Contracts in the Spanish legal system
Our law firm in Marbella, wishes to provide you with an approach to this certainly complex matter, but of transcendental importance for the legal traffic, establishing itself on the basis of the solution of many controversies and litigations generated after the conclusion of a contract and during its execution.
One of the ways to deprive a contract of its effectiveness is to invoke defects in the essential elements of such contract. Article 1261 states that a contract does not exist unless the following requirements are met:
- Consent of the contracting parties
- Certain object to be the matter of the contract
- Cause of the obligation to be established
Regarding the first of these requirements, the consent of the contracting parties must be fully, faithfully and seriously informed about the elements of the contract and the declaration of intent must be issued in a conscious, serious and unequivocal manner regarding the obligations arising from it. It is essential that such consent be expressed freely and seriously. Thus, those who have been concluded with animus iocandi or without serious intent are deprived of effectiveness because one of the essential elements of the contract is missing. Also those that have been produced by error or simulation, as well as those suffer from mental reservation or malice.
There is a solvent and consolidated jurisprudence in the Supreme Court regarding the emergence of the resolutory power in bilateral or synallagmatic obligations, highlighting the following requirements:
1. Existence of a reciprocal and enforceable contractual bond, including a pre-contract or a contract with a suspensive condition. In this respect, the STS (Supreme Court Judgement) of April 28, 1991 or July 29, 1996. We must also consider that the moment of performance by the other party, unless otherwise contractually stipulated, occurs from the moment at which performance has begun by the party suffering from delay or non-performance because the other party is in delay.
2. Non-compliance must be serious. It can be either partial or totally defective, but it is not enough to fail to comply with minor or additional conditions that do not impede the economic purpose of the contract, frustrating the legitimate aspirations or expectations of the counterparty. STS of October 18, 1983; June 5, 1989; May 5, 1997 or April 11, 2003. This does not include defective or late performance which would result in damages, but not the power to terminate the contract except where the time for performance was an essential requirement for contracts execution. Think about a wedding celebration where a sumptuous vehicle is rented to take the bride, and the vehicle arrives after the celebration of the event. The action in these cases is the actio non fite adipleti contractus, the action of defective performance.
3. That the other party has not failed to comply with its obligations, since in this case there would not be a failure of the first party to comply because it was not in default. Thus the STS of June 26, 1995 or April 10, 1997. Nor that the party invoking the action for termination for noncompliance caused such noncompliance on the contrary, STS of December 27, 1995.
Thus, we understand that this article 1124 includes two main actions:
– Actio exceptio non adipleti contractus or termination action for breach of contract, whose legal consequence is the business termination.
– Actio non fite adipleti contractus, whose consequence is compensation for damages.
In all these cases, and as the Supreme Court has also pointed out in its jurisprudence, it is particularly relevant to demonstrate who failed to comply first, as well as the diligence of the person seeking judicial protection for the termination of the contract or compensation for damages prior to the exercise of the action before courts. In all these cases, it is necessary to be guided by a skilled hand in the knowledge and application of our legal system, to provide the best solutions, and to reach an agreement with the counterpart to the conflict that is generated by the breach of its obligations.
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