Commercial certainty Incorporation difficulties/”battle of the forms”
Cheaper Need for regular review
Starting point for negotiation Legal constraints, eg UCTA 1977
DRAFTING AND CONTENT OF A COMMERCIAL CONTRACT
A basic checklist for a commercial agreement will be as follows:
1. Commencement and date;
2. The parties;
3. The recitals, if any;
not essential but can help put a contract in context
be careful that they do not introduce ambiguity.
4. Definitions and interpretation;
Definitions: A definitions clause should do no more than give a clear meaning to defined terms.
All defined terms to start with a capital letter
Listed alphabetically
All defined terms should be defined in the definitions section.
Care should be taken in defining things that might be subject to change within the contract.
Interpretation: non-controversial, like advising that the headings do not form part of the agreement.
5. Conditions precedent, if any; - operative part
Conditions that have to be satisfied before the agreement comes into effect.
6. Agreements; - operative part
Agreements define the rights and obligations of the parties.
p.8.
7. Representations and warranties; - operative part
Representations - are statements of factual and legal matters which one of the parties requires to
be made to it in a legally binding way.
Warranties - are promises that a given statement or fact is true. Can give provisions for repair or
replacement.
3
