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Business Contracts: The Criteria for Classifying a Provision in a Contract of Adhesion as Abusive

Many routine business agreements, such as contracts of employment, may be considered by the courts to be contracts of adhesion as they may not be freely negotiated. When a contract is thus qualified, it becomes possible to review the reasonableness of any provision therein which is found to be unfair. The person who signed the [...]

Business Agreements: The Limits of the Penal Clause

Business agreements often include a penal clause. This provision establishes a set amount or computation method for an amount to be paid by one of the parties to the other in the event that it fails to comply with one of its obligations pursuant to the contract. For instance, the non-compliance with a deadline in [...]

Business Agreements: an Ambiguous Duration Provision?

As explained during our seminars on business agreements, when drafting an agreement, it is not enough to merely state the various provisions of the contract. It is also important to ensure that the content is clear so as to avoid an eventual dispute between the parties on how it should be interpreted. A recent decision [...]

Business Contracts: The Entire Agreement Provision, a New Breach?

If you thought the entire agreement provision closed the door on the right of a contracting party to refer to previous documents to establish the intent of the parties, a recent decision of the Superior Court of Quebec ruled otherwise. The vast majority of business agreements contain an “entire agreement” or “precedence” provision indicating that such [...]

The Letter of Intent in the Context of the Purchase or Sale of a Business

Transactions for the purchase or sale of a business are complex and high risk operations. A potential buyer often wants to take the time to know the business before committing to the purchase. To do so, he will need to analyze information about the target business. The seller, on the other hand, wants to ensure [...]