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Article 6.314. Payment of the price


1. Unless bound to pay the price at a specified place, the buyer must pay the price to the seller at the place of delivery of the thing.


2. Unless bound to pay the price at a specified time, the buyer must pay the price at the time of delivery, under the contract or this Code, of the thing or documents of disposal thereof to the buyer.


3. The buyer shall not be obliged to pay the price until he has had an opportunity to examine the things, except where the agreement between the parties provides otherwise.


4. Unless otherwise provided by the contract, the buyer must pay the full price immediately.


5. If the buyer fails to pay in due time for the things delivered to him, the seller shall be entitled to demand payment of the price and interest as provided for by law or contract.


6. Where the buyer refuses to accept delivery of the thing and to pay the price, the seller may, at his own discretion, demand from the buyer the payment of the price or refuse to perform the contract.


7. Where the seller is bound under the contract to deliver to the buyer not only the things for which the buyer has not yet paid the price, but also other things, the seller may suspend the delivery of the latter things until the buyer pays in full for the previously delivered things, unless otherwise provided for by law or the contract. 

 


Article 6.315. Payment for the thing in advance


1. Where the contract provides that the buyer is bound to pay a part or the whole of the price in advance of delivery of the thing (advance payment), the buyer must pay the price at the date specified in the contract. 


2. If the buyer fails to pay the price in advance, the seller shall be entitled to suspend the performance of the contract.


3. Where the seller, having received the advance payment, fails to deliver the thing to the buyer within the prescribed time limit, the latter shall be entitled to demand from the seller delivery of the thing or reimbursement of the amount paid.


4. Where the seller, having received the advance payment, fails to deliver the thing to the buyer within the prescribed time limit, he shall be bound to pay interest on the received amount fixed by law or under the contract, unless otherwise provided for by the contract. Interest shall begin to accrue from the date on which the seller was bound to deliver the thing and shall be payable until the date on which the buyer is actually delivered the thing or the price paid is refunded.


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Article 6.316. Insurance of the thing


1. A sales contract may impose an obligation on the seller or the buyer to insure the thing. -


2. Where the party obliged to insure the thing fails to perform this obligation, the other party shall be entitled to insure the thing and claim reimbursement for the expenses incidental to insurance or repudiate the contract.

 


SECTION TWO

GENERAL OBLIGATIONS AND RIGHTS OF THE SELLER

 


Article 6.317. Obligation of the seller to deliver the things


1. Under the sales contract, the seller must deliver the things to the buyer, i.e. put the things into the buyer’s possession by the right of ownership/trust and give warranty of title to the things and the quality thereof.


2. The seller’s warranty (guarantee) of title to and quality of the things shall exist regardless of whether or not such warranty is stipulated in the sales contract (warranty under law).


3. Unless otherwise provided for by the contract, the seller must deliver the things together with their appurtenances and accessories in the condition as it was at the time of conclusion of the sales contract.


4. The seller’s obligation to deliver the things shall be deemed performed when the seller puts the things into the buyer’s possession or consents to the buyer taking possession of the things and any obstacles to the buyer’s right of possession are removed.


5. Delivery expenses shall be assumed by the seller unless the contract provides otherwise.


6. Where the sales contract provides that the buyer pays the price only after the delivery of the things, the seller shall not be obliged to deliver the things if the buyer has become insolvent after the conclusion of the contract.-


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Article 6.318. Place and time of delivery of the things and documents


1. The seller must, together with the things, deliver to the buyer the related documents and the titles of ownership in his possession, where this is prescribed by the contract or this Code.  If the seller himself needs the above documents for exercising other rights not related to the things sold, the seller must deliver to the buyer copies of the documents certified in accordance with the established procedure.


2. If the seller is not obliged to deliver the things at a specific place, the following shall be deemed to be the delivery of the things:


1) where the sales contract provides for the carriage of the things, handing of the things to the first carrier for delivery to the buyer, unless otherwise provided for in the contract;


2) where, in cases other than those referred to in point 1 of this paragraph, things have to be drawn from certain stocks or manufactured and at the time of the conclusion of the contract the parties knew thereof, placing the things at the disposal of the buyer or the person indicated by him at the place where the stocks are located or manufactured;


3) in cases other than those referred to in points 1 and 2 of this paragraph, placing the things at the disposal of the buyer at the place where the seller had his place of business or residence at the time of the conclusion of the contract or where the things are transmitted to the person indicated by the buyer.


3. The fruits and revenue from the things shall belong to the buyer from the time of delivery of the things.

 


Article 6.319. Time limit for delivery of the things


1. The seller must deliver the things to the buyer at the time provided in the sales contract.  Where the time limit for delivery is not specified in the contract, the things must be delivered within a reasonable time after the conclusion of the contract. In this case, Article 6.53 of this Code shall apply accordingly.


2. The sales contract shall be deemed to contain a clause for performance within a specified period of time if it is clear from the content of the contract that, in the event of breach of that time limit, the buyer loses an interest in the contract. Where the contract contains such a clause, the seller shall be entitled to perform the contract by the expiration of the time limit or after the expiration thereof only where the buyer grants his consent.


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Article 6.320. Risk of accidental perishing of or damage to the things


1. Unless otherwise provided for in this Code or in the sales contract, the risk of accidental perishing of or damage to the things shall pass to the buyer from the moment when the seller is deemed, by law or contract, to have duly fulfilled his obligation to deliver the things, regardless of the time of passing of the right of ownership.


2. The risk of accidental perishing of or damage to the things sold during the carriage thereof shall pass to the buyer from the conclusion of the sales contract, unless the contract or trade customs provide otherwise.


3. A contractual term that the risk of accidental perishing of or damage to the things passes to the buyer from the handing of the things to the first carrier may be declared null and void at the buyer’s request if, at the time of entry into the sales contract, the seller knew, or ought to have known, that the things had perished or had been damaged, however, he did not notify the buyer thereof.


4. If the thing perished or was damaged after its delivery through no fault of the seller, the buyer must pay the price to the seller. The above rule shall also apply in cases where the seller was unable to deliver the thing to the buyer because the latter did not cooperate sufficiently with the seller and thereby breached the contract.


5. Where the subject matter of the contract are things characterised by description of the kind of the things and the buyer refuses to accept the things or is otherwise in breach of the contract, the risk of accidental perishing of or damage to the things shall pass to the buyer from the moment when the seller identifies the things and notifies the buyer thereof.


6. If the buyer brings a justified action for the nullity of the contract or replacement of the things, the risk of accidental perishing of or damage to the things shall be borne by the seller.


7. If the risk of accidental perishing of or damage to the things stays with the seller even after the delivery thereof to the buyer, the seller shall be liable for the perishing of or damage to the things, even though this would have occurred as a result of the buyer’s actions. However, from the moment the buyer could have reasonably foreseen that he had to return the things to the seller, the buyer shall be responsible for the safekeeping thereof.


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Article 6.321. Seller’s obligation to give warranty of title to the things


1. The seller shall be bound to warrant the buyer that the things delivered are free from any rights or claims of a third party, unless the buyer agreed in advance to accept the things subject to such rights or claims, whereas the seller gave a due notice thereof to the buyer.


2. The seller shall be bound to discharge the delivered things of pledge (hypothec) irrespective of the registration of the pledge (hypothec), unless the buyer, after he has been given notice by the seller of the encumbrances, agrees to buy the things.


3. The seller shall be bound to warrant the buyer that the delivered things have not been seized and they are not an object of a legal action, also that the seller has not been deprived of the right to dispose of the things and that there are no encumbrances.


4. The seller of an immovable thing shall be bound to warrant the buyer that there are no violations or restrictions of public law that could affect the buyer’s right of ownership of that thing.


5. In cases where, at the time of conclusion of the contract, the seller has duly informed the buyer of the rights of third parties to the delivered things or of encumbrances of these rights, likewise where such rights of the third parties or such encumbrances have been registered in the public register, the buyer may not invoke the circumstance that the seller has breached his obligation.


6. Where the seller breaches his obligations specified in paragraphs 1 to 4 of this Article, the buyer shall be entitled to demand reduction of the price or to rescind the contract, unless the seller proves that the buyer was aware or ought to have been aware of the rights of third parties to the things or encumbrances of such rights.

 


Article 6.322. Obligations of the seller and the buyer in case of an action brought by a third party for the taking of the thing


1. Where an action for the taking of the thing is brought against the buyer by a third party on the grounds which arose before the performance of the sales contract, the buyer must bring the seller to be a party to the suit and the seller must join in the suit on the part of the buyer.


2. If the buyer fails to bring the seller to be a party to the suit, the seller shall be exempt from liability with respect to the buyer if he proves that, by taking part in the suit, he would have been able to prevent the taking of the sold thing from the buyer.


3. The seller who has been brought by the buyer to be a party to the suit but has not participated therein shall forfeit the right to argue that the buyer has failed to properly perform the procedural steps.


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Article 6.323.  Seller’s liability where the sold thing is revendicated against the buyer


1. Where the sold thing is revendicated against the buyer by the court on the grounds which arose before the performance of the contract, the seller must restore the price and pay the damages suffered by the buyer, unless the seller proves that the buyer was aware or ought to have been aware of the grounds.


2. Agreement between the parties to exclude or limit the liability of the seller shall be null and void if the seller, being aware that the third person has rights to the thing sold, fails to notify the buyer thereof.  

 


Article 6.324. Consequences of failure to perform the obligation to deliver the thing


1. If the seller refuses without a valid reason to deliver the thing to the buyer, the latter shall have the right to refuse to perform the sales contract and claim damages.


2. Where the seller refuses to deliver the individually determined thing, the buyer may resort to remedies provided for in Article 6.60 and 6.213 of this Code.

 


Article 6.325. Consequences of failure to perform the obligation to deliver appurtenances, accessories and deeds


1. In case of failure or refusal by the seller to deliver to the buyer the appurtenances, accessories or deeds that he is obliged to deliver under the contract or by law, the buyer shall have the right to fix a reasonable time limit for the seller to perform the obligation.


2. Where the seller fails to perform his obligation within the time limit fixed by the buyer, the buyer shall have the right to refuse acceptance of the thing unless otherwise provided for by the contract.

 


Article 6.326. Seller’s obligation to preserve the sold thing


1. Where the right of ownership or trust passes to the buyer before the delivery of the sold thing, the seller must preserve the thing before the delivery and prevent it from deteriorating.


2. The buyer must reimburse the seller’s expenses incidental to preservation of the thing unless the contract provides otherwise.


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Article 6.327. Requirements in respect of the thing


1. The quality, quantity and other criteria of the thing sold must comply with the terms of the contract or, in the absence of contractual specifications, correspond to the regular requirements.


2. The seller shall not be liable under paragraph 1 of this Article for any lack of conformity of the thing if, at the time of the conclusion of the contract, the buyer was aware or could not have been unaware of such lack of conformity. 


3. The seller shall be liable under the contract and this Code for any lack of conformity which exists at the time when the right of ownership passes to the buyer, even though the lack of conformity becomes apparent at a later date.


4. The seller shall be also liable for any lack of conformity which occurs after the time indicated in paragraph 3 of this Article and which is due to a breach of any of the seller’s obligations, including a breach of any guarantee that for a period of time the things will remain fit for their ordinary purpose or for some particular purpose or will retain the specified qualities or characteristics.


5. The buyer shall forfeit the right to rely on a lack of conformity of the things if he does not give notice to the seller specifying the nature of the lack of conformity within a reasonable time after he has discovered or ought to have discovered it.

 


Article 6.328. Right to examine the thing


1. Unless otherwise agreed by the parties, the buyer shall have the right, from the moment of entry into the sales contract or presentation of the offer, before making the payment or before accepting the thing, to examine the thing at any place, at any time or in any manner which correspond to the criteria of reasonableness.


2. Unless otherwise agreed by the parties, the expenses of examining the thing shall be assumed by the buyer. The buyer shall have the right to claim from the seller reimbursement of the expenses of the examination if it is established during the examination that the thing does not correspond to the requirements set out for it.

 


Article 6.329. Quantity of things


1. The quantity of things which the seller is bound to deliver to the buyer shall be established in the sales contract in units of weight, quantity, volume or other units or in monetary terms. The contractual term regarding the quantity of the things may be agreed between the parties, establishing in the contract only the procedure for determining the quantity. Where the performance of the contract has been initiated, the contract shall be deemed concluded in respect of the quantity of things actually accepted by the buyer.


2. Where the quantity of the things to be delivered cannot be determined from the content of the sales contract and its interpretation, the contract shall be deemed not to have been concluded.


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Article 6.330. Legal consequences of breach of the contractual term relating to the quantity of the things


1. If the seller, in breach of the contract, delivers to the buyer a quantity of things less than that indicated in the sales contract, the buyer shall be entitled, unless the contract provides otherwise, either to demand that the buyer makes up any deficiency in the quantity or to reject the delivered things and refuse to pay the price or, where the price has already been paid, to claim recovery of the price and damages.


2. Where the seller delivers to the buyer a quantity of things greater than that indicated in the sales contract, the buyer must give notice thereof to the seller within the time limit specified by laws or in the contract or, where there is no fixed time limit, within a reasonable time. If, upon receipt of the buyer’s notice, the seller fails to notify within a reasonable time of further actions that should be taken, the buyer shall have the right to take delivery of all things or refuse to take delivery of the things in excess of the contractual quantity, unless otherwise provided for in the contract.


3. If the buyer takes delivery of the things in excess of the contractual quantity, the price paid for the additional things shall be the same as the price specified in the contract, unless the parties have agreed otherwise.

 


Article 6.331. Range of things


1. Where it is provided in the sales contract that the seller must deliver things of a particular kind, model, size, colour or property characterised by other description (range of things), the seller must deliver things which are in conformity with the range of things agreed by the parties.


