Part 1 of Chapter 4 Flashcards
What are contracts
An agreement of wills
If someone agrees but has additions, limitations or other modifications what happens?
Then the contract is not accepted, acceptance with modifications constitutes a rejection of the proposal unless the modification itself constitutes a new proposal.
When is a contract concluded/agreed upon?
When the parties reach an agreement in relation to all the clauses that they consider necessary for the formation of the agreement. (when the opposing interests of each of the parties are reconciled).
What constitutes a contract
- An agreement of wills of two or more parties and as such is a bilateral or plurilateral legal transaction
- There must be intention to create a legal relation
- An agreement of wills aimed at creating, modifying or terminating legal relations.
- Binding agreement, regulated and protected by law. Once concluded, the parties are bound to comply with it, under the agreed terms.
Fundamental Principles of Contract law
- Principle of Contractual freedom
- Freedom of Form Principle
- Principle of good faith
- Principle of the Binding force of contracts (Leads to three sub-principles)
4 (a): Principle of exact and punctual compliance
4 (b): Principle of intangibility of the content
4 (c). Principle of irrevocability
Explain Principle of Contractual Freedom
Consequence of the principle of private autonomy.
1. Parties enjoy freedom to enter into a contract (to decide whether or not to enter a contract and to choose the other party
2. Freedom to select the type of contract
3. Freedom of stipulation
4. Freedom to establish the content of the contract (combo of 2 and 3)
What are the limitations on the freedom to enter into a contract
- There are cases in which one or both parties are subject to a legal obligation or duty to contract
- Others where they are prevented from contracting with certain people
- And still others where they are dependent upon someone’s consent.
What are the limitations o the freedom to establish the content of the contract
A legal transaction whose object is physically or legally impossible, contrary to the law or indeterminable is void. It is also void if a legal business is contrary to public order, or offensive to good customs.
Are there mandatory legal provisions?
Yes, that are imperative and cannot be overridden by the will of the parties.
What is the Freedom of Form principle
According to the principle, unless otherwise stated, the perfection of the contract depends only on the agreement of wills between the parties, without the need to adopt a special form.
What is the Principle of good faith?
Present for the entire life of a contract
Determines that anyone who negotiates with anther person with a view to concluding a contract is obliged, both in the preliminary and in the formation of it, to proceed in accordance with the rules of good faith.
If either party fails to comply due to intent or negligence, said party will be held liable to the damages of the other.
Both in fulfilment of an obligation, as well as in the exercise of the corresponding right, the parties are obliged to proceed in good faith.
What is the Principle of the binding force of contracts
Contracts must be punctually performed, and can only be modified or terminated by mutual consent of the contracting parties or in cases allowed by law
What are the three sub-principles of the Principle of binding force of contracts?
- Principle of exact and punctual compliance
- Principle of intangibility of the content
- Principle of irrevocability
What is the Principle of exact and punctual compliance
Means that the contract must be complied with in its entirety, point by point in all its clauses, (Obligations contained therein must be fulfilled).
What is the Principle of intangibility of the content
Except in cases provided by law, once a contract is concluded, its content is intangible, and can only be modified with the agreement of both parties.
What is the principle of irrevocability
Except in cases provided by law, once concluded, the contract can only be terminated with the consent of both parties
What is the name of the Principle that merges the las two sub principles
Principle of stability of contracts
Is there a reservation which allows for the modification of contracts or their termination without the agreement of both parties?
Yes, in the case of a material breach, the non-defaulting party may unilaterally terminate the contract.
What are typical or named contacts
They are those provided for and regulated by the law, such as purchase and sale, donation, partnerships, provision of services, lease, loan, mandate or deposit. These contracts, in addition to having nomen iuris (proper name assigned by law, have specific legal regulations)
What are atypical or unnamed contracts
Contracts that don’t have nomen iuris, (a proper name assigned by law), they also do not have specific legal regulations. These contracts are concluded under the principle of contractual freedom, in which the parties, within the limits of the law, stipulate the agreed content (Franchise agreements).
What are mixed contracts
Principle of contractual freedom, grants parties the option of entering into contracts other than the typical ones or incorporating in the same contract two or more typical contracts.
Two or more businesses fully or partially regulated by the law are incorporated in the same contract, one legal business (contract), whose essential elements relate to different typical contracts.
What is within mixed contracts
- Simple joining of contracts
- Coalition of contracts
In either case there are two or more contracts that are linked together, but retaining their individuality/autonomy.
The links between contracts in the simple joining of contracts and the coalition of contracts
Simple joining: Merely accidental
Coalition of contracts: Not accidental, there is a relationship of dependence between them, namely because one of the contract is a condition of the other
Examples of Simple junction and coalition of contracts
Simple junction:
Someone purchases materials at a hardware store and the salesperson offers to do repairs at the customer’s home. There is a link because the two contracts were concluded at the same time
Coalition of contracts:
When buying a house, the buyer also decides to acquire the furniture. However, he will only buy the furniture if he buys the house.
