C a m b rid g e Professional English

SB

Introduction
International
Legal English
A course for classroom or self-study use

■■ ! "• ^,
Amy Krois-Lindner
cont ains Matt Firth
 A career in law

THE STUDY OF LAW

Lead-in
The study of law differs from country to country, but most law degree programmes1
include core (compulsory] subjects which all students must take. Which core courses are
typical in your country? How long does it take to complete a law degree?

Reading i: A career in law

1 Read the text below and answer these questions.
1 Which courses do law students in the UK have to take?
2 Which optional courses might a student who wants to work in a big
law firm take?

The study of law is intellectually stimulating and challenging, and can lead to a
variety of interesting careers.
In the UK and the USA, law degree programmes usually take three years to
complete. In the UK, these programmes typically include core subjects such as
criminal law, contract law, tort law, land law, equity and trusts, administrative
law and constitutional law. In addition, students are often required to take
courses covering skills such as legal writing and legal research.
There is also a variety of optional (elective) courses available. Since many
law students go on to become lawyers, students often take courses that
will be useful to them during their future careers. Someone wishing to run a
small partnership or to work alone as a sole practitioner in a small town may
decide to take subjects such as family law, employment law and housing law.
Those wishing to work in a large law practice will consider subjects such as
company law, commercial law and litigation and arbitration.
Many universities also offer courses on legal practice. Courses like this give
students the opportunity to experience the work of a lawyer before deciding
on a career in the law. Another way of finding out more about law in practice is
to get involved with a voluntary advice centre or law clinic. These clinics offer
free legal assistance to the local community and provide a useful introduction
to some of the day-to-day work of a lawyer.
For students wishing to work in a commercial practice, knowledge of foreign
languages is essential. When law firms hire new recruits, they generally look
at four things: education, personality, work experience and language ability.
Since English is the language of the international legal community, law firms
increasingly expect graduates to have a good command of English.

(US) programs
2 Read the text again and decide whether these statements are true (T) or false
(F). If the statement is false, correct it.
1 A course in family law is usually included among the core subjects at law
schools in the UK.
2 Some law degree programmes offer courses in some of the important skills that
lawyers need in order to do their work, such as legal writing or legal English.
3 Law clinics give law students the opportunity to learn about the legal problems
of the medical profession. .
4 Today, commercial law firms expect recruits to be completely fluent in English.
3 When you record vocabulary, you should try to write down as many collocations
as you can, and not only single words.
How many collocations with the words legal (e.g. legal writing) and law (e.g. law
firm) can you find in the text?

Speaking i: Law firms and courses

4 Discuss these questions with a partner. Look at the sample responses.
1 What type of law firm do you (think you would like to) work in?
I'd like to work as a sole, practitioner, as I'd prefer to be my
own boss.
I think a big law •firm would be exciting.
2 Which optional courses are you taking / did you take during your studies?
This semester, I'm taking on elective course in environmental law.
! took a course on human rights Law when I was in law school.

Reading 2: Course descriptions

5 Reading texts in a foreign language often means encountering unfamiliar
words. Discuss these questions with a partner.
1 What is the best way to deal with unfamiliar words in a text?
2 Read the following list of strategies and discuss how useful they are.
What factors might affect the strategy you use?
C Try to understand the new word with the help of surrounding words.
O Look up every unknown word in a dictionary.
0 Ignore the unknown word and read on.
0 Look up some new words, ignore others.
C Analyse the unknown word: ask what part of speech it is (a noun or an
adjective, for example); if it has a root or a prefix (Latin or French, for
example) that may help you understand it; if it has a positive or negative
meaning, etc.
Keep these strategies in mind when reading the text on page 10.
6 Quickly read the law course descriptions taken from a university website. Ignore
the gaps for now. Do you think this university is in the UK? Why (not)?

:.Q 6 Q - .. -v , __. . , . ____ ___________ ... . . ... ■ - CD

q ~~ ; ................................... ''.......................... . . a *
as.

J
First-year course descriptions
Introduction to Law: This course aims to familiarize the student with the study of law; to begin
the development of certain basic skills, such as reading, analysis and synthesis of legal decisions,
and interpretation of statutes; to discuss fundamental aspects of the legal process, e.g. how courts
“make law” and the function of the courts with respect to statutory law.
1 ) ............................... : This course covers the fundamental principles governing the formation,
interpretation, performance, and enforcement of contracts. In addition, special attention is given
to the requirements of offer and acceptance, consideration, formal requirements, public policy, and
the problems of choosing a remedy in case of a breach. Some attention will also be given to the
Uniform Commercial Code.
2 ) ............................... : Topics covered include liability for intentional and negligently caused
injuries to person and property; strict liability; vicarious liability; ultra-hazardous activities;
products liability; nuisance; invasion of privacy; defamation; the impact of insurance and risk
distribution upon liability; accident compensation plans; damages; losses.
3 ) ...................... ..........: This course presents the basic concepts of criminal law. Crimes against
persons, property, and public administration are covered, with special emphasis placed upon
the law of homicide.

Second-year course descriptions

Evidence: This course will explore the rules of evidence and their rationale, including relevancy,
hearsay, impeachment, cross-examination, opinions and experts, documents, and privileges.
Crim inal Procedure: This course will cover regulation of law enforcement conduct during the
investigation of crimes, with special emphasis on constitutional and statutory limitations. Topics
include search and seizure, confessions and incriminating statements, electronic surveillance,
entrapment, identification procedures, and remedies for improper police conduct.
4 ) ......................... ........ : This course covers the general principles of federal constitutional law,
including government authority and its distribution under the constitution; the judicial function in
constitutional cases; powers delegated to the national government and the reserved powers of the
states in areas of federal authority; intergovernmental relations; rights, privileges, and immunities
under the constitution; national citizenship; the contract clause; the federal constitution and the
amendments thereto.
5) .................................. : This course is designed to acquaint students with the nature of legal
research. Students will analyze judicial opinions; apply legal concepts and rules; and learn correct
legal citation and use of correct precedent. Special attention is given to the mechanics of legal
research, the techniques of writing memoranda, and briefs,
M
 7 Choose the correct title for each course in the catalogue excerpt on page 10.
1 Criminal law / Crime law
2 Law of the constitution /‘ Constitutional law
3 Contract law / Contracting law
4 Legal research and writing / Legal investigation and writing
5 Liability law / Tort law
8 Read the excerpt again and answer these questions.
1 Which course covers basic skills that students will need during their studies?
2 Which course deals with research and writing skills needed in professional life?
3 Which course teaches students how to cross-examine a witness?
9 Underline three words you do not know. Try to guess their meaning by looking
at surrounding words and analysing the words.
10 Which of the courses in the excerpt are/were you required to take in the law
degree programme you are/were enrolled in?

Listening i: Law courses

Most universities now offer language courses for lawyers, and in some countries these
courses are compulsory. Some courses in legal English focus on the study of Anglo-
American legal systems and associated terminology. Others offer a more practical
introduction to the language skills lawyers will need during their future careers.
You are going to hear a discussion between two law students, Heidi from Germany and
Pavel from Russia. They are each spending a semester studying law in England and are
discussing the English courses they were required to take as part of the law degree
programmes in their respective countries.
11 H € i.i Listen to the discussion and tick (/ ) what each speaker says he/she did
on his/her legal English course.
Heidi's course Pavel’s course
(Speaker 1) (Speaker 2}
1 worked on writing skills for lawyers □ □
2 practised legal research skills □ □
3 learned about other legal systems □ □
4 studied terminology □ □
5 gave presentations □ □
6 practised speaking about own legal system □ □
12 i S l . i Listen to the conversation again and then discuss with a partner which
course (Heidi’s or Pavel's) most resembles your experience of legal English
so far.
 Language use: Comparative and superlative forms
13 The two law students in Listening 1, Heidi and Marc, compared the iegal English
courses they took at their universities. Look at these sentences from the dialogue
(1-9) and match them with the rules regarding the use of comparative and superlative
forms (a-h). Some examples may match with more than one rule.
1 People here speak very quickly, which makes it harder to understand.
2 But now it’s much e a sie r- I can understand almost everything.
3 That's more difficult for me than understanding what people say.
4 Yes, I think writing's the hardest thing to do in English.
5 Our course was more practical - we worked on the language skills thatlawyers need.
6 We didn't really work on speaking skills, though; it wasmore important topresent
the terminology.
7 That was definitely the most useful thing we did.
8 it sounds like your course was better than mine.
9 I don’t know if it was better, but it was certainly more language-based and more
skills-based.

a Adjectives with one syllable form their superlative by adding -est.

b Adjectives with one syllable form their comparative by adding -er.
c Short adjectives ending in - y form their comparative by removing - y and
adding -ier.
d Multi-syllable adjectives form their comparative with more.
e Compound adjectives form their comparative with more.
f Multi-syllable adjectives form their superlative with most
g Some very frequent adjectives have irregular comparative forms,
h Than is used to introduce the second element in a comparative structure.

14 Complete this excerpt from an introductory talk given in the first session of a legal
English course. Use the correct comparative or superlative form of the adjectives given.

You might be expecting to learn a lot of detail about Anglo-American legal systems and
their foundations, but our focus this semester will be 1 ) ..................................(practical)
than theoretical. We will mainly be working on language skills, such as writing letters
or speaking with clients, i am convinced this is the 2 ) ..................................(good) way
to prepare for using English for law. You may find this course 3 ) ..................................
(challenging) and 4 ) ........._....................... (time-consuming) than you expected, but you
may also find it one of the 5 ) .................................(useful) courses you take at university,
as many students have told me in the past. To make it 6 ) ........................ .....(easy) for
you to plan your time, I'll be handing out a fist of the readings and the assignments you’ll
be working on this term.

Speaking 2: Learning approaches

15 Discuss these questions with a partner.
1 Which of the four skills - reading, writing, listening or speaking - do you find
the most difficult?
2 When it comes to (earning legal English, which of the two courses discussed by
Heidi and Marc do you think offers the better approach? Explain the reasons
for your choice, using comparatives and superlatives if possible.
 LAW IN PRACTICE
Lead-in
Lawyers in smaller firms often advise clients on general legal issues, contacting colleagues
for assistance when necessary. Lawyers in larger firms tend to specialise in specific areas,
such as advising on tax matters, dealing with commercial transactions or registering patents.
Which areas of law do you find most interesting and why?

