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Transaction Cost

Transaction cost

In economics and related disciplines, a transaction cost is a cost incurred in making an economic exchange. For example, most people, when buying or selling a stock, must pay a commission to their broker; that commission is a transaction cost of doing the stock deal. Or consider buying a banana from a store; to purchase the banana, your costs will be not only the price of the banana itself, but also the energy and effort it requires to travel from your house to the store and back, and the time waiting in line, and the effort of the paying itself; the costs above and beyond the cost of the banana are the transaction costs. When rationally evaluating a potential transaction, it is important not to neglect transaction costs that might prove significant. A number of kinds of transaction cost have come to be known by particular names.
- Search and information costs are costs such as those incurred in determining that the required good is available on the market, who has the lowest price, etc.
- Bargaining costs are the costs required to come to an acceptable agreement with the other party to the transaction, drawing up an appropriate contract, etc..
- Policing and enforcement costs are the costs of making sure the other party sticks to the terms of the contract, and taking appropriate action (often through the legal system) if this turns out not to be the case. The term "transaction cost", frequently thought to have been coined by Ronald Coase, who used it to develop a theoretical framework for predicting when certain economic tasks would be performed by firms, and when they would be performed on the market, is actually absent from his early work up to the 1970s. While he did not coin the specific term, Coase indeed discussed "costs of using the price mechanism" in his 1937 paper "The Theory of the Firm", where he first discusses the concept of transaction costs. The term "Transaction Costs" itself can instead be traced back to the monetary economics literature of the 1950s, and does not appear to have been consciously 'coined' by any particular individual. Arguably, transaction cost reasoning became most widely known through Oliver E. Williamson's 'Transaction Cost Economics'. Today, transaction cost economics is used to explain a number of different behaviors. Often this involves considering as "transactions" not only the obvious cases of buying and selling, but also day-to-day emotional interactions, informal gift exchanges, etc. Transaction costs have been broadly defined by Steven N. S. Cheung as any costs that are not conceivable in a "Robinson Crusoe economy" -- in other words, any costs that arise due to the existence of institutions. To Cheung, "transaction costs", if the term is not so popular in economics literatures, should be called "institutional costs". (See Steven N. S. Cheung "On the New Institutional Economics", Contract Economics, L. Werin and H. Wijkander (eds.), Basil Blackwell, 1992, pp. 48-65) Economists then ask what kind of institutions (firms, markets, franchises, etc.) minimize the transaction costs of producing and distributing a particular good or service. Often these relationships are categorized by the kind of contract involved. This approach sometimes goes under the rubric of New Institutional Economics.

IT's relationship to transaction costs

Implementing a new information technology is generally seen as a means for reducing the transaction costs of an organisation. However, in practice, implementing a new IT often results in higher transaction costs. This is because the amount of information that need to be processed by the organisation increases. This can result in information overload. Antonio Cordella (2001) calls the cost of processing this information coordination cost. If these costs exceed the benefits of IT, then the implementation becomes something negative and expensive. To reduce coordination costs, organisations can do one of two things: # Improve information processing capabilities. This can be done either through implementing new information systems or creating lateral relations (Galbraith 1973). # Use IT to reduce the need for coordination through increased slack resources (which reduces the need for extreme precision) or increased reliance on self-contained tasks which provides more of the information to a single point of contact rather than requiring communications and coordination among multiple units (Galbraith 1973). The decreased amount of information to process means lower coordination costs and lower transaction costs. Technologies like enterprise resource planning (ERP) can provide technical support for these strategies.

References

Cordella, A (2001), 'Does Information Technology Always Lead to Lower Transaction Costs?', The 9th European Conference on Information Systems, Bled, Slovenia, June 27-29 Galbraith, J. A. (1973), Designing Complex Organizations, Addison-Wesley Longman Publishing Co., Inc., Boston, MA.

Information Infrastructure's relationship to transaction costs

Firms, or more generally, organizations, develop and become larger along time, using more and more computers to work. This growth in the number of computers leads to a growth of software use (operating systems and their applications, for example) and, as a result, to the growth in the number of software use/access licenses to be purchased and managed. For the owners of software intellectual property rights, this process leads to a greater supervision of users to regulate/enforce lawful access to software. The situation occurs when all of the software used by an organization is proprietary. This results in some costs — transaction costs — that are not usually taken into account by administrators and managers. The use of FLOSS - Free/Libre/Open Source Software leads to a reduction in transaction costs in terms of computation costs and in terms of the number of managed contracts, which can be numerically reduced by half.

References

Soares, MVB (2004), 'Reducing Transaction Costs in Information Infrastructures using FLOSS - Free/Open/Libre Open Source Software', 4S/EASST Conference, Paris, France, August 26-28

External links

- [http://www.encycogov.com/B11TransactionCostEconomics.asp Transaction cost economics] Category:Costs

Ronald Coase

Ronald Coase (born December 29, 1910) is a British economist. He attended London School of Economics and won the Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel in 1991. Coase is best known for two articles in particular: The Nature of the Firm (1937), which introduces the concept of transaction costs to explain the size of firms, and The Problem of Social Cost (1960), which suggests that well defined property rights could overcome the problems of externalities (see Coase Theorem). Coase's transaction costs approach is currently influential in modern organizational theory, where it was reintroduced by Oliver E. Williamson. Coase is also often referred to as the 'father' of reform in spectrum policy, based on his article The Federal Communications Commission (1959) where he criticizes spectrum licensing, suggesting property rights as a more efficient method of allocating spectrum to users.

