The Civil Code of the Russian Federation establishes that an agreement is considered concluded if an agreement is reached between the parties, in the form required in appropriate cases, on all the essential terms of the agreement.
The essential ones are
- conditions on the subject of the contract,
- conditions that are specified in the law or other legal acts as essential or necessary for contracts of this type, as well as
- all those conditions regarding which, at the request of one of the parties, an agreement must be reached.
The Civil Code of the Russian Federation indicates the subject of the contract only as an essential condition, without revealing its concept.
In the process of concluding a contract, the parties must formulate its subject matter and attribute specific legal relations to a specific contractual institution.
Condition about the subject
- determines the nature of the contract itself and
- individualizes the subject of execution.
Each contractual obligation has its own subject, which accordingly distinguishes it into an independent, separate contract. In the absence of clear indications in the contract regarding its subject matter, performance under it becomes impossible, and the contract, in fact, loses its meaning and therefore should be considered unconcluded.
G.F. Shershenevich drew attention to the fact that “the content of the agreement, or, as our law incorrectly put it, the subject of the agreement... is the legal consequence to which the consent of two or more persons is aimed. Achieving this goal presupposes, first of all, the validity of the contract, i.e. the presence of all conditions under which government ready to give legal security to the agreement. The validity of the contract is determined precisely by its content.”
Subject of the agreement:
- expresses essence of content the emerging legal relationship (the content of the legal relationship itself is the subjective obligations of the participants that arise as a result of their activities within the framework of the contract);
- determines the emerging relationships about a specific object.
Let us consider, for example, real estate as such an object.
Thus, the subject of the agreement is the paid transfer of real estate into the ownership of the buyer.
The subject of the lease agreement is the transfer for temporary possession and use of a building, structure or land plot.
And in the gift agreement, the subject is the gratuitous transfer of real estate into ownership.
In the examples presented, contractual relations arise regarding the same object - real estate. However, the objects of contracts and the obligations they generate are very different, as is their legal nature. The difference is determined by the actions of the obligated persons. Moreover, the subject of the contract is not the actions themselves (since the legal relationship has not yet arisen), but only an indication of them.
Thus, the subject of the contract is different from its object. In contractual obligations, the objects can be:
- material goods (things, property rights);
- money, securities as a specific object, distinct from things;
- various services and performance results of the obligated person;
- results of intellectual work (works of literature and art; inventions and discoveries, computer programs, etc.); etc.
Thus, subject of the agreement (contractual obligation) can be considered as complex, consisting of two objects.
When a company enters into any transaction with a counterparty, it is necessary to agree on the subject of the agreement. Without this, the deal will not be recognized as concluded. What to consider when developing a section of an agreement on its subject matter.
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The subject of the agreement is an essential condition of any agreement (Article 432 of the Civil Code of the Russian Federation). The concept of the subject of the contract covers all the details that are necessary to fulfill a specific obligation. Thus, the subject of the contract for a supply transaction is the specific name of the product, its characteristics and quantity. For a contract, the subject is the types of work, as well as, in some cases, the method of execution.
As a rule, the parties disclose the contents of the subject in the first part of the contract. But the obligations of the parties can be long-term, for example, if we are talking about the creation of a complex object or constant interaction (delivery of a batch of goods, cleaning, etc.). In such cases, the subject is determined in appendices and additional documents. Let's take a closer look at the concept of the subject of the contract, what a lawyer should pay attention to when determining the subject, and how to avoid possible risks.
There are situations when the parties fulfill their obligations properly and no conflicts arise. In this case, after a certain time, the contract is sent to the archive, and the lawyer does not have to deal with negative consequences unfinished documents. However, it is better to exclude such situations, especially if the parties enter into a deal for large sums. When a lawyer deals with a draft agreement, it is necessary to ensure a clear definition of the subject of the agreement.
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The subject of the contract is a condition, the inaccurate formulation of which exposes the company to risks.
Managers, production workers, etc. take the initiative to conclude an agreement. It is in their interests to quickly obtain a lawyer’s visa. They may consider the subject matter of the contract to be a formality, just like a written agreement in general. But the agreement with the uncoordinated essential conditions You can't "skip" it.
