Question

Identify and discuss various contract clauses that control funding.

Answer 1

Ans.

Here are some common contract clauses:

• Statute of limitations clause. This clause gives the parties a time limit for filing a lawsuit if there’s a breach of contract. A statute of limitations clause can’t conflict with any existing law, and many states will not enforce a shorter statute of limitations than what’s already on the books.
• Time of performance clause. Because some matters need to be handled within a particular time frame, a time of performance clause sets out when the contract duties can and can’t be performed.
• Merger clause. This contract clause states that the current contract overrides any previous agreements.
• Indemnification clause. This type of clause releases a party from liability if losses or expenses are incurred. For example, a subcontractor in a construction job may have to sign an indemnification clause stating that, if their work causes damage to the property, the contractor who hired them is indemnified or released from liability relating to the subcontractor’s work.
• Non-waiver clause. This clause protects parties who excuse another party when contract terms aren’t met. As an example, your contract might state that you will charge 5 percent interest on late payments. The other party continually pays their balance late, but you don’t charge them interest for several months. However, a non-waiver clause would allow you to recover the interest charges, even though you accepted the other party making late payments.
• Severability clause. A severability clause states that, even if there’s an invalid clause in the contract, the rest of the contract is enforceable. Without this clause, one invalid provision could void the entire contract.
• Arbitration clause. This states that any disputes must be resolved through arbitration, instead of being brought to court.
• Non-disclosure clause. A clause like this requires one party not to disclose confidential information belonging to the other party. It’s most commonly seen in employment agreements.
• Attorney fees clause. These clauses allow the party that wins in court to require the losing party to pay their attorney fees and sometimes other court fees and costs.