The Nature of the Firm

The Nature of the Firm is a brief essay in which Coase tries to explain why the economy is populated by a number of business firms, instead of consisting exclusively of a multitude of independent, self-employed people who contract with one another. Given that "production could be carried on without any organization [i.e. firms] at all", Coase asks, why and under what conditions should we expect firms to emerge? Since modern firms can only emerge when an entrepreneur of some sort begins to hire people, Coase's analysis proceeds by considering the conditions under which it makes sense for an entrepreneur to seek hired help instead of contracting out for some particular task. The traditional economic theory of the time suggested that, because the market is "efficient" (i.e. those who are best at providing each good or service most cheaply are already doing so), it should always be cheaper to contract out than to hire. Coase noted, however, that there are a number of transaction costs to using the market; the cost of obtaining a good or service via the market is actually more than just the price of the good. Other costs, including search and information costs, bargaining costs, keeping trade secrets, and policing and enforcement costs, can all potentially add to the cost of procuring something with a market. This suggests that firms will arise when they can arrange to produce what they need internally and somehow avoid these costs. There is a natural limit to what can be produced internally, however. Coase notices a "decreasing returns to the entrepreneur function", including increasing overhead costs and increasing propensity for an overwhelmed manager to make mistakes in resource allocation. This is a countervailing cost to the use of the firm. Coase argues that the size of a firm (as measured by how many contractual relations are "internal" to the firm and how many "external") is a result of finding an optimal balance between the competing tendencies of the costs outlined above. In general, making the firm larger will initially be advantageous, but the decreasing returns indicated above will eventually kick in, preventing the firm from growing indefinitely. Other things being equal, therefore, a firm will tend to be larger:
- the less the costs of organizing and the slower these costs rise with an increase in the transactions organized.
- the less likely the entrepreneur is to make mistakes and the smaller the increase in mistakes with an increase in the transactions organized.
- the greater the lowering (or the less the rise) in the supply price of factors of production to firms of larger size. Coase does not consider non-contractual relationships, as between friends or family members.

External links

- [http://www.nobel.se/economics/laureates/1991/index.html Biography]
- [http://ssrn.com/abstract=732483 Wireless Communications and Computing at a Crossroads], Journal on Telecommunications & High Technology Law, Vol. 3, No. 2, p. 239, 205 (describing some of Ronald Coase's theories as they apply to wireless communications and providing several footnotes for further research). Coase, Ronald Coase, Ronald Coase, Ronald Coase, Ronald Coase, Ronald Coase, Ronald Coase, Ronald ja:ロナルド・コース

Oliver E. Williamson

Oliver E. Williamson (born September 27, 1932) is a prominent author in the area of transaction cost economics, a student of Ronald Coase and Herbert Simon. Prof. Williamson received his S.B. from Massachusetts Institute of Technology in 1955, M.B.A. from Stanford University in 1960, and his Ph.D. from Carnegie Mellon University in 1963. He has held professorships in business administration, economics, and law at University of California, Berkeley since 1988. His focus on the costs of transactions have led Williamson to distinguish between repeated case-by-case bargaining on the one hand and relationship-specific contracts on the other. For example, the repeated purchasing of coal from a spot market to meet the daily or weekly needs of an electric utility would represent case by case bargaining. But over time, the utility is likely to form ongoing relationships with a specific supplier, and the economics of the relationship-specific dealings will be importantly different, he has argued. Other economists have tested Williamson's transation-cost theories in empirical contexts. One important example is a paper by Paul L. Jaskow, "Contract Duration and Relationship-Specific Investments: Empirical Evidence from Coal Markets," in American Economic Review, March 1987.

Awards, fellowships

- Horst Claus Rechtenwald Prize in Economics, 2004.
- Fellow, American Academy of Political and Social Science, 1997.
- Member, National Academy of Sciences, 1994.
- Fellow, American Academy of Arts and Sciences, 1983.
- Fellow, Econometric Society, 1977.
- Alexander Henderson Award, 1962.

Books

- The Mechanisms of Governance ISBN 0195132602
- The Economic Institutions of Capitalism ISBN 0029348218
- The Nature of the Firm: Origins, Evolution, and Development ISBN 0195083563

External links

- [http://groups.haas.berkeley.edu/bpp/oew/ Oliver E. Williamson's homepage] Williamson, Oliver E. Williamson, Oliver E. Williamson, Oliver E. Williamson, Oliver E.

Contract

A contract is any legally-enforceable promise or set of promises made between parties. In the civil law, contracts are considered to be part of the general law of obligations. This article describes the law relating to contracts in common law jurisdictions.

Comparison of contract and tort law

The law of obligations has traditionally been divided into contractual obligations, which are voluntarily undertaken and owed to a specific person or persons, and obligations in tort which are based on the wrongful infliction of harm to certain protected interests, primarily imposed by the law, and typically owed to a wider class of persons. Recently it has been accepted that there is a third category, restitutionary obligations, based on the unjust enrichment of the defendant at the plaintiff’s expense. Contractual liability, reflecting the constitutive function of contract, is generally for failing to make things better (by not rendering the expected performance), liability in tort is generally for action (as opposed to omission) making things worse, and liability in restitution is for unjustly taking or retaining the benefit of the plaintiff’s money or work [Beatson (1998) Anson’s Law of Contract, 27th ed. (Oxford: OUP), pg. 21].

