I.E.J.

Legal English
 
 
 
 
LESSON n°1: STANDARD PROVISIONS (1)
 
The students will be asked to comment the following provisions with their own
words, i.e. to show that they have understood the meaning and the purpose of
each article. All the IEJ English classes are made exclusively for those who will
prepare them.  Attendance of the class is in no way compulsory but
recommended. This class will start by a lecture in English on offer and
acceptance under French law and will therefore be the occasion to review some
principles of Contracts Law.
 
1 - TERM AND TERMINATION
 
1.1. Term : this Agreement shall commence on the Effective Date and will
continue for a term of 2 (two) years. This agreement will be renewed for
additional periods of 2 (two) years unless terminated by any of the Parties by
written notice at least six months prior to its expiration.
 
Termination
 
(provision which can be inserted in any contract)   - Either party may
terminate this Agreement without prejudice to its other remedies (either under
this Agreement or at general law) forthwith by notice in writing to the other if
that other either :
 
- fails to perform or observe any material term, condition, or undertaking
hereunder, commits a breach of this Agreement provided that if the breach is
capable of remedy the notice shall only be given if the party in breach shall not
have remedied the same within one month of having been given notice in writing
specifying the breach and requiring it to be remedied; or
 
- commits an act of bankruptcy or if (being a company) an order is made or a
resolution is passed for its winding up or if a receiver is appointed by a court
 
A termination for default or breach under the preceding paragraph shall not
preclude any remedies available for compensating the non-defaulting party in
respect of any damages it may have suffered and for which it may obtain an
arbitral award or, failing such award, to which it may be entitled at law or in
equity.
 
1.2.2 (provision of a sale contract inserted in the seller’s exclusive
interest)  - If the Buyer takes or suffers any action leading to its bankruptcy or
receivership in consequence of debt or commits any breach of this or any other
contract between the Seller and the Buyer, the Seller may without prejudice to
any of its other rights, stop any goods in transit and/or suspend further deliveries
and/or by notice in writing to the Buyer terminate the contract.
 
1.2.3. (provision of a trademark licence agreement) -  The Licensor may
terminate this Agreement forthwith by notice in writing in any of the following
circumstances if :
* the Licencee shall cease to be a direct or indirect 100 % subsidiary of Group
PLC;
* the Licencee's present ownership, management or control is changed without
the prior consent of LICENSOR and in a manner which LICENSOR considers to be
detrimental to its own interests.
 
1.2.4. (provision which can be inserted in any contract)   All provisions of
this Agreement which in order to give effect to their meaning need to survive its
termination shall remain in full force and effect thereafter.
 
2 - CONFIDENTIAL RELATIONSHIP
2.1. LICENSEE recognizes and acknowledges that all information supplied by
LICENSOR to LICENSEE in connection with or incorporated in any KNOW HOW,
technical or marketing assistance, or manufacturing machinery and related
equipment and tooling, supplied by LICENSOR pursuant to this Agreement, is
proprietary confidential information of LICENSOR which would not otherwise be
available to LICENSEE. LICENSEE therefore agrees to receive and use such
information only for the purpose of making and/or selling LICENSED PRODUCTS
under this Agreement.
 
2.2. LICENSEE agrees not to disclose any of such proprietary confidential
information received from LICENSOR or the latter's subsidiaries, affiliated
companies or other licensees under the LABEL PROGRAM, even after termination
or expiration of this Agreement, for so long as such information has not
independently become a matter of public knowledge, or becomes available to
LICENSEE from a third party who can lawfully disclose such information to
LICENSEE.
2.3. LICENSEE agrees to take all reasonable precautions to prevent any of its
employees, agents or representatives from violating LICENSEE's obligations
under this Article.
 
2.4. In the event that LICENSOR is the recipient of any information from
LICENSEE which the latter claims to be confidential and which was not previously
already known to or in the possession of LICENSOR, the obligations of LICENSOR
to keep such information confidential shall be governed by the same principles as
set forth above mutatis mutandis.
 
3 - FORCE MAJEURE
3. 1 -  The Seller shall not be liable to the Buyer for any loss or damage which
may be suffered by the Buyer as a direct or indirect result of the Supply of goods
by the Seller being prevented, hindered, delayed or rendered uneconomic by
reason of circumstances or events beyond the Seller's reasonable control
including but not limited to Act of God, war, riot, strike, lock-out, trade dispute or
labour disturbance, accident break-down of plant or machinery, fire, flood,
storm, difficulty or increased expense in obtaining workmen materials or
transport or other circumstances affecting the supply of the goods or of new
materials therefor by the Seller's normal source of supply or the manufacture of
the goods by the Seller's normal means or the delivery of the goods by the
Seller's normal route or means of delivery.
 
3.2 - If a limited quantity of goods is available to the Seller by reason of such
circumstances or events the Seller may apportion the available quantity between
its customers at its entire discretion.
 
4 - SUCCESSORS AND ASSIGNS
4.1 - All covenants and agreements in this Agreement made by or on behalf of either
of the parties hereto shall bind and inure to the benefit of  the
respective successors and assigns of the parties hereto whether so expressed or
not.
In the event of an assignment this Agreement shall be binding upon such successor or
assignee and the name of the party appearing herein shall be deemed to include the
names of any such successor or assignee.
This Agreement shall also apply to and be binding on the parties’ respective
controlled companies with respect to any activities covered by this Agreement.
 
4.2 -  The Licensee shall not assign, transfer, sub-contract or in any other
manner make over to any third party the benefit and/or burden of this
Agreement without the prior written consent of the Licensor.
 
5 - NO AGENT
5.1 - Nothing herein contained shall operate or be construed to constitute the
LICENSEE as an agent of LICENSOR, or permit LICENSEE to obligate or bind
LICENSOR with respect to third parties.
 
5.2 - This Agreement does not constitute any of the Parties, the partner, joint venturer
or employer of any other Party for any purpose whatsoever.
 
6 - WAIVER
The failure of any Party at any time to require performance by any other Party of any
provision hereof shall not affect in any way the right to require such performance at any
time thereafter. Nor shall the waiver by any Party of a breach of any provision thereof
be taken or held to be a waiver of the provision itself.
 
7 - TAX REGIME
The Loan being granted outside France, and being authorized by the French Ministry of
Economy and Finances, its interests will be, as provided by article 131 quatter of the
French General Tax Code, exempted from the withholding tax levied by article 124 A.
(III) of said Code.
 
In case of change in the French tax regulations causing such withholding tax to be
levied, subject to French law regarding usury, the fixed interest rate would be increased
so as to compensate the loss borne by the Lender.
 
All the taxes and duties levied in connection with the Agreement in the country of the
Borrower will be borne by the Borrower.
 