Reading 3: Graduate recruitment programme

16 Read the advertisement for the Barker Rose Graduate Recruitment Programme
and answer these questions.
1 Do you need to have a law degree to qualify for the programme?
2 How will Barker Rose help graduate students qualify to become solicitors?

^ The Barker ios© Graduate Recruitm ent whose application otherwise demonstrates first-
Programme rate personal qualities and experience.
For the ambitious graduate wishing to train as » When and hew to apply
a commercial lawyer, we offer trainees first-rate Apply by 31 st July two years before the start of
work in an informative, challenging and busy the training contract.
atmosphere, where your contribution counts from
To apply online, please click on this link:
day one.
http://www.barkerrose.co.uk
We require approximately 15 exceptional trainee
» Sponsorship
solicitors each year to contribute to our future
growth, in both our London and Manchester We will pay your full course fees for both the CDL

offices. and LPC, plus maintenance of £6,000 during your

GDL and £7,000 through your LPC study year.2
Training programme
» Further inform ation
We handle only commercial matters, offering
training in company, commercial and finance, If you would like further information, please

commercial litigation, employment, media, contact Graham Matthews, our Graduate

energy, trade and commodities, shipping and Recruitment and Trainee Manager, on 0650
581 8967 or by email at graduate.recruitment®
property law, and in the business skills essential
to success as a solicitor. barkerrose.co.uk.

Minimum qualifications Barker Rose will be presenting its Graduate

Recruitment Programme at the University of
Strong academic qualifications, including a 2.1
London Law Fair on 15 May at 2.30 p.m. in
degree1 (any discipline). We take a flexible
the John Adams lecture theatre.
approach and are willing to progress candidates

---------- -----*...... .... .....:------------------ :--------------------------- --------- --- -------------------------------- :------------ ------------- i_______________LdSi
1 In the UK, different-class degrees are awarded as follows: 1 [a first), 2.1 (a two-one), 2,2 (a two-two),
3 (a third).
2 The Graduate Diploma in Law (GDL) is a conversion course allowing those holding non-law degrees in any
subject to convert to a career in law. After completing the GDL, students who want to become barristers
take the Bar Vocational Course (BVC) before entering the profession as pupil barristers. Students who
want to become solicitors take the Legal Practice Course (LPC) before becoming trainee solicitors.

Unit 1 A career in law

17 Read these four descriptions of students and decide if they would be suitable for
the Barker Rose Graduate Recruitment Programme. Give reasons for your answers.
1 Andrea
Andrea is most interested in criminal law and has helped advise defendants
of their rights at her university law clinic. She is very studious and is aiming
for a first-class law degree.
2 Sandip
Sandip founded his own e-commerce business following a disappointing 2.2
law degree. He is now in great demand as a gifted dotcom consultant, but
would like to pursue a career in commercial law.
3 Meral
Meral is interested in company law and is very ambitious, Her aim is to
become a partner in a law firm by the age of 30. She would like to begin her
training contract next year in order to get ahead as soon as possible.
4 Oren
Oren is a business-studies student and would like to pursue a career advising
companies on mergers and acquisitions. He had originally wanted to start his
own business, but decided on a career in law during his second year.
18 Discuss these questions with a partner.
1 Would the Barker Rose Graduate Recruitment Programme be of interest to
you? Why (not)?
2 If you had the chance to speak to someone about the programme, what
questions would you ask?

Writing: Short email

19 The Barker Rose Graduate Recruitment programme gives an email address
where you can write for more information. Write a short email asking the
questions you discussed in Exercise 18, question 2, Use the opportunity
to give some information about yourself, your professional and academic
background and why you are interested in applying for the programme.

Listening 2: Graduate recruitment programme

20 ^ c 1.2 Barker Rose are presenting their Graduate Recruitment Programme at
the University of London Law Fair. Listen to the first part of the presentation
and decide whether these statements are true (T), false (F) or not clear (NC).
1 The students at the presentation have recently taken their mid-term exams.
2 The speaker is a law graduate.
3 Most of the speaker’s lawyer friends are partners in law firms.
4 The speaker will take questions during and at the end of the talk.
5 There were over 60 lawyers working for Barker Rose in 1979.
6 New associates can work in an area of law that interests them.
21 4 ii.3 Listen to the second part of the presentation and answer these questions.
1 How much do graduate trainees earn during their second year at Barker Rose?
2 How are year-end bonuses awarded?
3 What other benefits are paid for by the firm?
4 How many hours are associates expected to bill per year?
5 After how many years are some associates considered for partnership?
22 Some words can have several meanings. Choose the best explanation (a or b)
for each of these words or phrases as they are used in the presentation.
1 a partner
a one of the owners of a partnership (e.g. a law firm)
b someone’s boyfriend, girlfriend, husband or wife
2 an associate
a a person whose position at work is slightly lower or less complete than
the full official position described (e.g. an associate director)
b a person who is closely connected to another person as a companion,
friend or business partner
3 a bonus
a a pleasant, additional thing
b an extra amount of money given as a reward in addition to the money you
were expecting
4 benefits
a a helpful or good effect, or something intended to help
b things such as medical insurance that employees receive in addition to
money
5 to practise1
a to do something regularly in order to become skilled at it
b to work in an important skilled job for which a lot of training isnecessary

Text analysis: Structuring a presentation

In order to be effective, a presenter must make the audience understand why the topic
is important to them. It is also important to make your points short, simple and clear.
Remember to KISS (Keep it Short and Simple],
23 This outline gives a detailed summary of the main parts commonly found in
presentations. Find each of the points in the transcripts for audios 1.2 and 1.3
(pages 124-5). Write down the line numbers at which each point can be found.
1 Welcome the audience
2 Introduce yourself
3 Introduce the topic
4 Tell the audience why they should be interested in the topic •
5 Tell a short personal anecdote
6 Give an overview of the talk
7 Main point 1
8 Main point 2
9 Main point 3
10 Main point 4
11 Summary
12 Final 'bang' - leave the audience with a strong final impression

1 (US) to practice
Language Focus

1 Vocabulary: types of law firm Match the halves of these sentences about the
different types of law firm mentioned in Reading 1.
1 A commercial practice a is managed by partners who share profits and
2 A large, law firm responsibility equally,
b works on his or her own, has no partners and
3 A law clinic usually handles smaller cases,
4 A partnership c advises clients on corporate and commercial
matters and may also negotiate transactions
5 A sole practitioner and solve business problems,
d can have 50 or more lawyers working on
complex matters for large organisations,
e gives students an opportunity to deal with real
clients and to develop their legal skills.

2 Vocabulary: law vs legal Complete these sentences by inserting either law or legal.
1 Instruction in ...................... English is becoming compulsory in a growing number
of law faculties all over the world.
2 After university, my work as a trainee solicitor gave me useful experience in
commercial litigation, and I was offered a good position in a large.............. ........firm.
3 During my studies, I volunteered at a local..;... |....... ...... clinic, where I provided
fre e assistance to people who could not afford to pay for a lawyer.
.

4 Some of the most important courses a student completes during his or her
studies of the law are skills courses, such as courses in ..’................... writing
a nd.......................................... ;......research.
3 Prepositions Complete these phrases from the lawyer’s talk in Listening 2 with the
prepositions in the box.

about about about at by by for for from of on to to to with [

a First, I’ll s ta rt......by.... _.... giving you a little information................. ; ...Barker Rose.
b Our Graduate Recruitment Programme includes an excellent s e t..... ................ .
benefits...................... students prepared to commit themselves fully.
c I’ll then g o ....... ..............to outline what we have to offer....................... new
associates.
d OK, let me just s ta rt............ 1.........introducing myself.
e Finally, I'll also talk a little....................what we expect......................... our
potential graduate recruits.
f Helio, everyone, and thanks...................... coming along.
g Finally, I’d like to remind you ......... ..... what I s a id ........... the beginning
of my talk today.
h So, to s ta rt...................... , who are Barker Rose?
I This brings m e................ _.... my next point: what benefits can successful
applicants .......................our Graduate Recruitment Programme expect?
4 Ordering Number the statements in Exercise 3 in the order in which they most likely
occurred. You may want to listen to the talk again to check if your answers are correct.
1 f ...
 2 f Contract law
jfl
v

THE STUDY OF LAW

Lead-in
It is difficult to imagine going very long before making some kind of agreement enforceable
by law. Whenever we buy goods and services, we enter into a contractual relationship.
1 What kinds of contract have you entered into recently? Make a list of some of
the goods and services you have bought or used over the past 48 hours.
Compare your list with a partner. !s it always clear whether the above are goods
or services? How would you classify the electricity you consume every day?

Reading i: Contract law

This text deals with some of the main features of contract law.
2 Read the first paragraph. What is necessary for a valid contract to be formed?
3 Now read the whole text. Which two remedies following a breach of contract
are mentioned? Are any other options available in your own jurisdiction?
4 Read the text again and decide whether these statements are true (T) or false (F).
1 in all legal systems, parties must give something of value in order for a
contract to be formed.
2 An offer must be met with a counter-offer before a contract is agreed.
3 Oral contracts are not always valid.
4 If in breach, the court will always force the party to perform the contract.
5 Assignment occurs when one party gives its contractual rights to another party.

Contract Saw deals with promises which create legal rights. In most legal
systems, a contract is formed when one party makes an offer that is accepted
by the other party. Some legal systems require more, for example that the parties
give each other, or promise to give each other, something of value. In common-
law systems, this promise is known as consideration. In those systems, a
one-sided promise to do something (e.g. a promise to make a gift) does not
lead to the formation of an enforceable contract, as it lacks consideration.
When the contract is negotiated, the offer and acceptance must match each
other in order for the contract to be binding. This means that one party must
accept exactly what the other party has offered. If the offer and acceptance
do not match each other, then the law says that the second party has made
a counter-offer (that is, a new offer to the first party which then may be
accepted or rejected).
For there to be a valid contract, the parties must agree on the essential terms.
These include the price and the subject matter of the contract.
 Contracts may be made in writing or by spoken words. If the parties make a
contract by spoken words, it is called an oral contract. In some jurisdictions,
certain special types of contracts must be in writing or they are not valid (e.g.
the sale of land).
Contracts give both parties rights and obligations. Rights are something
positive which a party wants to get from a contract (e.g. the right to payment
of money). Obligations are something which a party has to do or give up to
get those rights (e.g. the obligation to do work).
When a party does not do what it is required to do under a contract, that
party is said to have breached the contract. The other party may file a lawsuit
against the breaching party for breach of contract. The non-breaching
party (sometimes called the injured party) may try to get a court to award
damages for the breach. Damages refers to money which the court orders
the breaching party to pay to the non-breaching party in compensation. Other
remedies include specific performance, where a court orders the breaching
party to perform the contract (that is, to do what it promised to do).
A party may want to transfer its rights under a contract to another party. This
is called an assignment. When a party assigns ('gives’) its rights under the
contract to another party, the assigning party is called the assignor and the
party who gets the rights is called the assignee.

