Law on Contracts
Contract Law
Quinten Metsys
1. Contracts are the basis for any commercial relationship.
Each contracting party wishes to know its rights and obligations as well as what security you will receive regarding payment or the execution of the works and services. Briefly, you want to know what you are starting.
2. After all, good contracts can avoid many problems. On the other hand, an agreement is binding like a law. Normally it is difficult to prove the existence of an agreement. However, the performance of an agreement can provide proof of the existence of the agreement according to the Court of Cassation[1]. And the execution can be demonstrated by any means ...
3. Contracts, and in particular the clauses included, are always binding between the parties when they are clear and not concealed. When these are concluded between entrepreneurs, they can usually be followed literally (with the exception of matters of mandatory law, or even of public order. For example, every person who carries out a professional activity for which a professional competence has been established must have proof of this professional competence ( Article 5.1 of the program law of 10.2.1998) For a contractor this is regulated by the Royal Decree of 29.1.2007 (Articles 1; 3 and 31) An agreement by someone who works as a contractor or calls upon subcontractors, without having this certificate itself is null and void ..![2]
In the event of nullity, the parties must return (to the extent possible), and this should generally not lead to enrichment, but it does not exclude compensation for pre-contractual liability. [3] Some contracts of indefinite duration do not provide for a termination option. However, any agreement of indefinite duration can always be terminated subject to a reasonable notice period [4]
So please read them carefully, and do not be afraid to ask questions if you are in any doubt about their scope. Jurisprudence also plays a major role. Example: cheating by one of the parties and the other party has committed a serious error; Cassation[5] states that the party who cheated cannot even invoke gross and unacceptable negligence on the part of the victim of cheating.
Rights arising from a contract generally expire after 10 years. Here, too, the case law allows certain principles such as "fraus omnia corrumpit" to prevail (e.g. a debtor who has managed to prevent through maneuvering execution). [6]
4. Do not forget that agreements can arise with traders / entrepreneurs much faster than is sometimes thought.
When a somewhat sustainable trade is created, the general terms and conditions at the back of the invoice acquire binding force. If you do not agree with certain provisions, do not forget to let this know (e.g. payment terms). This can be done by e-mail (with proof of receipt). The court must then be able to determine the possibility of knowledge of these conditions[7]
You receive the invoice from your supplier and regularly pay his invoices with the invoice conditions on the back (or electronically printable), then after some time his invoice conditions will determine the contractual relationships.
If you still want to escape it, it is recommended to conclude a separate (framework) agreement with the supplier with clear provisions (such as the term of payment, the consequences of non-payment, the sanctions, a clause of retention of title in the case of non-payment, etc ...).
Such considerations should certainly be made if your contractor is a foreign company or based abroad. Attention will also have to be paid to the legal system that will apply and before which court a possible dispute should be brought up. Some provide arbitration clauses, and then no court intervention is possible.
5. With regard to contractual liability, there is often talk of the theory of concurrence. This means that a contractor cannot be held liable on the basis of the concept of "error", if the damage would also have occurred if the contract had been correctly executed. The error is then abstracted, the other circumstances are preserved. If the court finds that the damage would have occurred in the same way or considers this to be uncertain, there is no causal link between the breach of contract and the damage.[8] In practice, this means that there must often be a criminal offense to additionally invoke this legal basis.
The contractual responsibility leads to compensation "which is an immediate and direct consequence of the non-performance of the agreement" (art. 1151 Civil Code). However, the Court of Cassation interprets "immediate and direct consequence" broadly[9], in particular as a "necessary consequence" of the contractual breach of contract "direct or indirect ". It also expressly states that this includes "compensation for indirect damage caused by non-compliance with the obligation”.[10] Article 1150 of the Civil Code also provides that it only concerns foreseeable damage, but also here the Court of Cassation interprets broadly and states that the requirement for foreseeability refers to the occurrence of the damage and not to its extent.[11]
That is why many (large) companies try to limit their compensation in their general terms and conditions. This is possible, but must not lead to an erosion of responsibility or be in violation of mandatory law (eg no responsibility in the event of fraud, or hidden defects in the sale when salesman knew this). With the new provisions in the Code of economic law, there are now different circumstances that are protected between companies (eg abuse of economic dependence). Interesting recommendations (for the supplier of the service) on the preparation of the clauses in the general terms and conditions are offered by specialized legal doctrine.[12]
6. Less is sold in the circular economy. More services are acquired. Raw materials must be able to be reused. Also, there are usually 3 parties: i) the service providers sharing assets, resources or skills (by private “peers” or professional service providers); ii) users; iii) intermediaries usually through an online platform.