EXAMPLE OF AN ARTICLE OF GENERAL CONDITIONS OF
SALES.
 
 
(the students  will be invited to give the content of each
paragraph expressed with their own words and to
explain its    purpose, i.e. the reason why the seller inserted it).
 
“These terms and conditions of commercial sale (the “Terms and
Conditions”) apply to and form an integral part of:
 
These Terms and Conditions shall constitute all of the terms and
conditions of any Offer, Confirmation and Agreement between Semic and
Buyer relating tothe sale by Semic and purchase by Buyer of Products.
Any specifications and any terms and conditions set forth on  any
document or documents  issued  by Buyer either before or
after issuance  of any document by Semic setting forth or referring to
these Terms and Conditions are hereby explicitly rejected
and  disregarded  by Semic, and any such document shall be wholly
inapplicable to any sale made by Semic and shall not be  binding in any
way on Semic.
 
Any Offer is expressly made conditional on  Buyer’sassent  to all of the
terms contained in the Offer without deviation. Acceptance by Buyer of
an Offer may be evidenced by (i) Buyer’s written or verbal assent or
the written or verbal assent of any representative of Buyer, (ii) Buyer’s
 acceptance of delivery of the Products or payment of the
firstinstallment of the Products
 
Semic’s Offers are open for acceptance within the period stated by Semic
in the Offer or, when no period is stated, within thirty (30) days from the
date of the Offer, but any Offer may be withdrawn or revoked by Semic
at any time prior to the receipt by Semic of the Buyer’s acceptance
related thereto.
 
 
FICHE 2

I.E.J.
Legal English
 
 
 
LESSON n°2 : STANDARD PROVISIONS (2)
 
The students will be asked to comment the following provisions with their own
words, i.e. to show that they have understood the meaning and the purpose of
each article.
 
 
 
 
8 - GOVERNING LAW-JURISDICTION
 
If any disputes, differences or questions shall arise between the parties hereto,
or their successors, concerning the validity, the interpretation, construction,
meaning or effect of this Agreement or of any of its provisions or of the rights of
liabilities of the parties hereto or regarding an alleged breach of this Agreement
by either of the parties hereto, shall be settled amicably by the parties which
hereby undertake to develop their best effort to reach an equitable settlement. If
such a settlement cannot be reached, then every such dispute, difference or
question shall be referred to and settled by the Commercial Court of  Paris,
France which shall have exclusive jurisdiction, unless such jurisdiction is
waived by the Seller.
 
9 – ARBITRATION
 
If any disputes, …., then every such dispute, difference or question shall be
referred to and settled by arbitration. The award shall be finally binding upon the
parties hereto. Such arbitration shall be conducted in accordance with the Rules
of Conciliation and Arbitration of the International Chamber of Commerce. The
arbitration will be held in Paris, France, in the English language. In the event that
failure of a Party to this Agreement to comply with the decision of the arbitrators
requires the other Party to apply to any court for enforcement of such award,
and such award is ordered to be enforced, the non-complying Party shall be
liable to the other for all costs of such litigation including attorneys' fees.
 
10 - NOTICES
All notices, requests, demands and other communications hereunder shall be in
writing and shall be deemed to have been duly given if delivered or mailed, first
class postage prepaid, by certified or registered mail return receipt requested:
(a) To the Seller : If to the Seller, to: ...
(b) To the Purchasers : If to any Purchaser, to its address set forth on the
signature pages hereof, and shall be deemed effective on the date so delivered
or mailed.
 
11 - DUE AUTHORIZATION
Each Party hereto represents and warrants that it is authorized to enter into this
Agreement and that there are no outstanding commitments, agreements, or
understandings, express or implied. Which may or can in any way defeat or
modify the rights conveyed or obligations undertaken by it under this Agreement.
 
12 - PREVAILING VERSION
In case of discrepancies between the French and the English versions, the
English version will prevail. Yet, in case of legal action brought in France, the
French version will be communicated to the Court and used during the
proceedings except if a discrepancy on a point material to the issue at Court is
alleged by one of the parties.
 
13 - HEADINGS
Article and Section headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose.
 
14 - EXECUTION IN COUNTERPARTS
This Agreement may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one and
the same agreement.
 
 
 
15 - ENTIRE AGREEMENT
This Agreement sets forth the entire agreement and understanding between the
Parties relating to the subject matter hereof and supersedes all prior discussions,
documents and agreements. No Party shall be bound by any terms, conditions,
definitions, warranties understandings or representations with respect to the
subject matter hereof other than as expressly provided for herein except as may
hereafter be agreed in a writing signed by the Parties hereto.
 
16 - SEVERABILITY
In the event that any one or more of the provisions of this Agreement are held
to be unenforceable or invalid by a court of competent jurisdiction, LICENSOR
and LICENSEE shall negotiate an equitable adjustment in the provisions of this
Agreement with a view toward effecting the purpose of this Agreement, and the
validity and enforceability of the remaining provisions of this Agreement shall not
be affected thereby provided that the invalidity or unenforceability of said
provision does not result in the cancellation of an essential part of the
Agreement or defect one of its fundamental purposes.
 
17 - IN WITNESS WHEREOF
The parties hereto have, as of the date first above written, caused this
Agreement to be executed on their behalf by their respective officers thereunto
duly authorized.
 
EXERCISE : Translate the following provision  (stay close to the
French version, this is not a free translation):
 
CLAUSE DE RÉSERVE DE PROPRIÉTÉ
 
Les marchandises expédiées et facturées sont vendues avec une clause
subordonnant expressément le transfert de leur propriété au paiement intégral
du prix.
 
L'acceptation des livraisons ou des documents afférents à cette livraison vaut
acceptation de la présente clause.
Le paiement du prix s'entend de l'encaissement effectif.
 
A défaut de paiement à l'échéance, huit jours (8 jours) après une mise en
demeure effectuée par acte extra-judiciaire ou lettre recommandée, restée
infructueuse, la vente serarésolue  de plein droit si bon semble au vendeur qui
pourra revendiquer immédiatement la restitution des produits, sans préjudice de
tous autres dommages-intérêts.
 
Les dispositions ci-dessus ne font pas obstacle, dès la livraison des
marchandises, au transfert à l'acheteur des risques de perte ou de détérioration
des biens soumis à réserve de propriété ainsi que des dommages qu'ils
pourraient occasionner. L'acheteur devra souscrire une assurance garantissant
les risques nés à compter de la délivrance des marchandises.