The manager may refer to the provision of information in the future, ask for approval and subsequent execution of documents. This situation is dangerous with negative consequences. The documents may not appear at all, or the counterparty may provide them for other amounts. If a conflict arises, a lawyer will have to sort it out in court.
Let's say the parties enter into an agreement to clean up the territory. The agreement specifies part of the area in the building, but does not define specific rooms where disinfection will be carried out. In this case, the lawyer advises the manager to draw up a building plan as an appendix to the contract and mark the areas that the contractor will clean. But the manager refers to circumstances that do not allow the documents to be drawn up in this way. If the customer’s lawyer admits that the subject of the contract will have similar defects, the customer will not be able to refer to poor quality of workmanship. The counterparty will not be held liable for non-fulfillment or improper execution responsibilities.
For example, the court rejected the plaintiffs' arguments that the contract specified the place of performance. The panel indicated that the parties did not specify in the agreement the place of its execution. They wrote in the subject: “Cleaning office and production premises"(appeal ruling of the Krasnodar Regional Court dated November 6, 2012 in case No. 33-22246/12).
If the subject of an agreement with a citizen is formulated in an abstract way, there is a risk of a dispute about the reclassification of the agreement into an employment agreement. The company may also be required to pay insurance premiums, fines and other payments. The lawyer will have to prove the absence labor relations with the contractor, present to the court certificates of work performed or services provided (resolution of the Federal Antimonopoly Service of the Volga-Vyatka District dated May 27, 2014 in case No. A82-11759/2013).
Demand a timely definition of the concept of the subject of the contract
To prevent difficulties, there is different variants actions. The simplest thing is to obtain a definition of the subject of the contract, request from managers Required documents and arrange them yourself in the form of an application. But this option is suitable for urgent tasks. If a lawyer takes on such work, there is a risk that in the future managers will always bring documents in an unfinished form.
The second way is to request information and save correspondence, and, if necessary, prepare memos addressed to the manager. This will protect the lawyer from disciplinary sanctions for late execution of tasks and will allow for the provision of data.
If the subject of the contract cannot be determined without special knowledge, seek approval from specialists
The company can prepare a transaction for large sums, which also includes complex work, supply of special equipment, etc. In this case, ask the relevant specialists to check the terms of the document or make sure that they have their signature.
Interaction between company departments and a lawyer is usually built according to two schemes:
- The legal department reviews the contract and forwards it with comments or recommendations to the contractor. The Contractor is responsible for approval by all departments.
- The lawyer reviews the contract last and ensures that all other departments agree on the terms.
In the first case, the lawyer receives a contract, which has already been reviewed by specialists and their visa has been issued. They also formulated the subject of the agreement. The lawyer analyzes the text, checks whether there is agreement from other departments (estimators, accounting, production workers, etc.), gives comments and recommendations, and returns the text to the person responsible for signing.
In the second case, the manager requires an agreement from the lawyer who is responsible for the organizational work. Then you need to contact the specialists who are responsible for the execution of the future agreement.
For example, if they plan to build a real estate property, the agreement must indicate the transfer of the necessary documentation; the estimate cannot consist of one line. A lawyer can check with the production and estimate department whether there are enough documents to specify the subject of the contract.
After experts express their opinion, the document needs to be checked. The lawyer has the right to point out shortcomings or controversial issues and ask clarifying questions. It is necessary to make sure that specialists do not miss important details, so that this does not subsequently affect the deadlines or lead to other problems.
Let's say the parties enter into an agreement for the supply of elevator equipment. Manufacturers place a visa on the application where the subject of the contract is indicated (these are the characteristics of the product). The equipment is required for the execution of another contract - for the construction of a house. But there is an error in the parameters, and when the supplier delivers the goods, it turns out that the dimensions of the elevator do not fit into the shaft. The lawyer will have to terminate the agreement with the supplier and negotiate the return of the advance payment. And managers will spend time searching for a new counterparty. The situation as a whole creates a risk of delay in the execution of the construction contract, which threatens a penalty. A detailed study of the subject matter of the contract by all responsible persons will help to avoid mistakes.
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