Using US contract templates outside the US: it can be a bad mistake

A few days ago, this golden oldie was “pingbacked” (pinged-back?) by a US website, which has prompted IP Draughts to reblog it. 2012 – seems like yesterday.

IP Draughts

US business practices dominate international contract negotiations.  This sometimes results in US contract templates being used for contracts that are not made under US laws.  While this may be okay for some of the more ‘commercial’ clauses in a contract, it can be a bad mistake to use US wording in liability clauses, when the contract is made under another country’s laws.

A case decided last week in the English Commercial Court illustrates the problems that can arise.

In Air Transworld Limited v Bombardier Inc [2012] EWHC 243 (Comm), an Angolan resident, Mr Antonio Mosquito, purchased a Challenger 605 private jet aircraft from a well-known Canadian manufacturer, Bombardier.  In his claim, he stated that the jet was for his personal use.  The contract was initially in the name of an Angolan company controlled by him, but was later assigned to a Gilbraltar company.  The contract was made under English law.

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