2. Where neither the range of things nor the procedure of determination thereof is specified in the contract, but it is evident from the content and substance of the contract that the things must conform with a certain range, the seller must deliver to the buyer things of the range that would conform with the needs of the buyer of which the seller is aware of at the moment of entry into the contract, or he shall be entitled to repudiate the contract.


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Article 6.332. Legal consequences of breach of the condition concerning the range of things


1. Where the seller delivers to the buyer things which do not conform with the range provided for in the sales contract, the buyer shall have the right to refuse to accept delivery and pay for it or, if the payment has already been made, demand restoration of the price paid, unless the contract provides otherwise.


2. Where the seller delivers to the buyer both the things which conform with the range and those which do not, the buyer shall be entitled to choose:


1) to accept the delivery of the things which conform with the range and refuse to accept the non-conforming things;


2) to refuse to accept the entire delivery;  


3) to demand replacement of the things which do not conform with the range with the things provided for in the contract;


4) to accept the entire delivery.


3. Where the buyer refuses to accept the delivery of the things which do not conform with the range or demands replacement thereof, he shall have the right to refuse to pay for the said things and, where the payment has already been made, to demand restoration of the price paid.


4. The things which do not conform with the range shall be deemed accepted if the buyer fails, within a reasonable time after the receipt thereof, to give notice to the seller of his refusal to accept the things.


5. If the buyer does not refuse to accept the things which do not conform with the range, he must pay for them the price agreed with the seller. Where the seller fails through his own fault to agree with the buyer upon the price within a reasonable time, the buyer must pay for the things at the price usually paid at the time of conclusion of the contract under analogous circumstances for analogous things.


6. The rules laid down in this Article shall apply to the extent that the sales contract does not provide otherwise.


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Article 6.333. Quality of things


1. The seller must deliver to the buyer things the quality of which meets the terms and conditions of the sales contract and the requirements of documents determining the quality of things. The seller shall be liable for the defects of the things provided the buyer proves that the defects appeared before the delivery of the things or due to reasons which arose before the delivery of the things.


2. The laws or the contract may provide for the seller’s obligation to warrant the buyer that the things meet the terms and conditions of the contract and to warrant, at the moment of conclusion of the contract, against any latent defects which render them unfit for the use for which the things were intended or which so diminish their usefulness that the buyer would not have bought them or paid so high a price had he been aware of them. However, the seller shall not be obliged to warrant against any latent defects known to the buyer or any apparent defects that can be perceived by a prudent and diligent buyer without any need of expert inspection.


3. Where the seller warrants the quality of the things, he shall be liable for the defects thereof unless he proves that the defects appeared after the delivery of the things to the buyer due to the buyer’s breach of the rules governing the use or storage of the things or through the fault of third persons or as a result of superior force.


4. Where the quality of the things is not covered by the contract, the seller must deliver the things to the buyer in the condition fit for the use for which they are usually intended.  If, however, at the time of conclusion of the contract the buyer made known to the seller the particular purpose for which he buys the things, the seller must deliver to the buyer things of such quality which would make the things fit for that particular purpose.


5. Where the contract is concluded according to a sample, model or description, the seller must deliver to the buyer things which correspond to the sample, model or description, except for the derogations set out in the contract.


6. The things shall be deemed not to meet quality requirements if they lack the qualities which the buyer could have reasonably expected, i.e. which are necessary for the things to be fit for the purpose they would ordinarily be used or for a particular purpose. 


7. The things shall be deemed not to conform with the contract if the quantity, volume or weight of the delivered things does not conform with the conditions of the contract or things of the kind other than that provided for in the contract have been delivered.


8. Sale under judicial authority shall not give rise to the seller’s obligation to warrant the quality of the sold things, whereas the buyer may not invoke the fact that the seller has sold a thing of inadequate quality, except where the seller was aware of the defects of the things sold.


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9. Where the rights of succession are sold without specifying the property, the seller shall be obliged to warrant only that he is the successor.


10. The warranty of the quality of the things provided for in paragraph 2 of this Article must also be given by the producer, distributor, supplier, importer or any other persons distributing the things in his own name.


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Article 6.334. Rights of buyers of things of inadequate quality


1. Where the things sold do not correspond to the quality requirements and the seller has not discussed the defects with the buyer, upon buying things of inadequate quality the buyer shall be entitled to demand, at his own choice:


1) that the thing which is characterised in the contract by its kind be replaced by the thing of adequate quality unless the defects are minor or appeared due to the fault of the buyer;


2) that the purchasing price be reduced accordingly;


3) that the seller eliminates the defects free of charge within a reasonable time or reimburses the buyer’s expenses for the elimination of defects if these can be eliminated;


4) to restore the price and repudiate the contract, where the sale of things of inadequate quality is a material breach of contract.


2. If the purchased things perish by reason of a latent defect that existed at the time of conclusion of the sales contract, the seller must restore the price to the buyer. If the loss results from superior force, or is due to the fault of the buyer, the buyer shall be only compensated for the difference between the value of the things at the time of their loss and the price of the things.


3. If the things perished by reason of a latent defect of which the seller was aware or ought to have been aware, he must not only restore the price, but also pay all damages suffered by the buyer.


4. The terms and conditions of the contract excluding or limiting the seller’s liability for the defects of the things shall be null and void unless he has disclosed to the buyer the defects of which the seller was aware or ought to have been aware or in the case where a buyer buys things at his own risk from a seller who is not a professional seller.


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Article 6.335. Period of warranty of quality of things


1. The law or the contract may provide that the warranty of quality of things given by the seller is valid for a certain period of time.  In this case, the warranty shall be valid for all component parts of the things unless otherwise established by law or the contract.


2. The period of warranty shall start to run from the moment of delivery of things unless the contract provides otherwise.


3. Where obstacles within the seller’s control prevent the buyer from using the things for which a period of warranty of quality has been set, the warranty period shall not run until the seller removes the obstacles.


4. Unless otherwise specified in the contract, the period of warranty shall be extended for the period the buyer was unable to use the things due to the defects, provided the buyer duly notified the seller of the perceived defects.


5. The component parts shall have the same period of warranty of quality as the principal thing, which shall commence to run together with the period of warranty of quality of the principal thing, unless otherwise provided for by the contract.


6. Where the seller replaces a thing or its component part within a fixed period of warranty of quality, the period of warranty of quality that has been fixed for the replaced thing or its component part shall be applied with respect to the thing or the component part presented in replacement, unless the contract provides otherwise.

 


Article 6.336. Period of fitness for use of things


1. Law or other legal statutes may fix periods of time upon the expiration whereof relevant items of things shall be deemed unfit for their ordinary purpose (period of fitness for use).  In such cases, the producer, importer, seller or any other person who distributes the things in his own name must explicitly indicate the period of fitness for use of the things.


2. A thing for which the period of fitness for use has been fixed must be delivered to the buyer by the seller within the time limit which would allow the buyer to use the thing for its purpose before the expiration of the period of its fitness for use.


3. The period of fitness for use shall be fixed by indicating the date of manufacture of the thing and the period of time running from the said date during which the thing is fit for use or by indicating the specific calendar day of expiration of its fitness for use period.


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Article 6.337. Inspection of quality of things


1. The laws or the sales contract may establish mandatory inspection of quality of the things and the procedure and time limits for performing the inspection. 


2. Unless the procedure and time limits for quality inspection of the things are established by laws or the contract, the inspection of quality of the things must be carried out within a reasonable time period and in accordance with the usual conditions for the quality inspection of things and custom of the trade.


3. Where the laws or the sales contract provide for the seller’s obligation to inspect the quality of the things which are delivered to the buyer (trial, examination, measurement, etc.), the seller must, together with the things, hand over to the buyer documents certifying the performance of the quality inspection of the things.


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Article 6.338. Time limits for filing claims regarding the defects of the sold things


1. Unless the contract or laws establish otherwise, the buyer shall have the right to file claims regarding the defects of the things sold, provided they were established within the time limits specified in this Article.


2. Where the time period of warranty of quality or fitness for use of the item of the thing has not been established, the buyer may file claims regarding the defects of the thing within a reasonable time but not later than within two years from the day of delivery of the thing, unless a longer time limit is provided for by law or the contract. The time limit for filing claims in respect of the defects of the thing transported or conveyed by post shall run from the day of arrival of the thing at the appointed destination.


3. Where the time period of warranty of quality of the thing has not been fixed, claims regarding the defect of the thing may be filed provided the defects are established within the period of warranty. If the period of warranty of quality valid for the component parts is shorter than the period of warranty of quality of the principal thing, the claim regarding the defects of the component part may be filed within the period of warranty of quality of the principal thing. Where a period of warranty of quality applied in respect of the component part is longer than that of the principal thing, a claim regarding the defects of the component part discovered within the period of warranty may be filed regardless of the expiration of the period of warranty of quality of the principal thing.


4. The buyer may file claims regarding a thing, in respect of which a time period of fitness for use has been fixed, provided the defects are established within the time period of fitness for use of the thing. 


5. Where the period of warranty of quality fixed for a thing in the contract is less than two years and the defects of the thing are established after the expiration of the time period but not after the lapse of two years from the day of delivery of the thing, the seller shall be liable for the defects of the thing if the buyer proves that the defect appeared before the delivery of the thing or due to the reasons which appeared before the delivery and for which the seller is liable.

 


Article 6.339. Completeness of things


1. The seller must deliver to the buyer things which are in conformity with the requirements of the terms and conditions of the sales contract, which determine the completeness of things.


2. If the contract does not cover the completeness of things, the seller must deliver things complete with all accessories so that they comply with the custom of the trade and the usual requirements.


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Article 6.340. Complete set of things


1. If the sales contract provides for the seller’s obligation to deliver to the buyer a certain assortment of things constituting a set (set of things), the seller shall be deemed to have fulfilled his obligation only when he delivers all the items constituting the set.  


2. The seller must deliver to the buyer all items of the set at the same time if, by virtue of the contract or the nature of the obligation, the contract cannot be performed otherwise.

 


Article 6.341. Legal consequences of delivery of incomplete things


1. In case of delivery by the seller of incomplete things, the buyer shall have the right to demand, at his choice:


1) reduction of the price of the thing;


2) delivery by the seller of the missing accessories within a reasonable time.


2. Where the seller fails to deliver the missing accessories within a reasonable time, the buyer shall have the right, at his choice:


1) to demand that the incomplete things be replaced with complete things;


2) to refuse to perform the contract and demand restoration of the price, where that breach constitutes a material breach of contract.


3. The rules provided for in paragraphs 1 and 2 of this Article shall also apply in cases where the seller is in breach of his obligation to deliver to the buyer a set of things, unless the rules are not applicable under the contract or due to the nature of the obligation. 

 


Article 6.342. Containers and packaging of things


1. Unless the contract or the nature of the obligation provides otherwise, the seller must deliver to the buyer things in containers and packaged, except in cases where due to the nature of the things there is no need to deliver them in containers or packaged.


2. Where the contract does not lay down requirements regarding the containers and packaging of things, the things must be delivered packaged in the manner customary for such things, whereas in cases where the containers and packaging may be varied, the things must be packaged in such a manner or in such containers which would ensure fitness of the type of things during storage or carriage under normal conditions. 


3. Where mandatory requirements regarding containers or packaging are established by laws or other legal acts, the seller, being a trader, must deliver the things to the buyer in containers or packaging which conform to the requirements set by laws or other legal acts.


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Article 6.343. Legal consequences of violation of requirements relating to containers and packaging of things


1. Where the seller, in breach of his obligation, delivers to the buyer things in bulk or without containers or incorrectly packaged or in unfit containers, the buyer must refuse to accept them and require the seller to package the things or to deliver them in containers or to supply the packaging or containers, unless otherwise provided for by the contract or determined by the nature of the obligation or things.


2. Unless the contract provides otherwise, in the cases specified in paragraph 1 of this Article, the buyer may make demands established in Article 6.334 of this Code instead of the demands established in paragraph 1 of this Article.

 


SECTION THREE

GENERAL OBLIGATIONS AND RIGHTS OF THE BUYER

 


Article 6.344. Buyer’s obligation to pay the price and other expenses


1. The buyer shall be obliged to pay the price of the things within the time limits laid down in the contract or laws and at the specified place.


2. For late payment of the price, the buyer shall be obliged to pay interest, which starts to run from the time of delivery of the things or the expiration of the period agreed by the parties, unless the contract or laws provide otherwise.


3. The buyer shall also be obliged to pay any other expenses incidental to the deed of purchase and sale.  


4. Where the laws establish that the sales contract must be concluded in a notarised form and thereafter must be registered in the public register, the buyer shall be obliged to pay the price of purchase into the notary’s deposit account at the time of conclusion of the contract, whereas the notary shall transfer the money to the seller following the registration of the contract in the public register, unless the agreement between the parties provides for a different settlement procedure.


5. Where the buyer has sufficient grounds to believe that due to the seller’s fault an action may be brought against him for revendication of the things sold or encumbrance of rights thereto, he may suspend payment of the price, unless the seller guarantees possible payment of damages to the buyer.


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Article 6.345. Legal consequences of the buyer’s non-performance of the obligation to pay the price


1. Where the movable things have already been delivered to the buyer but the latter fails to pay the sale price, the seller shall have the right to repudiate the contract, notifying the buyer thereof in writing and recover the things.  If only a part of the price has not been paid, the seller may recover only the unpaid part of the thing, provided the thing is divisible. The seller shall retain the right of recovery only until the things are in the country of their delivery or until they have been transferred for consideration to a third party, have not been pledged or subject to the right of usufruct.


2. In case of insolvency of the buyer, the seller may not recover the things for which the price has not been paid if, within a reasonable time, the buyer’s administrator offers to pay the price or presents a guarantee of performance of the obligation.