Fiche 3

I.E.J.           -   Legal English

LESSON n°3 : Partnerships - United Kingdom - (1st
part)
Exercise : prepare the class by reading these articles of the 1890 Act; be ready to explain
their content and to compare them with the articles of the French civil code and of the
French commercial code on the “société en nom collectif” reproduced below as well as to
answer the questions.
- 1890  Act on Partnership (extracts)-
I - NATURE OF PARTNERSHIP
Definition of Partnership
1.--    (1) Partnership is the relation which subsists between persons carrying on a
business in common with a view of profit.
Rules for determining existence of partnership
2.--   In determining whether a partnership does or does not exist, regard shall be had to
the following rules:
(1) Joint tenancy, joint property, or part ownership does not of itself create a partnership
as to anything so held or owned, whether the tenants or owners do or do not share any
profits made by the use thereof
(2) the sharing of gross returns does not of itself create a partnership, whether the persons
sharing such returns have or have not a joint or common right or interest in any property
from which or from the use of which the returns are derived
(3) The receipt by a person of a share of the profits of a business isprima facie evidence
that he is a partner in the business, but the receipt of such a share, or of a payment
contingent on or varying with the profits of a business, does not of itself make him a
partner in the business; and in particular :
…/… (d) The advance of money by way of loan to a person engaged in any business on a
contract with that person that the lender shall receive a rate of interest varying with the
profits, or shall receive a share of the profits arising from carrying on a business, does not
of itself make the lender a partner wit the person or persons carrying on the business or
liable as such.
(e) A person receiving by way of annuity or otherwise a portion of the profits of a
business in consideration of the sale by him of the goodwill of the business is not by
reason only of such receipt a partner in the business or liable as such.
Workshop : compare article 1 and 2 with this article of the French civil code (what is similar, what is
different) :
 
 Art. 1832  -     A firm is established by two or several persons who agree by a contract to appropriate property or
their industry for a common venture with a view to sharing the benefit or profiting from the saving which may
result therefrom.
It may be established, in the cases provided for by statute, through an act of will of one person alone.
The members bind themselves to contribute to losses.
 
Meaning of firm
4.-  (1) Persons who have entered into partnership with one another are for the purposes
of this Act called collectively a firm, and the name under which their business is carried
on is called the firm name.
        (2) In Scotland a firm is a legal person distinct from the partners of whom it is
composed.
Remark :  a contrario this means that in the other parts of the U.K. the firm is not a
legal entity distinct from the partners.
Exercise : compare article 4 with this article of the French commercial code ( “SNC” ) :
 
Article L221-2 - A general partnership shall be designated by its business name, in which may be incorporated
the names of one or more partners and which must be immediately preceded or followed by the words “société
en nom collectif ” (general partnership).
 

II - RELATIONS OF PARTNERS TO PERSONS DEALING WITH FIRM

Power of partner to bind the firm.
5.-- Every partner is an agent of the firm and his other partners for the purpose of the
business of the partnership; and the acts of every partner who does any act for the
carrying on in the usual way business of the kind carried on by the firm of which he is a
memberbind the firm and his partners, unless the partner so acting has in fact no
authority to act for the firm in the particular matter, and the person with whom he is
dealing either knows that he has no authority, or does not know or believe him to be a
partner.
Partner using credit of firm for private purposes
7.-- Where one partner pledges the credit of the firm for a purposeapparently not
connected with the firm's ordinary course of business, the firm is not bound, unless he
is in fact specially authorised by the other partners.
 
Exercise : compare articles 5 and 7 with these   articles of the French commercial code
relating to the   “SNC”(General partnership ) :
Article L221-3 - All the partners shall be managers unless otherwise specified in the memorandum and
articles of association, which may appoint one or more managers, who may or may not be partners, or
provide for such appointment by means of a subsequent deed.
  Should a legal personality be a manager, its executives shall be subject to the same conditions and
obligations and incur the same civil and penal liabilities as though they were managers in their own
right,without prejudice to the joint and several liability of the legal personality which they manage.
 
Article L221-5 - In dealings with third parties, the manager shall bindthe partnership by acts within
the purpose of the company.
…/…
Clauses of the memorandum and articles of association limiting the powers of the managers resulting from this
article shall not beopposable to  third parties.
 
Liability of partners
9.-- Every partner in a firm is liable jointly with the other partners, and in
Scotland severally also, for all debts and obligations of the firm incurred while he is a
partner;
Exercise : compare article 9 with this   articles of the French commercial code
dealing with the   “SNC” :
Article L221-1 - The partners in a partnership shall all be deemed to be merchants and shall have
unlimited joint and several liability for the debts of the partnership.
A partnership’s creditors may not pursue payment of the debts of the partnership against a partner until after
having fruitlessly given the partnership formal notice to pay by extra-judicial means.

Fiche 4

I.E.J.  -   Legal English LESSON

n°4 :Partnerships (2nd part)
Liability for wrongs
10.-- Where, by any wrongful act or omission of any partner acting in the ordinary
course of the business of the firm, or with the authority of his co-partners, loss or injury is
caused to any person not being a partner in the firm, or any penalty is incurred, the firm is
liable therefor to the same extent as the partner so acting or omitting to act.
Persons liable by "holding out"
14.--  Every one who by words spoken or written or by conduct represents himself, or
who knowingly suffers himself to be represented, as a partner to any one who has on the
faith of any such representation given credit to the firm, whether the representation has or
has not been made or communicated to the person so giving credit by or with the
knowledge of the apparent partner making the representation or suffering it to be made.
Notice to acting partner to be notice to the firm
16.-- Notice to any partner who habitually acts in the partnership business of any matter
relating to partnership affairs operates as notice to the firm, except in the case of fraud on
the firm committed by or with the consent of that partner.
Liabilities of incoming and outgoing partners
17.--  (1) A person who is admitted as a partner into an existing firm does not thereby become
liable to the creditors of the firm for anything done before he became a partner
(2) A partner who retires from a firm does not thereby cease to be liable for partnership
debts or obligations incurred before his retirement.
(3) A retiring partner may be discharged from any existing liabilities, by an agreement to
that effect between himself and the members of the firm as newly constituted and the creditors,
and this agreement may be either express or inferred as a fact from the course of dealing between
the creditors and the firm as newly constituted.
III - RELATIONS OF PARTNERS TO ONE ANOTHER
Variation by consent of terms of partnership
19.-- The mutual rights and duties of partners, whether ascertained by agreement or defined by
this Act, may be varied by the consent of all the partners, and such consent may be either express
or inferred from a course of dealing
Exercise : compare article 19 with this article of the French civil code :
Art. 1835 -    The memorandum and the articles of association or of partnership must be drawn up in writing.
They shall determine, in addition to the contributions of each member, the form, the objects, the name, the
registered place of business, the capital of the firm, the duration of the firm and its rules of functioning.
Partnership Property
20.--  All property and rights and interests in property originally brought into the
partnership stock or acquired, whether by purchase or otherwise, on account of the firm,
or for the purposes and in the course of the partnership business, are called in this Act
partnership property, and must be held and applied by the partners exclusively for the
purposes of the partnership and in accordance with the partnership agreement
Question : how is the issue of the ownership of the property and rights contributed
to the “société en nom collectif ” dealt with under French Law ?
Property bought with partnership money
21.-- Unless the contrary intention appears, property bought with money belonging to the
firm is deemed to have been bought on account of the firm.

