Essential Legal Contracts and Key Definitions
Understanding Legal Contracts
Core Contractual Concepts
Contract
An agreement between two or more persons creating mutual rights and obligations. Most contracts are consensual, meaning they are formed by the consent of both parties.
Cause of the Contract
The decisive reason that leads the parties to enter into the contract.
Form of Contract
The manner in which parties express their willingness to conclude a contract. Forms can be:
- Express: Has an outward manifestation, expressed verbally (through word) or in writing (private or public document), where parties explicitly demonstrate their intent.
- Tacit: Occurs without the parties explicitly manifesting their will to contract.
Types of Contracts
Onerous Contract
One in which there are mutual benefits. For example: sales.
Gratuitous Contract
Aims to benefit only one of the parties, with the other suffering a burden or no direct benefit. For example: donations.
Typical Contracts
Contracts that are planned and regulated by law. For example: sale, lease.
Atypical Contracts
Contracts for which the law did not intend a specific name, or whose features are not regulated by law.
Specific Contract Types Defined
Sale Contract
One party agrees to deliver a specific item, and the other agrees to pay a price in money or a representative equivalent. It is a consensual contract, typically made between a buyer and a seller.
Barter (Swap) Contract
A contract of exchange where each party undertakes to give something to receive something else.
Work and Services Contract
A contract where one person (the employer or contractor) agrees to perform work or provide a service for the benefit of another, who agrees to pay a certain price for it.
Donation Contract
A contract by which a person gratuitously transfers part or all of their property to another, without any remuneration.
Deposit Contract
A contract by which a person receives a movable asset belonging to another for custody until the end of the contract. The well-guarded item, along with any fruits produced during the deposit, must be returned.
Deposit Guarantee
A deposit required to be paid by one party or enforced by a third party in case of non-compliance. This creates a subsidiary obligation binding a creditor, secondary to the primary debt in case of non-payment.
Other Essential Legal Concepts
Usufruct
The right to enjoy the property of another, with the obligation to preserve its form and substance.
Loan
A credit operation where a financial institution makes a determined amount of money available through a contract.
Jurisprudence
The doctrine that repeatedly, and in a consistent manner, establishes how the Supreme Tribunal interprets and implements the law, custom, and general principles of law, thereby completing the legal framework.
Transfer of Credits
A financing operation where the creditor transfers a credit, or part thereof, to a third party.
Renunciation of Rights
The ownership of a right can be lost for many reasons, one being renunciation. Renunciation is an abdication of ownership of a right by its holder, which extinguishes it. It is only valid when it does not go against public interest or order, or cause harm to others.
Act (Law)
A standard issued by public authority and regularly disclosed in writing. State regulations typically become effective only after publication in the official gazette. Laws are repealed only by subsequent laws.
Regulation
General and abstract rules emanating from the executive branch, exercised under regulatory authority. In Spain, these are recognized by the EC, and decided cases have a unique and specific target.