3. In all other cases not specified in paragraphs 1 and 2 of this Article, the legal consequences provided for in Article 6.314 of this Code shall emerge.

 


Article 6.346. Buyer’s obligation to accept the things


1. The buyer must accept the delivered things, unless he is entitled to demand replacement of the things or rescission of the contract.


2. Unless otherwise provided for by laws or the contract, the buyer must take such measures and perform such actions which are necessary, in accordance with the requirements normally expressed, for the due delivery and acceptance of things.


3. Where the buyer, in breach of his obligation, does not accept or refuses to accept things, the seller shall have the right to demand that the buyer accept the things or to refuse to perform the contract.

 


Article 6.347. Buyer’s obligation to preserve the things


1. Where the buyer has the right under the law or the contract to return to the seller the things delivered to him, the buyer must properly preserve the things to be returned until their return. In this case, the buyer shall be entitled to retain them until he has been reimbursed his reasonable expenses by the seller.


2. If the things to be returned to the seller have been placed at the buyer’s disposal at their destination, he shall be obliged to return them at his own expense, unless the seller or his agent is present at the destination or provided this does not cause the buyer unreasonable inconvenience or unreasonable expense.


3. If the things are perishable, the rules laid down in paragraph 5 of Article 6.375 of this Code shall apply.


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Article 6.348. Buyer’s obligation to notify the seller of improper performance of the sales contract


1. The buyer must notify the seller of the breach of any terms and conditions of the contract specifying the quality, quantity, range, completeness, containers and packaging of the things within the time limit established by law or the contract or, where the time limit is not established, within a reasonable time after the breach of a certain term or condition was discovered or, in view of the nature and purpose of the things, ought to have been discovered.


2. In case of failure by the buyer to perform the obligation laid down in paragraph 1 of this Article, the seller shall have the right to refuse, fully or in part, to meet the buyer’s demands to replace the things, to deliver the missing things, to eliminate the defects of the things, to complete the things, to pack the things or deliver them in containers or to replace the containers or packaging, provided that he proves that following the breach of the obligation by the buyer his demands can no longer be met or that meeting of the demands would cause the seller unreasonable expenses compared to those the seller would have incurred if the buyer had duly notified the seller of the breach of the contract.


3. If the seller was aware or ought to have been aware of the non-conformity of the things delivered by him to the terms and conditions of the sales contract, he shall lose the right to invoke the rules laid down in paragraphs 1 and 2 of this Article.

 


Article 6.349. Prohibition to dispose of things


1. If the sales contract provides that the title to delivered things is reserved until the payment of full price or fulfilment of other conditions, before the title to the things passes to the buyer, the latter shall have no right to sell or otherwise dispose of the things, unless the purpose of the contract or characteristics of the things determine otherwise.


2. In case of non-fulfilment of the conditions of the sales contract, on which the passing to the buyer of the title to the things is made conditional under the contract, the seller shall have the right to recover the things from the buyer, unless otherwise provided for by the contact.

 


SECTION FOUR

SPECIFICS OF CONSUMER SALES CONTRACTS

 


Article 6.350. Concept of a consumer sales contract


1. Under a consumer sales contract, the seller, being a trader, shall undertake to sell a good to the buyer, being a consumer, while the buyer shall undertake to pay the price. A consumer contract under which goods and services are sold shall be considered a consumer sales contract.


2. The Retail Trade Rules shall be approved by the Government of the Republic of Lithuania or an institution authorised by it.


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Article 6.3501. Scope of application


1. The provisions of this Section shall apply to consumer sales contracts, including contracts relating to goods to be produced.


2. The provisions of this Section shall not apply to contracts for the supply of digital content or digital services other than digital content and digital services which comply with the following requirements:


1) they are incorporated in or inter-connected with a good with digital elements in such a way that without the digital content or digital service the good would not be able to perform its functions;


2) they are supplied together with a good containing digital elements under the same sales contract, irrespective of whether the digital content or digital service is supplied by the seller or another person. In the event of doubt as to whether the supply of incorporated or inter-connected digital content or an incorporated or inter-connected digital service forms part of the sales contract, the digital content or digital service shall be presumed to be covered by the sales contract.


3. The provisions of this Section shall not apply to:


1) physical media used solely as a means of delivering digital content;


2) goods which are realised in accordance with the procedure laid down by the Code of Civil Procedure during enforcement proceedings and in other cases provided for by laws;


3) the purchase and sale of second-hand goods by public auction;


4) the purchase and sale of live animals.


4. For the purposes of this Section:


1) ‘functionality’ means the ability of goods to perform their functions having regard to their purpose;


2) ‘compatibility’ means the ability of the goods to function with hardware or software with which goods of the same type are normally used, without the need to convert the goods, hardware or software;


3) ‘interoperability’ means the ability of the goods to function with hardware or software different from those with which goods of the same type are normally used;


4) ‘durability’ means the ability of goods, when used normally, to maintain their required functions and performance characteristics.

 


Article 6.351. Form of a consumer sales contract

Unless the laws provide otherwise, a consumer sales contract shall be deemed concluded from the moment the buyer chooses the thing to be purchased or expresses his will in any other manner.


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Article 6.352. Public offer


1. Presentation of the things in advertisements, general circulation catalogues or descriptions shall be deemed a public offer, provided that the principal conditions of the sales contract are specified.


2. Display of things in shop windows, on the counter or in other places of their sale, also demonstration of samples of the things or offering of information on the things on sale (description, catalogues, photographs, etc.) in the place of their sale shall be considered as public offer, irrespective of whether or not the price of the thing or other conditions of the sales contract are indicated, unless the seller explicitly and unambiguously states that certain things are not for sale.


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Article 6.353. Seller’s obligation to inform the buyer


1. The seller must provide the buyer with information in accordance with Articles 6.2286 or 6.2287 of this Code.    


2. The seller must indicate the selling price of each thing or of the things of one kind and the price of a suitable standard unit of a thing. The selling price shall be the final price of a thing or of the quantity of things, including all taxes. A standard unit price shall mean the price, including all taxes, of one kilogram, one litre, one metre, one square metre or one cubic metre of a thing.


3. The selling price of a thing or the price of a standard unit may be omitted where the things:


1) are supplied in the performance of services;


2) are sold by auction or are works of art or antiques.


4. The price of a standard unit of the things may be omitted where:


1) these are things whose price does not depend on their weight or measurement;


2) the price of the standard unit is the same as the selling price;


3) these are things or groups of things specified in the Rules On Labelling and Indication of Prices of Items (Goods) for Sale. They shall be approved by the Government of the Republic of Lithuania or an institution authorised by it.


5. Only a standard unit price of things must be indicated where things are not pre-packaged and their quantity is determined in the presence of the customer.


6. The selling price and the standard unit price must be conspicuous, unambiguous, clearly legible and easily identifiable.


7. In any advertisement of the thing, the indicated selling price must be accompanied by the standard unit price, save for the exceptions specified in paragraphs 3 and 4 of this Article.


8. The seller must provide the buyer with information about the price reduction applied. Any notice of reduction of the price of a thing must include information on the previous price. The previous price shall be considered to be the lowest price charged by the seller during the 30-day period preceding the price reduction. In cases where the price of a thing is gradually reduced, the previous price shall be considered to be the price of the thing prior to its first reduction. If the thing has been offered to buyers for less than 30 days, the actual time limit for offering the thing to buyers shall apply. The provisions of this paragraph shall not apply to perishable products or to things which rapidly lose their commercial value.


9. The buyer shall be entitled to examine the things before entering into the contract and to demand that the seller inspect the things in his presence or demonstrate the way they are used, provided this is possible given the nature of the things.


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10. In case of failure by the seller to promptly provide the buyer with an opportunity to obtain the information specified in paragraphs 1 to 8 of this Article at the place of sale of the things, the buyer shall have the right to claim from the seller compensation of damages for any loss occasioned by avoidance to conclude the contract or, where the contract has been concluded, to rescind the contract unilaterally within a reasonable time and to demand refund of the price paid and compensation of other damages. The seller must refund the price paid by the buyer and compensate for other damages without delay, but not later than fourteen days after the date of termination of the contract or the date of receipt of the buyer’s claim for damages.


11. The seller who fails to provide the buyer with an opportunity to receive the relevant information about the things shall be liable for the defects of the things which appeared after the delivery of the things to the buyer, if the buyer proves that the defects appeared because he did not possess the relevant information.

 

Article 6.354. No longer effective from 13 June 2014.

 


Article 6.355. Sale of things conditional on acceptance thereof by the buyer within a certain period


1. A consumer sales contract may contain a provision that the buyer is bound to accept the things within a certain period fixed in the contract, within which the seller has no right to sell the things to another buyer.


2. Unless otherwise provided for in the contract and if the buyer fails to arrive within the fixed period or fails to perform other actions necessary for the acceptance of the things within the period fixed in the contract, the buyer shall be deemed to have refused to perform the contract.


3. The seller’s additional expenses incidental to the transfer of the things to the buyer within a certain time period shall be included in the price of the things, unless the contract or laws provide otherwise.

 


Article 6.356. Sale of things by sample


1. A consumer sales contract may be concluded on the basis of samples of the things offered to the buyer by the seller (description of the goods, catalogues of goods, models, etc.).


2. Unless otherwise provided for by laws or the contract, a contract by sample shall be deemed concluded when the seller delivers the things to the destination specified in the contract, and in case there is no indication of the destination in the contract, to the consumer’s place of residence.   


3. The buyer shall have the right to repudiate the contract by sample before the transfer of the things. In such case, however, the buyer must reimburse the seller’s reasonable expenses incidental to the performance of the contract prior to the repudiation, unless the contract provides otherwise.

 

Article 6.357. No longer effective from 13 June 2014.


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Article 6.357. No longer effective from 13 June 2014.

 


Article 6.358. Sale of things by vending machines


1. If things are sold by vending machines, the owner of the machines must inform the buyer in a notice on the machine or in any other way about the seller (seller’s name and registered office), mode of operation of the machine, as well as the actions the buyer is bound to perform in order to be delivered the thing and the sequence of the actions.


2. In this case, the contract shall be deemed concluded from the moment the buyer performs the actions required in order to obtain delivery of the thing from the vending machine.


3. In case of non-delivery to the buyer of the thing payment for which has been made, the seller must promptly, upon the buyer’s demand, deliver the thing or restore the price.


4. The rules specified in this Article shall also apply where the machines are intended for the exchange of money, acquisition of token money or exchange of currency unless special rules establish otherwise.

 


Article 6.3581.   Requirements for the sale of certain types of things and certain types of places of trading

Requirements for the sale of certain types of things only in designated places of trading (specialised shops, specialised divisions of shops, markets or other places of trading) and requirements for certain types of places of trading may be laid down by law.


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Article 6.359. Sale of things conditional on their delivery to the buyer


1. Where a consumer sales contract provides that the things must be delivered to the buyer, the seller shall be bound to deliver the things to the place indicated by the buyer or, where there is no indication of the place of delivery, to the buyer’s place of residence.


2. The seller must deliver the things to the buyer by transferring them or their possession to him not later than within thirty days from the conclusion of the contract, unless the parties agree otherwise.


3. The contract shall be deemed performed from the moment of delivery of the things to the buyer or, in the buyer’s absence, from the delivery of the things to the person who presents a receipt or any other document confirming conclusion of the contract or the right to receive the delivered things, unless the contract provides otherwise.


4. Where the seller fails to fulfil his obligation to deliver the things within the time limit set in the contract or in paragraph 2 of this Article, the buyer shall present a demand for the delivery of the things within an additional reasonable period, taking into account the circumstances. Where the seller fails to deliver the things within the additional time limit set by the buyer, the buyer shall have the right to unilaterally terminate the contract.


5. Paragraph 4 of this Article shall not apply where the seller has refused to deliver the things or where the delivery within the time limit laid down in the contract is essential in the light of all the circumstances relating to the conclusion of the contract or where, before the conclusion of the contract, the buyer has informed the seller that the delivery of the things within the time limit laid down in the contract is essential.    In these cases, where the seller fails to deliver the things within the time limit set in the contract or in paragraph 2 of this Article, the buyer shall have the right to unilaterally terminate the contract without delay.


6. When the contract is terminated, the seller must immediately reimburse the buyer for any sums he has paid. In addition, the buyer shall have the right to exercise any other remedies established in this Code.

 


Article 6.3591. Risk transfer

Where a consumer sales contract provides for the carriage of the things and the seller dispatches the things to the buyer, the risk of accidental perishing of or damage to the things shall pass to the buyer when he or a person designated by him, other than the carrier, accepts the things. Where the things are handed over to the carrier selected by the buyer and the seller has not offered such delivery, the risk provided for in this paragraph shall pass to the buyer when the things are handed over to the carrier.

 

Article 6.360. No longer effective from 13 June 2014.


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Article 6.360. No longer effective from 13 June 2014.

 

 


Article 6.361. Lease-purchase contract


1. It may be stipulated in the contract that until the passing of ownership of the things to the buyer he remains the lessee of the delivered things (lease-purchase contract).


2. Unless the contract provides otherwise, the buyer shall become the owner of the things upon full payment of the sale price.

 


Article 6.362. Replacement and return of things


1. The buyer shall be entitled to replacement of the purchased things, other than food products, at the place of purchase or elsewhere, as indicated by the seller, within fourteen days from the delivery thereof to the buyer, unless the seller has set a longer time period, receiving in exchange analogous things of different measurements, form, colour model or completeness. In case of a difference in prices between the things to be replaced and things offered in replacement, the buyer must pay the seller the recalculated price.


