IN SEMESTER INDIVIDUAL ASSIGNMENT FALL 2017

ANSWER 1:

A full-proof contractual agreement should be well-drafted so as to precisely cover the duties

and obligations of both the parties to it. This not only ensures that the contract is not
incomplete so as to leave out on any relevant duty, but a well-drafted contract also ensures
that there is no ambiguity as to the meaning of any clause. It is the responsibility of the
contract manager to try and cover all aspects relating to the contract. While his aim should be
to avoid any point of dispute between the parties in future, the contract should envisage the
dispute resolution mechanism in case a dispute arises so as to avoid unnecessary wastage of
time on resolving the correct way and the jurisdiction of the dispute. It is necessary to
understand that while a contract manager can work on removing ambiguities of text, the
ambiguities that rise because of failure of the parties to anticipate an event at the time of
drafting the contract or the occurrence of an unforeseeable event after the contract is drafted
are out of control of the contract manager. The ambiguities in text are due to improper
semantics, syntax or are contextual in nature. Also, because all the documents submitted to
the Court must be in Arabic, while being translated from English to Arabic, some ambiguities
are bound to occur in the meaning of certain terms because of linguistic limitations.

Sometimes, the parties after due consideration, deliberately leave the contract ambiguous so
as to give themselves more discretion in a way that is beneficial to both.

Article 4 of the Oman Commercial Laws provides that in case a contract leaves out any
provision or if a provision mentioned in the contract is invalid, then the relevant legislative
provisions of applicable laws would apply.

Article 267 of the Egyptian Civil Code issued through Royal Decree 29/2013 provides that
the Court may grant liquidated damages as specified in the contract on the breach of a
condition if the same is a reasonable assessment of the damages.

According to the common law rule of contra proferentem, an ambiguous term of a contract
must be interpreted against the drafter of the contract. This is so as to protect the weaker party
to the contract, though it is applied only as a last resort after considering other extrinsic
factors.

A real life example of the ambiguity of contracts is a case where the terms of the contracts
specified entitlements to the employee after reaching the specified target. The target that was
set was unrealistic to achieve but when the employee reached it and demanded entitlements
as per the contract, the company tried to transfer the employment base of the employee to
Bahrain so that the contract could be changed. Here, the amount the employee was entitled to,
was financially unrealistic. On refusal to transfer, his employment was ended. The claimant
demanded compensation along with the rightful commission as per the condition attached to
the target received. Here, the ambiguity lied in the structure of remuneration provided for in
the contract.
In such cases, the Courts usually favour the employees and in this case, the employee was
granted a fair compensation but not what he expected.

ANSWER 2

In Oman, there are two categories of contracts for employment- fixed contracts and unlimited
contracts. While the fixed contracts which are for a particular time duration cannot be
terminated by either parties unless there is a reasonable ground for the same as specified in
Article 40 and 41 and due notice has been served of the Oman Labour Laws, unlimited
contracts may be terminated by either parties by serving due notice, just that the dismissal
must not be arbitrary.

There are many reasons as to why it may become necessary to terminate a contract. It may be
the unsatisfactory performance of a party, if one party refuses to perform the contract or
breaches some provision of the contract. Other than this, the contract may become non-
practical to go on with due to better alternatives, or the purpose of the contract may end, or
either of the parties may become bankrupt. A worker may be dismissed by the employer
hence terminating the contract if there arises any of the reasons mentioned under Article 40
and 41 of the Oman Labour Laws.