"-

Glossary

abuseof a dominantposition(UK) situation that occurswhen one firm is in a position to be able to actcompletely independentlyof its competitors,customers or consumers, remainingprofitableandengagingin conduct that is likelyto impede effectivecompetition in that market. It is this last part, thehindranceof effectivecompetition,which is prohibitedin most jurisdictions ratherthan the mere situation ofdominance. Some examples of abusive behaviourinclude the refusal to grant licences, geographicalprice discrimination, unjustified refusal to supply orpredatorypricing. (US abuse of monopolypower)

acquiredcompany(UK) companythat has been mergedinto another companyand is therefore no longer inexistence (US transferor)

acquirer companythat gains control over anothercompany

acquiringcompany(UK) companythat has gainedcontrol over another companythrough a mergerandremains in existence after the merger(US survivor)

acquisitionof controllingshares purchase of sharesowned by shareholders who have a controlling interest

actualdamagessee general damagesad hoc (Latin) for this purposeadmitsomeoneto the Bar (US)to grant a person

permission (froma Bar association) to practise law(UK call someone to the Bar)

advocateperson who pleads in courtaffidavitwritten statement which mightbe used as proof

in court that somebody makes after they have swornofficially to tell the truth

alienabilitypossibility to be transferredannual general meeting (AGM) yearlymeetingof

shareholders of a companywhere various companyactions maybe presented and voted upon

answer principal pleading bythe defendant in responseto a complaint

anticipatorybreach breach of contract committedbeforeperformance is due. The non-breachingparty mayregardthis as an immediatebreach and sue fordamages.

anti-competitive(UK) describes conduct that harms themarket or limits competitionamong businesses (USrestraintof trade)

antitrust(US) body of lawthat regulates businessactivities and markets,especially agreementsandpractices that limit competition (UK competition law)

apparentauthoritypowerwhich an agent appears tohave, or holds himself out as having,andwhich a thirdparty reasonably believes actuallyexists, though notformallygranted by its principal/employer

appellantperson who appeals a decision to a highercourt (US) see petitioner

appellatecourt(also court of appeal, appealscourt)court which reviewsjudgments held by lowercourts

arbitrationform of dispute resolution (an alternativetolitigationthroughthe court system) in which disputesare heard and decided byan impartialarbitratororarbitrators, chosen bythe parties to the dispute

articles of association(UK)documentthatdefines acompany'sinternal organisation(US bylaws)

asset any propertythat is owned and has valueasset protectionmethodof minimisingthe risk of loss

of one's propertyfrom business and personalliabilities

assignto transfer (rights) to anotherassignee person who receives an assignmentassignmentof contracttransfer of a contractto another

personassignment of rights transfer of rightsto another person

such that the person to whom the rights havebeentransferred receives full benefits underthe contract

assignor person who transfers his/her rights or duties toanother

associatejunior lawyerin a lawfirmattachmentseizure or taking into custody byvirtueof a

legal processattachmentlien prejudgmentlien, provisional in nature,

created in assets seized in accordancewith a courtorder or a writ of attachment

authorisedsharecapitaltotalamount of stock acompanymay offer to its shareholders. It is alsoknown as nominal capital. (US authorizedshares)

bailiff (UK) an officer of the sheriff who makes arrestsand serves writs; (US) a court officer who keeps orderduringcourt proceedings

balancesheetfinancialstatementshowing a company'sassets, liabilities and equityon a given date

the Bar (US) legal profession; (UK) the profession ofbarristers

bar associationorganisationof lawyerswhich mayregulatethe profession

bar examination(US)writtenexaminationtaken byprospective lawyersin order to qualifyto practise law

Bar VocationalCourse(UK)requiredcourse to be takenby lawgraduateswishing to practise law as a barrister.This is followed bya period of pupillage.

barriers to entryobstacles which make it difficultfor abusiness to enter into a market. Some examplesinclude patents,customer loyalty,research anddevelopment,distributoror supplier agreements,andgovernmentregulations.

barrister (UK) lawyeradmittedto plead at the bar and insuperior courts; a memberof one of the Inns of Court

barristers' chambers offices of barristers or a group ofbarristers

beneficiaryperson entitledto draw payment'benefitof the bargain'damagessee expectation

damagesbill formal proposal for legislationbill of exchange(UK) negotiable instrumentfor a

specified sum of moneywhich is writtenand signed bythree parties: the drawer(the person paying),thedrawee(the person who will conduct payment)and thepayee(the person who receivesthe payment)