Scope of common law contract law

Basic common law contract law addresses four sets of issues: #When and how is a contract formed? #When may a party escape obligations of a contract (such as a contract formed under duress or because of a misrepresentation)? #What is the meaning and effect to be given to the terms of a contract? #What is the remedy to be given for breach of a contract? Contract formation: There must be an agreement which consists of an offer and acceptance, consideration (see also consideration under English law) and contractual intention for a simple contract to exist: i.e. it is not a deed - otherwise no consideration is needed. Subject to the sine qua non of Contract Formation, other ingredients that make up a contract include: :
- Form - In some cases, certain formalities (that is, writing) must be observed. :
- Capacity - The parties must be legally capable of entering into a contract. :
- Consent - The agreement must have been entered into freely. Consent may be vitiated by duress or undue influence. :
- Legality - The purpose of the agreement must not be illegal or contrary to public policy. A contract which possesses all of the above ingredients is said to be valid. The absence of an essential element will render the contract either void, voidable or unenforceable In some situations, a collateral contract may exist. Meaning and effect of contract terms: Many contract disputes involve a disagreement between the parties about what terms in the contract require each party to do or refrain from doing. Hence, many rules of contract law pertain to interpretation of terms of a contract that are vague or ambiguous. The parol evidence rule limits what things can be taken into account when trying to interpret a contract. Privity: In general, only parties to a contract may sue for the breach of a contract.

Validity of contracts

For a contract to be valid, it must meet the following criteria:
- Mutual agreement - (see main article offer and acceptance): There must be an express or implied agreement. The essential requirement is that there be evidence that the parties had each from an objective perspective engaged in conduct manifesting their assent, and a contract will be formed when the parties have met such a requirement. (Notice that the objective mainifestation requirement means that one need not actually have assented so long as a reasonable person would believe that assent had been granted.) For a contract based on offer and acceptance to be enforced, the terms must be capable of determination in a way that it is clear that the parties assent was given to the same terms. The terms, like the manifestation of assent itself, are determined objectively.
- Consideration: There must be consideration (see also consideration under English law) given by all the parties, meaning that every party is conferring a benefit on the other party or himself sustaining a recognizable detriment, such as a reduction of the party's alternative courses of action where the party would otherwise be free to act with respect to the subject matter without any limitation.
- Competent, Adult (Sui Juris) Parties: Both parties must have the capacity to understand the terms of the contract they are entering into, and the consequences of the promises they make. For example, animals, minor children, and mentally disabled individuals do not have the capacity to form a contract, and any contracts with them will be considered void or voidable. Although corporations are technically legal fictions, they are considered persons under the law, and thus fit to engage in contracts. :For adults, most jurisdictions have statutes declaring that the capacity of parties to a contract is presumed, so that one resisting enforcement of a contract on grounds that a party lacked the capacity to be bound bears the burden of persuasion on the issue of capacity.
- Proper Subject Matter: The contract must have a lawful purpose. A contract to commit murder in exchange for money will not be enforced by the courts. It is void ab initio, meaning "from the beginning."
- Mutual Right to Remedy: Both parties must have an equal right to remedy upon breach of the terms by the other party
- Mutual Obligation to Perform: Both Parties must have some obligation to fulfill to the other. This can be distinct from consideration, which may be an initial inducement into the contract.

Written contracts

Contrary to common wisdom, an informal exchange of promises can still be binding and legally as valid as a written contract. A spoken contract is often called an "oral contract", not a "verbal contract." Any contract that uses words, spoken or written, is a verbal contract. Thus, all oral contracts and written contracts are verbal contracts. This is in contrast to a "non-verbal, non-oral contract," also known as "a contract implied by the acts of the parties." Courts in the United States have generally ruled that if the parties have a meeting of the minds (i.e., the same intent), consideration is paid or given by the parties, and they act as though there was a formal, written and signed contract, then a contract exists. However, most jurisdictions require a signed writing for certain kinds of contracts (like real estate transactions). In the United States, a law setting out such requirements is typically called the Statute of Frauds; the name originates from an English statute that was for "the prevention of frauds." The point of the Statute of Frauds is to prevent false allegations of the existence of contracts that were never made, by requiring formal (i.e. written) evidence of the contract. Contracts that do not meet the requirements of Statute of Frauds legislation are unenforceable, but not void. However, a party unjustly enriched by an unenforceable contract may be subject to restitution for unjust enrichment. Statutes of Frauds are typically codified in state statutes covering specific types of contracts, such as contracts for the sale of real estate. In Australia, for contracts subject to legislation equivalent to the Statute of Frauds, there is no requirement for the entire contract to be in writing, although there must be a note or memorandum evidencing the contract, which may come into existence after the contract has been formed. The note or memorandum must be signed in some way, and a series of documents may be used in place of a single note or memorandum. It must contain all material terms of the contract, the subject matter and the parties to the contract. In England and Wales, the Statute of Frauds is still in force, but only for guarantees, which must be evidenced in writing, although the agreement may be made orally. Certain other kinds of contract (such as for the sale of land) must be in writing or they are void. Furthermore, the existence of a written contract does not necessarily ensure its enforceability or validity. A contract can be deemed unenforceable if it requires a party to undertake an illegal act, if it was signed under duress or while intoxicated, if the disparity in knowledge between the parties is extreme and the weaker party was given onerous terms, etc. For example, in Massachusetts a contract is not enforceable if it is executed on a Sunday. If the terms of a contract subject to Statute of Frauds legislation are to be varied, the variations must be noted in writing as well. However, the contract may be discharged orally. If a contract is in a written form, then generally, you are bound by its terms regardless of whether you have read it or not (L'Estrange v. F Graucob Ltd [1934] 2 KB 394). However, this is tempered by the exception that if the terms of the contract are misrepresented, then the plaintiff is unable to rely on the terms of the contract; in addition, the document must be contractual in nature (Curtis v. Chemical Cleaning and Dyeing Co [1951] 1 KB 805). Furthermore, if a party wishes to use a document as the basis of a contract, reasonable notice of its terms must be given to the other party prior to their entry into the contract (see Balmain New Ferry Company Ltd v. Robertson (1906) 4 CLR 379). This includes such things as tickets issued at parking stations.

