- Deliverables are the tangible good(s) or material(s) resulting from the service(s) to be provided by the Contractor (Vendor).
- Warranties are assurances, promises, or guarantees by one party that a particular statement of fact is true and may be relied upon by the other party.
- Warranties are commitments by one party to the other party.
Intellectual property (IP):
- IP is generally comprised of four categories:
- Patents; and
- Trade Secrets.
- In general terms, the law protects a party’s IP from unauthorized use by others.
- Examples of IP include: music, literature, and other artistic works; discoveries and inventions; designs; software code; logos.
Limitation of Liability:
- Limitation of liability refers to a written statement that serves as a disclaimer to limit conditions or instances under which the disclaiming party may be held liable for loss or damages.
- Damages are generally divided into two categories: (i) Direct Damages and (ii) Consequential Damages.
- Direct damages:
- In general, direct damages are the difference between the value of the performance received and the value of the performance promised as measured by contract or market value.
- Rather than punish the non-performing party, direct damages are designed to put the injured party in the position they would occupy if the other party delivered the performance promised in the contract.
- Direct damages do not include incidental, indirect or consequential damages, such as lost profits or loss of goodwill.
- Direct damages flow directly and immediately from the act of the part, rather than being from some of the consequences of such act.
- Consequential damages:
- Consequential damages are those damages that are not a direct result of an act, but a consequence of the act.
- To be awarded consequential damages in a lawsuit, they must be a foreseeable result of an act.
- An example of consequential damages might be lost revenue because a Contractor’s online registration website did not function properly and individuals could not register and pay the fee for an event.
- Indemnification occurs when one party takes on the obligation to pay for losses or damages that have been or may be incurred by another party.
- Indemnification is also one party making the other party “whole” (give equal to what they have lost) or protected from losses which have or will occur.
- In a contract, the source(s) and extent (limits) of the losses or damages that will be indemnified should be specified.
- Indemnification may be unilateral (one party indemnifying the other) or reciprocal (each party indemnifying the other).
- Strict liability is when a party is responsible for the damage and loss caused by that party’s acts and omissions (failure to act) regardless of culpability (moral or legal responsibility).