Contract LawProf. Cornelia Lefter Grade: 1p. presence 1p. homework 2p. seminar (1p. presence, 1p. homework) 5p. exam 1p. office Bibliography: 1. Cornelia Lefter, Raluca Dimitriu, Ovidiu Maican Civil Law, 2000, Ed. Economica 2. Gabriel Boroi, Liviu Stanciulescu Institutii de drept civil in reglementarea noului Cod Civil, 2012, Ed. Hamangiu 3. Dumitru Florescu Contracte Civile, 2011, Ed. Universul Juridic 4. Stanciu Carpenaru Drept comercial, 2011, Ed. Universul Juridic 5. Paul Richard Law of contract, 1998, Putnam Publishing 6. Law 287/2009 and Law 71/2011 The new Civil Code (NCC)

Year I Master

1

Contract Law

Course 1Juridical relations one party (creditor) + other party (debtor) = juridical relation (stipulated by law Civil Code)

Obligations Sources of civil obligations (in the Civil Code): a) Events (in nature and society) b) Human actions regulated by law unwillingly produced to conclude juridical relations willingly produced to conclude juridical relations Unwillingly produced human actions: flood in your apartment because of another landlords pipe damage) => enter into a juridical relation because of the situation Willingly produced human actions: you enter into ones apartment because he lets you, in order to fix his pipe. Some actions may be lawful (cvasi contracts) unlawful (offenses/crimes) Law 1165/NCC the sources of civil obligations are: 1. The contract 2. The unilateral juridical acts 3. The legal juridical facts 4. The unlawful fact 5. Any other act/fact of which law binds the creation of an obligation Juridical acts - A material form of an act (e.g. the paper) - The proof of the act (material proof), called instrumentum (the expression of somebodys will made with the intention to produce legal effects) !!! proof = instrumentum act - e.g. when you buy a bread from the store you receive a receipt (this is the proof), and when you pay the money you receive the bread (this is a juridical act)

Homework 1: Write about the legal and abstract capacity of natural and legal persons

Year I Master

2

Contract Law

Course 2The unilateral juridical act (art. 1324 1329 / NCC) It is defined to be unilateral the juridical act that supposes only the expression of the will of each party. We include here the unilateral promise and the public process of reward. Article 1327 stipulates that if the author has not established a time limit, it is supposed that the promise/contract is valid for a certain time, according to the nature or the circumstances when the obligation was assumed. Within a unilateral promise, the author expresses the intention to assume an obligation. By difference, within the public process of reward, the author publicly promises to reward a person who will carry out a certain service/activity for him. Article 1328 stipulates that who publicly promises a reward in exchange for a service is liable to pay even if the service was carried out without knowing the reward. The legal juridical facts There are 3 different facts: a) the administration of business (art. 1339 and 1340 / NCC) Refers to the situation when a person, without being liable, voluntarily administrates the business of another person who is not aware of this administration or, knowing it, he could not appoint a mandator to carry it out. The person who administrates is called endorser and the beneficiary is called endorsee. The specificity of this situation is that the endorser acts only in the benefit of the endorsee. The endorser can conclude juridical facts and acts without having a mandate for that. b) the undue payment (art. 1341 1345 / NCC) That who pays without being liable has the right of restitution. It is presumed until the contrary proof that the payment is done with the intention to pay off your own debt. (art. 1341) Undue payment is the situation when a payment made by someone is not an obligation. Normally, a person who pays is considered to be liable to each payment it corresponds a debt (there is a debtor). If that situation occurs, that person has the right to be restituted the money. c) the enrichment without legal cause (art. 1345 1348 / NCC) That who in a non-imputable way has been enriched without legal cause to the detriment of another is liable to restitution as far as the patrimonial loss suffered by the other person, but not over the limit of his own enrichment. (art. 1345)