Void, voidable and unenforceable contracts

In general, there are three classifications of contracts that are not binding:
- Void: If a contract is held to be void, the contract has never come into existence. For example, a contract is void if it is based on an illegal purpose or contrary to public policy; the classic example is a contract with a hit man. Such a contract will not be recognized by a court, and cannot be enforced by either party.
- Voidable: A contract is voidable if one of the parties has the option to terminate the contract. Contracts with minor are examples of voidable contracts.
- Unenforceable: If a contract is unenforceable, neither party may enforce the other's obligations. For example, in the United States, a contract is unenforceable if it violates the Statute of frauds. An example of the above is an oral contract for the sale of a motorcycle for US$5,000 (because in the USA any contract for the sale of goods over US$500 must be in writing to be enforceable).

Uncertainty and incompleteness

If the terms of the contract are uncertain or incomplete, the parties cannot have reached an agreement in the eyes of the law. An agreement to agree does not constitute a contract, and an inability to agree on key issues, which may include such things as price, may cause the entire contract to fail. However, a court will attempt to give effect to commercial contracts where possible, by construing a reasonable construction of the contract (see Hillas v. Arcos Ltd (1932) 147 LT 503). Courts may also look to external standards, which are either mentioned explicitly in the contract (Whitlock v. Brew (1968) 118 CLR 445) or implied by common practice in a certain field (Three Rivers Trading Co., Ltd. v. Gwinear & District Farmers, Ltd. (1967), 111 Sol. J. 831). In addition, the court may also imply a term; if price is excluded, the court may imply a reasonable price, with the exception of land, and second-hand goods, which are unique.

Severence of unenforceable clauses

If there are uncertain or incomplete clauses in the contract, and all options in resolving its true meaning have failed, it may be possible to sever and void just those affected clauses. The test of whether a clause is severable is an objective test - whether a reasonable person would see the contract standing even without the clauses.

Spy contracts

In the U.S., one unusual type of unenforceable contract is a personal employment contract to work as a spy or secret agent. This is because the very secrecy of the contract is a condition of the contract (in order to maintain plausible deniability). If the spy subsequently sues the government on the contract over issues like salary or benefits, then the spy has breached the contract by revealing its existence. It is thus unenforceable on that ground, as well as the public policy of maintaining national security (since a disgruntled agent might try to reveal all the government's secrets during his lawsuit).

Bilateral v. unilateral contracts

Contracts may be bilateral or unilateral. The more common of the two, a bilateral contract, is an agreement in which each of the parties to the contract makes a promise or promises to the other party. For example, in a contract for the sale of a home, the buyer promises to pay the seller $200,000 in exchange for the seller's promise to deliver title to the property. In a unilateral contract, only one party to the contract makes a promise. A typical example is the reward contract: A promises to pay a reward to B if B finds A's dog. B is not obliged to find A's dog, but A is obliged to pay the reward to B if B finds the dog. In this example, the finding of the dog is a condition precedent to A's obligation to pay. An offer of a unilateral contract may often be made to many people (or 'to the world') by means of an advertisement. In that situation, acceptance will only occur on satisfaction of the condition (such as the finding of the offeror's dog). If the condition is something that only one party can perform, both the offeror and offeree are protected — the offeror is protected because he will only ever be contractually obliged to one of the many offerees; and the offeree is protected, because if she does perform the condition, the offeror will be contractually obliged to pay her. In unilateral contracts, the requirement that acceptance be communicated to the offeror is waived. The offeree accepts by performing the condition, and the offeree's performance is also treated as the price, or consideration, for the offeror's promise. The most common type of unilateral contract is the insurance contract. The insurance company promises to pay the insured a stated amount of money on the happening of an event if the insured pays premiums; note that the insured does not make any promise to pay the premiums. Courts generally favor bilateral contracts. The general rule in the United States is: "In case of doubt, an offer is interpreted as inviting the offeree to accept either by promising to perform what the offer requests or by rendering the performance, as the offeree chooses." Restatement (Second) of Contracts § 32 (1981) (emphasis added). Here the law attempts to provide some protection from the risk of revocation in a unilateral contract to the offeree. Note that if the offer specifically requests performance rather than a promise, a unilateral contract will exist. See option contracts for more information on protection given to the offeree in a unilateral contract.

