Analysis of Contract Nullity and Simulation Cases

Case 10 and Case 8 Analysis

Assumption II: Contract Flaws

1. Lack of Contract Cause

If the cause of the contract is flawed, according to Claveria and indirectly recognizing the TS, the contract is void, pursuant to Articles 1273, 1274, 1275, and 1276 of the Civil Code.

2. Influence on Will (Flavio's Purchase)

Regarding the will issued by Mr. Briatore:

• If Flavio had not been drunk, he would not have bought the item.
• This indicates influence, resulting in flawed consent.
• The contract is voidable if it had not been for the diffuser installation; otherwise, cancellation might be possible.

3. Intimidation and Contract Invalidity

Here, we face another defect of will: intimidation, which causes the contract's invalidity. Intimidation is contained in Section 1267.2 of the Civil Code, included alongside violence in Article 1268 CC. Avoidance is available here, and it is presumed to be caused by the other contracting party.

Course III: Simulation of Donation

1. Relative Simulation (Donation Disguised as Sale)

We are dealing with the simulation of a donation, where a sale is pretended, but the underlying reality is a donation. There is a real cause: the generosity of the donor to benefit the donee.

When relative simulation occurs, the following rule under the Civil Code applies:

The expression of a false cause in the contract will result in invalidity, unless it is proven that other causes were based on true and fair dealing.

In these cases, the simulated contract (the sale) is legally considered non-existent, and the hidden contract (the donation) must be given effect, applying all specific rules for that contract.

The problem arises because, in simulation, both parties act in concert. Both sides deny it was a donation and claim it was a sale (they might claim the sale was paid in cash and the seller subsequently spent the money).

2. Heirs' Legal Recourse

Therefore, the rightful heirs upon the death of their mother cannot simply contest the donation.

They must:

1. Bring a lawsuit to declare the nullity of the sale.
2. Bring a lawsuit to declare the nullity of the donation contract.

They may also ask to apply the consequences (for example, declaring such donations inoperative, if applicable). This means a reduction of the donation if it is detrimental to the legitimate heirs of the donor, as they might otherwise receive nothing (Art. 655.1 of the CC).