Year I Master

3

Contract Law

The unlawful facts (art. 1349/NCC) Any person has the obligation to observe the rules of behavior that the law or the rules of the place imposes and not to bring prejudice through his actions/non-actions to the right or to the lawful interest of another person. In case the persons do not observe the law and bring prejudices (moral, physical etc.), they will be liable to cover the damages. We speak here about liability due to damages or due to misfeasance or nonfeasance (raspundere non-conflictuala). Certain categories of persons are kept liable: parents for their children, employer for the facts of their employees, even if they do not do anything. The contract (art. 1166/NCC) It is defined as an agreement between the wills or two or more persons, with the intention to create/modify/end juridical relations. There are also rules referring to the contract not only in the NCC, articles up to 260 in number. The contract is a juridical act and it also is bilateral. Act = expression of somebodys will Contract unilateral (only one party assumes obligations, but there are two parties involved) bilateral (but not the same as for unilateral acts !!) !!! One cannot contract with himself. There must be two parties. There are also exceptions, when you are forced to contract with yourself for example (contract de comodat cu mine insami pentru ca detin spatiul). Within the bilateral contract, one party has the responsibility to conclude the contract, called active subject. He is entitled to receive something from the other party. From the point of view of the debt relation, the active subject is the creditor. The other party, who is liable to perform a duty for the active subject is called passive subject or debtor. The duty that the debtor has to perform is to give, to do or not to do. To give to transfer or to create a real right (e.g. selling and purchasing contract sell a specific good, transfer the ownership right to the buyer) To do to carry on a service/activity (e.g. do a service deliver a telephone) Not to do you assume the obligation not to do, although legally you are allowed to do (e.g. contract with exclusivity clause assume not to do the same thing/do a service with another party)*** *** synallagmatic (synallarmatical ?) contract the obligations of the parties are reciprocal and interdependent !!! The right of the active party is the obligation of the passive party. Homework 2: Write about the classification of goodsYear I Master 4 Contract Law

Course 3The classification of contracts (criteria) 1. according to the number of parties a) unilateral contracts b) bilateral contracts art. 1171/NCC the contract is synallagmatical when the obligations born from it are reciprocal and interdependent 2. according to the form of the contract a) consensual contracts The consensual contracts are enforceable by the simple consent of the parties. Their conclusion does not impose the performance of another activity or a specific form (concluded orally/written). If goods have to be delivered, the handing over of them represents the execution of the obligation and not a condition for their conclusion (e.g. sale-purchase). b) real contracts The real contract produces effects only when the goods are delivered (e.g. warehouse, shipping contracts). c) formal contracts Formal contracts are those which are enforceable only if they are concluded in a specific form (the authentic form normally the form written/drafted in front of a notary). Normally, the form can be enforced by law, either in order to prove the partys obligations (ad probatiorum only for the proof, or ad validitatem for the validity of the juridical operation itself); e.g. a mortgage has to be concluded in authentic form (requested ad validitatem), and the insurance contract has to be concluded in a certain form (ad probatiorum). 3. according to the personal qualities of the parties a) intuitu personae These contracts are concluded based on the personal qualities of the parties. The effect that the error in personae (who the real party is) brings the annulment of the contract. The parties cannot subcontract in this kind of contract. b) contract concluded by professionals or between professionals and consumers Here we take into account that at least one party is a professional from a certain point of view (legal rules, Civil Code): The contract concluded between professionals is submitted to special laws in admission to the provisions of the Code (article 1176/NCC).

Year I Master

5

Contract Law

4. according to the content of the contract a) adhesion contract The adhesion contracts are those contracts where the essential clauses are imposed by one of the parties or for this one, or as a result of his instructions, while the other party is only able to accept them or not (article 1175/NCC). The content of the contract is unilaterally imposed to the other party (e.g. insurance, bank, cable provider, telephone contracts). b) negotiated contract 5. according to the way the contract is performed a) contract with instant execution (unno ictu) b) contract with successive execution 6. according to the conclusion of the contract to another one a) principal contract b) accessory contract The legal regime of the accessory contract follows the one of the principal contract. 7. according to whether the contract is regulated or not by law a) named contract The named contract is regulated by law. b) unnamed contract The parties of the contract have to establish all the necessary elements of the contract. 8. the framework contract The framework contract is the agreement through which the parties agree to negotiate, to conclude or to maintain contracted relations where the essential elements are established by the contract (article 1176/NCC). The ways in which the contract is performed, especially the term and volume of services, as well as the price are established by subsequent agreements. It is just the frame for other contracts.