E

boardof directors group of individualselected byshareholders to make the major decisions of thecompany

bona-fidepurchaser for value someone who holds anegotiableinstrument in goodfaith

bonus paymentabove what was due or expectedboutique firm law firm that specialises in a specific area

of law

breach of contract failure to performa contractualobligationor interferencewith another party'sperformancewhich incurs a rightfor the other partytoclaim damages

brief documentor set of documents containingthedetails of a court case

by-law(UK) municipal law (US ordinance)bylaws (US) documentthat defines a company'sinternal

organisation(UK articles of association)

:v

call to the Bar (UK) grantingof permission to practiselawas a barrister (US admission to the Bar)

capital structure distributionof a company'sdebt andstock

capitalisation act of providingcapital for a companythroughthe issuance of securities

capitalisation issue process wherebya company'smoneyis converted into capital and then distributed toshareholders as new shares

cartel group of similar independentcompanies whoagree to join togetherto control prices and limitcompetition

case law (also common law,judge-made law)body of lawformed throughjudicial/court decisions, as opposed tolawformed throughstatutes or written legislation

certificate of deposit certificate issued bythe bankacknowledgingreceipt of moneyand promisingto payit back; a promissory note issued bya bank

certificate of incorporation document issued byagovernmentalauthoritygrantinga companystatus as alegal entity

Certificate of Incorporation on Change of Name (UK)certificate issued byCompanies House when acompanywishes to change its name. A copy of thespecial resolution of the companyauthorisingachangeof name must be submittedto CompaniesHouse along with a fee.

civil law 1) legal system developedfrom Roman codifiedlaw,established bya state for its regulation;2) area ofthe law concernedwith non-criminalmatters, rightsand remedies

claimant (UK) person who brings a civil action (US)plaintiff

clerk (UK) court employeewho takes records, filespapers and issues processes; (US) also a law studentwho assists a lawyeror a judge with legal work suchas research or writing

collateral propertypledgedas securityfor repaymentofa debt obligation

collective bargainingprocess of negotiationbetweentrade unions (or labor unions) and employers,usuallyregardingthe terms and conditions of employment

common law (also caselaw,judge-madelaw)bodyof lawformed throughjudicial/court decisions, as opposed tolawformedthrough statutes or written legislation

Companies House (UK)institutionwhere all limitedcompanies in the UK must be registered. It is anExecutiveAgencyof the UK governmentDepartmentofTradeand Industries (DTI).

competition law (UK) body of lawthat regulatesbusiness activities and markets, especiallyagreements and practices that limit competition (USantitrustlaw)

complaint first pleadingfiled on behalf of a plaintiffwhich initiates a lawsuit, setting forth the facts onwhich the claim is based (civil law)

compulsory winding-up(UK) liquidationof a companyafter a petitionto the court, usually by a creditor (USinvoluntarybankruptcy)

confer to grant,to bestowconflict of interest clash betweena person's personal

interests and their public or fiduciary responsibilitiesconsensual agreed to byall partiesconsensual lien security interest created byagreement

betweenthe debtor and creditor

consequential damages see special damagesconsideration something of value given by one partyto

another in order to induce the other to contract. Incommon law,consideration is a necessary element foran enforceable contract.

consolidation combiningof two companies to form anentirelynew company

constitutional amendmentchange in a company'sname,capital or objects

contract template model agreementwith particularitems to be filled in

copyright exclusive rightto reproduce and control anoriginal work of art (music, visual art, film, literature,etc.)

corporate veil separation betweenthe corporation andits shareholders such that the shareholders will not beheld personally liable for corporate debts

counter offer new offer with newterms made as a replyto an offer received

court of first instance see lower courtcreditor person or companywho is owed a financial

obligationcriminal law (also penallaw)area of law that deals with

crime, punishmentor penaltiescrown court (UK) highercourt of first instance for

criminal cases in Englandand Wales. Togetherwiththe High Court of Justice and the Court of Appeal, itforms the Supreme Court of Judicature. Appeals fromthe Crown Court go to the criminal division of theCourt of Appeal and then to the House of Lords.

cybersquatting practiceof registeringInternetdomainnames that are associated with another companyandthen demanding paymentfrom that companythroughthe sale or licensing of that domain name

damage loss or harm as a result of injurydamages moneyawardedby a court in compensation for

loss or injurydate of employmentday on which a person's

employmentbeginsde facto (Latin) in factdebenture (UK) instrument issued under seal which

evidences a debt or security for a loan of a fixed sumof money;a long-termdebt not secured byanyparticularasset, but rather by the general earningcapacityof the company(US secured debtinstrument);(US) unsecured debt

debtor someone who owes a financial obligationtoanother

default failure to perform a duty,whether legal orcontractual;failure to paya sum that is due

defendant (also respondent) person against whom anaction is brought in court. Defendant is generallyusedwhen referringto the answeringpartyto a civilcomplaint; respondent is generallyused when referringto the answering partyto a petitionfor a court order.