2. If the buyer does not possess things suitable for replacement, the buyer shall have the right to return the things to the buyer within the time period set in paragraph 1 of this Article and recover the money paid. The seller must refund the buyer the price paid by the latter without delay, but not later than within fourteen days from the return of the thing.


3. The buyer’s claim for replacement of the things shall be satisfied provided the things have not been in use, have not been damaged, have retained their fitness for use, and have not lost their merchantability and the buyer is in possession of proof confirming that he purchased the things from the seller.


4. The procedure for replacing and returning the things and the list of non-replaceable and non-refundable things are laid down in the Retail Trade Rules.


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Article 6.363. Quality requirements for goods


1. The seller must deliver to the consumer goods meeting the requirements laid down in this Article.


2. The goods must comply with all of the following requirements, provided that they are applicable:


1) be of the description, quantity and quality, and possess the functionality, compatibility, interoperability and other features, as required by the sales contract;


2) be fit for any particular purpose for which the consumer requires them and which the consumer made known to the seller at the latest at the time of the conclusion of the sales contract, and in respect of which the seller has given acceptance;


3) be supplied with all accessories and instructions, including on installation, as required by the sales contract;


4) be supplied with updates, as required by the sales contract.


3. In addition, the goods must meet all of the following requirements:


1) be fit for the purposes for which goods of the type would normally be used, taking into account any applicable legal provisions, technical standards or, in the absence of such technical standards, applicable codes of conduct;


2) where applicable, be of the quality such as the sample or model supplied to the consumer by the seller before the conclusion of the contract and correspond to the description of that sample or model;


3) where applicable, be delivered along with any accessories (including packaging, installation or other instructions) which the consumer may reasonably expect to receive;


4) be of the quantity and possess the features, including in relation to durability, functionality, compatibility and security, normal for goods of the same type and which the consumer may reasonably expect, given the nature of the goods and taking into account any public statements made by or on behalf of the seller, or other persons, including the manufacturer, particularly in advertising or labelling the goods;


4. The public statements referred to in point 4 of paragraph 3 of this Article shall not bind the seller if he proves that at least one of the following conditions is met:


1) the seller was not, and could not reasonably have been, aware of the public statement in question;


2) by the time of conclusion of the contract, the public statement had been corrected in the same way as, or in a way comparable to how, it had been made;


3) the decision to acquire the goods could not have been influenced by the public statement.


5. The seller of goods with digital elements must ensure that the consumer is informed of and supplied with updates, including security updates, that are necessary to ensure the adequate quality of the goods:


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1) for the period that the consumer may reasonably expect, given the type, purpose and digital elements of the goods and taking into account the circumstances and nature of the contract, where the sales contract provides for a single act of supply of digital content or a digital service;


2) for the period indicated in paragraph 2 of Article 6.364 of this Code, where the sales contract provides for a continuous supply of digital content or a digital service over a period of time.


6. Where the consumer fails to install, within a reasonable time, updates supplied in accordance with paragraph 5 of this Article, the seller shall not be liable for any lack of conformity resulting solely from the lack of the relevant update, provided that both of the following conditions are met:


1) the seller informed the consumer about the availability of the update and the consequences of the failure of the consumer to install it;


2) the failure of the consumer to install or the incorrect installation by the consumer of the update was not due to shortcomings in the installation instructions provided to him.


7. Where, at the time of the conclusion of the sales contract, the consumer was specifically informed that a particular characteristic of the goods was deviating from the requirements laid down in paragraphs 3 or 5 of this Article and the consumer expressly and separately accepted that deviation when concluding the contract, it shall be considered that the goods are of adequate quality.


8. The seller shall be liable for any lack of conformity resulting from the incorrect installation, fitting or assembly of the goods in the following cases:


1) the installation is the subject matter of the sales contract and it has been carried out by or under the responsibility of the seller;


2) the installation had to be carried out by the consumer and was not properly done due to inaccurate installation instructions provided by the seller and, in case of improper installation of goods with digital elements, by the seller or supplier of the digital content or digital service.


9. Where a violation of intellectual property or any other rights of other persons prevents or limits the consumer’s use of the goods, the consumer shall be entitled to the remedies in accordance with the provisions of Article 6.3641 of this Code.


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Article 6.364. Statutory guarantee


1. The seller shall be liable to the consumer for any non-conformity with the quality requirements of the goods, including goods with digital elements, at the time of delivery of the goods and which becomes apparent not later than within two years from the delivery of the goods (statutory guarantee).


2. Where the contract for the sale of goods with digital elements provides for a continuous supply of digital content or a digital service over a period of time, the seller shall be liable for any defects in the digital content or digital service which occur or become apparent within two years of the delivery of the goods with digital elements. Where the contract provides for a continuous supply of the digital content or digital service for more than two years, the seller shall be liable for any defects in the digital content or digital service which occur or become apparent during the period of supply of the digital content or digital service provided for in the contract.


3. The seller and the consumer may agree on a shorter term of liability of the seller for second-hand goods than laid down in paragraphs 1 and 2 of this Article, but this period may not be less than one year.


4. A defect in goods, including goods with digital elements, which becomes apparent within one year of its delivery shall be deemed to have existed at the time of delivery, unless the seller proves otherwise or where this is incompatible with the nature of the goods or the nature of the defect.


5. Where the contract for the sale of goods with digital elements provides for a continuous supply of digital content or a digital service over a period of time, the burden of proof with regard to whether the digital content or digital service is of adequate quality during the period specified in paragraph 2 of this Article shall shall lie with the seller if the defect becomes apparent during that period.


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Article 6.3641. Consumer rights when the goods are of inadequate quality


1. Where the goods do not meet the quality requirements, the consumer shall have the right, in accordance with the conditions laid down in this Article, to demand that the adequate quality of the goods be ensured, a proportional reduction in the price of the goods or to unilaterally terminate the sales contract.


2. In order to ensure the adequate quality of the goods, the consumer shall have the right to choose to require repair or replacement of the goods, unless it would be impossible to comply with the requirement or it would entail disproportionate costs for the seller compared to the costs of complying with the other requirement, taking into account all the circumstances, including:


1) the value of the goods, if the goods had no defects;


2) the significance of the defects/non-conformity of the goods;


3) whether the application of another requirement would not cause inconvenience to the consumer.


3. The seller shall have the right to refuse to ensure the adequate quality of the goods if repair or replacement of the goods is impossible or would entail disproportionate costs for the seller, taking into account all the circumstances, including those referred to in points 1 and 2 of paragraph 2 of this Article.


4. The consumer shall have the right to demand a proportionate reduction in the price of the goods or to terminate the sales contract in accordance with Article 6.3643 of this Code where:


1) the seller has not repaired or replaced the goods or the repair or replacement of the goods does not meet the requirements laid down in paragraphs 2 and 3 of Article 6.3642 of this Code, or the seller has refused to ensure the adequate quality of the goods in accordance with paragraph 3 of this Article;


2) the defect of the goods has occurred despite the seller’s attempts to ensure the quality of the goods;


3) the defect of the goods is of a serious nature;


4) the seller has declared, or it is clear from the circumstances, that the seller will not ensure the adequate quality of the goods within a reasonable time, or without significant inconvenience for the consumer.


5. The consumer shall not have the right to terminate the contract where the defect is minor. The burden of proof with regard to whether the defect is minor shall lie with the seller.


6. The consumer shall have the right to suspend payment of the price or part of the price of the goods until the seller performs the seller’s obligations under this Section.


7. The consumer shall be entitled to compensation for damage caused by the inadequate quality of the goods.


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7. The consumer shall be entitled to compensation for damage caused by the inadequate quality of the goods.


8. In order to exercise the rights set out in this Article, the consumer must inform the seller of the non-conformity with the quality requirements of the goods not later than within two months from detection of the non-conformity. The burden of proving that the consumer has missed that time limit shall lie with the seller.


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Article 6.3642. Repair or replacement of the goods


1. The seller shall have an obligation to ensure that the goods are repaired or replaced in compliance with the following requirements:


1) free of charge, i.e. without charging for the costs necessary to repair or replace the goods, including costs of postal services, transport services, work or materials;


2) within a reasonable time from the moment the seller has been informed by the consumer about the inadequate quality of the goods;


3) without causing any significant inconvenience to the consumer, taking account of the nature of the goods and the purpose for which the consumer required the goods.


2. The consumer shall return the goods to the seller for repair or replacement. The costs of returning the goods shall be borne by the seller.


3. If the goods have been properly installed, fitted or assembled before the defect becomes apparent, taking into account their nature and purpose, the seller’s obligation to repair or replace the goods shall include the removal of the goods and the installation of the repaired or replaced goods or covering the costs of removing and installing the goods.


4. The seller shall not be entitled to demand payment from the consumer for the normal use of the replaced goods during the period prior to their replacement.

 


Article 6.3643. Price reduction and termination of the sales contract


1. The price reduction must be proportionate to the decrease in the value of the goods received by the consumer compared to the value that the goods would have in the absence of defects.


2. The consumer shall exercise his right to terminate the sales contract by submitting to the seller a statement expressing his decision to terminate the sales contract.


3. Where only part of the goods delivered under the sales contract become defective and there are grounds for terminating the contract laid down in Article 6.3641 of this Code, the consumer shall be entitled to terminate the sales contract only in respect of defective goods and other directly related goods acquired together.


4. In the event of termination of the sales contract by the consumer:


1) the consumer must return the goods to the seller at the seller’s expense;


2) upon receipt of the returned goods or proof provided by the consumer that the goods have been dispatched, the seller must, within fourteen days at the latest, return the price paid for the goods to the consumer.


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Article 6.3644. Specific features of the quality guarantee (commercial guarantee) of the goods


1. ‘Quality guarantee (commercial guarantee) of the goods’ means the obligation of the seller or manufacturer (guarantor) to the consumer, additional to the statutory guarantee of the goods, to refund the price paid or to replace, repair or provide maintenance services of the goods if the goods do not meet the conditions or other requirements set out in the quality guarantee document or advertising published at the time of conclusion of the contract or prior to the conclusion of the contract or other requirements not related to those laid down in Article 6.363 of this Code. For the purposes of this Article, the ‘producer’ means the manufacturer of goods, the importer of goods into the territory of the Union or any person purporting to be a producer by placing his name, trade mark or other distinctive sign on the goods.


2. The quality guarantee of the goods shall bind the guarantor in accordance with the terms and conditions set out in the quality guarantee document and related advertising published at the time of the conclusion of the contract or before the conclusion of the contract. Unless other legal acts provide otherwise, where the producer provides the consumer with a quality guarantee as to the durability of the goods during a given period, the producer shall be directly liable to the consumer for the repair or replacement of the goods in accordance with Article 6.3642 of this Code for the duration of that guarantee. The producer may offer more favourable conditions to the consumer in the quality guarantee document for the durability of the good.


3. Where the terms and conditions set out in the quality guarantee document are less favourable to the consumer than those set out in the related advertising, the terms and conditions set out in the advertising shall apply, unless the advertising has been corrected prior to the conclusion of the contract, in the same or a similar way to that in which it was published.


4. The quality guarantee document must be made available to the consumer on a durable medium at the latest on delivery of the goods. The quality guarantee document must be be expressed clearly and intelligibly. It must contain all of the following information:


1) a clear statement that, as a result of the inadequate quality of the goods, the consumer is entitled by law to require the seller to ensure the free exercise of the rights set out in Article 6.3641 of this Code and that the quality guarantee of the goods does not affect the exercise of those rights;


2) the name and address of the guarantor;


3) the procedure to be followed by the consumer to ensure that the quality guarantee of the goods is fulfilled;


4) the goods covered by the quality guarantee;


5) the terms and conditions of the quality guarantee of the goods.


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4) the goods covered by the quality guarantee;


5) the terms and conditions of the quality guarantee of the goods.


5. The consumer shall have the right to claim the quality guarantee of the goods regardless of the fact that it has been granted in breach of the requirements laid down in paragraph 4 of this Article.


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Article 6.365. No longer effective from 13 June 2014.

 

Article 6.366. No longer effective from 13 June 2014.

 

Article 6.367. No longer effective from 13 June 2014.

 

Article 6.368. No longer effective from 13 June 2014.


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Article 6.369. Timeshare, long-term holiday product, resale or exchange contracts


1. The parties to timeshare, long-term holiday product, resale or exchange contracts shall be the seller, a person acting for purposes relating to business or profession or any person acting on behalf of, or for the benefit of, the seller, and the buyer, a natural person acting for purposes other than business or profession.


2. ‘Timeshare contract’ means a contract concluded for a duration of more than one year whereby the buyer, for consideration, acquires the right to use overnight accommodation at a given time for more than one period of occupation.


3. ‘Long-term holiday product contract’ means a contract concluded for a duration of more than one year whereby the buyer, for consideration, acquires the right to obtain discounts or other benefits in respect of accommodation separately or in combination with travel or other services.  Payments under long-term holiday product contracts may be made only in annual instalments of equal value in accordance with the payment schedule. No later than fourteen days before the date of payment of each instalment, the seller shall, using a durable medium accessible to the buyer, notify the buyer of the obligation to pay an annual instalment.    


4. By means of a resale contract, the seller shall, for consideration, assist the buyer in buying or selling timeshare rights or a long-term holiday product.


5. When concluding an exchange contract, the buyer shall, for consideration, join a timeshare exchange system which allows an access to overnight accommodation or other services in exchange for giving other persons temporary access to the rights deriving from a timeshare contract.


6. When determining the period of validity of a timeshare or long-term holiday product contract, consideration shall also be given to the implied terms of the contract with regard to renewal or extension of the period of validity of the contract.


7. A timeshare right or a long-term holiday product may not be offered or sold as investment services.


8. Within a reasonable period of time before the conclusion of timeshare, long-term holiday product, resale or exchange contracts, the seller must provide the buyer, free of charge and on a durable medium accessible to him, with the clear and accurate information provided by the Government or an institution authorised by it on the terms of the contracts. Buyer information forms shall be approved by the Government or an institution authorised by it.