Year I Master

6

Contract Law

Course 4Conditions for validity of contracts The conditions apply to any kind of contract The grounds for validity conditions (article 1179/NCC) The essential conditions for the contracts validity are: - the capacity of the parties to contract - the consent of the parties (generally consent) - the general and lawful subject matter - the lawful and moral consideration

The capacity of the parties ability of a subject of law to assume the obligationsand exercise rights in their own name.capacity

have

exercise/ assume

The concrete capacity - underage persons no concrete capacity - mentally ill persons no concrete capacity - 14-16 persons restrained/limited concrete capacity, consent of the parents/legal guardian needed - 16-18 persons restrained/limited concrete capacity, consent of the parents/legal guardian not compulsory - over 18 full concrete capacity Due to the social position they have, some persons (e.g. the President, the deputies, the sanctioned by law persons parents accused to having killed their children have interdiction to exercise parenting rights) have restricted their concrete capacity for a certain period. The abstract capacity of legal persons Abstract capacity = the possibility recognized to have rights and obligations 206/NCC the legal person may have any rights and obligations, except for those that may belong only to the natural person. In addition, the legal person with no patrimonial rights may have only those rights and obligations that are necessary for the accomplishment of their purpose established by law, its constitutive act or state (the principle of specialty of the abstract capacity of legal persons). The sanction for non-observing this principle is the absolute nullity of the act.

Year I Master

7

Contract Law

The abstract capacity of the legal person begins at different moments, depending on the fact if the legal person in question is submitted or not to registration meaning incorporation or any other formality of publicity mentioned by law, with the purpose of obtaining legal personality or in order for the legal person to be taken into consideration (e.g. a commercial company incorporated by the Register of Trade; the state, town or village are legal person not submitted tot registration). The abstract capacity of the legal person begins at the moment of the registration. The commercial company gets legal personality and abstract capacity at the moment of incorporation at the Register of Trade. The other legal persons have rights and obligations from the moment of their setting up, from the moment they obtain the necessary authorization or from the moment of fulfillment of any provision provided by law. According to article 205/NCC, paragraph (3), even before its registration, the legal person has some rights and obligations which are linked to its valid setting up. These so-called limited or anticipated abstract capacity results directly from the aim taken into account for the setting up of the legal person. This anticipated capacity allows the legal person to obtain the necessary rights and to assume the necessary obligations required for its valid setting up. The end of the abstract capacity of the legal person refers to both the anticipated abstract capacity and the full abstract capacity. The anticipated abstract capacity ends when the full abstract capacity is obtained. The full abstract capacity ends when the subject of law (the legal person) ends its existence. The sanction for not complying with the legal rules of the abstract capacity of the legal person is the nullity, either relative or absolute, depending on the nature of the protected interests. The concrete capacity of legal persons Concrete capacity = the ability of a legal person to exercise the rights and obligations by concluding in its own name juridical acts through its management bodies. In relation to the concrete capacity of the legal person, there are three rules: - the legal person exercises its rights and obligations through its management bodies; - the juridical acts concluded by the management bodies of the legal person within the limits of the powers given to them by law (constitutive acts) are the acts of the legal person itself; - the lawful/unlawful facts committed by the management bodies of a legal person oblige the legal person itself if they are committed within the exercise of their powers. Unlike the natural person, the legal person obtains the concrete capacity on the day of its setting up.Year I Master 8 Contract Law

The sanction when not complying with the rules is nullity (= the sanction which leads to the deprivation of the act itself of its effects).