Rules as to interests and duties of partners subject to special agreement

24.--  (1) The interests of partners in the partnership property and their rights and duties
in relation to the partnership shall be determined, subject to any agreement express or
implied between the partners, by the following rule :
 All the partners are entitled to share equally in the capital and profits of the
business, and must contribute equally towards the losses whether of capital or otherwise
sustained by the firm…/.. 
(2) The firm must indemnify every partner in respect of payments made and
personal liabilities incurred by him--
(a) In the ordinary and proper conduct of the business of the firm; or,
(b) In or about anything necessarily done for the preservation of the
business or property of the firm. …/…
 (4) A partner is not entitled, before the ascertainment of profits, to interest on the
capital subscribed by him.
(5) Every partner may take part in the management of the partnership business.
(6) No partner shall be entitled to remuneration for acting in the partnership
business.
(7) No person shall be introduced as a partner without the consent of all existing
partners.
Exercise : compare this provision   with this article of the French commercial code on
“SNC” :
Article L221-13 - The shares may not be represented by negotiable securities. They may be sold only with
the consent of all the partners.
Any clause to the contrary shall be deemed null and void.
(8) Any difference arising as to ordinary matters connected with the partnership
business may be decided by a majority of the partners, but no change may be
 made in the nature of the partnership business without the consent of all existing
partners.
Expulsion of partner
25.-- No majority of partners can expel any partner unless a power to do so has been
conferred by express agreement between the partners.
Dissolution by bankruptcy or    death
33.--  Subject to any agreement between the partners, every partnership is dissolved as
regards all the partners by the death or bankruptcy of any partner.
Exercise : compare this provision   with this article of the French commercial code on
“SNC” :
Article L221-16 - If an order is made for a winding-up proceedings or defining a total assignment plan, if an
order prohibiting the exercise of a commercial profession or if an incapacity order is made in respect of one of the
partners, the partnership shall be dissolved unless its continuation is specified in its memorandum and articles of
association or if the other partners so decide by unanimous agreement.

Fiche 5

Lesson 5 - DISTRIBUTORSHIP AGREEMENT

 
The students will be able to show that they can explain in English the general
purpose of this agreement and try to explain the regime of exclusive
distributorship. Then each student will select what he/she thinks are the five
most important provisions  of this contract and will be able to talk about their
content with his/her own words (which means that a mere reading of a
provision of the contract is fully inadequate).
The students will start to select the legal vocabulary contained in this
contract so as to be able to use it again  in the future lessons.
 
This AGREEMENT made and entered into this _____ day of _ 2004 by and
between  SAMSUNG
Ltd., a corporation organized and existing under the laws of Korea and having its
registered office at
....                                                                  
(hereinafter referred to as
"MANUFACTURER")
and
... S.A.R.L., a corporation organized and existing under the laws of the Republic of
France with its registered office at ...
(hereinafter referred to as
"DISTRIBUTOR")
 
WITNESSETH
 
WHEREAS MANUFACTURER is engaged in the manufacture and sale of various kinds of
electric and electronic equipment including those particular products as defined
hereinafter and desirous of developing its business in the TERRITORY hereinafter set
forth ;
 
WHEREAS, DISTRIBUTOR IS engaged in the business of importation and distribution of
similar products and bas many distribution outlets in the TERRITORY and desires to deal
in and sell the products in the TERRITORY ; and
 
WHEREAS, MANUFACTURER is desirous of granting to DISTRIBUTOR the exclusive
right to distribute the products in the TERRITORY AND DISTRIBUTOR is willing to accept
it.
Now, THEREFORE in consideration of the mutual covenants hereunder set forth. the
parties hereto agree as follows:
 
Article 1. Definitions
 
When used in this Agreement, each of the following terms shall have the meaning
attributed to it below.
 
(a) "PRODUCTS" shall exclusively mean the following listed products directly and/or
indirectly manufactured and/or sold by MANUFACTURER under SAMSUNG named
trademarks together with any related equipments:
 
(i) Audio/HiFî Equipment
(ii) Video Cassette Recorder/Video Cassette Player
(iii) Black and White TV / Color TV
(iv) Microwave Oven
 
(b) "TERRITORY" shall mean the Republic of France only.
 
(c) " MANUFACTURER 'S TRADEMARKS" sha11 mean those trademarks,
tradenames, slogans, lables, logo and other trade identifying symbols whether
registered or not in the Territory which are developed and used
by MANUFACTURER in connection with any PRODUCTS to be sold by DISTRIBUTOR in
the TERRITORY pursuant to this Agreement.
 
(d) "NOTICE" shall mean a notice given in accordance with the terms of Article 20 of
this agreement.
 
(e) " AGREEMENT " means this Agreement, any written amendment and any exhibits
or schedule thereto and all references to "herein"; "hereunder" or "hereof" shall refer to
this entire Agreement.
 
(f) "SHIPPING COSTS" means all costs and expenses customarily incurred or charged
by MANUFACTURER for the transportation of any applicable materials including without
limitation packing. insurance international freight, taxes, customs duties, handling fees,
and others similar items.
 
(g) "TERMS" means the period of time set forth in Article 17 of this Agreement
 
Article 2. Distributorship
 
2~1) MANUFACTURER hereby grants to DISTRIBUTOR the exclusive right to distribute
the PRODUCTS in the TERRITORY during the terms of this Agreement and subject to
the provisions and conditions hereinafter set forth provided, however, that the parties
hereto agree that the exclusive right applies only to the PRODUCTS as defined in Article
1 hereof and MANUFACTURER reserves an unfettered right to sell and distribute in the
TERRITORY either directly or, through any third party other products under its
trademarks or private brand names except for the PRODUCTS.
 
2-2) DISTRIBUTOR shall not without the prior written consent of
MANUFACTURER  purchase, import, expert, sell, distribute or otherwise deal in
products  the same as, competitive with or similar to PRODUCTS in the
TERRITORY  provided that it shall not preclude DISTRIBUTOR from having its
top  management personnel perform any of their other activities and such activities shall
net adversely affect the sale of the PRODUCTS and mix the distribution  of the
PRODUCTS with any other competitive products.
 