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9. The buyer information referred to in paragraph 8 of this Article shall be an integral part of the contract and may not be altered unless the parties expressly agree otherwise. The seller shall have the right to unilaterally alter the information referred to in paragraph 8 of this Article only where the alterations are made due to circumstances outside the seller’s will, which the seller could not have foreseen and whose consequences could not have been avoided even if every care had been taken. In addition to the information referred to in paragraph 8 of this Article, the contract shall also indicate the identity of each party, their place of residence/registered office, and the date and place of conclusion of the contract; the contract must be signed by the parties. In all cases, before the conclusion of the contract the terms of the contract and the possible amendments thereto referred to in this paragraph must be made available to the buyer on a durable medium accessible to him and clearly indicated in the contract. The seller must give one copy of the contract to the buyer at the time of the conclusion of the contract.


10. Prior to the conclusion of the contract, the seller must clearly inform the buyer of the right to repudiate the contract, the repudiation periods set out in paragraphs 1, 2 and 3 of Article 6.370 of this Code and the prohibition of advance payments provided for in paragraph 8 of Article 6.370 of this Code. The buyer shall sign under the above-mentioned terms of the contract separately in the form referred to in paragraph 8 of this Article.


11. The contract presented to the buyer must be accompanied by a repudiation form laid down in legal acts and approved by the Government or an institution authorised by it.


12. The information referred to in paragraph 8 of this Article shall be submitted to the buyer and the contract shall be drawn up, at the choice of the buyer, in the official language or one of several official languages of the Member State in which the buyer resides or the nationality of which the buyer holds, provided this language is also an official language of the European Union. Where the seller carries out his activities in the Republic of Lithuania, the contract shall also be drawn up in Lithuanian. For the purposes of this paragraph, the term ‘Member State’ means a Member State of the European Union or a Member State of the European Economic Area.


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13. Any advertisement offering a timeshare right, a long-term holiday product, or the conclusion of resale or exchange contracts must inform where and how the buyer can obtain the information referred to in paragraph 8 of this Article on the terms of the contract. Any invitation to an event that will involve offers to conclude timeshare, long-term holiday product, resale or exchange contracts must clearly state the commercial purpose and nature of the event. During such an event, the buyer must be given the opportunity to obtain, at any time, the information referred to in paragraph 8 of this Article on the terms of the contracts.


14. Where the subject matter of timeshare, long-term holiday product, resale or exchange contracts is an immovable thing situated in the Republic of Lithuania or the contract is not directly related to an immovable thing but the seller carries out his activities in the Republic of Lithuania or redirects, by any means, these activities to the Republic of Lithuania, this Article and Article 6.370 of this Code shall apply irrespective of the fact that foreign law is applicable to the contract.


15. Any waiver of the buyer’s rights granted to him in accordance with this Article and Article 6.370 of this Code shall not be valid.


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Article 6.370. Buyer’s right of repudiation in the case of timeshare, long-term holiday product, resale or exchange contracts


1. The buyer shall have the right, without giving any reason, to unilaterally repudiate timeshare, long-term holiday product, resale or exchange contracts by informing, on a durable medium accessible to him, the seller thereof within fourteen days from the date of conclusion of the respective contract, including the preliminary contract, or from the date of receipt of such a contract, whichever date is later. When repudiating the contract, the buyer shall have the right to use the form specified in paragraph 11 of Article 6.369 of this Code. Where an exchange contract is offered to the buyer together with a timeshare contract, both contracts shall be subject to the same period of repudiation of fourteen days from the date of conclusion of the timeshare contract, including the preliminary contract, or from the date of receipt of such a contract, whichever date is later.


2. Where the buyer has not been provided with the information referred to in paragraph 8 of Article 6.369 of this Code on the terms of the contract or the provided information does not include all the mandatory particulars, the buyer shall have the right to unilaterally repudiate the contract within three months and fourteen days from the date of conclusion of the contract, including the preliminary contract, or from the date of receipt of such a contract, whichever date is later, in accordance with the procedure laid down in paragraph 1 of this Article. Where the information on the terms of the contract containing all the mandatory particulars is served on the buyer within three months from the date of conclusion of the contract, including the preliminary contract, or from the date of receipt of such a contract, whichever date is later, the buyer shall have the right to repudiate the contract, including the preliminary contract, within fourteen days from the date of serving the information on the terms of the contract on him.


3. Where at the time of conclusion of the contract the buyer has not been provided with a form of a repudiation of the contract, as laid down in legal acts, the buyer shall have the right to unilaterally repudiate the contract within one year and fourteen days from the date of conclusion of the contract, including the preliminary contract, or from the date of receipt of such a contract, whichever date is later, in accordance with the procedure laid down in paragraph 1 of this Article. Where the form of a repudiation of the contract containing all the mandatory particulars is served on the buyer within one year from the date of conclusion of the contract, including the preliminary contract, or from the date of receipt of such a contract, whichever date is later, the buyer shall have the right to repudiate the contract within fourteen days from the date of serving the form of a repudiation of the contract on him.


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4. Where the buyer exercises the right to repudiate timeshare, long-term holiday product, resale or exchange contracts when the given rights are paid for fully or in part by a consumer credit granted to the buyer by the seller or a third party in accordance with the contract concluded between the seller and the third party, the buyer shall have the right to terminate the consumer credit agreement without incurring any costs.


5. Upon exercise of the right to repudiate a timeshare or long-term holiday product contract, all additional exchange or other contracts, whereby the buyer receives services relating to the timeshare or long-term holiday product contract from the seller or third parties under agreement with the seller, shall also terminate. The buyer may not be obliged to pay the costs due to the termination of the additional contracts referred to in this paragraph.


6. When the buyer exercises the right to repudiate a contract, as laid down in this Article, the obligations of the parties to perform the contract shall terminate and the buyer shall not incur any costs or pay for the services provided prior to the date of a repudiation of the contract.


7. The buyer’s right to repudiate a contract provided for in this Article shall not be subject to any restrictions in the form of additional obligations or payments or to any limitation or abolition.


8. Until the end of the period when the buyer has the right to repudiate a timeshare, long-term holiday product or exchange contract or until the performance of a resale contract or its expiry otherwise, the seller or the third party shall be prohibited from accepting any advance payment from the buyer. An advance payment shall be considered to be the issuing of the buyer’s guarantee, an amount reserved in the bank account, the acknowledgement of the debt, and the payment of any amount of money to the seller or the third party.


9. Where a long-term holiday product contract is concluded, the buyer shall, after the payment of the second or subsequent instalment, have the right to terminate the contract by notifying the seller thereof not later than within fourteen days of receipt of the notice of payment without paying any fine and incurring any additional costs.


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SECTION FIVE

SPECIFICS OF WHOLESALE CONTRACTS

 


Article 6.371. Concept of a wholesale contract

Under the wholesale contract, the seller, who is the person engaged in trade, or his agent shall undertake to deliver, at a specific time, things manufactured or purchased by him to the buyer under the right of ownership/trust for the latter’s business needs or other needs not related to personal, family or household need, whereas the buyer shall undertake to pay the price.

 


Article 6.372. Time limits for the delivery of things


1. Where a long-term contract for the sale of things has been concluded under which things are delivered in lots and the contract does not provide for the time limits for the delivery of things, the lots of things must be delivered on a monthly basis in equal parts, unless a different conclusion is to be drawn having regard to the custom of the trade or the essence of the obligation.


2. In case of failure by the seller to deliver all things within the specified time limit, the things that have not been delivered by the due date must be delivered within the remaining time limit(s), except where the contract provides otherwise.

 


Article 6.373. Delivery of things


1. If the means of transportation and terms of transportation of the things by the seller to the buyer are not specified in the contract, the seller shall be bound to arrange for carriage of the things by means of transportation appropriate in the circumstances and according to the usual terms for such transportation, unless it is reasonable to infer otherwise in view of the custom of the trade or the essence of the obligation.


2. The contract may stipulate the buyer’s obligation to collect the things from the seller’s place of business or any other place (warehouse, railway station, etc.).

 


Article 6.374. Acceptance of things


1. The buyer must take the necessary measures to ensure that all delivered things are accepted in due manner within the time limit fixed in the contract or, where the time limit is not fixed, within a reasonable time, and to examine the quantity and quality of the things in accordance with the procedure provided for in the contract and promptly notify the seller of the discovered defects and deficiency in the quantity.


2. Where the buyer has to collect the things from the carriers’ organisation, he must check conformity of the things with the information contained in the shipping documents and accept the things in accordance with the regulations of that means of transportation.


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Article 6.375. Preservation of the unaccepted things


1. The buyer who refuses to accept the things delivered to him under the contract must preserve the things (responsible preservation) and promptly notify the seller of his refusal.


2. Upon receipt of the notification specified in paragraph 1 of this Article, the seller must, within a reasonable period of time, take the things back or inform the buyer what he should do with them. In case of failure by the seller to do so, the buyer shall have the right to re-sell the things or return them to the seller.


3. The seller must reimburse the buyer for the necessary expenses incidental to the preservation, sale or return of the things. Having sold the things, the buyer shall make the necessary deduction of expenses incidental to the sale and preservation of the things and restore the balance to the seller.


4. In case of refusal by the buyer to accept the things in the absence of the grounds provided for by law or the contract, the seller shall have the right to demand from the buyer payment of the full price.


5. In case the things are perishable and the application of the rules laid down in paragraph 2 of this Article is not possible for the said reason, the buyer may re-sell the things without waiting for the seller’s response.

 


Article 6.376. Taking possession of the things


1. In case the buyer is bound under the contract to take possession of the things at the seller’s place of business or any other place, when taking possession of the things at the place of their delivery the buyer must examine their quantity and quality, unless the contract provides otherwise.


2. If the buyer fails to take possession of the things within the time limit fixed in the contract or, where the time limit is not fixed, within a reasonable time period after the seller has notified that the things may be taken possession of, the seller shall have the right to repudiate the contract or demand payment of the price and reimbursement of expenses incidental to preservation of the things.


3. If the buyer is bound to indicate the things he is purchasing by specifying their volume, form or otherwise, but fails to do so within a reasonable time, the seller may himself do this having regard to the needs of the buyer he is aware of.

 


Article 6.377. Containers and packaging


1. Unless otherwise provided for in the contract, the buyer must return to the seller, at his own expense, the reusable containers and packaging in which the things were delivered.


2. Other containers shall be returned only in cases provided for in the contract.


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Article 6.378. Sale of things of inadequate quality or completeness

Where the things delivered by the seller are of inadequate quality or completeness, the buyer shall have the right to make demands specified in Articles 6.334 and 6.341 of this Code, except in cases where the seller, upon receipt of the buyer’s notification, promptly replaces the things of inadequate quality with quality things or delivers the product in its completeness.

 


Article 6.379. Unilateral rescission of the contract


1. The buyer shall have the right to unilateral rescission of the contract in the event of a fundamental breach thereof by the seller.


2. A breach of the contract committed by the seller shall be deemed fundamental if:


1) the delivered things are of inadequate quality and their defects cannot be eliminated within the time period the buyer finds acceptable;


2) the seller has missed more than twice the time limit set for the delivery of the things where under the long-term contract the things had to be delivered within the fixed time limits.


3. The buyer shall be considered to have committed a fundamental breach of the contract and the seller shall acquire the right to a unilateral rescission of the contract if the buyer:


1) has failed more than twice to make timely payment for the things delivered when due;


2) has failed more than twice to take possession of the things delivered within the set time limits.

 


SECTION SIX

PUBLIC PROCUREMENT CONTRACTS

 


Article 6.380. Concept of a public procurement contract

Under a public procurement contract, a state or municipal institution or a state or municipal enterprise, agency or organisation shall purchase things or make payment for works or services (including lease) with the resources of the state budget, municipal budgets, State Social Insurance Fund budget and other state or municipal funds for the purpose of meeting the needs of the State or municipality, or the needs of state or municipal institutions, enterprises, agencies and organisations.

 


Article 6.381. Specifics of conclusion of public procurement contracts

Public procurement contracts shall be concluded by holding competitive bidding, except where the laws establish otherwise.

 


Article 6.382. Regulation of public procurement contracts

The provisions of this Code shall apply to public procurement contracts to the extent it is not established otherwise by other laws.

 


SECTION SEVEN

ENERGY SALES CONTRACTS


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SECTION SEVEN

ENERGY SALES CONTRACTS

 


Article 6.383. Concept of an energy sales contract


1. Under an energy (or energy resources) sales contract, the energy supply enterprise shall undertake to supply the subscriber, through the connected energy supply network, with the amount of energy of the type provided for in the contract, whereas the subscriber shall undertake to pay for the supplied energy and comply with the energy consumption regime specified in the contract, ensuring safety of exploitation of the energy supply network and maintenance in good condition of the installations and facilities owned by him.


2. An energy sales contract shall be concluded with the subscriber only provided he is in possession of energy consuming devices and internal network which meet the prescribed technical requirements and which are connected to the energy supply network and where energy metering devices are installed.  In the case of the construction of new energy supply networks, advance contracts for the purchase and sale of energy shall not be subject to the requirements of this paragraph. In cases set out by legal acts, an energy sales contract may be concluded with a subscriber also where there is no direct accounting of the above energy resources between the energy supplier and subscriber.


3. An energy sales contract shall be a public contract (Article 6.161 of this Code).


4. Where an energy sales contract is a consumer contract, the provisions of this Code regulating consumer contracts and consumer sales contracts shall apply mutatis mutandis to an energy sales contract.

