Canadian Business Law. CONTRACT NEGOTIATION

EXERCISE #2 CONTRACT NEGOTIATIONGOALS OF ASSESSMENT
Upon completion of Exercise #2 – Contract Negotiation, you should be able to:
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Identify and implement negotiation strategies based upon a set of facts
Identify the specific contract terms that apply to the facts
Explain the importance of including the specific contract terms
Identify the risk management clauses that apply to the facts
Explain the importance of including the specific risk management clauses in the
contract
It has two parts:
Part 1 – Video on Risk Management Clauses (10 marks)
Part 2 – Video on Contract Terms (20 marks)
INSTRUCTIONS FOR ASYNCHRONOUS NEGOTIATION EXERCISE
Part 1 – Video on Risk Management Clauses (10 marks)
• Read the confidential instructions for both Grocery Store Inc. and Vegetable
Greenhouse Corp.
• Record a 5-6 minute video detailing the following:
o Explain why a contract should include risk management clauses. Your
answer should demonstrate your understanding of why it is beneficial for
each party to this contract to include risk management clauses (2 marks)
o Based upon the confidential facts:
▪ Identify why Vegetable Greenhouse Corp. would want a force majeure
clause in the contract. Your answer should explain how a force majeure
clause works, and provide an example of when it would benefit
Vegetable Greenhouse Corp. during their contract with Grocery Store
Inc. (3 marks)
▪ Identify why Grocery Store Inc. would want an indemnity clause in the
contract. Your answer should explain how the indemnity clause works,
and provide an example of when it would be benefit Grocery Store Inc.
during their contract with Vegetable Greenhouse Corp. (3 marks)
o Explain why both parties would want an arbitration clause in their contract (2
mark)
Part 2 – Video on Contract Terms (20 marks)
• Read the confidential instructions for both Grocery Store Inc. and Vegetable
Greenhouse Corp.
• Record a 5-6 minute video detailing what you think would be the result of a fair
negotiation for 8 of the following 11 contract terms (what do you think the parties
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EXERCISE #2 CONTRACT NEGOTIATION
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would have negotiated for each term) and explain why you think this is fair for
each term (2 marks each):
o Quantity
o Quality of product or service
o Pricing
o Payment
o Deadline
o Cancellations
o Condition precedent
o Condition subsequent
o Entire agreement
o Governing law
o Venue
You will also identify one term in the contract that is a condition, as opposed to a
warranty (1 mark), explain why it is a condition (2 marks) and explain what happens
if you breach that condition (1 mark).
RUBRIC
Exceptional
(negligible errors)
Fully and
completely
understood and
explained risk
management
clauses as applied
to facts (9 – 10
marks)
Strong
(minor errors)
Comprehension of
the risk management
clauses as applied to
the facts is mostly
demonstrated
(7 – 8.5 marks)
Capable
(intermittent errors)
Some comprehension
of the risk
management clauses
as applied to the facts
is demonstrated
(5 – 6.5 marks)
Developing
(numerous errors)
Limited
comprehension of
the risk management
clauses as applied to
the facts is
demonstrated
(0-4.5 marks)
COMPREHENSION
OF CONTRACT
TERMS (part 2)
Fully and
completely
understood and
applied contract
terms to the facts
(14-16 marks)
Comprehension of
the contract terms as
applied to the facts is
mostly demonstrated
(9-13.5 marks)
Some comprehension
of the contract terms
as applied to the facts
is demonstrated
(5-8.5 marks)
Limited
comprehension of
the contract terms as
applied to the facts is
demonstrated (0-4.5
marks)
COMPREHENSION
OF CONDITIONS
(part 2)
Fully and
completely
understood and
applied conditions
to the facts (4
marks)
Comprehension of
conditions as applied
to the facts is mostly
demonstrated
(3-3.5 marks)
Some comprehension
of conditions as
applied to the facts is
demonstrated
(2-2.5 marks)
Limited
comprehension of
conditions as applied
to the facts is
demonstrated (0-1.5
marks)
COMPREHENSION
OF RISK
MANAGEMENT
CLAUSES (part 1)
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EXERCISE #2 CONTRACT NEGOTIATION
SUB-TOTAL
/30
DEDUCTIONS
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Failed to meet video length requirements – 15 marks
Significantly exceeded video length requirements – 15 marks
Unprofessional conduct – up to 15 marks
TOTAL
/30
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