The contracts will usually be classified under contracting work. An SLA (service level agreement) will entail a best efforts obligation or result obligation depending on the formulation. Under the influence of Directive 93/13 / EEC (Council of 5.4.1993) regarding unfair terms (in particular Article 5), there must be clear transparency (clear and comprehensible), certainly with regard to the consumer (Article 2, Book 2 CEL), measured and based on an average member of the target group. It is also expected with regard to companies (intended with regard to small companies) that the stipulations are clear and comprehensible (art. VI. 37 CEL).
The Services Directive (Directive 2006/123 / EC) obliges every company to make the general terms and conditions that it uses, available to every customer (Article 74 §1,9 °, Book III, CEL). At the request of the customer, the previous versions of the contract conditions applicable at the time of the contract (with start and end date) must be made available (possibly via the website).
7. When contracting electronically, the service provider must ensure that the customer of the service must be able to save (eg via e-mail, link on the website) and this before concluding the contract. With regard to a consumer, the service provider bears the burden of proof of compliance. (art XII.11 CEL). Given that it is a distance contract, the service provider (with regard to consumer) must take into account the regulations in art. 44/1 to 53 book VI CEL.[13]
8. A contract is the law between the parties. Therefore one is bound by it. Covid-19 and its impact on arrangements between contracting parties have very much fueled the discussion of "force majeure" and "imprevision doctrine”.[14] The draft law on contract law (Article 5.77) does give the space to reconsider a contract in case of drastic changing circumstances, and in which case the court can then make a final decision if necessary.
9. We can assist and advise you with all these problems. We can assist you and drawing up agreements tailored to your needs, striving for both substantive and formal perfection, so that you have a watertight certainty.
We can also review agreements drawn up by you and make adjustments where necessary.
We therefore also have the necessary expertise regarding drawing up general terms and conditions.
We make contracts available on our website, some subject to payment. The number will increase over time.
If you do not find what you are looking for immediately because it has not been published, this does not imply that we do not have it. In that case you can always contact us with your requests
[1] Court of Cassation, 14.4.2016, RW 2017-18, p. 1136
(2] Court of Cassation, 27.9.2018, RW 2019-20, p. 906
[3] Court of Cassation, 31.5.2019, RW 2019-20, p. 1032
[4] Court of Cassation, 8.2.2018, RABG 2020,11-12, p. 908
[5] Court of Cassation, 20.4.2017, TBBR 2019, p. 133
[6] Court of Appeal, 16.5.2017, RW 2019-20, p. 1266
[7] Court of Cassation 21.12.2018, RW 2019-20, p. 348
[8] Court of Cassation 28 juni 2018,ARnr C.17.0696.N, RW 2018-19, p. 1260
[9] Court of Cassation, 9.5.1986, Arr.Cass., 1986-87, p. 2699
[10] Court of Cassation, 2.4.1936, Pas. 1936, I, p. 209
[11] Court of Cassation., 14.10.1985, Arr.Cass., 1985-86, p. 179
[12] K. De Vulder & K. Scheerlinck, Exclusion of indirect damage in ICT contracts, Computer law 2019/133
[13] A. De Boeck, The increasing "earnings", TBBR 2020/1 p. 20
[14] J. Van Uylen, Coronavirus and Force Majeure: Selected Questions, TBBR, 2020-07 p. 398