Understanding Contract Elements, Seller & Buyer Obligations

Contract Elements

Real Elements

The real elements of a contract are the thing and the price.

The Thing Under Contract

This refers to the good, right, or merchandise being exchanged. The thing must be possible, according to the Code of Commerce:

• Things to resell furniture
• Sale of samples: The seller must deliver the thing with the same qualities as the sample, and the buyer may refuse to receive what was contracted.
• Sale to the test: The buyer purchases the thing, reserving their final decision based on the results of testing the effectiveness of the goods.
• Confirmation unless-Sale: The contract is agreed upon between the buyer and a trade representative.

Price

The price is the amount the buyer is obligated to pay the seller in exchange for the thing.

The price is set by contracting:

• Sale to firm price: The price upon signing the contract cannot change.
• Variable-price sale: If the delivery is made in phases, the price may change.

General Terms Price

• It must be money or something that represents money.
• It must be true: the exact amount.

Formal Element

The formal element is the way that contracting parties manifest or act out their will.

It doesn't matter whether it is verbal or written language, except where the law requires a specific form.

Commonly Used Contract Forms:

• By an oral agreement.
• Formalized in writing.
• Entered through an agent.

Seller's Obligations

• To deliver the thing in the place stated in the contract.
• Preserving and caring for the thing until delivery to the buyer.
• Repairing the defects of the thing.

Delivery of Goods

• The thing must be delivered in the time and place stated in the contract. If delivery is not made within the agreed timeframe, the buyer may terminate the contract (Section 329).
• Delivery is considered complete when the thing goes to the carrier. Delivery costs are borne by the seller (Art. 338).

Keeping the Thing Till Delivery

Things can get lost or damaged through no fault of the seller. The risk is borne by the buyer when delivery is made (trade code). However, the buyer bears the risk from the beginning (civil code).

Sanitation of the Thing Sold

The seller is obliged to guarantee the buyer's acquired possession of the thing and address any defects.

Defects Eviction

The buyer's legal possession of the thing is altered when deprived by a court sentence.

Quality Defect

When the thing does not have the quality it should.

Defect Defect

When the functioning is faulty or the use is impaired.

Defects Number

When fewer units of the agreed quantity are delivered.

Latent Defects

Defects that the buyer cannot see when delivery is made.

Buyer Obligations

• Pay the price agreed upon.
• To receive the item purchased.

Paying the Price

The buyer has to pay the price at the place and time determined. Payment is in cash, and the obligation to pay arises when delivery occurs. Payment can be made with coins or standard bills of exchange.

Receive the Purchased Goods

The buyer must take the thing at the time and place agreed upon and cannot reject the goods unless they are defective.