A contract is a form of agreement between two or more natural and/or legal persons who, through their mutual declarations of will, seek to achieve a certain legal result. The purpose of the contract is to establish, settle or destroy a legal relationship between the persons who conclude it. To this end, the parties are free to determine the content of the contractinsofar as it does not contradict the imperative norms of the law and good manners.
The conclusion of a contract between two or more persons constitutes an agreement reached between them. That is, their will statements must coincide. For those who have concluded it, the contract has the binding force of law. It regulates the relations between the parties in advance and obliges them to comply with what has been agreed. In this way, the treaty creates that predictability in the relations between the parties, which is of particular importance both for civil turnover and for business.In this sense, it is necessary that the contract correctly and comprehensively reflect the legal relationship between the parties to it, as well as correctly project the legal result intended by the contracting parties.
As we said above, the parties are free to determine the content of the contract they conclude with each other, as long as it does not contradict the law or good morals. This basic rule for contracts concerns the legal norms determining conduct from which the parties have no right to deviate (imperative legal norms).
Where the agreements of the parties deviate from the provisions of the law, the contract does not necessarily have to be null and void, provided that this deviation affects such legal norms from which the parties have the right to deviate. This means that the parties have a certain freedom to contract differently from what is written in the law (dispositive legal norms).
On this basis, we can distinguish:
Example: Necessary arrangements in a rental contract are the arrangements for temporary concession of the use of the itemand to pay a rental price. If there is no rental agreement, the contract is either incomplete, i.e. not yet definitively concluded, or there is a service loan agreement, because according to the law, the rental contract is always remunerated.
As we have indicated above, a contract is an agreement between two or more parties whose will statements coincide completely. These will statements must be objectified in real reality, they represent the factual composition of the transaction. The written form objectifies those agreements between the parties that the law has not found necessary to specify and they have the freedom to do so. If they do not, then the general provisions of the law apply, not their specific provisions. That is, agreements that are not objectified in writing remain not just a secret to the outside world, but also do not exist. This can be done in writing, in writing with notarized signatures, through a notarial deed, through conclusive acts and orally.
The first three species fall into the category of so pomegranate. “formal contracts”.For them, the law requires compliance with a certain form, depending on the type of transaction.
For example: contracts for the transfer of ownership of real estate, contractual mortgages, contracts for the establishment of building rights (superficia)etc. are concluded by a notarial deed; commercial enterprises and registered in Bulgaria Automobilesare transferred by a written contract with notarization of signatures. Written form is required for contracts bank loan, for a license, sale with a purchase agreement, etc.
Failure to comply with the form prescribed by law makes the contract null and void, regardless of what kind it is. Consequently, the Commercial Law provides that the statement on the conclusion, execution or termination of a commercial transaction is null if it is not made in the form established by law or agreed by the parties.
However, Art. 293, para. 3 of the TC introduces a deviation from the rule of nullity of transactions that are not carried out in the statutory form, stipulating that “a party may not invoke nullity if it can be concluded from its conduct that it has not challenged the validity of the statement.” That provision aims at speeding up trade turnover as well as facilitating trade relations. The deviation is made quite consciously, since it is assumed that tradersare professionals and can take a more qualified care of their affairs than ordinary citizens. For this reason, no such tolerance is provided for in civil law transactions. In them, failure to comply with the form provided by law leads to the nullity of the transaction.
Among the forms of actuality of the contract we can find the so-called. 'informal contracts'. In these cases, the law does not require a specific form and the contracting parties are free to determine in what form to conclude the contract — it may be oral or by conclusive action.
However, it should be borne in mind that there is also a so-called form of proof. What does she represent? In some cases, a written form of the contract is required, even if it is not mandatory. This is so, due to the needs of legal proceedings and the need to prove the facts and circumstances alleged. In the absence of a written contract, proving it in court is almost impossible.
In general, commercial transactions are informal, except in cases where a written or other form is provided by law (banking transactions, insurance contracts). This is possible because traders carry out their activities by profession and the speed of trade turnover is aimed at.
However, as we mentioned above, when the law requires the written form of the contract, its conclusion as an informal transaction would lead to its nullity. In these cases, compliance with the letter of the law is a condition for the reality of the transaction.
With regard to the terms of the agreed transaction between the parties, the presence of an objective record, such as the written contract, constitutes the bearer of their original intentions at the date of its signing. For those who conclude it, the contract is a law - a bearer of rights and obligations, and through it the terms of the contract itself and the wishes of the parties are distinguished.
In addition, the written form promotes precision and clarity in shaping the clauses in the contract, is used as a means of proof in case of poor performance or non-performance in a possible judicial production.
The written contract makes it possible to distinguish the agreed terms from the pre-contractual relationship. The contract serves to satisfy the interests and needs of the parties. Therefore, it is advisable to draw it up in writing, even when the law does not require it, since in an unclear or ambiguous agreement the purpose of the contract itself is interpreted, and this is easiest in the presence of a written contract, from which all the agreements made between the parties become clear.
Well-drafted contracts are a guarantee of security for each of the parties. In case of default or poor execution, they are a prerequisite for the realization of a successful judicial protection.They are the business card of the business that provides them for signature to its counterparties and/or customers, but at the same time, containing a comprehensive and well-balanced summary of the agreements between the parties, they manage to overcome uncertainty and unpredictability in the dynamics of joint commercial activity.
We advise you when drafting contracts of any type, content and form to consult with specialist in this field.
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