5 Complete these sentences using the words in the box.

breach counter-offer damages formation obligations oral

contract terms

1 Usually, contract................... ........ ....occurs when an offer is accepted.

2 A new offer made by one party to another party is called a

3 The price and the subject matter of a contract are the essential
................................. of a contract.
4 A contract which is not in written form but has been expressed in spoken
words is called a n ............................... .
5 Under a contract, a party has..................................(that is, certain things
it has to do).
6 When a party does not do what it has promised to do under a contract,
it can be sued fo r.... ............................. of contract.
7 A court can award............................ to the non-breaching party.
6 Match the verbs in the box with the nouns they go with in the text.

accept award breach enforce file form make negotiate perform

reject

1 an offer
2 a contract
3 damages
4 a lawsuit
7 Which other verb-noun collocations are possible with the words in Exercise 6?
8 With a partner, take turns to look at each of the verbs in the box in Exercise 6
and discuss whether the following subjects can carry out the action in question:
1 a party 2 the parties 3 the court 4 a lawyer
example: Well, ct party ouxepts an offer, ond, a Lawyer can accept An
offer, too. But I don’t think you con say th a t a court accepts an offer.

Reading 2: Remedies for breach of contract

9 Read this excerpt from a law textbook. What does the word remedy in the text
mean?

fm: •
R e m e d ie s f o r b r e a c h o f c o n t r a c t

If a contract is broken, the injured party might be expected to demand any o f the
following:
• to have what they gave returned to them Crestitution’)
• com pensation for their loss (‘dam ages’)
• the other party to be forced to perform the contract (‘specific performance’)
In the com m on-law tradition, damages is the usual remedy that a court awards for
a broken contract. Restitution and specific performance are available only in
certain circumstances.

10 According to the text, what is the most common remedy for breach of contract
in the legal systems of English-speaking countries? What is the most common
remedy in your jurisdiction?

Listening 1: Asking for clarification and giving

explanations
11 4^2.1 Listen to the first part of a short conversation between two law students,
who are discussing the law textbook excerpt in Exercise 9. What is the first
student confused about?
12 ^ z 2.1 Listen again and tick (✓) the expressions the student uses to ask for
clarification.
1 What does that mean? □
2 Sorry, I don’t follow you. EH
3 I don’t understand that. □
4 I don’t know what that wordmeans. □
5 That doesn’t make sense tome. □
6 I don’t get it. □
13 How would you explain to the student what the term damages means and how
it differs from the word damage? Discuss this with a partner.
14 2.2 Listen to the second part of the dialogue and compare your answer with
what the second student in the dialogue says.
15 2,2 Listen again and tick (/ ) the expressions the second student uses for
giving an explanation.
1 Well, it's quite straightforward.
2 Allow me to clarify. Q
3 Let me explain. □
4 What this word means is ...
5 It’s like this. "
6 In other words, ... '
16 Which of the expressions in Exercise 15 is the most formal? When would you
use this more formal way of giving an explanation?

Speaking i: Terminology
17 With a partner, take turns choosing and explaining one of these terms in your
own words. Can you guess which word your partner is defining?
O damages 0 specific performance O restitution
C assignor 0 assignee Q the breaching party
0 the non-breaching party O the injured party 0 remedy

Listening 2: Contract law lecture

18 HS2.3 Listen to the beginning of a lecture on contract law. What is the general
subject of the lecture?
19 2.4 Listen to the whole lecture and answer these questions,
1 Which of these terms does the speaker mention?
agreement Q counter-offer Q
consideration Q acceptance □
negotiation Q remedy
offer □
2 What topic will the lecturer talk about next time?
20 < ii 2A Listen again and complete this excerpt from a student’s lecture notes by
writing one word in each space.

Introductory IccinJrc on Contract Formation

* Three requirements for formation:
l)
SO
3) intention to create ..... .... relations
Agreement: when H} become a settled deal
- when an offer is made and 5) ........... there is agreement.
• QaesTions about offers: e.g. who makes an offer in an auction? I s a
<S) ............................. list an offer? I s an advertisement an offer?
* Questions about acceptance: does acceptance have to be
7) ....................... ......._ ? Accept by 8) .........i........................ ?
’ Consideration basically means the <?)........... ...................... . i f there is no
consideration; the contract is not legally 10) .......... .
■ Next week's lecture will cover rules o f l l ) '

Unit 2 Contract law

Speaking 2: Summarising the lecture
21 A fellow student missed the introductory lecture on contract formation and has asked you to explain
the most important points to him. Taking turns with a partner, explain in your own words what the
lecturer said about the following topics. If you don’t understand something, ask for clarification.
When your partner has finished explaining, say whether your partner has left something out or
whether you understand it differently.
C agreement: what it is and when it occurs 0 questions about acceptance
C questions about offers O consideration: what it is

LAW IN PRACTICE
Lead-in
Lawyers are often consulted by clients who need advice in contract disputes. What kinds of things could
lead to such disputes?
When meeting with a client to discuss a dispute, a lawyer will generally explain how the law relates to the
contract in question. This may mean helping the client to understand technical terms and important legal
concepts. It will often be necessary to examine a particular clause, or section of the contract, carefully.

Reading 3: Contract clause

22 Read the clause from a contract and answer these questions.
1 Which word means ship or boat?
2 What does the clause deal with?
3 What words are used to refer to each party to the contract?
4 What do you think probable readiness means?
5 What does the word shall mean in the context of this clause?

2 a The buyer shall nominate the date of shipment. The buyer shall give the seller at least two
weeks’ notice of probable readiness of vessel(s) and of the approximate quantity to be loaded,
b Upon notification of probable readiness of vessel(s), the seller shall
nominate a port for the loading of goods,
c Shipment is required no later than 22 May 2008.

23 Complete these lists of obligations using your own words. How are the obligations expressed in the
actual contract clause?
Buyer must:

Seller must:

24 Discuss with a partner what can go wrong in connection with a clause like the one in
Exercise 22. What might the consequences be?
Listening 3: Conditions and warranties
25 2.5 You are going to hear a conversation between a lawyer (Mr Dawe) and
his client (Mr McKendrick, Director of Export Threads, the seller referred to in
the contract extract in Exercise 22). Listen to them discussing the case and
answer these questions.
1 What is the name of the buyer in this dispute?
2 Why does Export Threads want to terminate the contract?
3 Does a breach of contract automatically allow one party to terminate
the agreement?
4 Does the lawyer think that Export Threads has a strong case?
5 What legal grounds might Export Threads have for terminating the contract?
26 Read the audio transcript of the dialogue on pages 125-126. Underline the
phrases which mean I don't understand and those used for giving an explanation.
27 a In the dialogue, the lawyer says that his client relied on the seller to notify
him of the date of shipment. The term reliance refers to depending on
someone's promises. Read these definitions of reliance (1-3) and match
each with its source (a-c).
1 f"
reliance
1 The act o f relying on someone or something; trust.
2 The condition of being reliant or dependent.
3 A person or thing which relies on another.

reliance n. the act o f relying; taking action

as a result o f another person’s promises or
assurances. Compensation may be available
for losses incurred by a claimant resulting
from such reliance (reliance dam ages).

3 r ~ .......... ....- ... ..... k

reliance /ri'laions/ noun [U]
when you depend on or trust
in something or someone:
The region’s reliance on
tourism is unwise.
You place too much reliance
on her ideas and expertise.

a The Cambridge Advanced Learner’s Dictionary

b an online legal dictionary
c The Wiktionary(an online dictionary created by its users)
b Which of the dictionaries did you find most useful? Why?
c What role do you think reliance plays in this contract?
Text analysis: Email of advice
29 This email summarises the discussion between the lawyer, Mr Dawe, and his
client. It contains four errors of fact. Find and correct the errors.

Dear Mr McKendrick

Thank you for coming to see me on 30 May when we discussed the termination of your
contract with Drexler Inc. I am writing to summarise our discussion and to confirm your
instructions.
You told me that Drexler Inc. agreed to purchase a large quantity of goods (exact amount
unspecified) from your firm, Export Threads. Under clause 2a of the contract, Drexler were
to give you two days’ notice of the date of shipment so that you could arrange a lorry for the
transportation of the goods. You were unable to arrange this because Drexler failed to let you
know by the agreed date. You now wish to terminate the contract.
The legal issue here is whether or not Drexler’s breach is enough to allow Export Threads to
terminate the contract without being liable for damages. !f the contract term in question can
be shown to be a condition, you will be able to terminate the contract without fear of damages
being awarded against you. If the term is simply a warranty, you will be able to claim damages
to cover any costs you have incurred as a result of this breach, but may not actually terminate
the contract.
Recent case law suggests that if you do choose to terminate the contract, and if Drexler
subsequently decide to sue you, the courts would rule against you. Your contract involves a
chain of sales, and in such cases, the need for certainty is very important. You were unable to
arrange the loading of the goods as a direct consequence of Drexler's breach of clause 2a, and
this term would be interpreted as a condition.
I will write a letter to Drexler Inc. outlining the above and notifying them of your intention
to renegotiate the contract. I will request confirmation from Drexler that they accept our
interpretation both of the events and of the relevant law, and that your termination of the
contract will not lead to any unnecessary legal action on their part. I will be in touch again
shortly. Please do not hesitate to contact me if you have any questions,

With kind regards

Charles Dawe

= = =
30 The email in Exercise 29 follows a standard pattern for an email of advice from
a lawyer to a client. Match each paragraph (1-5) with its correct label (a-e).
a Opening paragraph
b The lawyer’s proposed action
c The lawyer’s advice
d Summary of the facts
e The legal issue(s)

Unit 2 Contract law

 31 During this course, you will be asked to write several letters and emails of
advice. Read through the email in Exercise 29 and highlight any phrases that
would be useful in your own legal correspondence.
examples: TVifljik uou for coming to see me on 30 May wtien toe
discussed, ...