Express and implied contracts

A contract can be either an express contract or an implied contract. An express contract is one in which the terms are expressed verbally, either orally or in writing. An implied contract is one in which some of the terms are not expressed in words.

Implied in fact or implied in law

An implied contract can either be implied in fact or implied in law. A contract which is implied in fact is one in which the circumstances imply that parties have reached an agreement even though they have not done so expressly. For example, by going to a doctor for a physical, a patient agrees that he will pay a fair price for the service. If he refuses to pay after being examined, he has breached a contract implied in fact.

Quasi-contract

A contract which is implied in law is also called a quasi-contract, because it is not in fact a contract; rather, it is a means for the courts to remedy situations in which one party would be unjustly enriched were he or she not required to compensate the other. For example, an unconscious patient treated by a doctor at the scene of an accident has not agreed (either expressly or by implication) to pay the doctor for emergency services, but the patient would be unjustly enriched by the doctor's services were the patient not required to compensate the doctor.

Incorporation of terms

Course of dealing

If two parties have regularly conducted business on certain terms, it may be reasonable to presume that in future dealings where there is no contract, the parties wish to incorporate the terms of the previous contracts. However, if a party wishes to incorporate terms by course of dealing, the original document must have been contractual in nature, and delivery receipts may not fit this description. In Australia, there is a further requirement that the document was procured after formation.

Express and implied terms

Different types of statements

Whether a statement is a term of a contract is important because only if a promise is a term of the contract can a party sue for the breach of the contract. Statements can be split into the following types:
- Puff (sales talk): If no reasonable person hearing this statement would take it seriously, it is a puff, and no action in contract is available if the statement proves to be wrong.
- Representation: A representation is a statement of fact made to induce another person to enter into a contract and which does induce them to enter into a contract, but it is one that the maker of the statement does not guarantee its truth. If the statement proves to be incorrect, it cannot be enforced, as it is not a term of the contract, but it may prove to be a misrepresentation, whereupon other remedies are available.
- Term: A term is similar to a representation, but the truth of the statement is guaranteed by the person who made the statement. The test is an objective test. Factors that a court may take into account in determining the nature of a statement include:
- Timing: If the contract was concluded soon after the statement was made, this is a strong indication that the statement induced the person to enter into the contract.
- Content of statement: It is necessary to consider what was said in the given context, which has nothing to do with the importance of a statement.
- Knowledge and expertise: In Oscar Chess Ltd v. Williams [1957] 1 WLR 370, a person selling a car to a second-hand car dealer stated that it was a 1948 Morris, when in fact it was a 1939 model car. It was held that the statement did not become a term because a reasonable person in the position of the car dealer would not have thought that an inexperienced person would have guaranteed the truth of the statement.

Terms implied in fact

The Privy Council proposed a five stage test in BP Refinery Western Port v. Shire of Hastings: # Reasonableness and equitableness: The implied term must be reasonable and equitable. # Business efficacy: The implied term must be necessary for the business efficacy of the contract. For instance, if the term simply causes the contract to operate better, that does not fit this criterion. # Obviousness: The term is so obvious that it goes without saying. Furthermore, there must be one and only one thing that would be implied by the parties. For example, in Codelfa Construction Pty Ltd v. State Rail Authority of New South Wales (1982) 149 CLR 337, a term regarding the inability of construction company to work three shifts a day could not be implied because it was unclear what form it would have taken. # Clear expression: The term must be capable of clear expression. No specific technical knowledge should be required. # Consistency: The implied term may not contradict an express term. In Australia, the High Court has ruled that the test in BP Refinery applies only to formal contracts, while the test in Byrne and Frew v. Australian Airlines Ltd (1995) 185 CLR 410 shall apply to informal contracts:
- Necessity: The term must be necessary to ensure reasonable or effective operation of a contract of the nature before the court.
- Consistency: The implied term may not contradict an express term (same as for formal contracts).
- Clear expression: The term must be capable of clear expression (same as for formal contracts).
- Obvious: McHugh and Gummow JJ have stated that it must also be obvious.

Terms implied in law

These are terms that have been implied into standardised relationships. The other difference between this and terms implied in fact is that the test is one of necessity (Liverpool City Council v. Irwin [1976] 2 WLR 562); a necessary term is one where the contract is rendered worthless or nugatory if it is without it.

Terms implied by custom or trade

You are generally bound by the custom of the industry that you are in. To imply a term due to custom or trade, you must prove the existence of the custom, which must be notorious, certain, legal and reasonable (Con-stan Industries of Australia Pty Ltd v. Norwich Winterthur Insurance (Australia) Ltd (1986) 160 CLR 226). See also Frigaliment Importing Co., Ltd., v. B.N.S. International Sales Corp., 190 F. Supp. 116 (S.D.N.Y. 1960) (plaintiff failed to prove what he meant by "chicken") and U.C.C. § 1-205.