2-3) DISTRIBUTOR shall not directly sell or export the PRODUCTS outside
the  TERRITORY and shall use its best effort in the course of distribution of
the  PRODUCTS through its sub-distributors not to cause any third party to sell  or
export the PRODUCTS outside the TERRITORY provided that this Article shall not be
construed as preventing DISTRIBUTOR from complying with  relevant French or EEC
laws or regulations in connection with contracts  of commercial cooperation ,
 
2-4) MANUFACTURER shall not, during the terms of this Agreement, sell PRODUCTS in
the TERRITORY through any person, company or distributor other than DISTRIBUTOR.
 
2-5) MANUFACTURER shall have a right subject to adequate prior notice to
DISTRIBUTOR to change types or design of the Products or to discontinue or eliminate
any models of the Products without any liability to DISTRIBUTOR.
 
Article 3. Orders
 
3-1) Without prejudice to the other provisions of this Agreement and in particular to the
provisions under Article 5.1 MANUFACTURER shall sell PRODUCTS to DISTRIBUTOR  in
the TERRITORY for resale in the TERRITORY in accordance with the terms
and  conditions of each sales contract to be separately agreed and fixed between
the  parties provided that unless agreed otherwise provisions in this Agreement shall  be
applicable to each sales contract where the context so admits.
 
3-2) No sales contract shall be binding unless and until accepted by MANUFACTURER
 
3-3) MANUFACTURER shall use its best effort to accept any reasonable orders for the
products placed by DISTRIBUTOR provided that it shall not be required to accept a
DISTRIBUTOR'S order or any part thereof when  :
 
- a) the PRODUCTS are not available or sufficient enough to fi11 the
order  placed by DISTRIBUTOR, or all the orders placed by DISTRIBUTOR and
other  customers ; or
- b) MANUFACTURER has discontinued the manufacture or sale of the
PRODUCTS  ordered at the time the order is received ; or
- c) DISTRIBUTOR has defaulted to any material degree upon any of
the  Articles of this Agreement.
 
3-4) Neither DISTRIBUTOR nor MANUFACTURER shall rescind or amend any order
which has been accepted by both the MANUFACTURER and DISTRIBUTOR without
written consent of the other party.
 
3-5) Quotations by MANUFACTURER are not offers but only invitations to the
DISTRIBUTOR to make an offer. No order from DISTRIBUTOR is binding on
MANUFACTURER until MANUFACTURER issues an Acknowledgement to DISTRIBUTOR
for such order,
 
Article 4 - Independence of Parties
 
4-1) It is expressly agreed that the relationship hereby established between
MANUFACTURER and DISTRIBUTOR is that of supplier and purchaser. DISTRIBUTOR is
an independent contractor and does not have authority to act and/or to bind
MANUFACTURER in any way, or to represent that MANUFACTURER is in any
way  responsible for the acts of Distributor. This Agreement does not establish a joint
venture, agency or partnership between the parties nor does it create  an
employer/employee relationship.
 
Article 5. Prices and Payment
 
5-l) MANUFACTURER will sell the PRODUCTS to DISTRIBUTOR at the reasonable prices
MANUFACTURER normally sells to its other exclusive distributors from time to time.
 
5-2) MANUFACTURER, in its sole discretion, may change the prices of the  PRODUCTS
provided that such change of prices shall become effective and  applicable to each sales
contract to be effected between the parties only from the date of MANUFACTURER'S
notice thereof to DISTRIBUTOR unless otherwise  specified therein.
 
5-3) DISTRIBUTOR and MANUFACTURER will cooperate in all good faith to establish
selling prices for the PRODUCTS et a level appropriate for the competitiveness of the
PRODUCTS.
 
5-4) All payment for the PRODUCTS shall be made by an irrevocable and  confirmed
Letter of Credit, without recourse to be opened for each sales contract through a prime
bank acceptable to MANUFACTURER.  The Letter of Credit shall be opened et least 60
days prior to the date of each shipment of the PRODUCTS ordered by
DISTRIBUTOR.  However, DISTRIBUTOR sha11 inform MANUFACTURER of its order
confirmation  at least 120 days prior to the shipment of the PRODUCTS.
 
5-5) If DISTRIBUTOR fails to provide such a Letter of Credit MANUFACTURER shall have
the option of reselling the contracted goods in any country, holding the goods for
DISTRIBUTOR'S accounts and risk and/or cancelling the contract and claiming for
damages caused by DISTRIBUTOR'S default.
 
Article 6 -  Risk and Property
 
Risk in PRODUCTS supplied by MANUFACTURER to DISTRIBUTOR will pass upon
delivery FOB or CIF as will be agreed from time to time between the parties.
Property in such goods supplied by MANUFACTURER shall pass to DISTRIBUT0R
on payment in full to MANUFACTURER of the contract price therefor.

Fiche 5

Lesson 5 - DISTRIBUTORSHIP AGREEMENT

 
The students will be able to show that they can explain in English the general
purpose of this agreement and try to explain the regime of exclusive
distributorship. Then each student will select what he/she thinks are the five
most important provisions  of this contract and will be able to talk about their
content with his/her own words (which means that a mere reading of a
provision of the contract is fully inadequate).
The students will start to select the legal vocabulary contained in this
contract so as to be able to use it again  in the future lessons.
 
This AGREEMENT made and entered into this _____ day of _ 2004 by and
between  SAMSUNG
Ltd., a corporation organized and existing under the laws of Korea and having its
registered office at
....                                                                  
(hereinafter referred to as
"MANUFACTURER")
and
... S.A.R.L., a corporation organized and existing under the laws of the Republic of
France with its registered office at ...
(hereinafter referred to as
"DISTRIBUTOR")
 
WITNESSETH
 
WHEREAS MANUFACTURER is engaged in the manufacture and sale of various kinds of
electric and electronic equipment including those particular products as defined
hereinafter and desirous of developing its business in the TERRITORY hereinafter set
forth ;
 
WHEREAS, DISTRIBUTOR IS engaged in the business of importation and distribution of
similar products and bas many distribution outlets in the TERRITORY and desires to deal
in and sell the products in the TERRITORY ; and
 
WHEREAS, MANUFACTURER is desirous of granting to DISTRIBUTOR the exclusive
right to distribute the products in the TERRITORY AND DISTRIBUTOR is willing to accept
it.
Now, THEREFORE in consideration of the mutual covenants hereunder set forth. the
parties hereto agree as follows:
 
Article 1. Definitions
 
When used in this Agreement, each of the following terms shall have the meaning
attributed to it below.
 
(a) "PRODUCTS" shall exclusively mean the following listed products directly and/or
indirectly manufactured and/or sold by MANUFACTURER under SAMSUNG named
trademarks together with any related equipments:
 
(i) Audio/HiFî Equipment
(ii) Video Cassette Recorder/Video Cassette Player
(iii) Black and White TV / Color TV
(iv) Microwave Oven
 
(b) "TERRITORY" shall mean the Republic of France only.
 