Writing: Email of advice

32 Use these notes of an interview with a client to write an email of advice. Use
the email in Exercise 29 as a model.
SAM PLE
ANSWER
» P -141

7 November
Client - Berlingua Language School (Joanna Staines)
Other party - Simon Burnett, Burnett TV Supplies
Facts
Ms Staines (Director of Studies, Berlingua) bought a new satellite system (including
built-in hard drive) at 50% of the normal price horn Burnett TV Supplies for
educational use. She mainly wanted to use it to record foreign-language TV
programmes for use during lessons.
When she first set it up and tried to record, she realised that the timer function was
broken. This means som eone has to physically press 'record’ and ‘stop’ whenever
they want to record something.
Ms Staines has asked for a replacement, but was told that she couldn’t expect it
to work perfectly at such a cheap price. They have refused to replace it, but have
offered to repair it at a cost of £130.
Legal issues
Defect not pointed out at time of purchase; if reduction due to imperfections, seller
MUST inform client (Sale of Goods Act).
Advice/Action
Ms Staines is entided to either a full refund or a replacement system (her choice). I
oudined the options, Ms Staines is considering which to go for. I’m pretty sure that it
will only take one letter from us before Burnett backs down - he’d have no chance in
the small claims court!

... — — • -- ....... .

""*• Now turn to Case Study 1: Contract law on page 118.

 Company law

THE STUDY OF LAW

Lead-in
A knowledge of company law is essential to anyone planning to practise commercial law. Law
schools typically offer courses on business organisations, examining issues such as how each
major type of business entity may be formed, operated and dissolved.
1 As business becomes increasingly globalised, company lawyers in one jurisdiction
have to be more aware of the company laws of other jurisdictions as well as
international regulations. Discuss these questions with a partner.
1 What types of business entity are you familiar with? Describe the organisation of
one type of business entity in your jurisdiction to your partner.
2 What experience do you have of forming, running or working for a business
entity? What kind of business entity was it?
3 What aspects of company law have you studied?

Reading i: Company law

2 a Read the text below and decide whether these statements are true (T) or
false (F).
1 Under the law, a company and its members are distinct legal personalities.
2 Company members are generally not personally responsible for the money
owed by the company.
3 A certificate of incorporation is issued when the proper documents for
company formation have been filed.
4 The memorandum of association of a company contains regulations relating
to the internal affairs of a company.
b What are the main differences between a sole proprietor, a partnership and a
publicly listed company? Use the Glossary if necessary.

Company law1 is the law which deals with the creation and regulation of
business entities. The most common forms of business entity are companies
and partnerships.
A company2 is a group of people which is treated as a legai person, with a
separate identity from its shareholding members. It can own property, enter
into contracts, sue others and be sued. This contrasts with a partnership,
which is not considered to be a legal person and is not abie to own property
in its own name.
Because of the limited liability of the members of a company for its debts, as
well as its separate personality and tax treatment, the company has become
the most popular form of business entity in most countries in the world.

1 (US} corporation(s) law or corporate law 2 (US) corporation

 Companies have an inherent flexibility which can let them grow; there is
no legal reason why a company initially formed by a sole proprietor cannot
eventually grow to be a publicly listed company, but a partnership will
generally have a limited number of partners.
A company has shareholders (those who invest money in it and get shares in
return}, a board of directors (people who manage the affairs of the company)
and creditors (those to whom the company owes money). Company law deals
with the relationships between companies and their shareholders, creditors,
regulator^ and third parties.
The process of registering a company is known as company formation.1
Companies can be created by individuals, specialised agents, attorneys or
accountants. Today, the majority of companies formed in the UK and the USA
are formed electronically. In the UK, a certificate of incorporation is issued
once the company’s constitutional documents and statutory forms have
been filed.2
The constitution of a company consists of two documents. The memorandum
of association3 states the principal object of the company. The second
document, the articles of association,4 regulates the company’s internal
management and administrative affairs, including matters such as the rights
and obligations of shareholders and directors, conduct of meetings and
corporate contracts.

1 also company registration (UK) and incorporation (US)

2 (US) generally no official certificate is issued
3 (US) articles of incorporation or certificate of incorporation (US)
4 (US) bylaws

Key terms i: Who does what in company law

3 Complete the sentences below dealing with company law using the verbs in
the box.

enter into has invests is makes manages monitor owes own

owns serves on sue .

1 A legal person................................... rights and duties under the law just like
natural person.
2 The board of directors................................. the affairs of the company and
............................ .... company policy.
3 A company ca n ................................. property,......................... ......... contracts
and............ .................... other persons.
4 A shareholder................................. money by buying shares in a company.
5 A company director........................ .........the governing board of a corporation.
6 A creditor of a company is a person or entity to whom the company
a debt.
7 Regulators..................................the activities of companies to ensure that
they comply with the law.
8 A sole proprietor........................... a company and............................................. ...................................
personally liable for its debts.
Reading 2: Course in company law
4 Read the outline of an undergraduate course in company law and tick the
topics that are mentioned.
1 formation of a company in accordance with regulations
2 the development of company legislation over time □
3 a company’s dealings with other entities and institutions □
4 financing a company’s operations ED
5 the process of joining together two companies
6 increasing company profits [3
7 dissolving a company D

Com pany law

Course outline
This m odule concentrates on U K company law in the context
o f m odern capitalism and the wider global economy. A series o f
introductory lectures and seminars w ill provide students w ith an
understanding of, inter alia, the rules governing incorporation, funding
and corporate finance, corporate governance and fundamental changes
to the structure o f a company (including corporate insolvency and
w inding up).W e will also consider the more general operation o f
this particular form o f business vehicle. D uring the second half o f the
course, w e w ill examine the concepts o f corporate personality, corporate
rights and members’ rights in more depth before turning to the newly
introduced directors’ duties under the Companies Act 2006. Finally,
w e w ill consider how progressive lawyers might work w ith businesses
in order to ensure that directors m eet their responsibilities to their
shareholders, non-affiliated stakeholders, the environment and the
com m unities in w hich they operate. O ne way o f encouraging such a
com m itm ent is through the careful drafting o f the memorandum and
articles, on w hich topic two optional half-day sessions are now offered as
a supplement to the company-law module.

5 Match the terms and phrases from the text (1-6) with their definitions (a—f).
1 inter alia a raising money to pay for a business or businessidea
2 funding b responsibilities of leading company officers
3 winding up c among other things
4 business vehicle d type of company organisation
5 directors’ duties e process of bringing a company to an end
6 memorandum and articles f documents governing external and internal relations of a
company
6 Find words that collocate with corporate in the text above and in the summary
text (Reading 1, pages 50-51). Look up the meanings of the ones you don’t know
in the Glossary or a dictionary. Do you know any other collocations with corporate?
7 What do similar courses in your country typically include? Discuss with a partner.
Listening i: Lecture on company law
You are going to hear an introductory lecture on company law at an American university.
8 a <4S5.1 Listen to the first part of the lecture and say whether the professor
is discussing the advantages of corporations, the disadvantages of
corporations or both.
b 5.1 Listen again and answer these questions.
1 According to the speaker, what is the most important advantage of
a corporation?
2 Which significant disadvantage does she mention?
3 How can double taxation be avoided?
9 a 5.2 Listen to the second part of the lecture. How many advantages and
disadvantages does the professor mention?
b ^ ? s ,2 Tick the correct answer for each of the questions in the table. Listen
to the lecture again if necessary.

Corporation Partnership Sole Proprietorship

1 Which entity best protects the property and assets : ' • : •.
of the shareholders? . ' r •'•
- ' • ... - •' ■ .
■- ■ ■ - , --
2 Which entity no longer exists when its owner dies? ■- . .
|
3 Which of the entities mentioned is the most
expensive to form?
4 Which entity type(s) require relatively little ' •
Yk?- : ' - '
paperwork? r ' v; ....... ' 'j
5 Which entity requires shareholder-employees to pay .....
unemployment tax? J ■

c ^ c 5.2 Listen to the second part of the lecture again and complete these notes.

Advantages and disadvantages o f Corporations compared to sole

proprietorships and p a rtn e r ships
advantages '

1 Stockholders are not liable fo r Corporate .....................

2 Self-em.ptoijm.eni t a x ....................
3 Continuous....................
V Easier to r a is e ....................
S Easier t o ........... .........
disadvantages
b jiicjher....................
7 fo rm a l organisation a.nd Corporate .....................
8 Unemployment .....................

Unit 5 Company law

Language use: Discussing advantages and
disadvantages
10 a In Listening 1, the professor points out the most important advantages and
disadvantages of corporations. Look at the audio transcripts of the lecture on
page 129 and underline the words and phrases she uses to refer to them.
b Complete these phrases taken from the lecture.
X T h e ........ ................... advantage of a corporation is that its owners, known
as stockholders or shareholders, are not personally liable for its debts and
liabilities.
2 O n e...... ..........................disadvantage of a traditional corporation is double
taxation.
3 Corporations.................................many advantages.................. .................other
business entities.
4 The second............ .....................of corporations is self-employment tax savings.
5 The first of th ese................. ............... is the higher cost.

Speaking i: Role-play: lawyer-client interview

11 Work with a partner. One of you plays the role of the lawyer, the other is the client.
Use the WASP approach from Unit 3.
Lawyer
A self-employed client has called a meeting to discuss whether she should conduct
her business as a sole proprietorship or if she should incorporate (become a
corporation). You know little about her work other than the fact that she is trained
as a plumber.
Prepare to meet the client by considering the kinds of question you should ask in
order to give her the best advice. As you prepare, consider the advantages and
disadvantages each type of company would have for the client.
Client
You have been working as a self-employed plumber for several years and have
recently taken on two apprentices. You would like to expand even further, as
business is going well. You have built up a good reputation and have begun to
specialise in providing plumbing services for retirement communities. You would like
advice on what form your business should take.
Prepare to meet your lawyer by considering the kinds of question you will need to
ask. Your lawyer will also ask about your business, so be ready to answer questions
on your current situation and plans for the future.

LAW IN PRACTICE
Lead-in
The Companies Act 2006 is the longest piece of Legislation ever to be passed in the UK. It sets
out the basic procedures and systems for how a company should operate, and introduced many
reforms. Unlike previous company law, the Act also states that companies must consider the
effects of their business practices on the community, employees and environment. Do you have
an equivalent of the Companies Act in your jurisdiction? What does it cover?
12 The Companies Act 2006 highlights links between a company's financial
success and its social and environmental impact. What kinds of provisions
do you think it might contain? What different parties have an interest in a
company’s business practices? Should the law provide equal protection for
these different interests? Discuss in small groups.