Agreements to negotiate

It is common for lengthy negotiations to be written into a heads of agreement document that includes a clause to the effect that the rest of the agreement is to be negotiated. Although these cases may appear to fall into the category of agreement to agree, courts nowadays (at least in Australia) will imply an obligation to negotiate in good faith provided that certain conditions are satisfied (Coal Cliff Collieries Pty Ltd v. Sijehama Pty Ltd (1991) 24 NSWLR 1):
- Negotiations were well-advanced and the large proportion of terms have been worked out; and
- There exists some mechanism to resolve disputes if the negotiations broke down. The test of whether one has acted in good faith is a subjective one; the cases suggest honesty, and possibly also reasonably.

"Subject to" contracts

If a contract specifies "subject to contract", it may fall into one of three categories (Masters v. Cameron (1954) 91 CLR 353): # The parties are immediately bound to the bargain, but they intend to restate the deal in a formalised contract that will not have a different effect; or # The parties have completely agreed to the terms, but have made the execution of some terms in the contract conditional on the creation of a formalised contract; or # It is merely an agreement to agree, and the deal will not be concluded until the formalised contract has been drawn up. If a contract specifies "subject to finance", it imposes obligations on the purchaser (Meehan v. Jones (1982) 149 CLR 571):
- The purchaser must seek finance; and
- When offers of finance arrive, the purchaser must make a decision as to whether the offers of finance are suitable. Once again, there is an element of good faith involved. This may also refer to contingent conditions, which come under two categories: condition precedent and condition subsequent. Conditions precedent are conditions that have to be complied with before performance of a contract. With conditions subsequent, parties have to perform until the condition is not met. Failure of a condition does not void the contract, it is just regarded as voidable.

Statutory law applicable to contracts

The rules by which many contracts are governed are provided in specialized statutes that deal with particular subjects. Most countries, for example, have statutes which deal directly with sale of goods, lease transactions and trade practices. For example, most American states have adopted Article 2 of the Uniform Commercial Code, which regulates contracts for the sale of goods. There are also many acts around the world which deal with specific types of transactions and businesses. For example, the states of California and New York in the U.S. have statutes that govern the provision of services to customers by health studios, and the UK has the Sale of Goods Act 1979 which governs the contracts between sellers and buyers.

Remedies

Damages

Typically, the remedy for breach of contract is an award of money damages. Courts usually adopt one of three ways of calculating the value of damages. The most common is to assess the sum which would restore the injured party to the economic position that he or she expected from performance of the promise or promises (known as an "expectation measure" or "benefit-of-the-bargain" measure of damages). When it is either not possible or desirable to award damages measured in that way, a court may award money damages designed to restore the injured party to the economic position that he or she had occupied at the time the contract was entered (known as the "reliance measure"), or designed to prevent the breaching party from being unjustly enriched ("restitution").

Specific perfomance

There may be circumstances in which it would be unjust to permit the defaulting party simply to buy out the injured party with damages. For example where an art collector purchases a rare painting and the vendor refuses to deliver, the collector's damages would be equal to the sum paid. The court may make an order of what is called "specific performance", requiring that the contract be performed. In some circumstances a court will order a party to perform his or her promise (an order of "specific performance") or issue an order, known as an "injunction," that a party refrain from doing something that would breach the contract. Both an order for specific performance and an injunction are discretionary remedies, originating for the most part in equity. Neither is available as of right and in most jurisdictions and most circumstances a court will not normally order specific performance.

Procedure

In the United States, in order to obtain damages for breach of contract or to obtain specific performance, the injured party may file a civil (non-criminal) lawsuit, usually in a state court, or petition a private arbitrator to decide the contract issues presented. Many contracts provide that all contract disputes must be arbitrated by the parties to the contract, rather than litigated in courts. By law, some contracts, including most securities brokerage contracts, must be arbitrated; other contracts are referred by courts as a matter of local law or policy. Arbitrated judgements are generally enforced and appealed in the same manner as ordinary court judgements; a majority of states have adopted the [http://www.law.cornell.edu/uniform/vol7.html#arbit Uniform Arbitration Act] to facilitate the enforcement of arbitrated judgements. In England and Wales, a contract may be enforced by use of a claim, or in urgent cases by applying for an interim injunction to prevent a breach.

Theoretical considerations

Contract theory is the body of legal theory that addresses normative and conceptual questions in contract law. One of the most important questions asked in contract theory is why contracts are enforced. One prominent answer to this question focuses on the economic benefits of enforcing bargains. Another approach, associated with Charles Fried, maintains that the purpose of contract law is to enforce promises. This theory is developed in Fried's book, Contract as Promise. Other approaches to contract theory are found in the writings of legal realists and critical legal studies theorists.

External links

- [http://www.4lawschool.com/contracts/contracts.htm Contracts Case Summaries]
- [http://www.law.cornell.edu/topics/contracts.html Cornell Law School] contracts: an overview
- [http://www.jus.uio.no/lm/eu.contract.principles.part1.1995/ Principles of European Contract Law]
- [http://moodle.ed.uiuc.edu/wiked/index.php/Behavioral_contracting Behavioral Contracting in the Classroom]
- Category:Legal documents ja:契約 simple:Contract

Information Infrastructure

Information infrastructures are defined by (Hanseth, 2002) as "a shared, evolving, open, standardized, and heterogeneous installed base".