(c) " MANUFACTURER 'S TRADEMARKS" sha11 mean those trademarks,
tradenames, slogans, lables, logo and other trade identifying symbols whether
registered or not in the Territory which are developed and used
by MANUFACTURER in connection with any PRODUCTS to be sold by DISTRIBUTOR in
the TERRITORY pursuant to this Agreement.
 
(d) "NOTICE" shall mean a notice given in accordance with the terms of Article 20 of
this agreement.
 
(e) " AGREEMENT " means this Agreement, any written amendment and any exhibits
or schedule thereto and all references to "herein"; "hereunder" or "hereof" shall refer to
this entire Agreement.
 
(f) "SHIPPING COSTS" means all costs and expenses customarily incurred or charged
by MANUFACTURER for the transportation of any applicable materials including without
limitation packing. insurance international freight, taxes, customs duties, handling fees,
and others similar items.
 
(g) "TERMS" means the period of time set forth in Article 17 of this Agreement
 
Article 2. Distributorship
 
2~1) MANUFACTURER hereby grants to DISTRIBUTOR the exclusive right to distribute
the PRODUCTS in the TERRITORY during the terms of this Agreement and subject to
the provisions and conditions hereinafter set forth provided, however, that the parties
hereto agree that the exclusive right applies only to the PRODUCTS as defined in Article
1 hereof and MANUFACTURER reserves an unfettered right to sell and distribute in the
TERRITORY either directly or, through any third party other products under its
trademarks or private brand names except for the PRODUCTS.
 
2-2) DISTRIBUTOR shall not without the prior written consent of
MANUFACTURER  purchase, import, expert, sell, distribute or otherwise deal in
products  the same as, competitive with or similar to PRODUCTS in the
TERRITORY  provided that it shall not preclude DISTRIBUTOR from having its
top  management personnel perform any of their other activities and such activities shall
net adversely affect the sale of the PRODUCTS and mix the distribution  of the
PRODUCTS with any other competitive products.
 
2-3) DISTRIBUTOR shall not directly sell or export the PRODUCTS outside
the  TERRITORY and shall use its best effort in the course of distribution of
the  PRODUCTS through its sub-distributors not to cause any third party to sell  or
export the PRODUCTS outside the TERRITORY provided that this Article shall not be
construed as preventing DISTRIBUTOR from complying with  relevant French or EEC
laws or regulations in connection with contracts  of commercial cooperation ,
 
2-4) MANUFACTURER shall not, during the terms of this Agreement, sell PRODUCTS in
the TERRITORY through any person, company or distributor other than DISTRIBUTOR.
 
2-5) MANUFACTURER shall have a right subject to adequate prior notice to
DISTRIBUTOR to change types or design of the Products or to discontinue or eliminate
any models of the Products without any liability to DISTRIBUTOR.
 
Article 3. Orders
 
3-1) Without prejudice to the other provisions of this Agreement and in particular to the
provisions under Article 5.1 MANUFACTURER shall sell PRODUCTS to DISTRIBUTOR  in
the TERRITORY for resale in the TERRITORY in accordance with the terms
and  conditions of each sales contract to be separately agreed and fixed between
the  parties provided that unless agreed otherwise provisions in this Agreement shall  be
applicable to each sales contract where the context so admits.
 
3-2) No sales contract shall be binding unless and until accepted by MANUFACTURER
 
3-3) MANUFACTURER shall use its best effort to accept any reasonable orders for the
products placed by DISTRIBUTOR provided that it shall not be required to accept a
DISTRIBUTOR'S order or any part thereof when  :
 
- a) the PRODUCTS are not available or sufficient enough to fi11 the
order  placed by DISTRIBUTOR, or all the orders placed by DISTRIBUTOR and
other  customers ; or
- b) MANUFACTURER has discontinued the manufacture or sale of the
PRODUCTS  ordered at the time the order is received ; or
- c) DISTRIBUTOR has defaulted to any material degree upon any of
the  Articles of this Agreement.
 
3-4) Neither DISTRIBUTOR nor MANUFACTURER shall rescind or amend any order
which has been accepted by both the MANUFACTURER and DISTRIBUTOR without
written consent of the other party.
 
3-5) Quotations by MANUFACTURER are not offers but only invitations to the
DISTRIBUTOR to make an offer. No order from DISTRIBUTOR is binding on
MANUFACTURER until MANUFACTURER issues an Acknowledgement to DISTRIBUTOR
for such order,
 
Article 4 - Independence of Parties
 
4-1) It is expressly agreed that the relationship hereby established between
MANUFACTURER and DISTRIBUTOR is that of supplier and purchaser. DISTRIBUTOR is
an independent contractor and does not have authority to act and/or to bind
MANUFACTURER in any way, or to represent that MANUFACTURER is in any
way  responsible for the acts of Distributor. This Agreement does not establish a joint
venture, agency or partnership between the parties nor does it create  an
employer/employee relationship.
 
Article 5. Prices and Payment
 
5-l) MANUFACTURER will sell the PRODUCTS to DISTRIBUTOR at the reasonable prices
MANUFACTURER normally sells to its other exclusive distributors from time to time.
 
5-2) MANUFACTURER, in its sole discretion, may change the prices of the  PRODUCTS
provided that such change of prices shall become effective and  applicable to each sales
contract to be effected between the parties only from the date of MANUFACTURER'S
notice thereof to DISTRIBUTOR unless otherwise  specified therein.
 
5-3) DISTRIBUTOR and MANUFACTURER will cooperate in all good faith to establish
selling prices for the PRODUCTS et a level appropriate for the competitiveness of the
PRODUCTS.
 
5-4) All payment for the PRODUCTS shall be made by an irrevocable and  confirmed
Letter of Credit, without recourse to be opened for each sales contract through a prime
bank acceptable to MANUFACTURER.  The Letter of Credit shall be opened et least 60
days prior to the date of each shipment of the PRODUCTS ordered by
DISTRIBUTOR.  However, DISTRIBUTOR sha11 inform MANUFACTURER of its order
confirmation  at least 120 days prior to the shipment of the PRODUCTS.
 
5-5) If DISTRIBUTOR fails to provide such a Letter of Credit MANUFACTURER shall have
the option of reselling the contracted goods in any country, holding the goods for
DISTRIBUTOR'S accounts and risk and/or cancelling the contract and claiming for
damages caused by DISTRIBUTOR'S default.
 
Article 6 -  Risk and Property
 
Risk in PRODUCTS supplied by MANUFACTURER to DISTRIBUTOR will pass upon
delivery FOB or CIF as will be agreed from time to time between the parties.
Property in such goods supplied by MANUFACTURER shall pass to DISTRIBUT0R
on payment in full to MANUFACTURER of the contract price therefor.