delegate to give (duties) to another,to entrust another(with duties)

delegate (UK) third party in a delegationto whom theduties have been transferred (US delegatee)

delegation of duties transfer of responsibilities to beperformedunder a contract to another

delegator person who transfers his duties to anotherdelivery formal act of transferringsomething or passing

possession on to someone elsedesign right legallyprotected interest in the form of

appearance, style or textureof a particular itemdirective order from a central authority,for example,the

European Community.A European CommunityDirectiveis binding as to the result, but each Member Statemay choose how to implement it.

disability condition of being unable to do something dueto a physical or mental impairment

disbar (US) to declare a person unableto practise law. Inthe UK, the barrister is expelledfrom his or her Inn ofCourt and is no longerallowedto represent in court.

discharge to release a person from an obligationdisclaimer repudiationor denial of a legal rightor claimdisclaimer of warranties statement which limits the

liabilityof the seller for any defects of their goodsdiscriminatory dismissal termination of an employee's

employmentcontract based on a prejudiceor biasdividend distribution of companyprofits to its

shareholdersdraft to produce a piece of writingor a plan that you

intend to change laterdrawee person in a bill of exchangewho conducts

paymentor is directedto make payment;often a bankdrawer person in a bill of exchangewho pays the sum of

moneyduress unlawfulthreat or coercion used to force

someone to enter into a contract

duty obligationowed or due to another by lawduty of care obligationof a person to act with

reasonable caution or prudence,the violation of whichresults in liabilityat law

easement rightenjoyedby a person other than theowner of a piece of land to use or control that land, ora part of that land. No propertyrights are conferredupon the person using the land of another.Anexample of an easement is crossing a part ofanother's land in order to access a public road.

economic efficiency economics term that refers to theoptimal productionand consumption of goods andservices

employment tribunal judicial bodythat resolves disputesbetween employersand employees

endorsement (UK) writing, includingsignature,on theback of a document which allows for the transfer ofthe instrument (US indorsement)

enforceable capable of being made effective. In the caseof an agreement, it is one in which one partycanlegallycompel the performanceof the other party.

enforceable right interest the lawgives effect or force toentry of appearance written notice of appearanceduring

a hearingwhich providesthe respondent'sfull nameand contact details, as well as a statement ofopposition to the claim, includingthe grounds uponwhich it is opposed

escheat reversionof land to the state if the land owner

dies without a will or without any heirsessential term provision requiredfor a contractto existet alii (et al.) (Latin) and otherset cetera (etc.) (Latin)and other things of the same kindexclusive possession sole use and benefitof a propertyexclusive right sole poweror privilegeunderthe lawexecution lien lien created when a debtor's assets are

seized for the purposes of enforcinga judgmentexempli gratia (e.g.) (Latin)for exampleexemplary damages see punitivedamagesexpectation damages (also benefit of the bargain

damages) compensationfor the loss of benefits that aperson would have receivedhad the contract beenperformed

expert witness person who the court considers topossess specialised knowledgeor skill and who isallowed to offer an opinion as testimony in court

express contract contract whose terms have beenspecifically outlined, either in writingor orally

express warranty guaranteethat is created by the seller,whetheroral or written

extraordinarygeneralmeeting (EGM) (UK) anymeetingofthe shareholdersof a companyotherthan the annualgeneralmeetingwhich is called to discuss certainspecial issues of a company(US special meetinffJ

fair dealing (UK) see rightof fair use; (US) dutyof fulldisclosure imposed on corporatedirectors,officersandparties to a contract

fair use (US) see rightof fair usefee simple whole interest in a piece of real property;the

broadest interest in propertyallowed bycommon lawfee tail estate which lasts as long as the original

grantee or anyof his descendants livefiduciary duty obligationto act solely in the best

interests of another

file with to officially record (e.g. in a court of law)financing measures methods of securing funds or moneyfirst-in-time rule which distinguishes which creditor has

first claim over a debtor's assetsfitness for a particular purpose if a buyeris buying

propertyfor a certain reason and the seller knowsthis, then this warrantyexists by lawto guaranteethatthe propertyis suitable for that certain reason.Sometimes referredto as warrantyof fitness.