References

Ole Hanseth, 2002. "From systems and tools to networks and infrastructures — From design to cultivation. Towards a theory of ICT solutions and its design methodology implications," at http://heim.ifi.uio.no/~oleha/Publications/ib_ISR_3rd_resubm2.html accessed 21 September 2004.

Stamceltherapie

Stamceltherapie kan gezien worden als een nieuwe tak in de medische therapeutische benadering van ziekten en traumata waarbij de basisidee bestaat uit de transplantatie van -al dan niet gedifferentieerde- stamcellen ter vervanging van afwezige of defecte cellen, weefsels of organen. De stamceltherapie is benaderbaar vanuit vele ooghoeken, zowel wat origine als bestemming van de stamcellen betreft. Onder stamcellen verstaan we zelfhernieuwende pluripotente cellen.
- voorbeelden van origine van de stamcellen :
- embryonale blastocystische cellen
- hematopoëtische beenmergstamcellen,
- adulte stamcellen uit het leverbindweefsel
- navelstreng stamcellen.
- voorbeelden van bestemming:
- β-cellen bij diabetes mellitus
- huidtransplantaten bij grote derdegraads brandwonden
- levercellen bij cirrose
- neuronen bij Alzheimer en Parkinson
- dystrofine-eiwit bij Duchenne spierdystrofie
- neuronen bij herseninfarct
- hartspiercellen of vasculairegroeifactoren bij myocardinfarct
- beenmergcellen bij leukemie
- ... bij amyotrofische lateraal sclerose (ALS)
- ... bij multiple sclerose
- ... bij ruggenmergletsels
- reconstructie van geamputeerde ledematen

Verloop van stamceltherapie

:1. Opzetten van humane stamcellijnen ::Oogsten van de stamcellen ::Cultiveren/prolifereren van deze cellen :2. Differentiëren van de stamcellen :3. Transplantatie

Opzetten van stamcellijnen

Men oogst stamcellen (bijvoorbeeld embryonale) die men ondere andere met behulp van enzymen vrijprepareert uit een blastocyste. Het cultiveren (telen of verveelvuldigen) van deze cellen doet men door deze cellen op een speciale voedingsbodem te enten (aan te brengen) en door deze onder de juiste omstandigheden te brengen, gaan de cellen zich vermenigvuldigen. Het is de bedoeling dat er geen spontane niet-gecontroleerde differentiaties van deze cellen optreden, dus dat ze ongedifferentieerd blijven tijdens het cultiveringsproces. Dit lukt slechts in enkele onderzoekscentra ter wereld. De problemen die men hierbij moet trotseren zijn o.a. het vinden van het juiste voedingsmilieu voor deze cellen, het vermijden van contaminatie van de cellijnen door deze voedingsbodems (bijvoorbeeld muizenbindweefsel feederlayer), het afstellen van de juiste groei- en andere factoren voor het aanzetten tot prolifereren (vermenigvuldigen) van de cellen en het correct "enten" van deze proliferaties op nieuwe bodems. Het vermijden van differentiaties en het streven naar stabiele enten, waarbij er geen of weinig mutaties optreden tijdens het proces van proliferatie.

Differentiëren van stamcellen naar cellen, weefsels of organen

Na het cultiveren van humane stamcellijnen kan men overgaan tot het differentiëren van deze stamcellen naar cellen, weefsels of organen met de gewenste histologie. Hierbij is het belangrijk dat de differentiatie op een gecontroleerde manier gebeurt en moeten spontane woekeringen of instabiele of verkeerde differentiaties verhinderd worden. Bijvoorbeeld bij het spontaan differentiëren van embryonale stamcellen uit blastocysten ontstaan er embryoid bodies. Uit de kloneringsexperimenten blijkt dat, na het plaatsen van een pluripotente cel in het inwendige milieu van een (ontruimde) eicel, deze zich kan differentiëren tot een embryo. Hetgeen eigenlijk als een summum van stamcel-differentiatie kan beschouwd worden: het differentiëren tot een geheel van orgaansystemen.

Transplantatie

Afhankelijk van de oorsprong van de stamcellen zal er een auto- of een allotransplantatie gebeuren. Dit is het inbrengen van de stamcellen op de plaats van het beschadigde of afwezige weefsel. Bij een autotransplantatie gaat het om stamcellen afkomstig van de patiënt zelf. Bij een allotransplantatie gaat het om stamcellen van een andere persoon (of dier) afkomstig zijn. In de eerste situatie zullen er geen afstotingsverschijnselen zijn, omdat het om lichaamseigen materiaal gaat. In de tweede situatie kan het nodig zijn om immunosuppresiva te gebruiken om de afstotingsverschijnselen tegen te houden.

Positieve resultaten

Eerste experimenten met betrekking tot stamceltherapie wijzen in positieve richting wat de slaagkansen van deze nieuwe vorm van therapie betreft. Zo ziet men reeds een herstel van chronisch ischemisch myocardweefsel na myocardinfarct nadat men circa 25,5 x 10⁶ ongedifferentieerde mononucleaire beenmergstamcellen transendocardiaal autotransplanteerde op de plaatsen waar zich hibernerende myocardcellen bevonden⁽¹⁾. En hoewel uit onderzoek reeds is gebleken dat pluripotente stamcellen in staat zijn zich te differentiëren tot cardiomyocyten en endotheliale cellen⁽²⁾, lijkt het er in dit experiment echter op dat het injecteren van de mononucleaire beenmergstamcellen eerder heeft bijgedragen tot de angio(neo)genese. Beenmergcelcomponenten secreteren immers een gamma aan cytokines, fibroblast groeifactoren en vasculaire endotheliale groeifactoren die allen bijdragen tot het natuurlijke proces van angiogenese⁽³⁾. Toch bewijst dit experiment de veiligheid van de autotransplantatie van stamcellen.

