law

• Contract


  A meeting of minds between two persons whereby one binds himself, with respect to the other, to give something or to render some service
• Contracting parties


  • May establish such stipulations, clauses, terms and conditions as they may deem convenient, provided they are not contrary to law, morals, good customs, public order, or public policy
• Innominate contracts


  Shall be regulated by the stipulations of the parties, by the provisions of Titles I and II of this Book, by the rules governing the most analogous nominate contracts, and by the customs of the place
• The contract must bind both contracting parties; its validity or compliance cannot be left to the will of one of them
• The determination of the performance may be left to a third person, whose decision shall not be binding until it has been made known to both contracting parties
• The determination shall not be obligatory if it is evidently inequitable. In such case, the courts shall decide what is equitable under the circumstances
• Contracts


  • Take effect only between the parties, their assigns and heirs, except in case where the rights and obligations arising from the contract are not transmissible by their nature, or by stipulation or by provision of law
  • If a contract should contain some stipulation in favor of a third person, he may demand its fulfillment provided he communicated his acceptance to the obligor before its revocation
  • A mere incidental benefit or interest of a person is not sufficient. The contracting parties must have clearly and deliberately conferred a favor upon a third person
• In contracts creating real rights, third persons who come into possession of the object of the contract are bound thereby, subject to the provisions of the Mortgage Law and the Land Registration Laws
• Creditors are protected in cases of contracts intended to defraud them
• Any third person who induces another to violate his contract shall be liable for damages to the other contracting party
• Contracts


  Are perfected by mere consent, and from that moment the parties are bound not only to the fulfillment of what has been expressly stipulated but also to all the consequences which, according to their nature, may be in keeping with good faith, usage and law
• Real contracts


  Such as deposit, pledge and Commodatum, are not perfected until the delivery of the object of the obligation
• No one may contract in the name of another without being authorized by the latter, or unless he has by law a right to represent him
• A contract entered into in the name of another by one who has no authority or legal representation, or who has acted beyond his powers, shall be unenforceable, unless it is ratified, expressly or impliedly, by the person on whose behalf it has been executed, before it is revoked by the other contracting party
• Essential requisites of contracts

  • Consent of the contracting parties
  • Object certain which is the subject matter of the contract
  • Cause of the obligation which is established
• Consent


  Is manifested by the meeting of the offer and the acceptance upon the thing and the cause which are to constitute the contract. The offer must be certain and the acceptance absolute. A qualified acceptance constitutes a counter-offer
• Acceptance made by letter or telegram does not bind the offerer except from the time it came to his knowledge. The contract, in such a case, is presumed to have been entered into in the place where the offer was made
• Acceptance


  May be express or implied
• The person making the offer may fix the time, place, and manner of acceptance, all of which must be complied with
• An offer made through an agent is accepted from the time acceptance is communicated to him
• An offer becomes ineffective upon the death, civil interdiction, insanity, or insolvency of either party before acceptance is conveyed
• When the offerer has allowed the offeree a certain period to accept, the offer may be withdrawn at any time before acceptance by communicating such withdrawal, except when the option is founded upon a consideration, as something paid or promised
• Unless it appears otherwise, business advertisements of things for sale are not definite offers, but mere invitations to make an offer
• Advertisements for bidders are simply invitations to make proposals, and the advertiser is not bound to accept the highest or lowest bidder, unless the contrary appears
• Persons who cannot give consent to a contract

  • Unemancipated minors
  • Insane or demented persons, and deaf-mutes who do not know how to write
• Contracts entered into during a lucid interval are valid. Contracts agreed to in a state of drunkenness or during a hypnotic spell are voidable
• The incapacity declared in Article 1327 is subject to the modifications determined by law, and is understood to be without prejudice to special disqualifications established in the laws
• Mistake, violence, intimidation, undue influence, or fraud


  Can make a contract voidable
• Mistake


  Should refer to the substance of the thing which is the object of the contract, or to those conditions which have principally moved one or both parties to enter into the contract. Mistake as to the identity or qualifications of one of the parties will vitiate consent only when such identity or qualifications have been the principal cause of the contract
• When one of the parties is unable to read, or if the contract is in a language not understood by him, and mistake or fraud is alleged, the person enforcing the contract must show that the terms thereof have been fully explained to the former
• There is no mistake if the party alleging it knew the doubt, contingency or risk affecting the object of the contract
• Mutual error as to the legal effect of an agreement when the real purpose of the parties is frustrated, may vitiate consent
• Violence


  When in order to wrest consent, serious or irresistible force is employed
• Intimidation


  When one of the contracting parties is compelled by a reasonable and well-grounded fear of an imminent and grave evil upon his person or property, or upon the person or property of his spouse, descendants or ascendants, to give his consent
• Violence or intimidation shall annul the obligation, although it may have been employed by a third person who did not take part in the contract
• Undue influence


  When a person takes improper advantage of his power over the will of another, depriving the latter of a reasonable freedom of choice
• Fraud


  When, through insidious words or machinations of one of the contracting parties, the other is induced to enter into a contract which, without them, he would not have agreed to
• Failure to disclose facts, when there is a duty to reveal them, as when the parties are bound by confidential relations, constitutes fraud
• The usual exaggerations in trade, when the other party had an opportunity to know the facts, are not in themselves fraudulent
• A mere expression of an opinion does not signify fraud, unless made by an expert and the other party has relied on the former's special knowledge