Law of obligations & Contract Law Flashcards
What is a legal fact?
every fact to which the law accords legal consequences:
- Event: e.g. birth, death
- Condition: e.g. insanity
- Action / omission: e.g. causing an accident
What are legal acts?
Every action (omission) which is deliberately taken considering the consequences accorded to it by law
- Unilateral: an offer, a resignation
- Multilateral: e.g. a contract
Name four conditions for a valid legal act?
- Consent
- Object
- Cause
- Ability
What is the condition consent for valid legal acts?
Free will or intention to be bound
The intention of a party to be legally bound is to be determined:
- From the party’s statements, conduct or omission
- As they were reasonably understood by the other party
- No vices: Absence of vices in the consent of a part case-by-case assessment
What is the object condition for a valid legal act?
- Sufficiently defined or can be determined
- Which is permissible
- On the market
What is ability as a condition for a valid legal act?
party must have the ability to take legal action / enter into an agreement
What is the condition cause for a valid legal act?
the reason why you take action (legal act) or enter into an agreement
- Not contrary to public policy, and/or mandatory law
What is the difference between legal and personal capacity?
- Legal capacity: to have the possibility to be the holder of subjective rights
- Personal capacity: to have the ability to exercise the rights of which one is the holder.
Conditions for a mistake to be a vice?
- About the substance / core of the legal act/claim
- The essential element is known to or ought to have known by the other party
- Excusable = all other reasonable persons would have made the same mistake
Name three types of vices?
- Mistake
- Fraud
- Threats (of violence)
What happens to a legal act if there are vices?
- Law sanctions parties if rules were breached upon the conclusion of a legal act
It can either be through avoidance or nullity of the legal act
What are the characteristics of fraud as a vice?
- About the substance / core of the legal act/claim
- By the other party’s fraudulent representation, whether by words or conduct (common law), or fraudulent non-disclosure of any information
Requires a fraudulent intention of the other party - At the moment the legal act is concluded
Name four characteristics of threats (or violence) as a vice?
- Towards myself or close relatives
- By the other party’s imminent and serious threat
- A threat which is wrongful in itself or to use
- At the moment the legal act is concluded.
What is the difference between avoid and void in sanctioning legal acts?
Avoided we need to court the sentence the sanction
vs
void: vs it operates automatically
What is meant with a retroactive effect of santions in case of vices, errors?
A retroactive effect means the legal act never existed (exchange/return what was already performed)
Name four conditions for relative nullity:
- Sanctions acts which violate rules of mandatory law (rules which are installed to protect a certain (contracting) party and which cannot be set aside by the contracting party
- Only protected parties can invoke the sanction
- They have to invoke it at the beginning of dispute (at the first stages of going to court)
- Protective party is able to waive the vice upon certain conditions
Name four characteristics of absolute nullity?
- Sanctions acts which violate rules of public order
- Everyone can invoke the sanction
- Even, at every stage of the dispute
- The sanction cannot be waived by the protected party, because the act was against the essence of our society, culture etc.
What does waiving mean?
protected party sets aside the protection the law offers him. He doesn’t ask the court to apply the nullity-sanction. This causes the legal act to stand regardless of whether there was a vice, error, breach at the moment the act was concluded.
Based on what conditions is the protective party in a legal act able to waive a vice?
- The protected party is aware of the protection given to him by law
- He is aware of this utterly at the moment he waives the sanctions
- It has to be clear that he expressly waives the sanction to be applied
Name three limits of freedom of contract?
- Rules relating to the validity of a contract
- General rule is freedom of contract: Where the otherwise applicable law so allows, the parties may choose to have their contract governed by their contract terms and thus set aside default rules provided by the law
Based upon what conditions can a contract be governed by contract terms instead of default rules provided by the law?
effect should nevertheless be given to those mandatory rules of national, supranational and international law which, according to the relevant rules of private international law, are applicable.
Name three rules relating to the validity of a contract limiting freedom of contract?
- Consent
- If required, fulfilment of formal requirements (we need a formal document to constitute a legal act (exceptional)
- Personal capacity
What is public order?
rule of law that constitutes the essential interests of a country or collective of people, or rule of private law that constitutes the legal framework on which the entire economic and/or moral order of that society, country, group of people is founded. It can never be waived
What is the limit of public law?
Conflicting (fundamental) rights of others
No discrimination
Name two conditions to constitute an offer?
- It is intended to result in a contract if the other party accepts it,
- It contains sufficiently definite terms to form a contract.
Give three considerations for what an offer can constitute?
- Even if it is for free
- An offer may be made to one or more specific persons or to the public
- Offer to supply goods or services at stated prices made by professional supplier in a public advertisement for example, is presumed to be an offer to sell or supply at that price until the stock of goods, or the supplier’s capacity to supply service, is exhausted.
When can an offer be withdrawn?
An offer becomes effective when it reaches the offeree, however, even if it is irrevocable, the offer may be withdrawn if the withdrawal reaches the offeree before or at the same time as the offer
When does an offer become effective?
An offer becomes effective when it reaches the offeree
When can one revoke an offer?
A offer may be revoked if the revocation reaches the offeree before it has dispatched acceptance or, in cases of acceptance by conduct, before the contract has been concluded.
Name three situations in which revocation of an offer is ineffective?
- Offer indicates that it is irrevocable
- Offer states a fixed time for its acceptance
- It was reasonable for the offeree to rely on the offer as being irrevocable and the offeree has acted in reliance on the offer.
Name two condititons for how an offer can be accepted?
Declaration by the offeree: any form of statement or conduct by the offeree is an acceptance if it indicates assent to the offer. Silence or inactivity does not in itself amount to acceptance
- Declaration of the offeree has to reach the offeror.
Name three considerations on when an offer needs to be accepted?
Offer needs to be accepted within a reasonable or fixed time
- Period of acceptance fixed by offeror begins to run from the time that the offer is dispatched
- A late acceptance does not constitute an acceptance.
What constitutes a counteroffer?
- A reply to an offer with an acceptance but it contains additions, limitations or other modifications is a rejection of the offer and constitutes a counter-offer
In more modern times, these adjustments do not materially alter the terms of the offer, and therefore constitutes an acceptence.
What is the difference between unilateral and reciprocal agreements?
Unilateral agreement: only one contracting party has certain legal obligations
Reciprocal agreement: both parties have legal obligations.
When is an offer concluded?
Contract is concluded when acceptance reaches the offeror. In case of acceptance by conduct, the contract concluded when notice of the conduct reaches the offeror.
Name the three types of oral agreements?
- Consensual agreements are the general rule
- Formal agreements: formal requirements are required to constitute a valid agreement
- Real agreement: agreement is constituted when an asset is being handed over to the other party
What are personal agreements?
Agreements stand or fall with the person of one of the contracting parties. Namely, closely linked to the person of the debtor:
- The contract can only be performed by the debtor
- If the debtor dies, the contract is terminated.
What are the consequences of a contract in regards to relativity and privity of a contract?
- Contract only creates obligations and rights for the contracting parties involved.
1. Other parties are third parties
2. Third parties only have to know existence of contract, not its contents, unless there are third party claims in the agreement: contracting parties can give rights to a third party
What is required to supervise performance under a contract?
strict compliance to the performance of the contract. Sanctions in case of breach of contract:
Two considerations in regards to sanctions in case of breach of contract?
- Can contracting party in breach be excused (force majeure, hardship)
- Sanction does not apply automatically. Formal notice ought to be served
