Hi Jane,
Thanks for your rather complete response! At this stage I have enough work
on that I can afford to give the US clients a bit of an ultimatum: either
switch to NZ justidiction or find another software developer... We'll see if
they walk or want to talk.
Regards,
Dave
On Thursday 21 June 2001 15:01, you wrote:
> Dave
>
> I'm not surprised that a US business wants its contracts to be subject to
> US law - I've found that this is a standard response.
>
> "Just a quick query: when dealing with US-based companies with regard to,
> say, contract software development, how do you limit your liability with
> respect to US litigation laws?"
>
> Limiting your exposure has at least two steps:
>
> First, ideally your contract should include clauses which limit your
> liability in certain circumstances anyway, such as saying that the other
> party will be responsible for ABC and that you will not be responsible for
> XYZ.
>
> Second, if there is a dispute, that's where the relevant law comes in.
> Some options:
> * agree that US law will apply to the contract, and take the risk that
> there will never be a dispute arising out of the contract.
> * take out litigation insurance. A good insurance broker will be able
> to let you know the costs of various types of policies and the cover
> available.
> * agree that US law will apply to the contract, but don't exclude the
> New Zealand courts from having jurisdiction to hear a dispute. This means
> that the dispute could be heard in New Zealand and the courts here would
> apply US law. To explain further, most jurisdiction clauses in contracts
> will say something to the effect of "this contract is governed by the laws
> of New Zealand and is subject to the exclusive jurisdiction of the New
> Zealand courts." If the contract is to be governed by US law, try not to
> include a clause saying like the contract is "subject to the exclusive
> jurisdiction of the US courts".
> * keep trying to negotiate for New Zealand law to apply and New
> Zealand courts to have exclusive jurisdiction.
>
> " I have heard of the International Arbitration Association, but I'm not
> sure
> if anyone uses it... They may or may not have a NZ office - they don't
> appear to have much of an Internet presence. Has anyone heard of it or of
> a
>
> comparable international trade dispute arbitrator? I'd like to offer my
> client an alternative to choosing either NZ or US law as the basis for the
> contract."
>
> The International Arbitration Association is an association of qualified
> arbitrators, such as retired judges, industry specialists, senior lawyers
> and the like. I think that it's based in London, but it has members from
> around the world.
>
> If you include a clause saying that any disputes have to be heard by an
> arbitrator, then (in most situations) disputes must be heard by an
> arbitrator and can't be heard in a court. It is open for you to agree:
>
> * where the arbitration will be held (eg country and city);
> * who the arbitrator will be (or for a formula to appoint the
> arbitrator, such by asking the President of the New Zealand Software to
> appoint a suitable arbitrator)
> * the law that will apply to any disputes
>
> Most western countries around the world have adopted similar laws about how
> arbitrations will be held to ensure consistency between trading nations.
> The rules can get a bit complex so it wouldn't hurt to find out more about
> them and their effect before including an arbitration clause in contracts.
> There are pros and cons of including arbitration clauses in contracts and
> they largely depend on the nature of your business and what your goals are.
>
>
> There is a lot more that I could say on these topics, but I don't want to
> perpetuate the myth that lawyers talk too much! Hope this (limited)
> information helps.
>
>
>
>
> Jane Montgomery
>
> Senior Associate
> Buddle Findlay
> P O Box 322
> Christchurch
>
> Direct phone: 64 3 371 3517
> Fax: 64 3 379 5659
>
>
>
> ____________________________________________________________________
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