460 GlossaryOfferA proposal of a set of terms by which the
offeror is willing to be contractually bound.
OffereeA person to whom an offer is made.
OfferorA person who makes an offer.
Offer to settleA formal offer to settle a civil claim
for a certain amount.
Office of Legal ComplaintsA new body which
will investigate complaints against solicitors and
barristers.
Off the shelf companyA company formed in
advance so that it can be sold to people who do
not want to form their own company.
OmbudsmanA person empowered to investigate
disputes which arise within a certain trade or
industry.
Oral contractA contract made by spoken words
(i.e. not made in writing or by conduct).
Ordinary resolutionA company resolution which
is passed if a majority of eligible members who
actually vote vote in favour of the resolution.
OverdraftCredit given by a bank in allowing a
customer to take more money out of his or her
account than is in the account.
OverruleA higher court overrules aratio decidendi
of a lower court by declaring it to be invalid and
overturned.
Parent ActA statute which gives the power to
make delegated legislation.
ParliamentThe supreme governing body of the
United Kingdom which can pass legislation. It is
made up of the Queen, the House of Lords and the
House of Commons.
PartnershipTwo or more persons carrying on a
business together, with the intention of making a
profit, and without operating as a company or
an LLP.
Partnership agreementA written agreement
setting out the rights of partners as regards each
other. Can be in the form of a deed, but does not
need to be.
Partnership propertyProperty which belongs to all
of the partners in a firm, rather than to individual
partners.
PartyA person.
Passing offA tort committed by deceiving the
public so that they believe that a business is in fact a
different business.Past considerationA promise to perform an act
which has already been performed (cannot be good
consideration in law of contract).
PatentA right to exploit a new inventive step
which has been registered as a patent.
Payment into courtA formal offer to settle a civil
claim for a certain amount.
PenaltyA term in a contract which sets out the
amount of damages to be paid if the contract is
breached, the amount specified being a large sum to
terrorise the other party into performance, rather
than a genuine pre-estimate of what the loss would
be. Penalties are ignored by the courts, which assess
damages as if the penalty did not exist. Contrasted
with liquidated damages clauses.
Perpetual successionThe idea that a company or
an LLP can stay in existence permanently.
PlcSee public company.
Pledge (or pawn)Handing over possession of
goods as security for a loan, on the understanding
that the goods can be sold if necessary to recoup
any part of the debt which is not repaid.
Pledge creditGain credit by promising that the
debt will be repaid.
PollA vote on a company resolution where each
voting share carries one vote. Contrast show of
hands.
Postal ruleThe rule that acceptance of an offer by
letter or telegram is effective when it is posted. The
rule applies only if acceptance by letter or telegram
is asked for or reasonably expected.
Preference (in relation to companies)An act by a
company which puts a creditor of the company into
a better position if the company should go into
insolvent liquidation than he otherwise would have
been. A court can order that a preference be repaid
to the company.
Preference sharesA class of shares which have
rights which are not the same as the rights attaching
to ordinary shares.
Preferential creditorA creditor of a company who
has taken security for the debt and is therefore
allowed to take payment out of the sums realised by
the security ahead of unsecured creditors. However,
this right can be subject to ‘top-slicing’.
PrescriptionA property right which can give a
right to continue committing what would otherwiseZ01_MACI4097_03_SE_GLOSS.QXD 1/31/11 3:01 PM Page 460