Praktische mogelijkheden

Als de stamceltherapie op punt staat, is het aanleggen van een weefselbank met stamcellen uit navelstrengbloed van elk individu erg zinvol. Op deze manier beschikt men voor de meeste personen over onaangetaste 'jonge' stamcellen waarmee veel ziekten, aandoeningen en trauma's genezen en hersteld kunnen worden.

Ethische bezwaren

- over de herkomst van de 'reserve-onderdelen'. Bijvoorbeeld: nieuwe pancreascellen van een diabetespatiënt zijn eigenlijk een ontrafeld en bewerkt embryo.
- productie van embryo's voor dit stamceltherapie.
- gebruik van 'overtollige' embryo's (die niet meer voor terugplaatsing in aanmerking komen omwille van genetische afwijkingen bijvoorbeeld)

Andere toepassingen voor stamcellen

Een waardevoller alternief bieden voor proefdieren of computersimulaties in de farmacologische industrie. Verder zullen zij de wetenschap in staat stellen basisonderzoek te verrichten op humane cellen en diepere inzichten te creëren in de functie van genen en molecules (zoals groeifactoren en nutriënten) tijdens de embryologische ontwikkeling.

Huidige situatie

Stamcelonderzoek en -therapie zijn een volledig nieuw ontwikkelingsveld waar op vele vlakken grote doorbraken te verwachten zijn. Het onderzoek naar stamceltherapie staat nog in zijn beginfase; bij het trachten opzetten van humane stamcellijnen. Het oogsten lukt reeds, het cultiveren en proliferen lukt slechts in enkele centra ter wereld. De volgende fase: het gecontroleerd differentiëren is volop in ontwikkeling.
De Zuid-Koreaanse overheid stimuleert al geruime tijd stamcelonderzoek en reproductief klonen; baanbrekend zijn de resultaten van Dr. Hwang Woo Suk en zijn team [http://cgi.omroep.nl/cgi-bin/streams?/tv/tros/2vandaag/bb.20040609-1.rm?proto=rtsp&start=0:0:12:20&end=0:0:34:26] 2 Vandaag (video). In China passen Dr. Huang Hongyun en zijn team stamceltherapie toe op ALS-patiënten [http://www.netwerk.tv/templates/videoasx.jsp?f=150936] Netwerk (video). In Groot-Brittannië stemde de overheid op 11 augustus 2004 in met het klonen van menselijke embryo's voor wetenschappelijk onderzoek. [http://www.cbc.ca/story/science/national/2004/08/11/cloning040811.html] CBC News. In Zwitserland stemde de bevolking op 28 november 2004 in met het gebruik van stamcellen uit menselijke embryo's, zie Referendum in Zwitserland. In de Verenigde Staten zijn federale subsidies voor onderzoek met gebruik van embryo's verboden sinds 1995. Het onderzoek blijft onderwerp van publieke debatten. Voorstander van onderzoek met embryo's is voormalig first lady Nancy Reagan. Haar echtgenoot Ronald Reagan leed aan de ziekte van Alzheimer, die genezen zou kunnen worden met stamceltherapie. Categorie:Ethiek Categorie:geneeskundige behandeling

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Йенс Финк-Йенсен () родился 19 декабря 1956 года в г. Копенгагене, Дания. Датский прозаик и поэт, фотограф, композитор.

Биография

Писательский дебют — новелла «Июнь 1995»,

Внешний вид

Бомжи имеют характерный внешний вид: обветренное, почерневшее лицо, немытые спутанные волосы, грязная, дурнопахнущая одежда.

Transaction cost

IT's relationship to transaction costs

References

Information Infrastructure's relationship to transaction costs

References

External links

Ronald Coase

The Nature of the Firm

Further reading

See also

External links

Oliver E. Williamson

Awards, fellowships

Books

See also

External links

Contract

Comparison of contract and tort law

Scope of common law contract law

Validity of contracts

Written contracts

Void, voidable and unenforceable contracts

Uncertainty and incompleteness

Severence of unenforceable clauses

Spy contracts

Bilateral v. unilateral contracts

Express and implied contracts

Implied in fact or implied in law

Quasi-contract

Incorporation of terms

Course of dealing

Express and implied terms

Different types of statements

Terms implied in fact

Terms implied in law

Terms implied by custom or trade

Agreements to negotiate

"Subject to" contracts

Statutory law applicable to contracts

Remedies

Damages

Specific perfomance

Procedure

Theoretical considerations

See also

External links

Information Infrastructure

References

Stamceltherapie

Verloop van stamceltherapie

Opzetten van stamcellijnen

Differentiëren van stamcellen naar cellen, weefsels of organen

Transplantatie

Positieve resultaten

Praktische mogelijkheden

Ethische bezwaren

Andere toepassingen voor stamcellen

Huidige situatie

Биография

Внешний вид

Занятия