Contract Negotiation Flashcards
7 cards from real CCEP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Contract Negotiation flashcards as text
Which contract element defines what happens to deposits if the event planner cancels the event?
Answer: Cancellation clause
The cancellation clause outlines the financial penalties—including deposit forfeiture or sliding-scale fees—that apply if the event is canceled by either party at various points before the event date.
What does 'mutuality of obligation' mean in a contract context?
Answer: Each party must be bound by enforceable promises for the contract to be valid
Mutuality of obligation means both parties must be bound by real, enforceable commitments; if only one party is obligated to perform, the contract typically lacks enforceability.
When a venue offers a complimentary room ratio (e.g., 1 comp per 40 paid rooms), what should the planner negotiate?
Answer: To have the ratio applied to cumulative rooms across the entire program, not nightly
Applying the comp ratio to total cumulative room-nights across the entire program (rather than per night) maximizes the number of complimentary rooms the planner earns.
What is the key risk of signing a contract that contains a 'net 30' payment term without adequate cash flow planning?
Answer: The planner may face late fees or contract default if invoices are not paid within 30 days
Net 30 terms require full payment within 30 days of invoice; without sufficient cash flow, a planner risks breaching the contract and incurring late penalties or losing vendor services.
Which tactic involves a negotiator claiming they must get approval from a higher authority before agreeing to a concession?
Answer: Limited authority tactic
The limited authority tactic slows negotiations and creates leverage by preventing the negotiator from making immediate binding concessions, forcing the other side to wait or make additional compromises.
In a hotel contract, what is typically included in a 'room block cutoff date' provision?
Answer: The deadline by which attendees must book rooms at the contracted rate before rooms are released to the public
The cutoff date is the deadline for attendees to reserve rooms at the negotiated group rate; after this date, the hotel may release unsold rooms to the general public at market rates.
What is the negotiation concept of 'ZOPA'?
Answer: Zone of Possible Agreement — the overlap between each party's acceptable outcomes
ZOPA (Zone of Possible Agreement) is the range within which a deal can be struck because both parties' acceptable outcomes overlap, making it the target space for successful negotiation.