Signing a contract is something common in civil and commercial turnover. We should be careful each time we sign an agreement, because in most cases they create both rights and obligations for us.
The important things in which we look for signing an agreement are different depending on the type of the agreement-whether it is preliminary or final; whether it is a commercial transaction; whether it is unilateral or bilateral; whether it is remunerative or gratuitous; whether or not it is custom, etc.
However, there are a few things for which we follow closely for no matter what kind of an agreement sign. They are:
Price/remuneration– you should follow whether in the agreement, when is signed in written form, correctly reflects the amount of remuneration for which the parties are agreed in the negotiations especially when the lasts are not in the written form.
Deadlines– you should always pay attention for the deadlines for fulfilling the obligations of the each of the parties. The planning of deadline excludes the need of call for performance, as upon its expiration the debtor falls into delay and owes interest.
Penalties– with regard to non-penalty clauses you should pay attention to the type of non-compliance they are intended for-complete; inaccurate-delayed, partial, poor quality. It is important to indicate precisely and clearly the type of default for which the party will owe a penalty. Next, it is important to determine exactly the amount of the penalty and how it is calculated. The penalty can be agreed as a fixed amount; to be determined on a daily, monthly or annual basis; to be agreed as a percentage. When the amount of the penalty is agreed in percentages, it is important to indicate the basis on which it is calculated-selling price, unfinished work, value of undelivered goods, etc. Lastly, you should not overstate the amount of the penalty, as otherwise the court may consider it to be excessive in relation to the damage suffered and reduce its amount. In cases of excessive penalty, when the relationship is between traders, the non-penalty clause may be declared null and void due to infringement of good morals.
Termination of the agreement– the parties can agree on a notice period in case of unilateral termination of the agreement. Termination of the agreement is applicable in cases of an agreement with continuous and periodic performance. In principle, in case of one-off agreements, the non-performance of one of the parties is ground for termination of the agreement, in which case each of the parties owe the return of the given;
Security- in the agreement the parties can agree on security in the form of: mortgage, when the subject of the security is real estate; pledge when it is a movable property; guarantee, in which case the guarantor is jointly and severally liable with the principal debtor. When the security is in the form of a mortgage, it should comply with the requirements for its establishment-with a notary deed and be registered in the Property Register. In the case of a real pledge, the transfer of the actual power over the pledged thing is required. In case of special pledge, entry in certain registers is envisaged, depending on the type of the pledged asset.
These are just a few of the things to look out for. Whenever you are about to sign an agreement, it is best to consult a lawyer who will review the agreement and see if your interests are best protected.
The article above is for information purposes only. It is not a (binding) legal advice. For a thorough understanding of the subjects covered and prior acting on any issue discussed we kindly recommend Readers consult Ilieva, Voutcheva & Co. Law Firm attorneys at law.