Course 5 The consent of the partiesThe juridical act is the expression of somebodys will, in order to produce juridical effects. Will = the juridical will of the parties is composed by two elements the consent and the consideration. In our system of law, the juridical will of the parties is governed by 2 principles, as follows: - the principle of freedom to contract (arts. 1169 and 1270(1)/NCC) The parties are free to conclude a juridical act, to provide in it any particular clauses and modify/end the juridical act they concluded. In addition, according to the provisions of article 1178/NCC, the parties are free to conclude named or unnamed contracts and to choose the form of the act if the law does not impose it. There are some limits imposed by law in relation to this principle as resulting from article 11 and 1179/NCC. These limits are imperative legal provisions and good morals. If the limits are not observed, the juridical act is sanctioned with abstract or relative nullity. The imperative legal provisions = must be applied as they are; derogations are not permitted (e.g. the donation contract should be concluded in authentic form). - the principle of the real will of the parties If there are any differences between the real will of the parties at the conclusion of the juridical act and the expressed clauses of the act, we have to take into account the real intentions of the parties (article 1266(1)/NCC). The most important effect of the principle of the real will of the parties is the good faith. The good faith is a moral concept and refers to the behavior of the contracting parties. It means that the contracting parties, especially the debtor, are obliged to perform exactly the assumed obligations, in order to accomplish the purpose or interest taken into account at the contract conclusion. In addition, the creditor is obliged to do nothing that will make the conclusion of the contract more difficult or even impossible. Moreover, in accordance to the requirements of good faith, both parties are obliged to cooperate in order to obtain a better performance of the contract (e.g. the debtor who provokes the impossibility to conclude the contract or a person who concludes a sale-purchase contract with 2 persons for selling an apartment do not observe the requirements of good faith).

Year I Master

9

Contract Law

The creditor who puts the debtor in the position of making unnecessary expenses does not observe the duty to act in good faith (e.g. the carrier is obliged to take the shortest route). Article 1170/NCC regulation of good faith in relation to contracts Article 1183/NCC regulation of good faith during negotiations The parties have the right to continue or end the contract without sanctions. The consent means the externalized decision or intent to conclude a contract. In order to be valid, it must fulfill several conditions: 1) To be expressed by a person who is mentally capable to conclude the act. This means that the parties must have judgment, must be able to understand the nature of the act and its consequences. Generally, a person having full concrete capacity is presumed by law to have judgment or discernment. This presumption may be overruled by proving that temporary lack of judgment of the person in question (e.g. in case of temporary mental illness or in case of drugs influence) article 1205(1)/NCC. 2) To be expressed by a person who has the intention to produce legal effects. This condition is not fulfilled when, for example, a person is only kidding, has no real intention to conclude a contract (informal bet). 3) To be externalized, the consent must result from the words/actions of the parties. In this respect, several problems arise in case of silence. Generally, in our law, the consent cannot be implied and, therefore, in case of silence, it is considered that there is no consent at all. The inaction of the parties (or the silence) is not conceived as the expression of the intention to conclude a contract. However, there are some exceptions from this rule, as follows (article 1196(2)/NCC): a) The law expressly provides, in some cases, that the silence of one of the parties must be considered as consent (e.g. according to the law, the rent contract continues to be enforced if, after the duration of the contract has expired, the parties silently continue to perform the contract). b) The initial agreement of the parties may constitute in some cases for regarding silence as consent. It means that the parties, by their will, give a particular juridical significance to silence. 4) To be genuine, the consent derives from the fact that the contract has an intention and a free nature. Therefore, the consent to conclude a contract must be intentional and genuine, because otherwise there is no contract between the parties. The lack of genuine consent may arise from the following vices of consent:Year I Master 10 Contract Law

I.

The mistake (error) = a false representation of reality at the conclusion of a contract. It is induced by the person himself and not by the other party or anybody else. Classification: a) According to the nature essential or immaterial error The essential error leads to the relative nullity of the act, because there is a lack of genuine consent. The essential error may refer to the following issues: - the nature of the contract (called error in negotium), e.g. when one of the parties believe that it is a donation contract, and the other party believes that it is a sale contract; - the identity of the object of the contract (called error in corporae), e.g. when one of the parties believes he sells a crop, and the other party believes the contract refers to a plane; - the qualities of the object of the contract (called error in substantia), e.g. when the buyer believes that the object of the contract is an apartment with the walls made of brick, and actually the walls of the apartment are made of concrete; - the qualities of the contracting party (called error in personae) applies only in case of contracts concluded intuitu personae (in person), meaning on the ground of one of the partys qualities, e.g. the donation contract or a contract concluded with a singer for a specific performance. The immaterial error refers to an unimportant element of the contract. Generally, this kind of error does not produce any juridical consequences.