fixed charge (UK) grant of securityfor a loan on aspecific asset or on specific assets wherebythecreditor has first claim to recoverupon default bythedebtor (US security interest in specific assets; (priortoUCC) chattel mortgage)

floating charge (UK) form of security interest overthedebtor's assets which maychange on a daily basis,such as stock; a grant of securityfor a loan on thecompany'sassets in general,and not on anyspecificasset (US floatinglien)

foreseeability reasonable anticipationof possible resultsof an action

Glossary

E

foreseeability rule rule thatstates that damages areonly recoverablewhen it can be established that thedamagewas reasonablyanticipated bythe breachingpartyat the time the contract was entered into

form model documentor agreementwith blank spacesto be filled in

formation act of bringinga contract into existencefraud deliberatemisrepresentationor concealment of a

materialfact to gain an advantagefraud in the inducement act of misrepresentingor

misleadingsomeone so as to entice them to enterinto a contractor agreement

freehold estate propertywhose duration of ownership oroccupation is not determined

friendly takeover situation where a companyattempts tobuy anothercompanywith approvalof the board ofdirectors of the companythat is being bought

gain control to obtain the powerto direct or haveinfluence overthe managementof a company

garnishment 1) claim or interest resulting from a legalproceeding in which party A (creditor)requests acourt to issue an order or writ against party B(garnishee)holding propertyof or owing money (e.g.bank account or wages) to party C (debtor)torelease the relevant propertyor moneyto thecreditor; 2) the whole process involvedin the legalproceedingsdescribed in 1) above

general creditor creditorwho has no lien or security forpaymentagainst the debtor's assets (also known asan unsecuredcreditor)

general damages (also actual damages) compensationfor proveninjuryor loss

genuine occupational qualification limitedcircumstanceswhere sex or marital status may beused as a job requirement

global firm law firm that employs hundreds of attorneysfrom allover the world

good faith state of mind wherebya person has anhonest convictionthat they are observing reasonablecommercialstandards of fair dealing

good title title that is valid and free from defects suchas liens, litigationor other encumbrances

goods items of personal propertyother than money(USgood can be used in the singular)

grantee person to whom a grant of propertyis made

hereditamentpropertywhich can be inherited;alsorefers to land in general

high court (UK) court which hears serious civil casesand appeals from countycourts; (US supreme court)

holder person that has legal possession of a trade markholder in due course (HDC) person who acquires a

negotiableinstrumentin good faithholder of title person who owns the rightto control and

dispose of a particular piece of propertyholidayentitlement rightof an employeeto take paid

time off from his/her employmenthorizontal merger combiningof two or more firms which

are at the same level in the economic supply chainhostile takeover situation where a companyattempts to

buy anothercompanyagainst its wishes

,id est (i.e.) (Latin)that isillegality of the subject matter when the matterunder

consideration in the contract is unlawfuland thereforeunenforceablein a court of law

immaterial breach breach of contract after which thenon-breachingparty is still requiredto perform itscontractualobligations and may be entitled todamages

implied contract contract whose terms have not beenspecifically outlined, but rather are presumed

implied warranty guaranteethat is implied by law ratherthan promised by the seller

in rem (Latin) against a piece of property(ratherthan aperson)

in the course of business regularmode of conduct orroutine of a trade

incidental beneficiary person who was not planned tobenefit from a contract and is also not partyto thatcontract. This person does not gain any rights underthe contract.

indefinite vague, not certain, not determinedinfringement unauthorised use of material protected by

copyright,patent or trademark lawinheritance propertywhich is transferred upon death to

a person designated as an heirinjunction official order from a court for a person to do

or stop doing somethinginjured party partythat has suffered a violation of its

legal rightsInn of Court (UK) one of four institutions that barristers

must join in order to practise law as a barristerinsolvent unable to payone's debtsinstrument writtenformal legal documentintangible property rights legal interest or claim in

things which cannot be touched or feltintended beneficiary person who was planned to benefit

from a contract but is not partyto that contract.As aresult of this, this person obtains rightsto enforce thecontract.

intent mental desire/willingness to act in a certain wayinter alia (Latin) among other thingsipso facto (Latin) by that very fact itselfissue to produce or providesomething officialissued share capital shares of a companythat are held

by shareholders

judge public official who hears and decides cases incourt

judge-made law (also case law,common law) body of lawformed throughjudicial/court decisions, as opposed tolawformed through statutes or written legislation

judgment lien lien imposed on a person against whom ajudgment has been entered but remains unsatisfied

judicial lien security interests arising as a result of courtproceedings broughtby the creditorto secure aninterest in the debtor's property

juris doctor (JD) (US) law degree (UK LLB)juvenile court court that hears cases involvingchildren

under a certain age

lack of legal capacity absence of abilityof a person toenter into contractual relations, sue or be sued

law school (US) graduate school offering courses in lawleadingto a law degree

lease contract for which the use and occupation of apropertyis conveyedto another,usually in exchangefor a sum of money(rent)

leasehold propertywhose duration of ownership oroccupation is fixed or capable of being fixed

legal entity individualororganisationthatcan enter intocontracts, is responsible for its actions and can besued for damages

legal opinion documentoutlininga lawyer'sunderstandingof the law regardinga particularsituation

legal person artificial entitycreated by law and givenlegal rights and duties, for examplea corporation