Fiche 6

Lesson 6 : be able to talk with your own wording about those pages + do
exercises.

Labor Law - Employment Contract

 

I - Types of Contracts –
 
The standard form of employee recruitment ends in the execution of an
indeterminate period contract (or open-ended contract). Under such a
contract, the employee has a right to continue working for his employer unless
and until he is fired for cause. French labor law forces the use of indeterminate
period contracts on employers by restricting the qualifying conditions for use
of fixed-term or temporary-worker (« temp ») contracts. The severity of this
rule imposing indeterminate contracts on employers is tempered by the ability to
engage employees for trial periods, during which the employer may fire the
employee at will, prior to commencing the indeterminate term.
 
Fixed Term Contracts
To encourage stable employment, the labor administration feels justifies in
strictly construing the rules for use of fixes term contracts to prevent avoidance
of indeterminate term contracts. A term contract may only be uses to hire an
employee: (i) to perform a precise and temporary task in factual circumstances
defined by the law, (ii) to hire a trainee.
The most frequent justification for the use of a temp employee is to per form
a « precise and temporary task ”. This legal term, which is extensively defi
ned by administrative regulations, encompasses the need :
• to replace an employee who is temporarily absent or whose contract is tem
porarily suspended ;
• to temporarily replace an employee who has quit and whose job is being
eliminated ;
• to fill a temporary vacancy while awaiting the arrival of a new hire ;
• to deal with a temporary increase in business activity (e.g., for a large order or
for an extraordinary export sale);
- to hire for seasonal work ;
 
A written employment contract is required when the individual is hired as a
temp, on a fixed term or on apart-time contract. Collective conventions for
some business sectors also mandate a written employment contract. Other than
these cases, an employment contract need not be in writing. It can result from a
verbal agreement.
An employee's definitive hiring must be preceded by apre-hiring notice that is
filed with the local social security office, which must disclose a certain amount of
personal information about the employee and about the terms of employment.
For the public authorities, the pre-hiring notice is designed to prevent the
enterprise from hiringundocumented employees.
 
Trial Period
Given the difficulty of dismissing an employee once definitively hired, the point
that the employee's hiring becomes definitive is frequently preceded by a trial
period (essentially a preliminary contract period) during which the employer
attempts to assess the professional aptitude of the employee.
The trial period may be extended before the end of its term provided the
extension is explicit and not abnormal or abusive.
During the trial period, either party to the agreement may terminate it at any
moment without notice or indemnities, unless the contract or a collec tive
convention specifies otherwise.
 
 
 
Non-competition Clause
A non-competition clause may be drafted into an employment agreement or be
read into the contract by a collective convention. As in most legal systems, the
validity and scope of non-competition clauses has been elaborated by the courts
rather than the legislature. To be valid under the case law, a non-competition
agreement must be reasonably limited in time, in space, and in the specific
activities that are prohibited. The clause takes effect on the date of the
employee's departure from the enterprise, whatever the rea son for leaving.
Compensation must be paid to the ex-employee operating under the restrictions
of a non-competition clause. In such a case, the employer can decide to lift the
non-competition restriction and thereby avoid paying non-competition
compensation.
 
II - Amending the Contract - Substantial Modifications
The employer and the employee may amend their employment agreement
during the course of the agreement. In the more typical situation, the employer
proposes to modify some of an employee's working conditions to improve
performance or production. Provided that the change is not substantial, the
employer unilaterally may change the employee's working conditions, job
description, or place of work. The employer may not, however, unilaterally make
a substantial modification to an employee's contract without his permission.
The distinction between substantial and insubstantial, proposed and effective,
temporary or permanent modifications in employment contracts have generated
a considerable case law. For example, the courts have held that moving the
business from Paris to a suburb was a substantial change because the employee
had to travel an additional 22 minutes to work. In another case, a move was not
considered by the courts as a substantial change because the employer provided
free transport to the new location.
The significance of having made a permanent and substantial modification to an
employment contract is that the change could be considered as a de
facto dismissal triggeringabusive termination indemnities, but only if the
employee refuses to consent to the change.
 
III – Transfer of employees and assignment of contracts
 
Transfer or Détachement
Labor law distinguishes between different types of modifications to employment
contracts that involve sending employees to work in another enterprise.
An employee is transferred to another enterprise when one employer agrees to
send the employee to work permanently with an other employer. Legally, the
initial employment contract is broken, and a new contract is made with the new
employer. The employee's rights against the former employer remain
(for vacation pay indemnities, etc.) and his rights against his new employer
begin only once the new contract begins (for tenure rights, etc.). The situation
is more complicated when the transfer is made between companies of the same
group. Typically, an agreement will be made between the two related companies
such that the employee's salary, vacation, and tenure rights are preserved. In
the absence of such an agreement, the courts have intervened to grant the
employee transferred within the group rights akin to a continuity of employee
status based on the existence of economic and financial links between the
successive employers (a quasi-article L.122-12 situation).
In a temporary transfer (détachement), the employee's contract with the
transferor enterprise continues. He will be reintegrated in the transferor
employer's personnel once the temporary mission is completed, and the
transferor remains liable for all of its former employment obligations should the
transferee enterprise default in any of its obligations. As such,
a détachement agreement is usually drafted between the two employers setting
forth their respective duties vis-à-vis the employee.
A temporary transfer abroad is a special case, whose exact consequences
depend on whether the transfer is within the Single Market.
 
Changes in the Legal Status of the Employer
Whatever the form for an acquisition of an existing concern, French and
community labor law will tend to require that the acquiror of the business
assume all of the former employer's obligations to his former employees. The
exact scope of this rule is continually being modified by the French
andCommunity courts such that legal advice on the precise transaction may
be necessary to accurately determine the labor law liabilities that will be
assumed by the acquiror during an acquisition.
The definitional scope of this obligation under French law, which applies when
there is « a modification in the legal status of the employer », is specified by
Labor Code article L.122-12. As examples of the «modifications» to which article
122-12 applies, the Labor Code lists the following  :
 
1. A transfer following the death of the employer.
2. A merger, a transformation, the incorporation of a business, or any other
change in the form the employer uses for doing business (e.g., a drop down of
an existing business into a new subsidiary);
3. A sale of a business. Regarding the “sales” category of covered «
modifications », the sale may involve the transfer of a complete business activity
conducted by the seller or merely a part of the seller's business that is capable of
standing alone and that is then continued by the purchaser. Such partial asset
transfers covered by article L.122-12 could consist in the transfer of as little
as a trademark or a license to which specific personnel are associated or the sale
of a warehouse and related inventory.
 