b) According to the number of parties affected unilateral or bilateral error The unilateral error when the mistake is on the part of only one of the parties The bilateral (mutual) error when the mistake is on the part of both parties However, an act may be avoided on the ground of error vice of consent in both cases of error. c) According to its object error concerning the law or error concerning the fact The error concerning the law the legal provisions applicable in the case, which is accepted as a vice of consent only in relation toYear I Master 11 Contract Law

legal provisions essential in concluding the contract in accordance with the will of the parties (article 1207(3)/NCC) The error concerning the fact e.g. the object of the act, the value and the contracting party, which is a vice of consent if it is essential for concluding the contract.

II.

The fraud = a misrepresentation of the reality, made with the intention to deceive the other party and to determine him to conclude a contract. Therefore, the fraud is always the result of another persons action. According to the law, the fraud must always be proven. The fraud as a vice of consent leads to the relative nullity of the contract. The fraud has two elements: a) The intentional element the will to deceive the other party b) The material element the activities performed in order to lead the other party into mistake (e.g. lying about the hidden defect of the sold goods or failing to inform the other party about it). According to the law, the fraud is a vice of consent even if it is the result of the action of a 3rd party, but the contracting party is aware of this action.

III.

The duress (violence) = a state of mind induced by threats in order to determine the person to conclude a contract. The duress leads to the relative nullity of the contract. According to article 1216/NCC, the threats may be: a) Moral referring to the feelings of the person; b) Physical referring to the physical injury of the person or his property. Furthermore, the threats may be exercised not only against the contracting party, but also against a relative or against the relative to the contracting party. According to the law, the duress as a vice of consent can arise not only from the activity of the contractual party, but also from the wrongful activity of a 3rd party (article 1220/NCC). The duress has two elements: a) The intentional element the intention to force the contracting party to conclude a contract in a state of mind characterized by lack of free will; b) The material element the means used in order to threat the contracting party.

Year I Master

12

Contract Law

According to article 1216(4)/NCC, the duress, as a vice of consent, must be considered from case to case. It means that, in each case, it is necessary to determine whether the acts of threats are wrongful and whether the threats and not the free will of the party have induced the consent to conclude a contract. IV. The injury It means the disproportion between the mutual promises of the parties within a contract. In case of injury, one of the parties takes advantage from the lack of experience, lack of knowledge or a specific state of mind of the other party and provides in the contract in its own benefit a promise that is more valuable than his own promise. According to article 1221(3)/NCC, there is an injury when the minor assumes an excessive obligation taking into account his patrimony, the advantage obtained from the contract or the circumstances in which the contract was concluded. According to article 1222/NCC, the injury as a vice of consent may have the following consequences: a. The relative nullity of the contract, but only in the cases when the promise of the injured party is reduced with more than half of its value at the moment of concluding the contract.

b. The reduction of the promise of the injured party. However, according to article 1224/NCC, the aleatory contracts cannot be avoided on the ground of injury.

Course 6 The general and lawful subject matter (the object of the contract)According to article 1225(1)/NCC, the object of the contract consists of the juridical operation agreed by the parties as it results from all rights and obligations assumed through the contract. Therefore, for example we have the sale-purchase, rent, loan, deposit contracts as object. According to article 1226(2)/NCC, the object of the obligation consists of the action or inaction that the debtor (passive party) is obliged to perform. In other words, the object of the contract is composed by the behavior of the parties established through that contract, namely the actions/inactions that the active party has the right to request and the passive party has the obligation to perform.Year I Master 13 Contract Law

For example, the object of a particular sale-purchase contract is the sale-purchase operation, meaning the transfer of the ownership right of the specific goods by one party in exchange for the payment of the price by the other party. Generally, the behavior of the parties, meaning their actions or inactions, is related to goods. Therefore, the goods must be considered as the derived object of the contract. In order to be valid, the object of the contract must fulfill the following general conditions: 1. the object has to exist The law considers the object as existing even if it does not actually exist, but it will exist in the near future. For example, the sale of future harvest is a valid contract. Therefore, according to article 1228/NCC, a future thing may be the object of the contract with only one exception: the future inheritance. The juridical acts having as object the future inheritance are prohibited by law because of the moral consideration. 2. the object of the contract has to be in civil circuit Therefore, the goods that are the public property of the state or the administrative-territorial units (villages, towns, counties) cannot be object of contracts. In addition, there are several categories of goods which may be the objects of contracts, but only under special conditions (e.g. firearms, drugs etc.).