 


Article 6.384. Conclusion and extension of an energy sales contract


1. Where under the contract the subscriber is a natural person who uses energy for domestic consumption, the contract shall be deemed concluded from the moment the consumer’s equipment is connected to the energy transmission network. The contract shall be considered concluded for the term of unlimited duration, unless the contract provides otherwise.


2. If, before the expiration of the term of the contract, neither of the parties declares that the contract will be terminated or modified or that a new contract will be concluded, the energy sales contract concluded for a term of limited duration shall be deemed extended for the same period and under the same conditions.


3. If, before the expiration of the contract’s term of limited duration, one of the parties to the contract proposes to conclude a new contract, pending the conclusion of the new contract, the conditions of the previous contract shall apply to the relations between the parties.


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Article 6.385. Energy amount and rates (tariffs)


1. The energy supply enterprise must sell to the subscriber the amount of energy provided for in the contract in compliance with the energy supply regime agreed between the parties. The amount of the energy supplied and consumed shall be determined on the basis of energy meter readings or in any other manner specified in the contract.


2. The contract may provide for the subscriber’s right to change the amount of energy received provided that the subscriber would compensate for the losses incurred by the energy enterprise due to the requirement to ensure the supply of a larger amount of energy not provided for in the contract.   


3. The subscriber, in the case of a natural person who is a consumer using energy for domestic consumption, may use as much energy as he needs. 


4. Energy rates (tariffs) shall be fixed in accordance with the procedure established by law.

 


Article 6.386. Energy quality


1. Energy quality must conform to the standards of the contract and quality standards as well as to the requirements established by other regulations.


2. If the energy supply enterprise violates the energy quality requirements, the subscriber shall be entitled to refuse to pay for the energy. However, the energy supply enterprise in this case shall be entitled to request that the subscriber compensate for the value of what the subscriber saved without a legal justification by using energy.


3. The subscriber shall be entitled to compensation of damages incurred by him due to the supply of energy of inadequate quality.

 


Article 6.387. Buyer’s duties relating to the maintenance of installations


1. The subscriber must ensure the adequate condition of the energy supply network, other facilities and installations owned by him and safety of their operation, also comply with the established energy consumption regime and notify the energy supply enterprise without delay of any accident, fire, damage of energy metering equipment or any other violations related to the use of energy.


2. In the case of a natural person who is a consumer using energy for domestic consumption, the adequate technical condition and safe operation of the energy supply network, energy metering equipment and their safe use must be ensured by the energy supply enterprise, unless otherwise provided for by the contract or laws.

 


Article 6.388. Payment for energy


1. The subscriber shall pay for the amount of energy actually used according to the readings of the energy meters, unless the contract establishes otherwise.


2. Unless legal acts provide otherwise, payment procedure shall be established by agreement between the parties.


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Article 6.389. Sub-subscriber


1. The subscriber may, without exceeding the capacity permitted for use, transmit to another person (sub-subscriber) electricity received from the energy supply enterprise without the latter’s consent.


2. The subscriber may transmit heat, cold and hot water to another person (sub-subscriber) only provided the supply enterprise gives its consent thereto.


3. In the cases provided for in paragraphs 1 and 2 of this Article, the subscriber shall remain liable to the energy supply enterprise under the energy sales contract.

 


Article 6.390. Modification and rescission of the contract


1. If under the energy sales contract the subscriber is a natural person who is a consumer using energy for domestic consumption, he shall be entitled to unilateral rescission of the contract notifying the energy supply enterprise thereof, provided that he has fully paid for the energy consumed. The consumer residing in a multi-apartment house may exercise this right only if such an act will not be detrimental to the residents of other apartments in that house.


2. If the subscriber is a legal person, the energy supply enterprise shall be entitled to unilaterally refuse to perform the contract on the grounds provided for in Article 6.217 of this Code unless the contract provides otherwise.


3. Termination, suspension or limitation of energy supply shall only be allowed by agreement between the parties, except in cases where state energy supervisory authorities identify such deficiencies in the subscriber’s installations which may cause an accident or endanger human life and safety.   The energy supply enterprise must notify the subscriber in advance of the termination, suspension or limitation of energy supply.


4. Termination, suspension or limitation of energy supply without coordination with the subscriber or without prior notice to the subscriber shall be allowed only in cases when this is necessary in order to prevent an accident or as a response to an accident in the energy supply network. However, in such cases, the subscriber must also be promptly notified of the termination, suspension or limitation of energy supply.


5. Termination of electricity and heat, hot water and gas supply to multi-apartment dwellings due to arrears in payment of individual apartment owners/tenants for the electricity, gas and water consumed shall be prohibited.

 


Article 6.391. Scope of application

The provisions of this Article shall apply with respect to supply of electricity, heat energy, gas, oil and oil products, water and other forms of energy through the distribution network, unless the laws establish otherwise or unless, taking into account the essence of the obligation, a different conclusion should be made.

 


SECTION EIGHT

CONTRACTS FOR THE SALE OF AN IMMOVABLE THING


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SECTION EIGHT

CONTRACTS FOR THE SALE OF AN IMMOVABLE THING

 


Article 6.392. Scope of application


1. The provisions of this Section shall apply with respect to the purchase and sale of land, buildings, residential houses, apartments, and other immovable things.


2. The provisions of this Section shall apply to the purchase and sale of enterprises to the extent that the provisions of Section Nine of this Chapter (Articles 6.402 to 6.410 of this Code) do not establish otherwise.

 


Article 6.393. Form of a contract


1. A sales contract of an immovable thing must be in a notarial form, with the exception of the sales contracts of an immovable thing concluded in the course of bankruptcy proceedings.


2. Non-compliance with the requirements of the form shall render the contract null and void.


3. A sales contract of an immovable thing may be invoked against third persons only in the event of it being registered in the public register in accordance with the procedure established by laws.


4. Ownership of an immovable thing shall pass to the buyer from the moment of delivery of the thing. The fact must be registered in the document executed in accordance with the procedure established in Article 6.398 of this Code. If any of the parties avoids registering the fact of passing of ownership of an immovable thing, the court may, at the request of the other party, adopt a decision on the registration of the contract. In such case, the contract shall be registered on the basis of the court decision. The party who has unjustifiably avoided registering the passing of ownership right must compensate the other party for the damages incurred by reason thereof.


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Article 6.394. Rights to a land plot


1. Under the sales contract of a building, installation or other immovable thing, the seller shall transfer to the buyer, together with the right of ownership to the thing, the rights specified in paragraphs 2 and 3 of this Article to the part of the land plot which is occupied by the thing and which is necessary for the thing to be fit for the purpose it would ordinarily be used.


2. Where the seller is the owner of the land plot on which the immovable thing being sold is situated, the buyer shall be transferred the rights of ownership to the land plot or the right of land lease or right of superficies, depending on what is provided for in the contract. A contract in which the buyer’s rights to the land plot are not contemplated may not be certified by a notary and, if certified, shall be null and void.


3. Where the owner of the immovable thing is not the owner of the land plot on which the thing is situated, he may sell the immovable thing without the consent of the owner of the land plot only provided that this is in compliance with the conditions of use of the land plot laid down by laws and/or the contract. In the event of sale of such an immovable thing, the buyer shall acquire the right to use the appropriate part of the land plot under the same terms and conditions as the seller of the immovable thing.

 


Article 6.395. Rights to an immovable thing in the event of sale of a land plot


1. In the event of sale of a land plot containing buildings, construction works, installations, plantations or other objects, the issue of passing of the right of ownership thereto must be contemplated in the contract.    If the issue is not contemplated in the contract, the right of ownership to the buildings, construction works, installations, plantations or other objects situated on the land plot shall be deemed to have passed to the buyer of the land plot.


2. If the land plot containing buildings or other immovable things belonging to the seller by the right of ownership is sold without transferring to the buyer the rights of ownership to the above-mentioned immovable thing, the seller shall retain the right to use the part of the land plot which is occupied by the immovable thing and is necessary for the use thereof by the right of superficies or any other right and under the terms and conditions provided for in the contract.


3. Where the seller’s right to use a part of the land plot and the conditions of use are not contemplated in the sales contract, the servitude shall be established for the seller with respect to the part of the land plot which is occupied by an immovable thing and which is necessary for it to be used for the purpose it would ordinarily be used.


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Article 6.396. Subject matter of the contract


1. The sales contract of an immovable thing must contain the information relating to the immovable thing which the seller is obliged to transfer to the buyer under the contract, also the indication of the location of the thing in the relevant land plot or the location of the immovable thing being sold in another immovable thing.


2. If the information specified in paragraph 1 of this Article is not presented in the contract, the contract may not be certified by a notary and, if certified, shall be null and void.

 


Article 6.397. Price


1. The price of the immovable thing being sold must be indicated in the sales contract of the immovable thing. The regulations set forth in paragraphs 2 to 6 of Article 6.313 of this Code shall not apply to sales contracts of the immovable thing. If the price is not indicated in the contract, the contract shall be deemed not to have been concluded.


2. The price of the land plot being sold shall include the price of the buildings, construction works, installations, plantations and other objects located on the plot, unless the laws and contract provide otherwise.


3. Where only the price of the area or any other measurement unit of the thing is indicated in the sales contract of an immovable thing, the price of the entire thing shall be determined according to the size of the immovable thing actually transferred to the buyer.

 


Article 6.398. Transfer of a thing


1. Transfer and acceptance of an immovable thing must be executed by the transfer and acceptance deed or any other document provided for in the contract, signed by the seller and buyer.


2. Unless otherwise provided for by the laws or contract, the seller’s obligation to transfer the immovable thing shall be deemed performed from the moment of transfer of the thing to the buyer and signing of the relevant document regarding the transfer thereof.


3. Where one of the parties to the contract avoids signing the document of transfer specified in the contract, it shall be deemed that the buyer refuses to accept and the seller refuses to transfer the thing.


4. The circumstance that the buyer has accepted an immovable thing which does not conform with the terms and conditions of the sales contract shall not constitute grounds for releasing the seller from liability for improper performance of the contract even in the cases where such non-conformity was contemplated in the document of transfer of the thing.

 


Article 6.399. Transfer of a thing of inadequate quality

Where, under the sales contract of an immovable thing, the seller transfers to the buyer a thing of inadequate quality, the provisions of Article 6.334 of this Code shall apply, except with respect to the buyer’s right to request replacement of the thing of inadequate quality with a thing of adequate quality.


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Article 6.400. Conditions and content of sales contracts of a residential house or apartment

In addition to the conditions provided for in Articles 6.396 and 6.397 of this Code, the essential condition of the sales contract of a residential house or apartment, which at the moment of its sale is inhabited by the persons who, under laws or contracts, retain the right to use the residential premises after the change of owner thereof, shall be the listing (list) of such persons and the content of their right to use the residential premises which are being sold.


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Article 6.401. Contract for the sale of a planned residential house or apartment


1. The buyer, being a natural person, may conclude a preliminary sales contract of a planned residential house or apartment whereby the seller, being a legal person, undertakes, by itself or upon enlisting the help of other persons, to build the residential house or apartment provided for in the preliminary contract and thereafter to conclude a sales contract of the residential house or apartment with the buyer, whereas the buyer undertakes to purchase the built residential house or apartment for the price indicated in the preliminary contract.


2. The following must be indicated in the preliminary contract:


1) the buyer’s right to repudiate the preliminary contract within ten days from the date of conclusion of the contract;


2) the price of the planned residential house or apartment and the terms and conditions of its revision or changing;


3) the description of the subject matter of the contract and the works to be  performed by the seller;


4) the time limits for the construction of the residential house or apartment;


5) encumbrances of the right to the residential house or apartment (both existing and future);


6) the contractor, architect, engineer and other persons who will carry out and supervise the construction work;


7) the legal status of the land plot on which the house or apartment will be built and the rights to the land plot of the buyer of the residential house or apartment.


3. Where the preliminary contract provides for the seller’s right to claim indemnity from the buyer for the losses the seller would suffer if the buyer exercised the right specified in point 1 of paragraph 2 of this Article, the amount of indemnity may not exceed one-fifth of the price of the immovable thing indicated in the sales contract.


4. The project of the residential house or apartment, its estimate and other documents shall constitute an inseparable part of the preliminary contract.


5. It may also be stipulated in the preliminary contract that the buyer finances the construction of the residential house or apartment under the conditions laid down in the contract whereas the seller shall perform the functions of the customer. In this case, the buyer shall acquire the right of full ownership of the residential house or apartment upon payment of the full construction price provided for in the preliminary contract.


6. Unless otherwise provided for in the preliminary contract, one party to the preliminary contract may mortgage the planned residential house or apartment only in case the other party gives its written consent thereto.

 


SECTION NINE

PURCHASE AND SALE OF AN ENTERPRISE


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SECTION NINE

PURCHASE AND SALE OF AN ENTERPRISE

 


Article 6.402. Concept of a contract for the sale of an enterprise


1. Under a contract for the the sale of an enterprise, the seller shall undertake to transfer to the buyer by the right of ownership the whole enterprise as a property complex or a substantial part of the enterprise, with the exception of the rights and duties which the seller has no right to transfer to other persons, while the buyer shall undertake to accept it and pay the price.


2. The right to the name of the firm, trade name or service name or to other marks identifying the seller or his goods or services supplied by him, also to the rights possessed by the seller under the licence agreement shall pass to the buyer, unless otherwise provided for in the contract.


3. The seller’s rights which he acquired under authorisations/licences shall be transferred to the buyer only provided the possibility of such transfer has been stipulated by the laws or the licence. The transfer to the buyer alongside with the enterprise of obligations which he cannot perform since he does not have the authorisation/licence for the performance of such obligations shall not release the seller from liability to creditors for non-performance of such obligations. In such cases, the seller and the buyer shall be jointly liable to creditors for non-performance of the obligations.