Reading 3: Breach of Companies Act 2006

The directors of Baggers pic, an independent supermarket, have received a letter
concerning their potential breach of the Companies Act 2006.
13 Read this letter. Who might Pippa Solloway be?

Dear Directors/Chief Executive

Re: Your possible breach of the Companies Act 2006
I am writing to you concerning your company’s sourcing of palm oil. As you
may or may not be aware, the activities of many palm-oil suppliers have been
causing environmental degradation in South-East Asia. The establishment
o f palm-oil plantations has resulted in deforestation, the destruction of the
habitat of orang-utans, human rights abuses and violent conflict. Palm oil is
used in approximately 10% of all of your food products.
The Companies Act 2006 (the Act) stipulates (in sections 172 and 417
respectively) that you have a duty to take such issues into consideration and
to report on them.
I do not believe that your company is doing enough to ensure that your
palm oil conies from sustainable, non-destructive sources. I am therefore
concerned about whether this may consequently be a breach of the Act. This
letter has been copied to the Secretary of State for Business, Enterprise and
Regulatory Reform, who has responsibility to enforce the Act.
I look forward to hearing from you as soon as possible as to how you plan to
manage these significant issues and ensure that your shareholders are made
aware of them.
Yours faithfully .

Pippa Solloway

14 Read the letter again and answer these questions.

1 What environmental issue is Pippa Solloway concerned about in her letter?
2 Which sections of the Companies Act 2006 might Baggers pic be in breach of?
3 Who else has been sent a copy of the letter?
15 Explain these phrases from the letter in your own words.
1 sourcing
2 a duty to take such issues into consideration
3 sustainable
4 responsibility to enforce
16 Discuss the directors’ possible responses to the letter. What would you advise
them to do?
Unit 5 Company law
 Listening 2: Directors’ meeting
Baggers’ Executive Committee is responsible for formulating and implementing company
strategy, and consists of Zoe Cook (CEO), David Wright (Marketing Director) and Simon
Travis (Public Relations Director), it has called a meeting with Sara Ball (Baggers’
corporate counsel] to discuss the company’s response to Pippa Solloway’s letter.
17 ^ 5.3 Listen to the first part of the recording. What does Simon want to send
to Pippa Solloway? Why?
18 ^ i 5.4 Listen to the second part of the recording. When does Baggers have to
publish its first business review under section 417 of the Act?
19 4^5.3, s .4 Listen to both parts of the recording again. Decide whether these
statements are true (T) or false (F).
1 Baggers issued a policy statement on environmental issues before the
enactment of the Companies Act 2006.
2 Baggers is a carbon-neutral company.
3 The Executive Committee have detailed information on the local impact of
Baggers’ sourcing of palm oil.
4 Baggers’ competitors have not yet responded to all the provisions of the
Companies Act 2006.
5 Baggers plan to publish a business review within the next three weeks.

Key terms 2: Public relations

The advice given by corporate lawyers can have a strong influence on the way acompany
is viewed by the public. Good media relations are essential. Listening 2 includes some of
the terms used when discussing the public face of a corporation.
20 Match the terms and phrases in italics (1-7) from Listening 2 with their
definitions (a-g).
1 How much more proactive can you get?
2 ... you've seen the press release we put out in March 2005 ...
3 We all agreed on the policy statement concerning the environment,
employment and our role in the community.
4 ... the bottom line is that just about ail the palm oil used in our own-brand
products is sourced from South-East Asia.
5 I want people to see us as setting the agenda ...
6 ... we're prepared to stand by our own policy initiatives ...
7 We’re on track as far as the rest of the Act is concerned ...
a the most important fact in a situation
b deciding what subjects other people should discuss and deal with
c a document outlining a set of agreed ideas concerning a particular issue
d making progress and likely to succeed
e taking action by causing change and not only reacting to change when it
happens
f new actions often intended to solve a problem
g a public statement given to the media to publish if they wish

56
 Text analysis: Reading a statute
During the meeting, the CEO of Baggers distributed copies of sections 172 and 417 of the
Companies Act 2006.

21 Quickly read section 172 of the Companies Act 2006 and choose the best heading.
a Duty to consider social and environmental issues
b Duty to promote the success of the company
c Duty to respect the rule of law

; I
1 7 2 ..........................................................

(1) A director o f a company must act in the way he considers, in good faith, would be
most likely to promote the success o f the company for the benefit o f its members as
a w hole, and in doing so have regard (amongst other matters) to —

(a) the likely consequences o f any decision in the long term;

(b) the interests o f the com pany’s em ployees;
(c) the need to foster the com pany’s business relationships with suppliers,
customers and others;
(d) the impact o f the com pany’s operations on the community and the
environment;
(e) the desirability o f the company maintaining a reputation for high standards of
business conduct; and
(f) the need to act fairly as between members o f the company.

(2) Where or to the extent that the purposes o f the company consist o f or include
purposes other than the benefit o f its m embers, subsection (1) has effect as if the
reference to promoting the success o f the company for the benefit o f its members
were to achieving those purposes.
I I
(3) The duty imposed by this section has effect subject to any enactment or rule o f law
requiring directors, in certain circum stances, to consider or act in the interests o f
creditors o f the company.

22 Read the statute a second time. Which subsection is the easiest to

understand? Which seems most difficult? Why?
23 a Statutes are drafted in general terms to cover all foreseeable circumstances.
Their meaning must be interpreted by lawyers and judges. What strategies
can you think of to make sure that you interpret a statute correctly, e.g. pay
attention to the punctuation, assume each word has been carefully chosen
by the drafter, etc.?
b Compare your ideas with those in the box on the next page.

Unit 5 Company law

Some statutes are clearly written, meaning that you can easily understand exactly
what the legislature intended. Unfortunately, many statutes are very difficult to
understand. Here are some rules to follow when interpreting a statute:
C Make sure you understand the statute. Begin by reading the key sections quickly
to get a general idea of what the statute says, then read it again for detail.
0 Pay close attention to all the ands and ors. The use of and to end a series
means that all elements of the series are included, or necessary; an or at the
end of a series means that only one of the elements need be included.
c Assume all words and punctuation in the statute have meaning. It’s tempting
to skip words you don't quite understand and ignore awkward punctuation. Try
not to do this.
O If the statute is only one of several you are studying, interpret it to be
consistent with the other statutes if at all possible.
0 Interpret a statute so that it makes sense rather than leading to some absurd
or improbable result.
C Track down all cross-references to other statutes and sections and read those
statutes and sections.

24 Read the letter from Pippa Solloway to Baggers pic again. Which of the
provisions of s. 172{1) might Baggers be in breach of?
25 Explain the meaning of s.l72(2) to a partner. What kind of situations might it
cover? Prepare by rewriting s.172(2) in your own words.
26 Read s. 172(3). In what way is the duty it imposes limited?

Speaking 2: Role-play: lawyer-client interview

The meeting of the Executive Committee was called to discuss Baggers’ response to Pippa
SolLoway’s letter. By the end of the meeting, four possible options had been suggested:
1 Write a short response with the company’s view of the issue.
2 Write an explanation of why Baggers failed to disclose the issue and/or considered it
to be immaterial to report to shareholders.
3 Outline Baggers’ plan to mitigate the issue.
4 Promise to write a full response after a reasonable period.
The CEO must now discuss the advantages and disadvantages of each of these with
Baggers’ Lawyer and decide which would be in the best interests of the company.
27 Work with a partner. One of you plays the role of the lawyer, the other is the
CEO of Baggers. Use the WASP approach from Unit 3.

CEO
Prepare for the meeting by considering the advantages and disadvantages
of each option. Which do you think is in the company’s best interests? Why?
What questions must you ask your lawyer in order to get the most out of your
meeting and to ensure the best result for Baggers? Make sure that the lawyer
explains everything clearly.
Lawyer
Prepare for your meeting with the CEO by considering the advantages and
disadvantages of each option. Which do you think is in the company’s
best interests? Why? Advise the CEO with reference to section 172 of the
Companies Act 2006, and explain your reasoning clearly.
IM* Now turn to Case Study 2: Company law on page 120.
 Commercial law

THE STUDY OF LAW

Lead-in
1 Commercial law is the body of law that governs trade and commerce. Discuss
these questions in small groups.
1 What bodies of law govern commerce in your jurisdiction?
2 How would a contract dispute between two companies from different
jurisdictions be settled?
3 Which international bodies do you know that set guidelines for commercial
' transactions?

Reading i: Commercial law

2 Read the text below and decide whether these statements are true (T) or false (F)-
1 Commercial law is a general term for a number of diverse areas of the law
which regulate trade and commerce.
2 Contentious work includes the drafting of contracts and advising clients.
3 The Uniform Commercial Code applies to commercial transactions in all of
the member nations of the European Union.
4 The World Trade Organisation checks to see if countries follow the trade
agreements they have signed.

Commercial law deals with issues of both private law and public law. it
developed as a distinct body of jurisprudence with the beginning of large-
scale trade, and many of its rules are derived from the practices of traders.
Specific law has developed in a number of commercial fields, including
agency, banking, bankruptcy, carriage of goods, commercial dispute
resolution, company law, competition law, contract, debtor and creditor, sale
of goods and services, intellectual property, landlord and tenant, mercantile
agency, mortgages, negotiable Instruments, secured transactions, real-
property and tax law.
The work of a commercial lawyer may involve any aspect of the law as it
relates to a firm’s business clients, and the role of the lawyer is to facilitate
business clients’ commercial transactions. It is essential for a commercial
lawyer to have not only a good knowledge of a lot of substantive law, but also
a thorough understanding of both contemporary business practices and the
particular business needs of each client.
A commercial lawyer may be asked to advise a client on matters relating to
both non-contentious and contentious work. Non-contentious work largely
involves advising clients on the drafting of contracts, whereas contentious
work commonly involves the consequences of breach of contract.
 Many jurisdictions have adopted civil codes that contain comprehensive
statements of their commercial law, e.g. the Uniform Commercial Code (UCC),
which has been generally adopted throughout the USA. Within the European
Union, the European Parliament and the legislatures of member nations are
working to unify their various commercial codes.
A substantial amount of commercial law is governed by international treaties
and conventions. The United Nations Commission on International Trade
Law (UNCITRAL) regulates international trade in cooperation with the World
Trade Organisation (WTO). The WTO is responsible for negotiating and
implementing new trade agreements, and is in charge of policing member
countries’ adherence to these agreements, which are signed by the majority
of the world’s trading nations and ratified by their legislatures (for example,
Parliament in the UK or Congress in the USA).

