Understanding Contracts: Essential Elements, Interpretation, and Termination

Posted on Jan 24, 2024 in Law & Jurisprudence

CHAPTER V

GENERAL THEORY OF CONTRACTS

1. GENERAL IDEAS

(A) CONCEPT

Pursuant art. 1254 of Civil Code:

“The contract is an agreement of wills between two or more persons, by which one or more of them consent to be bound with another or others to give something or provide some service.”

This means that the contract is a bundle of synallagmatic obligations (“to give something or provide some service”) reciprocally established between the parties.

However, the essence of the contract is the agreement of wills, since without it there is neither contract, nor obligations derived from it. This agreement of wills requires two core elements: offer and acceptance.

Four basic classifications of contracts may be distinguished:

  1. CONSENSUAL: FORMAL:
  2. OBLIGATIONAL: REAL:
  3. MULTILATERAL: UNILATERAL:

those contracts made with freedom of form those contracts which needs a specific formality (f.i. public deed)

those contracts without effects on things (f.i. contract of services)
those contracts with effects on things (f.i. contract of sale)

those contracts which create obligations for several parties (two or more).

those contracts which create obligations for just one party (f.i. loan contract)

1

4.

ONEROUS: those contracts involving consideration (exchange)

GRATUITOUS: those contracts not involving any consideration (f.i. donation)

(B)
(B.1)

Article 1255 CC provides that:

BASIC PRINCIPLES OF CONTRACTING PRINCIPLE OF THE AUTONOMY OF THE WILL