 


Article 6.403. Form of a contract


1. A contract for the sale of an enterprise must be a document in writing, signed by both parties to the contract, certified by a notary and containing the accompanying documents specified in Article 6.404 of this Code.


2. Non-compliance with the requirements as to the form of the contract shall render the contract null and void.


3. A contract for the sale of an enterprise may be invoked against third parties only provided it has been registered in the public register in the manner established by law and relevant amendments have been made in the Register of Legal Entities.


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Article 6.404. Content of the contract and the accompanying documents


1. The contract must specify the composition of assets of the enterprise being sold and the price of the enterprise as well as the person to whom the payment will be made and who will settle with the creditors of the enterprise (Article 6.405 of this Code).


2. In order to fulfil the duty specified in paragraph 1 of Article 6.405 of this Code, the following accompanying documents must be drawn up, agreed between the parties and signed before the signing of the contract:


1) the deed of inventory of the enterprise assets;


2) the balance sheet of the enterprise;


3) the opinion of an independent auditor regarding the composition and price of the assets of the enterprise;


4) the list of debts (obligations) of the enterprise, specifying the amount of the debt, time limits for performance and kinds of security of the obligations, creditors and their addresses.


3. The assets, rights and duties specified in the documents provided for in paragraph 2 of this Article shall be transferred to the buyer, save for the exceptions indicated in the contract and Article 6.402 of this Code.


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Article 6.405. Protection of rights of creditors of the enterprise


1. The buyer must not later than twenty days before the conclusion of the contract notify in writing all creditors of the enterprise named in the list of enterprise debts (obligations) of the intended sale of the enterprise. In the event of failure by the buyer to fulfil the above duty, the seller’s creditors shall have the right to submit their claims directly to the buyer. It shall not be necessary to notify the creditors of the enterprise of the sale thereof only if the price of the enterprise is paid in cash and the amount thereof is sufficient to settle with all creditors of the enterprise.


2. Having received the notification specified in paragraph 1 of this Article, the creditor of the enterprise must within twenty days from the date of receipt thereof notify the buyer in writing of the share and nature of his claim.


3. The buyer shall pay part of the price provided for in the contract to the person specified in the contract, who shall be charged with settling with the creditors of the enterprise, while the remaining amount shall be paid to the seller. Only a bank, other credit institution or insurance company may be chosen by the parties as the person to be charged with settling with the creditors.


4. The person charged with settling with the creditors of the enterprise shall, within twenty days from the payment of the price, draw up and send to the creditors the deed of price distribution for the settlement of debts of the enterprise that is being sold.


5. Unless the creditors contest the deed of price distribution, they shall be paid the share of the price proportionate to the amount of their claims.


6. In the event the creditor(s) file objections to the deed of price distribution within twenty days from the receipt of the deed of price distribution, the person to whom the price has been paid must apply to the court for the determination of the priority of creditors and procedure of satisfaction of claims.


7. The buyer shall not have to comply with the procedure laid down in this Article if he presents to all creditors of the enterprise an acceptable security for the satisfaction of claims. If the buyer has duly performed his duties specified in this Article, the creditors of the enterprise shall lose the right to assert any claims against him or the assets of the sold enterprise, however, they shall retain the right to address their claims to the seller.


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Article 6.406. Legal consequences of violation of right of the enterprise creditors


1. In case of improper performance by the buyer of the duties laid down in Article 6.405 of this Code, the fact of sale of the enterprise may not be set up against the creditors of the enterprise whose right of claim arose before the conclusion of the contract for the sale of the enterprise, unless the buyer satisfies the creditors’ claims by paying for the value of assets of the purchased enterprise.


2. The claims of creditors provided for in paragraph 1 of this Article may be satisfied if submitted within one year from the day on which they became aware or ought to have become aware of the sale of the enterprise and provided that not more than three years have elapsed from the date of sale of the enterprise.


3. The seller and buyer of the enterprise shall be jointly and severally liable for the actions of the person to whom the price was paid and who had to settle with the creditors, however, the buyer shall only be liable to the extent of the value of the assets of the enterprise purchased by him.


4. The creditors of the enterprise whose claims were secured by pledge (mortgage) and who were excluded from the distribution of the price or whose claims were not satisfied in full shall retain their rights in any case.

 


Article 6.407. Transfer of the enterprise


1. The seller shall transfer the enterprise to the buyer under the deed of transfer and acceptance. The deed must contain the information relating to the enterprise and its assets, the condition of the assets, obligations of the parties to the creditors of the enterprise and the performance thereof.


2. Unless the contract provides otherwise, the seller must prepare the enterprise for sale and draw up the deed of transfer and acceptance at his own expense.


3. The enterprise shall be deemed transferred to the buyer from the moment the deed of transfer and acceptance is signed by both parties.


4. The risk of accidental perishing of or damage to the assets of the enterprise shall pass to the buyer from the moment of signing of the deed of transfer and acceptance of the enterprise.


5. Where the contract provides that the seller retains the right of ownership to the enterprise until the buyer pays the full amount of the price or until he fulfils other conditions, the buyer shall be entitled, until ownership of the enterprise passes to him, to use the assets of the enterprise and the incidental rights to the extent and in the manner that is required for the purpose for which the enterprise was acquired.


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Article 6.408. Legal consequences of sale of a defective enterprise


1. In case the seller is transferred an enterprise which does not conform to the quality and other requirements contemplated in the contract, the buyer may exercise the rights provided for in Articles 6.321 to 6.323, 6.330, 6.334, 6.341, unless otherwise provided for in paragraphs 2 to 4 of this Article or in the contract.


2. Where the enterprise is transferred and accepted under the transfer and acceptance deed in which the defects of the enterprise or its assets are specified, the buyer shall be entitled to demand a reduction in the price if, under the contract, he is not entitled to present any other demands in such a case.


3. The buyer shall be entitled to demand a reduction in the price if he has been assigned the seller’s debts (obligations) not specified in the contract or the enterprise transfer and acceptance deed, except in cases where the seller proves that the buyer was aware or ought to have been aware of the debts (obligations) at the moment of conclusion of the contract and transfer of the enterprise.


4. If the seller receives the buyer’s notification of discovery of defects of the transferred assets or of the fact that certain assets provided for in the contract are altogether missing, the seller shall have the right to promptly replace the assets of inadequate quality with assets of adequate quality or to offer to the buyer the missing assets.


5. Where the defects of the enterprise for which the seller is liable render the enterprise unfit for the use indicated in the contract and the defects cannot be eliminated or the seller has not eliminated them within the fixed lime limit, the buyer shall have the right to apply to the court for the dissolution or modification of the contract and compensation for the damage.

 


Article 6.409. Legal effects of nullity of transactions and dissolution or modification of a contract

For a contract for the sale of an enterprise, the legal effects of nullity of transactions and modification or dissolution of a contract provided for in this Code shall arise only provided this does not essentially violate the rights of the seller’s and buyer’s creditors and their interests protected under law and is not contrary to public order.

 


Article 6.410. Cases in which the provisions of this Section do not apply


1. The provisions of this Section governing the purchase and sale of an enterprise shall not apply in cases where the pledged assets of the enterprise are sold, as well as when the assets of the enterprise are sold by a bailiff.


2. The provisions of this Chapter regulating the purchase and sale of an enterprise shall apply in the course of bankruptcy proceedings to the extent that the law regulating the insolvency of legal persons does not provide otherwise.

 

 


SECTION TEN

SALE BY INSTALMENT


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SECTION TEN

SALE BY INSTALMENT

 


Article 6.411. Contract of sale by instalment


1. Under a contract of sale by instalment (credit), the seller shall retain the right of ownership to the thing which is being sold until the payment of the full sale price set in the contract, unless the contract provides otherwise.


2. A reservation of ownership in respect of the thing which is not subject to registration, acquired for the service or operation of an enterprise, may be used against third persons only if the sales contract has been registered in the public register in accordance with the procedure prescribed by law.

 


Article 6.412. Risk of accidental perishing of or damage to the things

The risk of accidental perishing of or damage to the things transferred to the buyer shall be borne by the buyer, except in consumer contracts, unless otherwise provided for by the contract of sale by instalment.

 


Article 6.413. Form and content of a contract


1. A contract of sale by instalment must be in writing.


2. The price of the thing and the amount of regular instalments, the schedule of payment of regular instalments and settlement procedure must be specified in the contract.


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Article 6.414. Price and settlement procedure


1. The price of the thing and the procedure for effecting settlement in the sale thereof under an instalment contract shall be established by agreement between the parties. Unless the parties establish otherwise in the contract, subsequent change in the price of the thing sold by instalment shall not affect mutual settlement between the parties. Where, in case of a reservation of ownership right to the property, the buyer fails to comply with the schedule of payment of regular instalments laid down in the contract, the seller may demand immediate payment of the instalments due or take back the sold thing. Unless otherwise provided for in the contract, the buyer shall have the right to demand refunding his instalments from the seller who has taken back the thing. If the buyer has paid more than half or the price of the thing, the seller shall have no right to take back the thing, unless the contract provides otherwise. The costs of depreciation and use of the thing provided for in the contract shall be deducted from the repayable instalments.


2. Where the right of ownership passes to the buyer from the moment of delivery of the thing, it shall be considered, from the moment of delivery of the thing to the buyer until the payment of the full price, that the thing has been pledged to the seller seeking to secure performance of obligations by the buyer (compulsory pledge (mortgage), unless the contract provides otherwise.


3. Where the buyer without having obtained the seller’s consent transfers to another person the things delivered to him or the things are seized due to unlawful actions of the buyer, the seller shall have the right to demand immediate payment of the balance of the sale price due.


4. If the contract of sale by instalment has been registered, the seller, having taken the things back, must within twenty days or within sixty days, where the subject matter of the contract is an immovable thing, cancel the registration of the contract in accordance with the procedure established by law.

 


Article 6.415. Interest

The contract of sale by instalment may provide for the obligation of the buyer to pay interest in case of his default on the timely payment of regular instalments. In this case, the period for which the interest is payable shall run from the day of lapse of the time limit until the payment of instalments.

 


Article 6.416. Specifics of sale by instalment where the buyer is a consumer

The provisions of this Code regulating consumer contracts shall apply to the contracts of sale by instalment where they are consumer contracts.

 


CHAPTER ELEVEN

SALE WITH A RIGHT OF REDEMPTION


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CHAPTER ELEVEN

SALE WITH A RIGHT OF REDEMPTION

 


Article 6.417. Contract of sale with a right of redemption


1. Under a sales contract with a right for redemption, the seller shall undertake to sell the thing at the same time reserving the right to redeem the sold thing, whereas the buyer shall undertake to possess, use and dispose of the thing in such a way as to allow the seller to exercise the right of redemption.


2. A sales contract with a right of redemption in respect of the things which are not subject to registration, acquired for the service or operation of an enterprise, may be used against third persons only if it has been registered in the public register in accordance with the procedure established by law.


3. The seller shall have the right of redemption for a maximum term of five years. In case the contract provides for a longer term of the above right, it shall be reduced to five years.

 


Article 6.418. Exercise of the right of redemption


1. The seller wishing to exercise his right of redemption must give notice of his intention to the buyer or any other person against whom he intends to exercise this right. Such notice must be published not later than twenty days before the date of exercise of the right of redemption if the thing is movable and not later than before sixty days if the thing is immovable. In case the contract has been registered, notice of the intention to exercise the right of redemption must also be given to the data processor of the public register.


2. Where the seller exercises his right of redemption, he shall take back his thing free of any charges or encumbrances, or additional contributions or compensation to the buyer provided the notice of the intention to exercise the right of redemption was published in accordance with the procedure laid down in this Law.


3. If the buyer of an undivided part of a thing which is subject to a right of redemption acquires the remaining part of the undivided thing, he may require the seller, exercising his right of redemption, to buy the rest of the thing acquired by the buyer.


4. Where the thing is sold by several sellers jointly by way of a single contract, and they wish to redeem the thing or where several heirs left by the seller wish to exercise the right to redeem the thing, the buyer shall be entitled to require one seller or heir to buy back not only his share but also the whole thing.


5. Where it is provided for in the contract that the right of redemption is the security of a loan, the seller shall be treated as a borrower (receiver of the loan) and the buyer shall be treated as a mortgagee.


6. The specifics of purchase and sale of securities with the right of redemption shall be established by separate laws.


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SECTION TWELVE

AUCTION SALES

 


Article 6.419. Sale of things by auction


1. Sale of things by auction shall mean that things are offered for sale to several persons through an intermediary – the auctioneer, and the contract is deemed concluded with the buyer – the bidder of the highest price for the thing offered for sale.


2. A public auction shall be a method of sale where the things or services are offered for sale to several persons who participate in the auction personally or who are enabled to participate personally and who are publicly competing by bidding through the auctioneer, while the contract for the purchase of the things or services is concluded with the bidder offering the highest price.


3. An auction sale may be either voluntary or forced. The peculiarities of an action as a forced sale shall be determined by the Code of Civil Procedure.


4. The regulations laid down in this Section shall apply to the purchase and sale by auction of things owned by the State and municipalities to the extent it is not provided otherwise by other laws.


5. Where, after the auction, the contract is concluded between the trader and the consumer, the rules governing consumer contracts shall apply to the contract, unless other laws provide otherwise. Where a contract is concluded by way of a public auction, the information specified in points 2 and 3 of Article 6.2287 of this Code may be furnished about the auctioneer.


6. Where, following a public auction in respect of second-hand goods, a contract is concluded between the trader and the consumer, clear and comprehensive information must be easily accessible to the consumer that the contract is not subject to the provisions of this Code governing the specifics of consumer sales contracts.