Key terms: Fields, institutions and concepts in

commercial law
3 Look at the areas of activity in commercial law mentioned in the first paragraph
of the text above and answer these questions. Use the glossary If necessary.
1 Which field deals with the legal rights associated with products of the mind,
such as patents, copyrights and trademarks?
2 Which field involves the laws and regulations governing market behaviour,
particularly agreements and practices that restrict free enterprise?
3 Which institution deals with the supply of credit information about business
organisations to other businesses and financial institutions?
4 Which field is concerned with the legal relationships between the shipper (or
owner) of goods, the carrier, and the receiver/consignee of goods?
5 Which field focuses on the laws regulating money paid to the government in
connection with commercial transactions?
4 Choose the correct word or phrase to complete these definitions.
1 ‘Agency’ is the term for the relationship of a person who acts in addition to /
on behalf of / on account of another person, known as the principal.
2 Bankruptcy is when someone cannot pay what they owe / own / won, and all
their property is surrendered to a court-appointed person who liquidates the
property to pay the claims of creditors / owners / debtors.
3 A secured transaction is a loan or credit translation / transaction /
termination in which the lender/ loaner/ debtor acquires a security interest
in certain property owned by the borrower and has the right to repossess the
property if the borrower cannot pay.
4 Negotiable instruments are documents which represent a right of charge/
payment/ credit for a specified sum of money on demand or at a defined time.

Unit 6 Commercial law

Listening i: Profile of a commercial lawyer
Just as commercial law itself encompasses many distinct fields of law, commercial
lawyers often deal with different areas of commercial activity in the course of their
careers. You are going to hear the podcast of an interview with Michael Grant, an
associate at a commercial law firm, which appears on the website of the alumni
association of an Australian university.
5 6.1 Listen and answer these questions.
1 Why has he decided to return to university?
2 What does he advise law students regarding career choices?
6 ^ 6.1 Listen again and tick the work he did before joining Ravenstone, Aitman
and Ofner, LLP.
1 Preparing notices of dismissal ;
2 Interviewing junior lawyers for positions at his firm □
3 Analysing technical documents 0
4 Submitting patent applications □
5 Writing patent drafts D
6 Drafting maritime legislation
7 Resolving charter party disputes □
8 Handling cargo ciaims D
9 Litigating ship collisions O

Language use: Adverb functions

Adverbs are often used to describe the action expressed by the verb. We
distinguish adverbs of time (e.g. often, usually and adverbs of manner, which
describe how an action is carried out [slowly, carefully). Adverbs can also be
used to qualify adjectives (e.g. particularly interesting).

7 a Underline the adverbs in the sentences below from Listening 1 and then
decide which function the adverbs have (a-c).
a describing time of action
b describing manner of action
c qualifying an adjective
1 He’s currently undertaking a Master's of e-Law at Monash University.
2 There’s something about the challenge of taking a complex commercial
transaction and expressing it clearly and concisely that really appeals to me.
3 I also had to write patent drafts, which are incredibly detailed descriptions of
the inventions in precise legal terms.
4 It was interesting, although at times extremely difficult and demanding.
5 But I quickly realised that what 1 liked best was working ciosely with the
other lawyers on litigation, defending or enforcing patents.
6 1 usually spend most of the day reviewing documents, drafting agreements,
meeting with clients and, of course, answering emails.
b Where are the adverbs placed in relation to the verbs?
 8 For each of these sentences, decide which adverbs don’t fit.
1 My work often / carefully/ regularly involves litigating charter party disputes,
although I occasionally / sometimes / remarkably handle collision cases as
well.
2 Maritime salvage claims can be closely/extrem ely/ incredibly challenging
due to the complicated legal situation.
3 The remarkably/quickly/extremely fast pace of change in the area of
information technology law means that lawyers at our firm have to mainly /
regularly / often attend seminars about the effects of new legislation.
4 Researching technical innovations carefully/ extensively/ extremely is
a(n) very/ extremely/regularly interesting step in the process of writing a
patent draft.

Speaking i: Internships
In Listening i, Michael Grant described his internship with a maritime law firm. It is
common for law-school students to work in the summer months as an intern in a Law
firm, government department, non-profit group or organisation. An internship can be paid
or unpaid. Some internships lead to course credits which count towards a law degree.
9 Discuss these questions with a partner.
1 Have you done an internship? If so, describe the organisation and your
duties there.
2 What do you think makes an internship a valuable experience? What can be
gained from it?
3 What would your ideal internship be?

Text analysis: Letter of application for an

internship
Law students often write a Letter of application to apply for an internship in response to a
specific advertisement. However, it is also common for a student to write what is known
as a prospecting letter, or letter of interest, in which the sender asks if there are any
openings for interns at the company or institution.

10 Quickly read the letter on page 64 written by a student. Is it a prospecting

letter or a letter of application replying to a specific advertisement?
11 Read the letter again and answer these questions.
1 What kind of organisation is she applying to?
2 Which areas of the law is she interested in?
3 What legal work experience has she had?
4 Which documents are enclosed in the letter?
12 Underline the adverbs used in the letter. Why do you think the writer uses so
many adverbs? What effect does it have?
 Julia Schwende
1 Marktgasse 17
1210 Vienna
Austria

2 1 November 2008

3 Robson, Mumsen and Meech LLP

8 Hawthorn Road
Saffron Walden
Essex
CB11 3KL

4 Dear Sir or Madam

S um m er internship in com m ercia l taw

5 I am a student of law at the University of Vienna, Austria. 6 I am now in my second
year and I expect to complete my degree in June 2010. 7 I am interested in applying
for the summer internship in commercial law which is advertised on your website.
8 In m y studies, I have completed all of the required courses successfully to date.
I am particularly interested in commercial law, and have taken elective courses in
debtor-creditor law and negotiable instruments. 9 Furthermore, I have frequently
attended guest lectures and discussions at my university on topics related to
commercial la w .101have also already gained work experience at a law firm, as I
carried out an internship last summer at a small law firm specialising in tax law in my
hometown of D orn b irn .11 There m y duties included researching new legislation and
helping the partners prepare cases for tria l.12 Full details of my studies and work
experience are included on the enclosed resume.
13The internship you are offering is especially attractive to me, as I would like to get
to know what it is like to w ork at a large commercial law firm with many international
clients and to have the experience of working abroad in an English-speaking country.
141am extremely motivated and a hard worker and I sincerely believe that I would
make the best of such an opportunity.
151can confidently say that I have a particularly good knowledge of English, as I
have spent several summer vacations with my family in the U S A and I have taken two
courses in Legal English at m y university. 161am enclosing writing samples in English
as you request in your advert; the letters were written as part of m y Legal English
courses.
17 Should you require further information, please do contact m e .18 i look forward to
hearing from you.

Yours faithfully
13 Match the sections and ideas which should be included in a letter of
application for an internship (a-m) with the corresponding sentences in the
letter (1-18). Some sections/ideas are used more than once.
a Reference to how you found out about the internship
b Your address
c Reference to things requested in the ad (writing sample, references, etc.)
and enclosed in the letter
d Recipient’s address .
e Reasons for your interest in internship
f Description of your Segal work experience
g Introduction, saying who you are
h Date
i Description of your studies and coursework
J A ‘call for action' which closes the letter
k Salutation
I Reason for writing letter
m Details of any personal qualities, qualifications or skills that make you right
for the internship

Reading 2: Commercial law internship

14 Read this text. Where do you think it appeared?

Powderhouse Sommerville LLP International Com m ercial Law Internship

The international commercial law firm Powderhouse Sommerville LLP launched its International
Commercial Law Internship at the University Law School in 2006 and has renewed it for the
current academic year.
Powderhouse Sommerville LLP is one of the world’s largest law firms, with over 1,600 lawyers
and 15 offices in North America, Europe and Asia.
Professor May Rikos, Director of the University Law School, said: The University Law School
welcomes the opportunity to work with one of the first-rank global commercial law firms.’
Under the terms of the internship, students taking International Commercial Law courses in
Mergers, Comparative Antitrust Law and World Trade Law will be invited to compete for the
internship. Selection will be on the basis of an essay plus interview of the students who achieve
the top essay mark in each of the relevant courses. Applications must be submitted by March
10, and the interviews will take place in late March/early April. The Internship will take place from
May to July inclusive in the Powderhouse Sommerville Frankfurt Office.
Link to application at the bottom of this page.

15 Read the text again and answer these questions.

1 Who can apply for the internship?
2 How will students be chosen for the internship?
3 When and where will the internship take place?
4 How can a student apply?

Writing i: Letter of application

16 Write a letter of application in response to the internship advertisement in
Exercise 14. Be sure to include all of the sections and ideas necessary.
' Unit 6 Commercial law
LAW IN PRACTICE
Lead-in
Internships are very often the first experience young Lawyers have of the realities of
globalisation in the workplace. Many large legal firms have offices across the globe,
employing lawyers of many nationalities.
17 Discuss these questions with a partner.
1 What do you understand by the term globalisation?
2 What factors have contributed to the globalisation of the world's economies?
3 What are the implications of globalisation for:
a businesses? b commercial lawyers?

Reading 3: Role of commercial agents

Most companies engaged in international trade make use of agents to represent them
abroad. The relationship between agent and principal is commonly governed by a
commercial agency agreement, and the European Union has sought to harmonise' its
member states’ agency laws in order to give agents greater protection.
This text is taken from the introduction to a document written to inform lawyers about
recent changes in the law concerning commercial agency agreements.
18 Read the text and decide whether these statements are true (T) or false (F).
1 Linder EU law, a commercial agent is a person who sells goods and services
on behalf of a principal.
2 Agents are generally paid a flat rate; that Is, a charge that is the same for
everyone.
3 Principals will often abandon agency agreements once a customer base
becomes established.

