Legal Errors: Understanding Deceit, Coercion, and Injury in Contracts

Error of Law

Error of law is the ignorance of the law or its interpretation. It does not invalidate a contract. Article 141 of the LICC (Law of Introduction to the Civil Code) requires good faith. Article 141 - Transmission of the will by an intermediary may be canceled. Article 142 - Does not become addicted when... Article 143 - The miscalculation is accidental.

Deceit (Dolo)

Dolo is the error caused by the bad faith of others.

• Principal Deceit: Represents the determinant of the transaction.
• Incidental Deceit: Not a decisive reason for the legal business. It only requires the satisfaction of losses and damages.
• Positive Deceit: Resulting from an action.
• Negative Deceit: Resulting in an omission.
• Bilateral Deceit: Given the bilateral turpitude, deceit cannot be invoked to nullify the legal business.
• Third-Party Deceit:
  • John buys a stamp thinking it is authentic and not a replica.
  • If Paul knows the trick, the legal transaction may be canceled.
  • If Paul does not know the trick but should have assumed it by the circumstances, the business may be canceled.
  • If Paul did not know and had no way of knowing, the deal continues. Peter is liable.

Coercion

Coercion is a state of mind in which the agent, losing moral energy and spontaneity, performs the act that is demanded.

• Physical Coercion (Vis Absoluta)
• Conditions of coercion:
  • The threat must be serious enough to terrorize the victim.
  • The threat must refer to the person coerced, their families, or their assets.
  • The harm must be wrongful.
  • The threat must be imminent.
• Article 153: The normal exercise of a right is not coercion.
• Article 154: Third-Party Coercion - If the party could not have known of the coercion, then only the third party is liable.

State of Danger

Article 156 of the Civil Code raises the nullity of the transaction. A security deposit in a hospital sets a state of danger. The state of danger requires a disproportionate benefit.

Injury

Injury is the nullification of a transaction that reflects the loss resulting from the disparity between the benefits of the transaction because of inexperience or abuse of the necessity of a party. It is an addiction that comes with the concomitant legal business. It is voidable.

Requirements for Injury

• Disproportionate and obvious benefits.
• Caution! Not to be confused with the theory of unpredictability, which is a supervening fact.
• A situation of need or the inexperience of the injured party does not always characterize misery.