OBLICON_GENERAL PROVISIONS ON CONTRACT PART 2

Summary

This video script delves into the three stages of contract law: preparation or negotiation, perfection or birth, and consummation or termination. It explains that a contract is perfected when parties reach a definite agreement, creating obligations to fulfill stipulated terms in good faith. The script also covers exceptions involving third parties, essential elements of contracts, and the importance of consent. It clarifies the difference between void and voidable contracts and illustrates the process of offer and acceptance, emphasizing the legal capacity of parties to enter into contracts.

Takeaways

• 📝 The video discusses the three stages of contracts: preparation or negotiation, perfection or birth, and consummation or termination.
• 🤝 Preparation or negotiation involves the steps taken by parties leading to the perfection of the contract.
• 🎯 A perfected contract exists when parties are in negotiation about the price or other terms, indicating a mutual agreement is yet to be fully established.
• 🌟 Perfection or birth of a contract occurs when there is a definite agreement or meeting of the minds regarding the subject matter and cause of the contract, as per Article 1319 of the Civil Code.
• 📚 Once a contract is perfected, obligations arise between the parties, and they are bound to fulfill what has been expressly stipulated in good faith, as per Article 1315.
• 🔄 Consummation or termination is when parties have performed their respective obligations, fully accomplishing or executing the contract, which results in its extinguishment.
• 🚫 Exceptions exist where contracts are only effective between parties, and rights and obligations are not transmissible, such as in the case of personal services like painting or singing.
• 📜 Third parties generally have no rights or obligations under a contract unless it is specifically stipulated in favor of a third person, creating an exception to the general rule.
• 🔑 Essential elements of contracts include consent of the parties, a certain object or subject matter, and a cause or purpose for the obligation, as outlined in Article 1318.
• 📬 Acceptance is a critical component, manifesting when one party agrees to the terms of the offer, and it must be absolute for a contract to be valid.
• 📝 The legal capacity of parties is crucial for a contract to be valid; the law presumes everyone has capacity unless proven otherwise.

Q & A

What are the three stages of contracts mentioned in the script?

The three stages of contracts mentioned are: 1) Preparation or Negotiation, 2) Perfection or Birth, and 3) Consummation or Termination.

What does the term 'preparation or negotiation' in the context of contracts entail?

Preparation or negotiation refers to all the steps taken by the parties leading to the perfection of the contract, which is self-explanatory and involves discussions and agreements on the terms of the contract.

Can you explain what is meant by a 'perfected contract'?

A perfected contract is one where the parties have come to a definite agreement or meeting of the minds regarding the subject matter and cause of the contract, as per Article 1319 of the Civil Code.

What happens when there is a 'meeting of minds' between the parties in a contract?

When there is a meeting of minds, obligations between the parties arise, and they are bound to the fulfillment of what has been expressly stipulated, in compliance with the law and in good faith, as per Article 1315 of the Civil Code.

What is the significance of 'consummation' in the context of contracts?

Consummation refers to the stage when the parties have performed their respective obligations, and the contract is fully accomplished or executed, resulting in its extinguishment or termination.

What are the exceptions when contracts are effective only between the parties?

Contracts are effective only between the parties when the rights and obligations arising from the contract are not transmissible, such as in personal services like painting or singing, as discussed in previous modules.

According to Article 1178 of the new Civil Code, what happens when death extinguishes legal relationships?

According to Article 1178, death extinguishes the legal relationships whether it involves the parties themselves or third persons affected by a contract. However, third persons have no rights and obligations under a contract since they are not privy to it.

What are the essential requisites of contracts as per Article 1318 of the Civil Code?

The essential requisites of contracts are the consent of the contracting parties, a certain object which is the subject matter of the contract, and a cause of the obligation, which are the elements without which no contract can validly exist.

What is the difference between 'void' and 'voidable' contracts as mentioned in the script?

A void contract is one that is inexistent or not existent from the beginning, such as in the case of a simulated contract where there was no intention to be bound. A voidable contract, on the other hand, is one that is valid until it is avoided due to certain defects like fraud, error, or undue influence.

What is the importance of 'consent' in the formation of a contract?

Consent is crucial as it is manifested by the meeting of the offer and acceptance upon the thing and the cause which are to constitute the contract. It presupposes legal capacity and the fulfillment of conditions if any are attached.

What happens if an offer is withdrawn before acceptance?

If an offer is withdrawn before the acceptance is communicated, the offeror is allowed to do so by law, as there was no meeting of the minds between the parties yet, hence no contract had been perfected.