Business law

Italian Contract Law     

THE CONSTITUTION OF THE ITALIAN REPUBLIC

Article 41.   

Private economic enterprise is free.

• It cannot be carried out against the common good or in a way that may harm public security, freedom or human dignity. 
• The law controls that public and private economic activities are directed and coordinated towards social aims.

Article 42.

Property is public or private.

• Economic goods belong to the State, to public bodies, or to private citizens.
• Private ownership is recognized and guaranteed by laws which determine the manner of acquisition, enjoyment + its limits, in order to ensure its social function and to make it accessible to all.

• Private property, in some cases determined by law, can be expropriated for reasons of common interest.
• The law establishes the rules of legitimate and testamentary succession + its limits and the right of the State to the heritage.

4th BOOK - OBLIGATIONS

OBLIGATIONS 

Article 1173. Source of obligations.

Obligations are created by contracts, illicit matters and by any other action capable to produce them according to law.

Article 1174. Patrimonial performance.

The object of the contract must be capable of an economic evaluation and must correspond to an interest of the creditor, not necessary monetary.

 Article 1175. Correct behavior.

Both the seller and the buyer must act in good faith respecting the duty of the fair dealing.

DAMAGE 

Article 1218. Debtor’s obligations.

The debtor who does not perform as established must pay the damage caused by non-fulfillment or delay except in the case of impossibility related to a factor which is independent from him/her.

{The performance was different from the one we agreed, so you are responsible. Except in the case of force majeure: the delay/impossibility depending on an event not due to him. Force majeure = an event; usually war, weather conditions, natural disasters or other elements absolutely beyond your control} [It is not considered impossibility caused by force majeure if you do not give something because your supplier did not give you the object because of a natural disaster 🡪 because the contract has effects only between the two main parts]

Article 1223. Compensation for damage.

The compensation for damage caused by non-fulfillment or delay of the performance must include the losses caused to the creditor + the missed gains (as they are immediate and direct consequences).

Article 1226. Assessment of the damage on equitable principles.

If the damage cannot be calculated on the precise amount, it is liquidated by the judge on equitable principles.

Article 1227. Action of the creditor’s negligence.

If the negligence of the creditor contributed to produce damage, the compensation for damage is reduced by the corresponding amount related to the level of negligence.

• The compensation of damage is not required when the creditor could have avoided to create damage with ordinary diligence.

Article 1229. Clause of responsibility limitation.

It is considered null any contract that limits or preventively excludes the obligations of a debtor for fraud or negligence.  

Contracts

Article 1321. Notion.

 A contract is an agreement between two or more parties in order to set up, regulate or cancel a legal relation.

• A contract is essentially a set of promises.

Typically, each party promises to do something for the other in exchange for a benefit.

🡪 For example, if you hire someone to work in your store. You and the contractor sign an agreement in which you promise to pay a sum of money in exchange for the work. Both you and the contractor have agreed to give up something of value. You have agreed to pay money, and the contractor has agreed to perform the work.

...