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3. the object of the contract has to be identified or identifiable According to article 1225(2)/NCC, a contract must have as object an identified juridical operation under the sanction of absolute nullity. In addition, at the moment of concluding the contract, the behavior of the parties, meaning their actions/inactions and the thing which is the derived object of the contract must be identified or at least identifiable. Therefore, if the object of the contract is an individually determined thing, this condition is fulfilled. If the object of the contract is composed by generally determined goods, this condition is fulfilled in the following ways: mentioning in the contract the exact number, quantity, quality or volume of the goods. In this case, the object is identified (e.g. 10 kg of strawberries). mentioning in the contract several criteria for identifying the goods. This criteria is going to be used when the contract is performed. In this case, the object is identifiable.

Year I Master

14

Contract Law

In addition, it should be mentioned that the NCC contains expressed provisions for determining the object of the contract, its quality, or other specific elements in relation to it. As for the quality of the object of the contract is concerned, according to article 1231/NCC, if it cannot be established by the contract, the quality of the promise or object must be reasonable or at least of medium quality. In addition, article 1232/NCC provides the possibility of establishing the object of the contract by a 3rd party. Thus, for example, a 3rd party nominated by the contractual parties may determine the price or any other element of the contract. If the 3rd party is not able to establish the element in question or his assessment is unreasonable, the price of the undetermined element will be established by the judge. In the relations between professionals, according to article 1233/NCC, if the contract does not provide the price or the method to determine the price, the law considers that the parties took into account the price usually charged in that field of business for the same promises, under similar conditions, or if there is no such price, a reasonable price. If, according to the contract, the price must be determined in relation to a reference factor, and this reference factor does not exist or is no longer used, it must be replaced by the closest reference factor, according to article 1234/NCC. 4. the object of the contract must be possible This condition is imposed by the principle of law according to which nobody can be obliged to do something impossible. This condition is not fulfilled only when there is an absolute impossibility to perform the object of the contract, meaning the object is impossible for everybody (e.g. traveling to the moon). However, this condition is fulfilled if the impossibility is relative, meaning the performance of the contract is generally possible, being impossible only for particular persons (e.g. the obligation to return of a sum of money is always possible, even if the debtor has no money to perform the obligation). In addition, according to article 1227/NCC, the initial impossibility or the obligation may be admitted. Therefore, the contract is valid even though at the moment of concluding it there was an impossibility of one of the parties to perform his obligation, unless the law provides otherwise. 5. the object must be lawful and moral Therefore, a contract by which the parties promise to do something illegal and immoral is not valid. In addition, sometimes the object of the contract must fulfill several special conditions in accordance with the type of agreement involved.Year I Master 15 Contract Law

In some cases, the law requests some authorizations for concluding specific controls (e.g. the sale-purchase of firearms is possible with a special permission). The non-observance of the validity conditions leads to the absolute nullity of the contract.