Given that the above statutory list is merely indicative and is not restrictive in
the Code, case law bas extended the article L.122-12 rule to include any transfer
of an economic unit that maintains its identity as such.
For example, the courts have held that the simple transfer of a service contract
from one service provider to another by the contractor required the new supplier
to take over and assume all the former employer's employment contracts, even
though the two employers were totally unrelated, had no contract between
them, and did not intend a transfer of personnel (the students will give other
examples).
 
When, under article 122-12, the employer is deemed to have merely changed
its legal status, the new employer must assume all the existing employment
obligations of the former employer in existence on the date of the transfer. ln
the absence of a clause to the contrary  in a contract between them, the
former employer remains liable to the new employer for any pre-transfer
obligations. Nevertheless, since the law presumes that the identity of the
employer did not change vis-à-vis employees, the employee may demand that
the new employer remedy any injury caused by the former employer should he
default in performing his obligations.
The former and new employers' legal ability to dismissemployees remains what it
was under general dismissal principles. The former employer may only dismiss
an employee prior to the acquisition for real and serious cause linked to the
employee's performance or when economic necessity has forced the elimination
of the job position. The new employer may only dismiss employees after the
transaction on the same basis. In practice, pre-reorganization dismissals could
well be scrutinized more rigorously by the labor tribunal than ordinary dismissals
to determine whether they were demanded by the purchaser as a condition for
the sale.
 
IV - Terminating Employment Contracts
 
Dismissal
When the employer terminates the agreement, this is called adismissal.
A termination should be distinguished from the suspensionof an employment
contract. A suspension occurs when the individual does not actually perform
work for the enterprise but the employment contract legally is not broken. For
example, a female employee has a right to request the suspension of her
employment contract for a set period of months after the birth or the family's
adoption of a child. Normally, the employer does not pay salary during a
suspension but other employer-employee obligations remain in effect (such as
non-competition clauses).
 
Resignation  
The employee may resign through a serious and clear expression of his desire to
terminate the employment contract. Some cases have even allowed employees
to quickly change their minds without the employer having to decide to rehire
the individual for the individual's employment to continue.
Once the employee's decision to resign is clear and irrevocable, however, the
resignation notice period begins to run without the employer having to consent
to the resignation. 
In a similar vein, the employer and the employee may mutually agree to the
employee's departure under conditions that they establish. Such termination
agreements will usually accord an employee more substantial benefits than an
involuntary departure, although the consequences forunemployment
benefits may be less favorable for the employee if the departure is determined
to be totally voluntary by the unemployment agency.
 
Retirement
Since the Labor Code abrogated the legal validity of any mandatory retirement
age in employment contracts or collective conventions, whether the employee or
the employer initiates the retirement continues to have substantial significance in
terms of indemnities.
To force an employee to retire without the termination being considered as an
abusive dismissal, an employer must show that the individual can qualify for full
retirement pension benefits under the general social security system
(meaning generally that the employee has sufficient qualifying periods of
coverage and is old enough) and that the employee has reached the minimum
age for retirement specified in the collective convention, the employment
contract, or under a particular old-age pension system. If the conditions for a
proper retirement termination are not met, the forced retirement will be
considered as an abusive dismissal with all of the attendant legal consequences.
Even when an employee retires at the employer's initiative, he will have a right
to receive the minimum dismissal indemnity set in the Labor Code or a more
favorable indemnity set in an applicable labor agreement. He may also have to
be paid the notice period indemnity, if serving the notice
period is waived by the employer. For proper retirement dismissals, the
procedure for dismissals for cause need not be followed.
An employee voluntarily retiring to receive his retirement pension will have to
serve the normal notice period (unless it is waived) and will qualify for
the retirement indemnityprovided by the 1977 labor-management
accordmandating monthly salary payments. This indemnity is equal to one half
month's salary per year after ten years of service, one month's salary per year
after 15 years, 11/2 month's salary per year after 20 years, and two month's
salary after 30 years of service in the enterprise.
 
Other Cases
Force majeure is a recognized basis for terminating an employment contract without the
burden of the procedural and substantive due process normally accorded to dismissals
made at the employer's initiative. Force majeure is an event that
isunforeseenable, unavoidable, and insurmountable, and that makes it impossible
for the parties to the contract to continue performance. ln an employment context, force
majeurecould be found if the work place is destroyed by fire or if the employee is unable
to continue working because he is incarcerated.
 
V - notice period
Whatever the cause for the contract's termination (except for grave fault), the
employee must continue to work during the notice period after the intention of a party
to terminate the contract bas been given. The length of the notice period is set at
different durations depending on whether the employee resigns or is dismissed.
 
- For resignations, the Labor Code does not set a mandatorylegal minimum notice
period, except for professional journalists and VRPs. The length of the notice period
originates in a collective convention or from professional custom in the business sector.
The conventional or customary notice period is often one week for
hourly workers (ouvriers), one month forgeneral employees (non cadres), and three
months for engineers and cadres (i.e., executive level employees).
 
- For dismissals for reasons other than grave fault or weighty fault, the employee bas
a legal right to a minimum notice period set based on tenure in the enterprise. ln these
cases, the dismissal notice period is the same as the resignation notice period discussed
above when tenure in the enterprise was less than six months. It is increased to one
month for tenure between six months and two years, and to two months when tenure
was at least two years. The employment agreement, collective conventions, the Labor
Code (for certain types of employees), or professional custom may set longer notice
periods for dismissals.
Aside from the employee's right to two hours off a day to look for other work (often
stipulated in a collective convention or by professional custom), the employee must
work normal hours during the notice period.
The employer may offer to pay a notice period indemnity in lieu of forcing the
employee to work his notice period. This indemnity is equal to the base
pay, bonuses, and benefitsthat the employee would have received if he had worked
his notice period. The employer should not attempt to force the employee to accept the
indemnity instead of working because the employee may sue the employer for damages
if the employee's reputation was damaged by his apparent abrupt departure. The reason
behind this is that an abrupt departure could be considered as indicative of the
employee's having committed a grave fault, which is so serious afault that it is a legal
basis for terminating the individual without allowing him to serve his notice
period and without having to par him the notice period indemnity.
Seen from the other side, the employee could agree to pay the notice period indemnity
to his employer instead of continuing to work for his ex-employer during the notice
period.
 
Exercice: BAKER limited is a British company whose French subsidiary (53
employees) wants to dismiss Léon for low performance. Léon has a 12- year
seniority in the company but the company wants him to leave as soon as
possible. BAKER limited is asking you for a verbal but complete consultation on
the procedure and costs of Léon’s dismissal as well as for some advice to avoid
damages for abusive dismissal.
Moreover, BAKER wants you to write a note  on the rules regarding the
dismissal of protected Employees and to  draft a contract  that it wants to sign
with Mr Smith who is going to be hired as a sale representative (VRP).This will
be the occasion to talk about those employees’ legal status.