7. Contracts and other sources of obligations

Question 1

What is a contract?

Answer 1

• Contracts allow consumers to purchase goods and services
• Contracts allow businesses to organize themselves and to trade goods and services both with other businesses and with consumers

Question 2

How are contracts written?

Answer 2

through documents drawn up by the parties, by a public notary, by a solicitor, etc. orally or even by conduct

Question 3

Contracts in modern societies

Answer 3

• Modern society is unthinkable without the possibility to conclude binding contracts.
• Societies without contracts are conceivable solely in situations where the State or the community takes care of everything, including the provision of the necessities of life (such as food, housing and health care)

Question 4

Movement of contract from status

Answer 4

Status to contract <=> feudalism to market <=> families/social classes to individual freedom

Question 5

What would lead to the death of contract?

Answer 5

modern society to contemporary society <=> contract to tort <=> market to welfare systems <=> individual freedom to statualism

Question 6

Formal definition of contract

Answer 6

Roman law:

• Contractus: Cum-trahere meant “to bind” the parties

Civil law

• Contract = agreement/donations

Common law

• Contract = a bargain, i.e. an exchange
• Gratuitous promises are not contracts (if not made by deed)
• Gratuitous bailments are not contracts
• A bailment occurs when a person (the bailor) transfers possession of a chattel to another (the bailee)

Question 7

Contracts and obligations

Answer 7

Contract is essentially a source of obligations

e.g. contract of sale (the contract having as its object the transfer of the ownership of a thing or the transfer of other rights in exchange for a price)

Obligations of the seller

• To deliver the thing to the buyer
• To warrant the buyer against eviction and defects in the thing sold

Obligations of the buyer: To pay the price within the time and the place fixed by the contract

Question 8

Legal effects of contracts

Answer 8

1. Obligation -> creation, modification and discharge
2. Ownership -> transfer of rights