COMMERCIAL CONTRACTS 1 BBA Dr Ewa Wjtowicz UWr

COMMERCIAL CONTRACTS 1 BBA Dr Ewa Wójtowicz, UWr

COMMERCIAL LAW The body of law that applies to the formation, structure, operation and dissolution of businesses (entrepreneurs) as well as legal relations involving entrepreneurs.

BUSINESS (ENTREPRENEUR) Art. 431 Civil Code: Entrepreneur is a natural person, a legal person or an organisational unit deprived of legal personality but having legal capacity under provisions of a separate Act, conducting economic activity and/or professional activity on its own behalf.

ECONOMIC ACTIVITY Art. 3 of the Business Law A profit – making organized activity conducted on its own behalf in a continuous fashion. • profit – making; • continuous; • conducted in an organized form; • conducted in entrepreneur’s own name.

COMMERCIAL CONTRACT Commercial contract – bilateral or multilateral juridical act of an entrepreneur carried out within the scope of their business or professional activity.

COMMERCIAL CONTRACT– characteristics: i. often long term contracts, ii. standardization --> standard contract terms, iii. high degree of the freedom of contract, iv. professional due care standard (art. 355 Civil Code), v. security and certainty of trade, special trust relationships between the parties, vi. complexity.

Art. 355 Civil Code [Due care]. § 1. A debtor is obliged to use the care commonly required in relations of a given type (due care). § 2. The due care of a debtor in his business activity is specified with consideration taken of the professional nature of this business.

Art. 353(1) Civil Code [Freedom of contract]. Parties executing a contract may arrange their legal relationship at their discretion so long as the content or purpose of the contract is not contrary to the nature of the relationship, the law or the principles of community life.

CONTRACT OF SALE - DEFINITION Art. 535 Civil Code: By a sale contract, the seller commits to transfer to the buyer the ownership of a thing and to hand over the thing, and the buyer commits to collect the thing and to pay the price to the seller.

CONTRACT OF SALE – essential provisions The essential provisions (essentialia negotii): of a contract of sale include the indication of the object of the seller’s performance (subject matter of a sale, or thing/item sold) and the price.

OBLIGATIONS OF THE PARTIES SELLER: releasing the thing/item and transferring the ownership of the thing to the buyer.

OBLIGATIONS OF THE PARTIES BUYER: the duty to pay the price agreed upon and a duty to collect the thing.

WARRANTY AGAINST DEFECTS Defects A physical defect exists where thing is not in accordance with the contract. • A legal defect: a) the thing is owned by the third party, b) the thing is encumbered with a third party’s right, c) there are restraints to use or dispose thing resulting from a judgement or a decision of a competent body. In case of sale of rights, the seller is also liable for the existence of the rights.

WARRANTY AGAINST DEFECTS BUYER’S REMEDIES 1) he may rescind the contract (BUT not when the defects are insignificant); 2) he may reduce the price; 3) he may demand replacement of the defective thing(s) by delivery of the same thing(s) free from defects; 4) he may demand to have the defect removed.