Legal Practice Course (LPC) (UK) course that must becompleted before a person can be qualified as asolicitor. It is the first step to becominga solicitor (thesecond being working as a trainee solicitor,and thelast being successful completion of the ProfessionalSkills Course).

licence (UK) permission or authorityto do somethingwhich would otherwise be illegal. No interest istransferred in this case. (US license)

lien interest or attachment in another's propertyassecurity for paymentof an obligation

lien creditor creditor whose claim is secured bya lienlife estate estate granted only for the life of the granteelife tenant person who holds a life estate or an estate

pur autre vie, or for the benefit of anotherliquidated damages (also stipulated damages)

compensation that is agreedto in the contractliquidation dissolution of a companywherebyall assets

are sold and the proceeds used to payoff debtsLLB (Legum Baccalaureus) (UK) Bachelor of Laws, law

degree (US JO Uuris doctor))loan capital form of long-termborrowinglockout preventingpeople from enteringa buildingby

locking it, such that employeescannot worklower court (also court of first instance) court whose

decisions may be appealed to a highercourt

magistrates' court (UK) court that has very limitedpowers

maker person who makes a promissory notemarket economy economicsystem which permitsthe

open exchangeof goods and services betweenproducersand consumers. In a marketeconomy,pricesand productionare largelydeterminedbysupplyanddemand.The contrastingmodelto a marketeconomyiscentral planningand a non-marketeconomy.

material breach breach of contract which is so

fundamental or significant that the non-breachingpartyis excused from its contractualobligations and mayrecoverdamages

mechanic lien (also mechanic'slien) lien to securepaymentfor labour or materials used in constructingor repairing buildingsor other structures

memorandum of association (UK) legal documentthat. sets out the importantelements of the corporation,

including its name, address, objects and powers. It isone of the two fundamental documents upon whichregistrationof a companyis based. (US articles ofincorporation)

merchant person who is engaged in the buyingandselling of goods for profit

merchantability warrantyimplied by lawthat somethingis fit for the ordinary purposes for which it is used

merger acquisition of one companybyanother resultingin dissolution of one and survival of the other

merger regulation legislation aimed at limitinganticompetitiveconcentrationof market power.Lawthat seeks to ensure that the combination ofcompanies will not have any anticompetitiveeffects.

minority shareholder shareholderwho holds less thanhalf the total shares outstandingand is thereforeunable to control the business of the company

minutes notes or records of business conductedat a

meetingmonopoly organisation or groupthat has complete

control of an area of business so that others have noshare

monopoly right exclusive rightto make, use or sell aninvention

moot court fictitious court where lawstudents arguehypotheticalcases

mortgage transfer of legal title of a property,often land,to another as securityfor paymentof a debt

motion applicationto a court to obtain an order,ruling,or decision

naked debenture (UK) unsecured debt (US debenture)negotiable able to be transferredby endorsementor

deliverynegotiable instruments (UK) writtenand signed

documents which representan intangiblerightofpaymentfor a specified sum of moneyon demandorat a defined time. Some examples are bills ofexchange,promissory notes, bank cheques orcertificates of deposit. (US commercialpaper)

nemo dat rule principlethat states that one cannot giveawaymore than one possesses. If one does notpossess title to something, then one cannot transfertitle of that thing to another.

nominal capital (also authorisedcapital)totalamount ofstock a companymayoffer to its shareholders

non-breaching party partyto the contractthat has notviolated its contractualobligations

non-consensual not agreedto or formed byagreementofall parties

non-monetaryrelief remedythat is not money,but rathersomething else such as an injunction,a declaratoryjudgment, specific performanceor modificationof acontract

non-obviousqualityof an inventionbeing unexpectedorsurprising or sufficientlydifferentfrom other existingthings. It is often a requirementfor obtaininga patent.

non-possessory type of security interest wherebythedebtor retains control over the propertybut is limitedin what he or she may do with it

notice document providingnotificationof a fact, claim, orproceeding

novation substitution of an obligationwith a new one,therebycancellingthe old obligation

objects goals or purposes of a companyobjects clause section of a company'smemorandumof

association that outlines the company'sobjectsobligee person to whom a right is owedobligor person who owes a rightoffer indicationof willingness to enter into a contract on

specified terms, whereby,if accepted by the otherperson, a bindingcontract would result

offeree partyto whom an offer is madeofferor partythat displays a willingness to enter into a

contract on specified termsoligopoly marketsituation in which only a small number

of firms compete with each other

Glossary

E

on notice of the security interest where a securityinterest exists betweena certain creditor and debtor.It occurs on perfectionof a security interest.