1 The role of commercial agents is well known. They act as independent intermediaries
representing their principals in the market. A commercial agent is defined by EU
Directive 86/653 as a person 'who is a self-employed intermediary having continuing
authority to negotiate the sale or purchase of goods (but not services) on behalf of his
principal or to negotiate and conclude such transactions on behalf of and in the name of
his p r i n c i p a l T h e y do not buy products from their principals, but arrange sales directly
from their principals to the customer. For the provision of this service, commercial
agents are typically paid a commission by their principals, calculated as a percentage of
the sale price of the product to the customer.
2 Commercial agency is of particular importance in international trade. It provides a
convenient structure enabling a foreign supplier to penetrate an overseas market. By
using the services of an agent established in the targeted overseas market, the principal
can benefit from the knowledge and local connection of the agent, avoid the investment
and commitment of managerial resources required by the establishment of a branch or
subsidiary and, by taking advantage of the agent’s services on a commission basis, can
effectively test the overseas market on a ‘no cure, no pay’ basis.

1 Harmonisation is the process by which different states aciopt the same laws.
 3 But the position of the commercial agent is vulnerable. Because of the agent’s role as
intermediary, the principal necessarily has perfect knowledge of the customers procured
by the agent. As sales volumes build, the temptation for the principal to circumvent
the agent and enter into direct relationships with customers can often become
overwhelming against the background of an increasing commission bill, often fuelled by
repeat orders from the same customers. It is commonplace, therefore, for the commercial
agent to find his relationship with his principal brought to an end precisely at the
moment where the agent’s efforts have resulted in the establishment of a significant
new customer base for the principal in a new market. In this way, the agent becomes
the victim of his own success and the principal takes advantage of the goodwill in the
principal’s product, created largely as a result of the agent's efforts.

19 Read the text again and answer these questions.

1 Why is commercial agency important for international trade?
2 How do commercial agents sometimes become ‘victims of their own success’?
20 Match these words and phrases from the text (1-4) with their definitions (a-d).
1 commission a when payment is only made following a positive result
2 intermediary b the benefit a business gets from having a good reputation
3 a ‘no cure, no pay’ basis c someone who carries messages between people who are unable
4 goodwill to meet
d payment to someone who sells goods which is directly related to
the amount of goods sold

Reading 4: Commercial agency contract 1

The ICC2 Model Commercial Agency Contract is commonly used by businesses entering a
new market, and is an example of a standard form3 contract. Its provisions are based on
prevailing practice in international trade rather than national laws.

21 What are the advantages of using a standard form contract based on common
business practices rather than negotiating contracts according to domestic laws?
22 What kind of provisions would you expect to find in a commercial agency
contract?
23 Chance Computing is a UK-based company that produces budget laptop
computers for schoolchildren. It uses agents to sell its products to other
countries. Read the clauses on the next page taken from Chance Computing’s
standard commercial agency contract and answer these questions.
1 Can the agent set the price at which goods will be sold to third parties?
2 Linder what circumstances can the contract be terminated?
3 What is the governing law?
4 If the principal breaches the contract, what court has jurisdiction?

1 also commercial agency agreement

2 The International Chamber of Commerce is an organisation of businesses from over
80 countries that works to promote and support global trade and giobalisation
3 also boilerplate

Unit 6 Commercial law

 27 A colleague from outside the EU contacts you to ask about the legal protections
in place in the EU for commercial agents. Write a summary of Regulation 17 to
circulate to your litigation department.

Listening 2: Meeting with corporate counsel

Following two years of increasing sales in southern Europe, Chance Computing wants to break
into the more competitive central European market. Jenny Miller, Sales Director of Chance
Computing, has asked Clive Sanborn, corporate counsel, for advice on terminating a number of
agency agreements.
28 ^ 6.2 Listen to the first part of their conversation and answer these questions.
1 Why does Chance Computing want to end the agreements with their agents in
southern Europe?
2 What is the maximum amount of compensation an agent can be paid, according
to the regulations?
29 4^6.3 Listen to the second part of their conversation and answer these questions.
1 Is compensation limited only to lost commissions?
2 For how many years are the agents’ commercial activities restricted following
termination of the agreement?
30 6 .2 , 6.3
Listen to the whole conversation again and decide whether these
statements are true (T) or false (F).
1 The agents are in breach of contract.
2 Under the agreement, the minimum notice period is six months.
3 The agreement allows for the payment of an indemnity of up to one year's
average commission fees.
4 The agents must make any claims for compensation within one year of the
termination of the agreement.
5 The restraint-of-trade clause is valid for five years.
6 Under the law, a restraint-of-trade clause in an agency agreement must refer to
either the relevant geographical area or the type of goods in question.
7 The lawyer believes a court would be likely to find for the agents and not uphold
the restraint-of-trade clause if the principal breached the terms of the agreement.

Speaking 2: Role-play: discussing options

31 Following his discussion with Jenny Miller, Clive Sanborn discusses the options
available to Chance Computing with an intern who is shadowing him. With a partner,
role-play their conversation. Discuss the various options that are available to
Chance Computing, together with their possible outcomes. Consider the best case,
worst case and most likely scenarios.
Student 1: You are Clive Sanborn. Summarise the position that Chance Computing
are in.
Student 2: You are the intern shadowing Clive. Suggest some options for the
company based on the information in this unit.

Writing 2: Summary
32 Write a summary of your discussion. Include a model compensation package for
SAMPLE
ANSW ER
Chance Computing to offer their agents.
»P-147
 Litigation and arbitration

THE STUDY OF LAW

Lead-ih
A dispute is a disagreement or argument about something important. There are all
kinds of legal disputes, from disputes over people’s behaviour and business disputes to
planning and environmental disputes, to name just a few.
1 Legal disputes can be resolved in the courtroom, but there are other ways of
resolving them, as well. What forms of dispute resolution do you know?
What procedures do they involve?

Reading i: Litigation and arbitration

2 Read the text and decide whether these statements are true (T) or false (F).
1 The term litigation refers only to the hearing or a trial.
2 Mediation differs from arbitration in that the disputing parties are actively
involved in the decision-making process.
3 International arbitration developed in response to the need to settle
disputes involving more than one jurisdiction.
4 Online dispute resolution requires that the disputing parties meet in person
with the arbitrators before a final decision can be made.

If a dispute is not settled by agreement between the disputing parties, it will

eventually be heard and decided by a judge and/or jury in a court. A lawsuit
before a court is commonly referred to as litigation. In fact, litigation Includes
all stages before, during and after a trial.
Litigation may be used to resolve a dispute between private individuals, an
individual and a business, or between two businesses. Litigation sometimes
involves disputes between an individual or business and a government
agency, or between two governmental bodies.
In the UK, the majority of pre-trial work is carried out by a solicitor before the
case is passed on to a barrister, who will represent either the claimant1 or
the defendant during a hearing or a trial. In the USA, the same attorney may
deal with the case from the time the client first makes contact through to the
trial and enforcement stages. The steps in between these two stages typically
include an attempt to reach a settlement before and/or after filing a lawsuit
and pleadings, entering the discovery phase and then proceeding to trial. At
the end of a trial, the court will deliver its judgment and pass an order, which
the winning party's counsel2 and/or the court may help the winning party
to enforce.

1 (US) plaintiff
2 One or more of the lawyers taking part in a trial
Criminal matters are also considered litigation, and many civil litigation
lawyers also deal with criminal cases, as well as some forms of alternative
dispute resolution (ADR).
The term litigation is sometimes used to distinguish lawsuits from ADR
methods such as negotiation, arbitration and mediation. If a case goes to
arbitration, the disputing parties refer it to one or more impartial referees (the
arbitrators, arbiters or arbitral tribunal); the parties agree to be bound by the
referees' decision (e.g. an award for damages). Arbitration is the main form of
ADR used by businesses. Mediation involves a type of structured meeting with
the disputing parties and an independent third party who works to help them
reach an agreement between themselves. In arbitration, a binding decision is
imposed by an independent third party. With mediation, the role of the third
party is to facilitate negotiation and agreement between the disputing parties.
Arbitration is often used to resolve commercial disputes, particularly those
involving international commercial transactions, and it developed historically
alongside international trade. The arbitral process for resolving disputes under
international commercial contracts is referred to as international arbitration.
Arbitration is also used in some jurisdictions to resolve other types of dispute,
such as those involving employment-related issues.
Recent years have seen the development of online dispute resolution (ODR).
ODR proceedings start with the filing of a claim online, followed by
proceedings which take place over the Internet.

Key terms: Parties and phases in litigation and

arbitration
3 Complete the sentences below using the words for parties involved in dispute
resolution from the box.

: arbitration tribunal arbitrator barrister claimant court

|defendant disputing parties solicitor third party______

1 In litigation, th e ................................. files a lawsuit against the

........ ............. Usually, a ... .............................carries out pre-trial
work in preparation of the case, while a ........................ ..........represents
the claimant or defendant in court. When the case has been heard, the
................................ . delivers judgment.
2 In arbitration, a n ..... ....... .......... .........or ...................................decides on the
outcome of the case.
3 In mediation, an independent........................ ......... helps the
................................reach a settlement.
 Match the phases of litigation (1-4) with the descriptions (a-d).
pre-trial phase a One or both parties gathers evidence about the dispute by taking
discovery phase the testimony of witnesses, examining documents or physical
evidence, or requesting evidence from the other side,
trial phase b The facts of the case are heard by a judge, or by a judge and a jury.
enforcement phase The court delivers a judgment in the case,
c The losing party may file post-trial motions to convince the judge to
amend the judgment, or may decide to appeal to a higher court. The
winning party has the task of collecting the judgment,
d When a dispute arises, one party will usually have their lawyer send
a letter to the other party in an attempt to reach a settlement. This
party makes a demand of the other, who will then send a response.
Informal discussions often follow. If the parties cannot reach an
agreement, forma! action may be started and a suit is filed.
5 Read this outline of the advantages of one particular form of dispute
resolution, taken from a government website. Which form is being referred to?

It works because it: IPS

1 is a positive process which encourages cooperative problem-solving and preserves
relationships;
2 allows people to have a say in resolving their dispute;
3 can look at all aspects of the problem, not just the immediate
. . . * ’ * “■ —
4 enables people to hear directly from each other and gain a
other's needs.

....

6 In your opinion, what are the advantages and disadvantages of the other forms
of dispute resolution - including litigation? Discuss in small groups. Use some
of the phrases for talking about advantages and disadvantages introduced in
Unit 5.

Reading 2: Letter of invitation

The law faculty of a large university has invited a distinguished scholar, Professor Zhang
Lin, to speak on the subject of Chinese arbitration law. Nicholas O’Brien, a law student at
the university, has written to Professor Zhang.

7 Read the letter on page 86 and answer these questions.

1 What does Nicholas invite Professor Zhang to do?
2 What will the simulated arbitration be about?
3 What does Nicholas offer to send to Professor Zhang?

