Essential Commercial Law: Sales & Commission Contracts
Commercial Sales Contracts and Obligations
Consequences of Buyer’s Unjustified Refusal
If the buyer refuses or rejects goods without valid reason or purpose, the seller, who prefers the performance of the contract, may deposit the goods in court. The seller can then claim the price and may also seek contract rescission.
Common Breaches of Contractual Obligations
- Failure in the duty of delivery of goods in all circumstances (quantity, quality, etc.).
- Breach of the duty of paying the price.
- Failure to accept receipt of the goods sold (due to unjustified refusal or default).
Seller’s Rights Under Commercial Code Article 340
Article 340 of the Commercial Code states that as long as the goods sold are held by the seller, even as a deposit, the seller will have precedence over them against any other creditor to secure payment of the price and any interest costs incurred due to delay.
Defining ‘Sale from Square to Square’
This occurs when the place (town) of delivery differs from the place of sale. In these cases, the place of delivery is often the establishment of the carrier hired to transport the goods to the buyer.
Understanding the Installment Sales Regime
The regime of an installment purchase contract can be summarized as follows:
- Written form is mandatory.
- In addition to recording contract covenants and clauses stipulated by the parties, the contract must contain the minimum stipulated in Article 7 of the Law on Hire Purchase of Movable Goods (e.g., place and date of purchase, names of buyer, seller, and financier; description of the object of sale, price, amount paid and amount deferred, and whether the interest rate is variable or fixed).
- The buyer’s possibilities of withdrawal.
Commercial Collaboration Contracts: The Commission
Collaboration Contracts: Means vs. Results
Yes, as in partnership contracts or management of external interests, obligations are primarily assumed. In some cases, the predominant purpose is merely the realization of the activity as a means that may or may not achieve an outcome (procurement of means). In other cases, the object is clearly the achievement of a specific result (performance contracts).
Key Characteristics of a Commercial Commission Contract
- It is a mandate: a contract where a person (commission agent) agrees to render a service or act on behalf of another (principal).
- The purpose of the commission, as instructed by the principal, must be an act of commerce. Its execution forms the legal business conducted by the commission agent, distinct from the commission agreement itself, and generates external relationships with third parties.
- Either the principal or the agent must be a trader.
- The internal relationship between the client and the commission agent is not a lasting or successive one, but an instantaneous relationship that concludes upon the perfection and consummation of the commission’s purpose.
- The commission is a consensual, bilateral, or synallagmatic contract. While a general mandate is naturally gratuitous unless otherwise agreed, a commercial commission is naturally remunerated, unless otherwise agreed.
Client Acceptance of Commission Agent’s Actions
Can the commission agent act on their own behalf or on behalf of the principal? In both cases, must the client accept all consequences of the commission? (Commercial Code, Article 253)
Yes, except for the right of recourse against the agent for faults or omissions in compliance.