ordinance (US) municipal law (UK by-law)ordinary course of business regularmode of conduct or

routineof a trade

ordinary resolution (UK) resolution passed by a simplemajorityof members at the annual general meeting

ordinary shares (UK) shares that carry voting rights anddividendentitlementsand which are the most commonform of shares (US common shares)

,

paralegal person who assists a lawyerwith legal work,but is not a lawyer

parallel behaviouracting in a similar wayto another; forexample,setting prices at the same level as acompetitoror producinga similar levelof output asanother in the same business

Parol Evidence the rule that evidence,apart from theactual contract itself, cannot modify,explain,varyorcontradictthe writtenterms of a contract

party person or entity involvedin an agreementpassage of title exchangeof ownership in a propertypassing of risk the point at which the risk (e.g. of

damage)passes from one partyto another (andthereforealso the responsibility,for example,forinsuringgoods)

passing off illegal type of unfair competitionwherebyabusiness does somethingthat the public wouldreasonablybelieveto be relatedto the activities of adifferentbusiness such that this second businesssuffers damages as a result

patentgrant from the governmentgivingexclusive rightsto an inventorto make, use or sell an inventionfor aspecified period of time

payee person who is being paid in a bill of exchangepecuniary compensation remedythat involves

compensatingthrough moneypenal law (also criminal law) area of lawthat deals with

crime, punishmentor penaltiespenetrate the market to enter into a marketper annum (Latin) per yearper se (Latin) by itselfperfected when the appropriatefiling or registeringor

other formal action of a security interest has beendone to protectone's security interest in another'spropertyagainst all other creditors

perfection appropriatefiling or registeringor other formalaction of a security interest in order to protect one'ssecurity interest in another'spropertyagainst all othercreditors

performance completionof obligations requiredbycontract

personal liability state of being legallyobliged out ofone's own personal assets

personal property (also chattelsin common law)thingsthat are moveable(as opposed to real property)andcapable of being owned

petitioner (US) person who brings a petitionto a court,especiallyon appeal

picketing demonstrationoutside a place of work inwhich peoplecongregateto dissuade others fromenteringthe building,usually done in attempttopersuade another partyto meet certain demands. It isoften done duringa strike.

pleading formal written statement setting forth thecause of action or the defence in a case

pledge propertywhich is security for a debt or obligationpledgee person who receives a pledge,or the creditor in

a secured transaction

pledgor person who gives a pledge,or the debtor in asecured transaction

possessory type of security interest wherebythe creditorhas the rightto control the property

predatory pricing pricinga productso low- for example,below its productioncost - as to eliminate competition

pre-emptionrights (UK) rights of shareholders tomaintain their proportionateownership in a companyby purchasingnewlyissued stock before it is offeredto the public (US preemptiverights)

preference shares (UK) shares that are given preferencein dividendentitlements over ordinaryshares, butusually do not carry anyvoting rights (US preferredshares)

price-fixing conduct of setting a price for a productwhich is contraryto workings of supply and demand,and therefore contraryto the free market

priority rightto enforce a claim before otherspriority creditor creditorwho is given priorityover other

creditors, or has first claim over the debtor's assetsprivity of contract relationship between parties to a

contract

pro forma (Latin) as a matter of formpro rata (Latin) proportionallyprofit-and-Iossaccount (UK) statement summarising a

company'srevenues and expenses over a period oftime (US profit-and-Iossstatement or incomestatement)

promisee person to whom a promise, or an assurancethat something will or will not be done, is made

promisor person who makes a promise or an assurancethat they will or will not do something

promissory note formal unconditionalwritten note madeand signed bya person obligating him or her to payaspecified sum of moneyto another specified person orto the bearer of the document

punitive damages (also exemplarydamages)compensationdesigned to punish the breaching partyfor conduct found to be reprehensible,e.g. fraud

pupillage (UK) one year of apprenticeshipto become abarrister,which follows the completion of the BarVocational Course

purautrevieestategranted only for the life of someoneother than the grantee

quasi-security similar to security,except the creditor hasactual ownership over the propertywhile the debtoronly has possession. In case of default, the creditorcan simply take back possession of the property.Serves the same purpose as security,but is notrecognised by the law as such.

quorum number of shareholders or directors who havetobe present at a board meetingso that it can be validlyconducted

race relations social, political or personal connectionswith and between people with differentdistinguishingphysical characteristics

real property land, includinganythingattached to itreasonable reliance dependence on a contract which is

considered fair,sound thinking or common sensereasonably prudent person (also reasonableperson)

fictitiouspersonused as a standard for legalreasoning in negligencecases

redundancy dismissal (UK) terminationof an employee'semploymentcontract because their position ceases toexist (US layoff)

