When drafting a liability clause in a contract, which of the following statements are TRUE? Select THREE
The correct answers are 1, 3 and 5: exclusions should be narrowly defined and clearly state which types of liabilities are excluded, liability is a legal responsibility and liability cannot be excluded for injury resulting from negligence. These are all explained on p. 22. Liability is never there to publish anyone (this is a red herring answer that CIPS like to put into different questions and it's usually the wrong answer - no one should look to publish anyone else). The option 'Liability can only be limited where there is valid insurance' is not true. A contract can state any limitations on liability so long as it's agreed by both parties, they're fair and don't contradict any laws. The thing about not being able to exclude liability regarding personal injury is a Law in the UK.
Franky B's is a popular restaurant chain which is seeking a resolution to a conflict it has with its supplier of Fried Chicken. It is looking for a dispute resolution that does not involve the court but in which an expert third party will make a binding decision. Which is the most suitable dispute resolution method for Franky B's?
This is Adjudication. The other answers are incorrect- litigation involves the court. Conciliation and mediation do not provide binding decisions. P. 143
David is selling his house and Barbera would like to buy it. David is expecting to get 100,000 for his house. Barbera offers 80,000 and David asks Barbera if she'll pay 90,000 instead. Barbera says no. After a week David hasn't had any other offers so would like to accept Bar-bera's offer. Can he do this?
'No - David's counter offer rescinded Barbera's offer' is the correct answer. Remember: 'once a counter offer is made, the original offer is viewed as rejected' - p.6 of the study guide. What this means is when David goes back to Barbera about the 80,000 - he is now the offeror - and Barbera has the option to reject this. David is no longer in a position to accept or reject - Barbera is.
Lollypop Manufacturer has a long standing contract with Retailer
yes- if there is a variation clause and both parties agree. This would usually be written in as a 'price adjustment clause' but if it's not, then it could be agreed and signed by both parties as a 'contract variation'. See p.16 for more details
Which of the following are a suitable course of action to take in the event of a minor breach of a contract? Select TWO
In the event of a minor breach, CIPS says it is best to work with the defaulting party by conducting progress meetings and collaboration. This is on p. 50 of the study guide