The lawful and moral considerationThe consideration is the objective, motive, goal for which the parties decided to conclude the contract. It is the element of the contract which answers to the question why is the contract concluded?. The consideration has two elements: the instant consideration the same in all acts belonging to a certain category. In bilateral contracts, the instant consideration of each party is determined by the mental consideration of the other partys promise (e.g. in the sale-purchase contract, the instant consideration of the seller is determined by the wish to buy the product; in contracts made with gratuitous title, the instant consideration is the intentions to do/give something for free animus donati). the specific consideration different from a certain contracts to another. In order for the contract to be valid, the consideration has to fulfill several conditions. These conditions refer to the specific consideration because the instant consideration is abstract and always valid. According to article 1236/NCC, the conditions are the following: o it has to exist if there is no consideration or it is not real, the sanction applied to the contract is the relative nullity. The consideration is not real when there is a misrepresentation of the motive for which the contract is concluded (e.g. a specific sale-purchase, the specific consideration is to buy a specific good). o it has to be lawful and moral if the unlawful/immoral consideration is done by both parties, or if one of the parties knows or should have known the unlawful/immoral consideration, the sanction is the absolute nullity of the contract. It should be mentioned that the consideration does not have to be proven. Thus, article 1239/NCC provides two presumptions: the consideration that any contract exists the contract is valid As a consequence, the party who wants to obtain the nullity of the contract has to prove that the consideration of a particular contract does not exist or it is not valid.

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Year I Master

16

Contract Law

Course 7 The legal formThe legal form is a validity condition of the juridical act. The observance of the legal form is one of the validity conditions required for concluding a juridical act. The legal form may be defined as the validity condition that represents the way in which the will of the parties to conclude a juridical act is expressed. Actually, in our law, most contracts are consensual (article 1178/NCC). Therefore, the simple expression of the will of the parties is sufficient in order to conclude a valid contract and the law does not normally request a special form for the agreement of the parties. There are exceptions from this rule, meaning juridical acts or contracts that must be concluded in a certain form imposed by the law for their validity. According to the juridical consequences of their non-observance the form conditions meet the requirements concerning the legal form of the contract may be divided into three categories: 1. the form requested by law ad validitatem This form has to be observed for the validity of the contract. It means it is a constitutive, essential validity condition of the juridical act. Therefore, the form requested ad validitatem is compulsory and its non-observance is sanctioned by the absolute nullity of the act. For example, several categories of contract are valid only when they are concluded in authentic form, meaning as a document drawn up by a notary (e.g. the donation contract, all the contracts transfer a real right submitted to registration with the Land Register). 2. the form requested by law ad probatiorum This form has to be observed in order to prove the content of the act, although the act is valid even in the absence of this form. However, the form requested ad probatiorum is also compulsory, but its nonobservance is sanctioned by the impossibility to prove the act by other means of evidence. Therefore, even though the simple consent of the contracting parties is sufficient for concluding a valid contract, the law requires a written form only for constituting evidence that may be used in future disputes (e.g. insurance contracts, company contracts). 3. the form requested for the opposability to a 3rd party It means the formalities necessary, according to the law, in order to make the juridical act opposable to persons who did not participate to its conclusion. This form is based on the idea of protecting the interest of 3rd parties. This form is also compulsory and its non-observance is sanctioned by the inapposability of the act towards 3rd parties. This means that in such a case, 3rd parties are allowed to disregard the juridical act in question and, therefore, the act could not produce its effects over any 3rd party.Year I Master 17 Contract Law

However, the act is able to produce its effects between the parties, but the parties are not allowed to invoke against 3rd parties their right derived from the act (e.g. the publicity concerned certain rights over movable goods, meaning the formality of registration within the Electronic Register -> a mortgage contract over movable things has effects only between the parties creditor and debtor, unless it is registered in the Electronic Register; therefore, the creditor who is the owner of the mortgage could not be able to invoke his rights against the debtor unless he has observed the form requested by law).

The nullity of the actA juridical act concluded with the observance of legal rules is a valid act. Therefore, it can produce its effects provided by the law. Whenever, the contract concluded by the parties disregards certain legal rules, it cannot produce legal effects. Therefore, the contract is void. It means that a juridical act concluded against the provisions of the law is sanctioned with a specific sanction nullity. As a definition, the nullity is the civil sanction that deprives the juridical act of its effects contrary to the legal provisions stipulated for its valid conclusion. However, in the Romanian system of law, the nullity does not destroy the act itself, but only its effects. Therefore, a void or avoidable act is not considered as nonexistent. Actually, as a consequence of the nullity, such an act is not able to produce any effect due to the nonobservance of legal rules at the moment when the act was concluded. E.g. A sale-purchase contract done by a minor(