Registrar of Companies (UK) officer in charge of keepingthe list of limitedcompanies registeredat theCompanies House

regulation order controllingthrough rules or restrictionsrejection refusal to accept an offerrelease to discharge a person from an obligationrelevant market area in which effectivecompetitive

constraints may be imposed. There may be tworelevant markets in anticompetitiveanalyses: theproduct market and the geographicmarket. It isdetermined byexamining in which marketanundertakingcan raise prices above the competitivelevel without being unprofitable.

reliance damages compensation for losses incurredbythe plaintiff due to his dependence on the contractbeing performed

remaindermenperson who is entitledto what is left of anestate after the life tenant dies and the parts of theestate that are handed down in his will are carved out

remedy means of preventing,redressing orcompensating a violation of a right

respondent see defendantrestitution damages compensation which is equal to the

amount of moneythe breachingparty receivedunderthe breached contract

right interest that is recognised and protectedby lawright of fair use (US) defence to a claim of copyright

infringementwhereby permission from the artist isnot required so long as usage of that artist's work isreasonable and limited (UK The concept of fairdealing is the closest equivalent; however,fair dealingis more restrictive than the US doctrine of fair useand in order to be protected,the use has to fall inone of several categories.)

rights issue offer to existing shareholders to purchaseadditional new shares in the company

salaried partner person who is a memberof the law firmpartnership and is paid by regularsalary payments

Sale of Goods Act (UK) Act governingthe sale of goodsin the United Kingdom

sale of substantially all assets form of acquisitionwherebyall or almost all assets and liabilities of acompanyare sold

sale by sample sale bywhich the seller providesanexample of the goods to the buyerwhich then leads toan understandingthat the rest of the goods will be ofthe same standard as the example

security propertypledged in order to secure thefulfilment of a promise or loan

security agreement agreementwherebya person grantsinterest in his or her propertyto another as collateralin order to guarantee performanceof an obligation

security interest any interest in propertyacquired byagreementor operation of law for the purpose ofsecuring paymentor performanceof an obligation

senior partner person who has been a partner of a lawfirm for manyyears (the exact numberof years maydiffer in each firm); in some law firms, an official titlegiven to some partners

serve (a document on someone) to deliver a legaldocument to someone (which usually demands they goto a court of law or obey an order)

sex discrimination differenttreatment,usually awardingprivilegesto some and denyingprivilegesto others,based on gender

share consolidation (UK) proportionalexchangeofexistingshares in the corporationfor a fewer numberof shares, each with greatervalue (US reversestocksplit)

share subdivision (UK) exchangeof a multipleof newshares for each old share such that shareholdingsarein the same proportionafterwards(USstocksplit)

Sherman Act (US)US federal statute which was passedin 1890and which prohibits interferencewith freecompetitionand aims to limit monopolies and trusts.Any agreementor combinationwhich has the effect ofrestrainingtrade is prohibitedunderthis statute.

shrink-wrapcontract licence agreementor contractualterms and conditions that appear on the outsidepackaging of an item. Acceptance by the consumer isconfirmed by the opening of the package. Often usedin the software industry.

sic (Latin)thussingle European market established underthe Single

EuropeanAct, came into effect on 1 January 1993;the core of the process of Europeaneconomicintegration,involvingthe removalof obstacles to thefree movementof goods, services, people and capitalbetween memberstates of the European Union

small-claims court court that handles civil claims forlimited amounts of money

sole practitioner lawyerwho practises on his/her ownsolicitor (UK) lawyerwho is qualified to give legal advice

and prepare legal documentssolo practice law practicewith only one lawyersolvent able to payone's debtsspecial damages (also consequentialdamages)

damages that are awardeddue to a particularwrongor particularcircumstances

special resolution resolution on majordecisions of acompany(such as changingthe company'sarticles orreducingits share capital) at a general meetingthatmust be passed bya certain majority,usually 75%

specific performancewhen a court orders the breachingpartyto perform its part of a contract

statute formal written law created bya legislativebodysuch as a parliament,as opposed to a law createdthroughthe courts

Statute of Frauds piece of legislationwhich declaresthat certain kinds of contracts, for examplethoseregardingland, marriageand the sale of goods worthover a certain amount of money,will be invalidunlessput into writingand signed by both parties. Theoriginal statute was enacted in England in 1677andserves as a basis for the US statutes.

