Contracts in Costa Rica.
A business lawyer is always recommended to draft or review contracts in Costa Rica. My law office can help you with this. Even though there is “contractual freedom” in Costa Rica, it´s always a good idea to have an expert in business law to check on things. Contractual freedom means that contracts are not susceptible to forms and formalities. If what the contracting parties convene does not constitute a violation of Costa Rica business laws, it will be legally binding. Thus, the legal system will protect you in case of breach of contract.
How are contracts in Costa Rica defined?
Under Costa Rica business laws, the definition of a contract is a legally binding pact between two or more people. The object of the contract is the obligation of the parties. The object and the cause of the agreement must be legal. This means that contracts that carry out illegal commitments are not protected by law and are null and void. Another important factor of any contract is that it can be legally enforced or resolved through litigation. You should know that contracts create an obligation that may consist in:
A. Doing something.
B. Giving something.
C. Not doing something.
How are they perfected in Costa Rica?
In Costa Rica, deals are perfected by mere consent. However, in some contracts, certain formalities are sometimes required by law. So mere consent is sometimes not enough. This, however, is the exception since contractual freedom is the norm.
In this article, I will be able to offer several links to descriptions of the different agreements in Costa Rica that I can help you with as a business lawyer. In addition, I will even provide links to other pages where I cover what to do in case of breach of contract concerning civil litigation.
Can contracts be annulled or executed through litigation?
Yes. Contract annulments are possible, and in case of contract breaches, you can execute or have it resolved by the Judge. Civil damages can also be requested. These procedures can even be filed in different jurisdictions. For example, the Agrarian Jurisdiction must execute or resolve an agricultural contract. Business law is a mix of commercial and corporate law. You should know that business law contracts and civil contracts fall under the Civil Judge. Contracts with the Public Administration (State of Costa Rica) are the subject matter of the Administrative Judge.
Business law contracts in Costa Rica that our law office can assist you with:
Donations
Asset donations may include vehicles and properties. My law office can draft this for you.
Property and car sales. Options to purchase
Mortgages are business law contracts my law office can assist you with.
Due Diligence Agreements
When you buy your property, we guide you through all the steps beginning with due diligence.
Car liens
Loan and credit transfers
Guarantee Fiduciary Agreements
Rentals
Types of contracts in Costa Rica business laws:
Unilateral agreements:
They are unilateral when only one of the parties obligates himself to perform a determined obligation for the benefit of another. Bonds, powers of attorney, donations, and mortgages are examples of unilateral deals.
Bilateral contracts:
Unlike unilateral ones, bilateral agreements have reciprocity of obligations regarding distinct obligations by both parties. Examples are sale agreements, rental arrangements, and some mutually agreed-on divorces.
Consensual and Solemn commitments:
The mere consent of both parties perfects consensual contracts; the written word and certain formalities are accidental to the agreement. For example, the sale of a property gets perfected by the mere consent given by the seller to sell and the consent given by the buyer to buy for a determined price. The contract becomes perfect with that consent, and the written form (escritura), is something adjacent or accidental to the deal, which has already been perfected. On the other hand, solemn deals are perfected by certain solemnities that the law establishes. An example is donations, which can only be done in public scripture by a business attorney who must be a notary public.
Recordable Contracts:
Sometimes, the written form of the agreement must also be registered in the Public Registry. This is not an essential condition for the agreement´s validity but rather to give publicity to third parties. An example is when you buy a property: the public scripture must be registered so that third parties know there has been a change in the proprietor. If this is not done, the original or primitive owner remains as such in the Registry, and continues to be, to all third parties. This presents huge problems for the buyer, that may even lose the property. Your business lawyer must be on top of the proper registration of the public scripture.
Nominated and unnominated:
Nominated deals have been given a determined name and legal treatment under the law. You must remember that we have codification in our legal system. Nominated contracts are established by the law itself, like property sales agreements, mortgages, fiduciary agreements, and donations. All of these contracts have law-specific regulations in the law. Unnominated arrangements are not specified directly by codified laws, but people can create them under contractual freedom. This is where the business lawyer´s academic freedom comes into place.
Dr. Christopher Pirie.
Business lawyer and attorney in Costa Rica.
Law office in San José, Costa Rica.