Unit 8 Litigation and arbitration

 Dear Professor Zhang

I am a student of law at University College, Dublin, Ireland, and a

member of the European Law Students’ Association (ELSA). This semester,
I am taking a course on alternative dispute resolution, and we are also
learning about ADR in China. My lecturer, Professor Peter Donnelly, has
informed me that you are visiting the university and giving a presentation
on the subject of Chinese arbitration law on 11 March. ELSA will
advertise your talk on its website and on campus. I’m certain that many
students will attend.
On behalf of ELSA I would like to invite you to take part in a simulated
arbitration, which will be carried out by students taking the ADR course.
We are holding the simulation the morning of 12 March, and very
much hope that you will have time to participate. We have selected an
interesting Chinese case, the ‘peanut kernel’ case (1999), and will use it as
the basis of the simulation. If you would like, I can send you more detailed
information about the planned simulation.
I would also like to invite you, on behalf of ELSA, to be the guest of
honour at a dinner we are hosting on 11 March at 8 p.m. I very much
hope that you will be able to accept this invitation.

I look forward to your reply.

Sincerely

Nicholas O ’Brien

Language use i: Future forms

As the examples from the letter show, there is no single verb form for referring
to the future in English. The two future forms (be + verb + -in g and will + verb)
are used to express the specific meanings listed in Exercise 8, and these are
best learnt separately.

8 a Find examples of the present continuous tense (be + verb + -ingj in the letter.
Which examples refer to the future, and which to the present? Label them
with the correct letter (A or B).
A future meaning: fixed arrangements in the future
B present meaning: an ongoing process at the moment of speaking
b Now look for examples of will + verb, and label them with the correct letter (C, D or E).
C making an offer or expressing an intention to do something
D making a prediction about the future
E referring to future time
9 Complete the letter on page 87, written in response to the invitation, with the correct
forms (verb + - ing or will + verb) of the verbs in brackets.
 Dear Mr O’Brien
Many thanks for your kind invitation. I am very grateful to you and ELSA for requesting my
participation in the simulated arbitration you 1 ) ............(hold) 12 March. Unfortunately, I 2 ) ......
(fly) to Hong Kong early in the morning that day and therefore cannot take part. Also, I 3 ) ..........
(meet) with a group of professors from the Law Faculty on the evening of the 11th. However,
I 4) ..... ....(try) to rearrange my schedule for that evening to make time to attend your dinner.
I 5 ) ..........(contact) you and let you know.
If you have any questions about Chinese arbitration law in general or the ‘peanut kernel’ case in
particular, please do not hesitate to ask and I 6 ) ........... (be) very happy to answer them.
Sincerely
Zhang Lin
jr-r or

Listening i: Question-and-answer session

10 These terms are used during a question-and answer-session following
Professor Zhang’s lecture on Chinese arbitration law. Match the terms (1-3)
with their definitions (a—c).
1 enforcement of an award a an international agreement signed
by two states
2 bilateral treaty b a party that has signed an international
agreement
3 signatory to a convention c ensuring that the decision of (e.g. an arbitral
tribunal1) is obeyed or carried out
11 ^ 8.1 Listen to the question-and-answer session and tick the topics that
Professor Zhang talks about.
1 The structure of China’s economy 0
2 The CIETAC □
3 International conventions to which China is a signatory Q
4 The enforcement of Chinese awards in foreign countries Q
5 Rights of appeal following arbitration in China
6 A Chinese case about to be decided by an arbitral tribunal G]
12 4^8.1 Listen again. The audience members begin their questions with phrases
that signal that a question is coming. Tick the question openers you hear.
1 I was wondering if you could tell us ... EH
2 You mentioned th a t... C]
3 Could you go back to the point you madeabout ... □
4 I’ve got a question ...
5 Could you tell us more about... □
6 I’m afraid I didn’t understand what you saida b o u t... d

Speaking i: Talk on litigation/arbitration

13 Prepare and hold a short talk (two to three minutes) about an aspect of litigation
or arbitration in your jurisdiction. Take notes during other students’ talks, and ask
questions using some of the question openers listed in Exercise 12.

1 also arbitrationai tribunal

2 China Internationa! Economic and Trade Arbitration Commission Unit 8 Litigation and arbitration
LAW IN PRACTICE
Lead-in
Lawyers generally attempt to settle disputes out of court before advising litigation.
However, sometimes a trial is unavoidable. Litigation involves three main stages: filing
the claim /defence, preparing the case and, finally, the court hearing. Litigation can also
involve the enforcement of a judgment when necessary.

14 Think of an example of a case that has gone to a final hearing. What are the
facts of the case? What are the legal issues? Which side won? Was the right
decision reached?

Reading 3: Avoiding litigation

15 What can businesses do to avoid litigation? If litigation is unavoidable, how can
a business minimise its legal costs? Discuss with a partner.
16 Read this article on limiting legal problems and match the first half of each
paragraph (1-5) with the correct second half (a-e) below.

Preventing large fees by limiting legal problems

by Daniel L. Abrams
It is always easier (and cheaper) to prevent a fire him or her without consulting an
legal problem from arising than to deal with a employment lawyer. [... j
problem through litigation. Saving money on It is a good idea to get everything in
legal fees does not mean ignoring problems writing. [...]
or handling matters yourself when you need Consider inserting a ‘loser pays’ rule into
legal expertise. Be proactive, for example: your commercial contracts. [...]
1 If somebody threatens to sue you, do not If you are about to be sued, check your
wait for the lawsuit. [...] insurance policies. [...]
2 If you have a problem employee, do not

a This discourages frivolous litigation.

b Businesses occasionally pay their lawyers for defending a lawsuit without
recognising that the litigation expenses are covered by insurance.
c Hire a lawyer immediately. Early settlement talks can clarify positions and save
substantial money in the form of both legal fees and damages.
d They can tell you how to conduct the firing in a way that minimises your exposure to
a lawsuit.
e Too much litigation arises out of ‘he said / she said’ disputes that can be avoided
by simple documentation. This rule applies to dealings with your lawyers as well.
17 a Read the article again and compare the ideas you discussed in Exercise 15.
b What other points would you add to (or remove from) the list? Discuss these with a
partner and then rank the complete list in order of importance.
Reading 4: Cost of litigation
18 Look quickly at the article below and answer these questions.
1 What do you think the word burden in the headline means?
2 What are the two most common types of litigation?

Litigation burden rises for firms

worldwide
A ccording to an annual survey by US lawyers
Fulbright & Jaworski, nearly 80% of UK
firms surveyed faced some court proceedings last
'Despite the general consensus that the UK is
not thought to be as tightly regulated as the US,
UK businesses are experiencing more exposure
year. Worldwide, litigation costs have risen by to regulatory matters,' said Lista Cannon, Head
25%. US and UK firms faced average litigation of European Disputes at Fulbright &Jaworski.
costs of $12m and $lm respectively. 'All companies must ensure they are prepared to
Construction firms face the highest litigation address current regulatory issues and anticipate
costs worldwide of any industry, with average future regulatory changes'
expenses of $39m. Insurers have paid out $36m The most common sources of litigation
on average, while manufacturers have incurred employment and contract disputes. While
costs of more than $14m. arbitration is considered a quicker way of
Although the cost of litigation is not as high resolving disputes than litigation, most fin
in the UK as across the Atlantic, the number believe there is little difference in terms of cost.
of legal actions and their expense is rising fast.

19 Read the text more closely and decide whether these statements are true (T)
or false {F).
1 Average litigation costs for British businesses are 12 times higher than
those in the USA.
2 Building firms have the highest legal expenses worldwide.
3 Most businesses believe that arbitration is cheaper than litigation.
20 Read the text again. What is a major factor in the increased costs of litigation?
21 Match these words or phrases from the text (1-4) with their definitions (a—d).
1 to incur a a legal restriction imposed by a government administrativeagency
2 to face / to address b a large sum of money which is paid to someone
3 regulation c to experience something, usually something unpleasant, asa result of
4 payout actions you have taken (e.g. costs)
d to give attention to or deal with a matter or problem (e.g. court
proceedings or litigation costs)

Reading 5: Letter before action

22 In what different ways can a person's employment end? Which of these might
result in litigation or arbitration? Discuss with a partner.
23 Read the letter on page 90 quickly and answer these questions.
1 What do you think the term constructive dismissal1 means?
2 Why might Ms Loushe have a strong case for a claim for defamation?
Unit 8 Litigation and arbitration
 64 Waldingfield Road
Minchin & Lacey Doncaster
SOLICITORS South Yorks hire
DN13GF
telephone: +44 1405 738 59235
fax: +44 1405 738 59236
YOUR REF: email: [email protected]
OUR REF: CSK/DT-1
29 February 2008
STRICTLY PRIVATE AND CONFIDENTIAL

David Tyler Construction Ltd.

Kersey Lane Industrial Estate
Shawditch Road
Doncaster
South. Yorkshire
DN2 3SQ

Dear Sirs
Our client: Jaycee Loushe
We are instructed by the above named in connection with her employment with your
company.
We understand that our client has been employed by you since 13 January 2007, and that
on 26 February, while attending to her duties with a colleague, she was accused by Mr
David Tyler of stealing confidential information from your offices. Our client strenuously
denies these accusations.
We are informed that there had been no previous criticism of our client’s work. In
fact, Mr Tyler recently informed her that she was a positive asset to the company and
suggested that a promotion, together with a substantial increase in her remuneration,
would shortiy be forthcoming.
In light of your actions of 26 February, it is clear that our client would be fully___
entitled to resign and bring a tribunal claim for constructive dismissal. Due to the
circumstances under which the allegations against our client were made, we have also
advised Ms Loushe that she would stand excellent prospects of success should she
decide to pursue a claim for exemplary damages^ and/or defamation.
However, our client would be prepared to discuss alternative means by which this
matter might be resolved. Our instructions are to commence proceedings against you
if we do not receive satisfactory proposals for settlement of this m atter within 14 days.
Yours faithfully
Minchin & Lacey Solicitors
Minchin & Lacey Solicitors

■(US) also constructive discharge 2 Compensation in excess of actual damages awarded in cases of malicious or
wilful misconduct designed to punish the breaching party (also punitive damages)

24 Read the letter again and answer these questions.

1 What is the purpose of the letter?
2 What are the facts of the case?
3 What legal actions might the recipient face?
4 What must the recipient do to avoid litigation?