statutory forms forms requiredby lawstatutory lien security interest created by legislationdue

to the economic relationship betweenthe debtor andthe creditor

stipulated damages see liquidated damagessubject matter thing under consideration in a contractsubmit to delivera documentformallyfor a decision to

be made by otherssubscriber person who has purchased stock in the

companybyan agreementsui juris (Latin) of one's own right;able to exercise one's

own legal rights

Glossary E

3takeover bid (UK) offer byone companyto purchase atminimuma controllingnumberof votingshares ofanother company(US tender offer)

tangible chattel propertyother than land that is capableof beingtouched or felt

target companythat is the object of a takeoverattempttax lien lien on propertyarising from unpaid taxestenement propertywhich is the subject of tenure (a

mode of occupyingland wherebypossession is heldby a tenant, but absolute ownership lies in anotherperson), i.e. land

term of years fixed period of time for which an estate isgranted

termination of employmentend of the work term oremployment

terms and conditions of employment fixed period oftime for which one is employedand the provisionsunderwhich employmentis held

third-party beneficiary person who is not partyto acontract,but still benefits from it and has legal rightsto enforce it

third-party beneficiary contract contractthat providesfor rights and duties to be conferredon a person whois not partyto the contract

tie-in arrangement (also tyingarrangement,tiedarrangement)agreementwhich forces the buyertopurchase a second productwhen the buyer purchasesthe first product.The productthat the buyeroriginallywants to purchase is called a tyingproductand thesecond producthe or she is forced to purchase withthe first is called a tied product.These arrangementsmayalso be applied to services.

title rightto control and dispose of propertyor the rightto ownership in property

to the bearer of expression designatingthat the sum ofmoneyof a note or cheque is payableto whomeverholds the document

to the order of expression designatingthe person towhomthe sum of moneyon a note/cheque is payable

tort wrongcommittedbetween private individualsforwhich the law providesa remedy

trade mark (UK) word, phrase or symbol used byamanufacturer,seller or dealer to distinguish theirgoods apart from the goods of others (US trademark)

trade secret formula,technique,process or the like whichis keptconfidentialand used byonly one business inattemptto maintaina competitiveadvantage

trade union (UK) association of employeesformed tofurther their mutual interests with respect to theiremployment,for exampleworking hours, wages,conditions, etc. (US labor union)

trainee solicitor (UK) position of one who is completingthe practicalapprenticeship required for a person toqualifyas a solicitor. It is the second step tobecominga solicitor (follows the completion of theLegal Practice Course and is followed by theProfessional Skills Course).

transfer to conveyor to pass propertyor a righttoanother byany method

tribunal bodywith eitherjudicial or quasi-judicialfunctions

trust legal device used to set aside moneyor propertyofone person or companyfor the benefit of anotherperson or company.In the US, trusts are businesscombinationswith the aims of a monopoly.

trustee person who holds something in trust forsomeone else

trustee in bankruptcy person appointed to handle theaffairs of a bankruptparty

trustee in sequestration person appointedto handle thepropertyof another person until the court determinesthe ownership of that property

trustee under a deed of arrangement persondetermined bycontract to handle the propertyandaffairs of an insolvent person while debts are beingpaid and creditors' claims are being settled

trustee under a trust of deed person who holds legaltitle for real propertyof another person who haspledgedthat propertyas collateral for a loan

trustbuster (US) person who fights againstanticompetitivetrusts, often a federal officer

ultra vires (Latin) unauthorised,beyonda person's legalpower

unauthorised use sale, licensing or otherwise dealing,especially with a viewto profit,of a copyrightthat isdone without the authorityof the person whopossesses the copyright

undertakings (UK) enterprise, a companyor a group ofcompanies (US business,firm or enterprise)

unfair dismissal unjust termination of an employee'semploymentcontract. The question is whether theemployeracted reasonably in dismissing theemployee.

Uniform Commercial Code (UCC) (US) act harmonisingthe law of sales and commercial transactions in allstates in the US

United Nations Convention on the Contracts for the

International Sale of Goods Act (CISG) conventionofthe United Nations which sets forth rules governingcontracts for the internationalsale of goods

usufruct rightto use another person's propertyfor aperiod of time, to be later restored to the ownerwithonly ordinarywear and tear

versus (vs. or v.) (Latin) againstvertical merger combining of two or more firms who are

at different levels in the economic supply chain, forexample producerand distributor

vest 1) to give full title to a propertyto a person; 2) togive a person an immediatefixed right

videlicet (viz.) (Latin) as followsvoluntary liquidation (UK) termination of a company's

business that is supported bycompanyshareholders(US dissolutionor winding-up)

warranty of title guaranteethat the seller has title tothe propertybeing sold, that there are no liens .orencumbrances on the propertyother than those thathave been disclosed, and that the transfer of propertyis valid

winding-up process of ending the carryingon of abusiness throughthe settlement of liabilities and thedistribution or liquidationof assets

writ document informingsomeone that they will beinvolvedin a legal process and instructingthem whatthey must do

written resolution written expression of an intentionoropinion decided at a meeting