L4M3 Exam Dumps : Commercial Contracting

Benefits for the purchaser in using call off contract are as below:

- The benefit of a call off contract is that they allow the supply of materials, goods and services to be secured over multiple delivery dates across the length of a project.

- Agreed prices, either fixed or pre-agreed mechanism for adjustment. This helps with setting and controlling budgets.

- Simple order mechanisms at the point of need

- Schedules of rates pricing enables electronic procure-to-pay systems, which gives greater control and visibility of spend

- The value of spend ad length of contract justify the cost of proper market engagement and tender or negotiation processes resulting in better value for money

- The longer the contract, the greater the opportunities for aligning working practices to create joint efficiency.

Express terms are the terms of the agreement which are expressly agreed between the parties. Ideally, they will be written down in a contract between the parties but where the contract is agreed verbally, they will be the terms discussed and agreed between the parties.

Implied terms are terms implied into the contract by the courts. They are not expressly set out in the contract but are taken to be as effective as if they were and as if they had been included from day one of the contract. The express terms and any implied terms together create the legally binding obligations on the parties.

The types of express terms to be found in a contract are many and varied and will depend on the type of contract. Any term written into the contract is an express term and may refer to price, time scales, warranties and indemnities, limitations on liability, conditions precedent and so on.

An implied term is a term which the courts imply into a contract because it has not been expressly included by the parties. This may be because the parties did not consider it, did not think that any problem would arise in relation to it or simply omitted to include it.

The courts are very reluctant to imply terms into contracts and will only do so in the following circumstances:

1. terms implied under statute

2. terms implied under common law

3. terms implied because of custom or usage

4. terms implied due to previous dealings

5. terms implied ‘in fact’ or to reflect the parties’ intentions

Incentivised pricing is designed to motivate suppliers to meet or exceed performance targets by providing financial or other incentives. In urgent projects, such as constructing a hospital ward during a pandemic, incentivised pricing encourages suppliers to accelerate delivery without compromising on quality. This supports the buyer’s need for speed and reliability.