 

 


Article 6.420. Price and conditions of the auction


1. The seller may fix the initial price of the thing offered for sale and any other conditions of the auction. However, unannounced conditions of the auction may not be set up against the bidders, unless the auctioneer has announced the conditions to the bidders before receiving the bids.


2. The seller shall have the right not to disclose his identity, but if his identity is not disclosed to the successful bidder, the auctioneer shall be liable for all the obligations of the seller to the successful bidder.


3. The bidder shall have no right to withdraw his bid.


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Article 6.421. Moment of conclusion of the contract


1. The sales contract by auction shall be deemed concluded when the auctioneer announces this by the fall of his hammer or any other customary action. If, at the moment when the completion of the auction sale of the thing is announced by the fall of the auctioneer’s hammer, a new bid is received, the auctioneer shall have the right to extend the auction or declare the thing sold for the last price bid before the fall of the hammer.


2. The entry in the auctioneer’s register of the bid and the name of the successful bidder shall constitute proof of the conclusion of the contract.  In the absence of such an entry, the fact of the conclusion of the contract may be proved on the basis of the testimony of witnesses.


3. In case an immovable thing is sold at the auction, the seller and the buyer must conclude a contract in the form prescribed by law within ten days of the sale.


4. Where an enterprise is sold at the auction, the requirements laid down in Articles 6.403 to 6.407 of this Code must also be complied with.

 


Article 6.422. Payment of the price


1. The buyer must pay the price in accordance with the procedure and within the time limits prescribed by the conditions of the auction.


2. If the buyer does not pay the price in compliance with the established procedure and within the set time limits, the auctioneer shall be entitled to exercise all the rights of the seller. Moreover, the auctioneer shall have an additional right to announce, after notifying the buyer within a reasonable time, that he is holding a new auction for the resale of the thing. In such event, a false bidder shall not be entitled to bid again at a new auction. He shall be bound to cover the auctioneer’s expenses incidental to arranging and holding a new auction and also pay the difference in prices if the thing was resold at a lesser price than the price the false bidder did not pay.

 


Article 6.423. Withdrawing the thing from auction

If the auctioneer has invited to make bids, the thing for the sale whereof auction sale has been announced may not be withdrawn, except in cases where no bid has been received within a reasonable time. In a special auction, the thing for the sale whereof the auction has been announced may be withdrawn at any time.


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Article 6.424. Protection of the buyer’s rights

When a thing, which the buyer has purchased by auction, is arrested in compliance with requirements of the creditors of the seller, the buyer shall be entitled to withdraw from the contract and to request that the seller refund to him the paid amount and compensate for the damage incurred, provided that the buyer was neither aware nor could have been aware of the creditors’ claims regarding the property.

 


SECTION THIRTEEN

PURCHASE AND SALE OF RIGHTS

 


Article 6.425. Contracts for the purchase and sale of rights

The provisions of this Chapter shall apply to contracts for the purchase and sale of rights to the extent this is not contrary to the nature and essence of the rights.

 


Article 6.426. Sale of rights of succession


1. A person who, upon accepting the property received by succession, sells rights of succession without specifying in detail the property affected shall be bound to warrant to the buyer only his quality as an heir.


2. The seller shall be bound to hand over to the buyer all the fruits and revenues he has received from the succession together with the capital of any claim due and the price of any things he has sold which formed part of the succession.


3. The buyer shall be bound to reimburse the seller for the expenses incidental to accepting the succession and pay the amounts due to the seller from the succession.


4. The buyer shall be bound to reimburse the seller for the debts of the succession that he has paid.


5. The buyer shall also be bound to pay the debts of the succession for which the seller is liable.

 


Article 6.427. Sale of litigious rights


1. A right shall be litigious when it is contested by a person bringing an action or there is reason to presume that such an action maybe brought.


2. No advocate, judge, notary or bailiff or their family members or close relatives shall have the right to acquire contested litigious rights. Contracts, concluded by the above persons for the purchase and sale of litigious rights shall be null and void.


3. Where litigious rights are sold, the person from whom they are claimed shall be fully discharged by paying to the buyer the sale price, the costs related to the sale and interest on the price. This right of redemption may not be exercised where the sale is made to a creditor in payment of what is due to him or to a co-heir or co-owner of the rights sold. Nor may the right of redemption be exercised where a court has rendered a judgment affirming the right sold.

 


SECTION FOURTEEN

PECULIARITIES OF CONCLUSION OF OTHER SALES CONTRACTS


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SECTION FOURTEEN

PECULIARITIES OF CONCLUSION OF OTHER SALES CONTRACTS

 


Article 6.428. Sales contracts of securities and currency

Peculiarities of conclusion of sales contracts of securities and currency shall be established by separate laws.

 


Article 6.429. Conclusion of a sales contract by way of a tender


1. A sales contract shall be concluded by way of a tender by the seller with the buyer determined by the tender commission in accordance with the conditions of the tender.


2. Conclusion of a sales contract by way of a tender shall be regulated by this Code and the regulations of the tender. The regulations shall be approved by the organiser of the tender or any other authorised person.

 


Article 6.430. Conclusion of sales contracts on the exchange


1. Conclusion of sales contracts on commodity or stock exchanges shall be regulated by the laws determining the activities of the exchange and the rules for trading on the exchange.


2. The general rules of conclusion of sales contracts provided for in this Chapter shall apply to sales contracts concluded on commodity or stock exchanges to the extent that they are in conformity with the laws regulating the activities of the exchange or the essence of the contract.

 


Article 6.431. Sales contract with a reservation regarding the right of ownership


1. Under the sales contract with a reservation regarding the right of ownership, the seller shall retain the right of ownership to the thing being sold until the performance by the buyer of the obligations provided for in the contract.


2. Under a sales contract with a reservation regarding the right of ownership, the buyer shall have no right of disposal of the thing being sold until he fulfils the conditions specified in the contract.

 


Article 64311. Sales contract of a motor vehicle

The sales contract of a motor vehicle must contain the data about the motor vehicle which the seller is bound to transfer to the buyer under the contract. In the sales contract, the seller must indicate (declare) the mileage data to the buyer and inform the buyer of all traffic or other accidents that have caused damage to the motor vehicle during the seller’s ownership of the motor vehicle and of all traffic or other accidents that have caused damage to the motor vehicle as far as the seller is aware of. The list of mandatory particulars about a motor vehicle and its defects to be indicated in the sales contract shall be approved by the Government or an institution authorised by it.

 


CHAPTER XXIV

EXCHANGE


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CHAPTER XXIV

EXCHANGE

 


Article 6.432. Concept of a contract of exchange


1. Under a contract of exchange, each of the parties shall undertake to transfer to the ownership of the other party one thing in exchange for another.


2. The provisions governing sales contracts (Chapter XXIII of this Book) shall apply to the contract of exchange if this is not contrary to the provisions of this Chapter and the essence of exchange. Within the contract of exchange, each of the parties shall be deemed to be the seller of the goods being transferred and the buyer of the goods being accepted in exchange.

 


Article 6.433. Price and expenses of concluding a contract


1. Unless otherwise provided for by the contract of exchange, it shall be presumed that the goods subject to exchange are of equal value and exchanged without any extra payment, while the expenses for the transfer and acceptance thereof must be effectuated in each instance by that party which bears the respective duties.


2. Where the contract provides that the goods to be exchanged are not of equal value, the party obliged to transfer the goods whose price is lower than the price of the goods being transferred in exchange shall not be bound to pay the difference in price to the other party unless otherwise provided for by the contract.

 


Article 6.434. Performance of the obligation to transfer things

Both parties shall be bound to perform the obligation to transfer the respective things simultaneously unless otherwise provided for by the contract.

 


Article 6.435. Legal consequences for eviction of things acquired under a contract of exchange


1. In the event when a thing acquired by a party under a contract of exchange is evicted pursuant to the claim of a third person, this party shall have the right to claim from the other party either damages or recover the things transferred to the latter in exchange.


2. If a party, after having received the things transferred to him in exchange, becomes aware that the other party was not the owner of those things, he shall have the right to return the things received to the party who has transferred them. In this event, the other party (in bad faith) may not demand from the party who has returned the things to deliver the things the latter has promised in exchange.

 


CHAPTER XXV

GIVING IN PAYMENT AND ALIENATION FOR RENT


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CHAPTER XXV

GIVING IN PAYMENT AND ALIENATION FOR RENT

 


Article 6.436. Concept of a contract of giving in payment


1. Under a contract of giving in payment, the debtor shall transfer his property which is not pledged to a creditor into the latter’s ownership in payment of his monetary or any other property debt.


2. A contract of giving in payment shall be governed by the rules pertaining to sales contracts. The person who transfers property according to the contract of giving in payment (debtor) shall assume all duties of the seller.


3. A contract of giving in payment shall be deemed to be concluded at the moment when the property is delivered to the creditor.

 


Article 6.437. Prohibition to agree on giving in payment in advance

The parties shall be prohibited from including a clause in the contract by which the creditor reserves an irrevocable right to become the owner of the property of the debtor or the right to dispose of it if the debtor fails to perform his obligation. Such contract clauses shall be null and void.

 


Article 6.438. Contract of alienation for rent


1. Under a contract of alienation for rent, the lessor shall transfer the ownership of an immovable thing to the lessee in exchange for a rent. The obligation to pay the rent shall rest on the lessee.


2. The rent shall be payable at the end of each year in money or in kind from the day on which the contract enters into force unless the contract provides otherwise.


3. The lessee (payer of rent) shall have the right to relinquish at any time periodical annual payments of rent by informing about this the lessor (recipient of rent) and offering instead to pay the capital value of the rent in a lump sum payment.  However, the lessee (payer of rent) may not transfer the obligation to pay the capital value of the rent in a lump sum payment to the insurer of the thing or to any other person.


4. The lessee shall be personally liable towards the lessor for the payment of rent. He shall not be discharged from the performance of his obligations upon relinquishing his ownership right in the immovable or due to its destruction by force majeure.


5. Any other relationships between the lessee and the lessor which are not established in this Article shall be regulated by the corresponding rules pertaining to sales contracts and to life annuities.

 


CHAPTER XXVI

RENT

 


SECTION ONE

GENERAL PROVISIONS


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CHAPTER XXVI

RENT

 


SECTION ONE

GENERAL PROVISIONS

 


Article 6.439. Concept of a contract of rent


1. Under a contract of rent, one party – the payer of rent (debtor) – shall undertake, gratuitously or in exchange for the capital transferred to his ownership, to perform periodical payments to the other party – the recipient of the rent – of a monetary amount determined in the contract (rent) or to grant maintenance to the recipient of the rent in any other form.


2. Duty to pay rent may be established not only by a contract but likewise by laws, a court judgment or a will. In such cases, payments of rent shall be correspondingly governed by the provisions of this Chapter.


3. It shall be presumed that a non-returnable loan constitutes a life annuity for the benefit of the lender.

 


Article 6.440. Capital transferable under a contract of rent


1. Under a contract of rent, the recipient of the rent may undertake to transfer to the ownership of the payer of rent a movable or immovable thing or a sum of money.


2. Where the transfer of an immovable thing for payment is provided for by a contract, such a contract shall constitute a sales contract for rent and shall be correspondingly governed by the provisions regulating a sales contract.


3. If the capital is a sum of money, it may be paid in a lump sum or by instalments.

 


Article 6.441. Contract of rent for the benefit of a third person

It may be provided under a contract of rent that the recipient of the rent shall be a third person, but not the person who transfers ownership of the capital for the benefit of the payer of rent.


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Article 6.442. Duration of a contract of rent


1. It may be provided under the contract of rent that a rent is constituted for the life of the recipient of rent (life annuity), in perpetuity (permanent rent) or for a fixed term.


2. Rent for life (life annuity) may be established as maintenance for life.


3. It may be stipulated in the contract that the payment of rent shall be continued after the death of the recipient of rent for the benefit of his heir or any other person.


4. A contract of rent set up for a deceased person or a person who dies within the following thirty days from the day when the contract was formed shall be null and void. The same rule shall apply also in the case where a rent is constituted for a person who does not exist on the day when the contract is formed unless the recipient of rent had already been conceived at that time and was born alive.


5. Where a life annuity is set up for the lifetime of several persons successively, it shall have effect only if the first of those persons existed on the day the contract was concluded or if he had already been conceived at that time and was born alive.


6.  In all cases, the duration of contract of rent may not exceed one hundred years from the date of conclusion of the contract of rent. 

 


Article 6.443. Form of a contract of rent


1. A contract of rent must be in the notarial form.


2. A contract of rent providing for the alienation of an immovable thing under payment of rent may be invoked against third persons only upon that contract being registered in the public register in accordance with the procedure established by laws.

 


Article 6.444. Encumbrance of rights in an immovable thing by rent


1. A rent shall be deemed to encumber the right in an immovable thing if this thing is transferred under the condition of payment thereof.  In the case of alienation of such thing by the payer of the rent, his obligations under the contract of rent shall pass to the acquirer of the thing.


2. The person who has transferred an immovable thing, the rights in which are encumbered by rent, to the ownership of another person shall be subsidiary liable with the new owner of the thing with regard to the claims of the recipient of the rent for violation of the contract of rent unless their solidary liability has been established by laws or the contract.


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Article 6.445. Security for payment of rent


1. When an immovable thing is transferred under condition of payment of rent, the recipient of the rent shall acquire the right of pledge on this immovable thing as security of the obligation of the payer of the rent (forced hypotheque).


2. If, under the contract of rent, a movable thing or a sum of money is transferred to the payer of rent, the essential condition of the contract of rent shall be the duty of the payer of rent to grant security for the performance of his obligation or to insure his civil liability for the failure to perform or improper performance of the contract of rent.


3. If the payer of rent fails to fulfil the duties provided for in paragraph 2 of this Article, likewise, in the event of loss or substantial deterioration, under the circumstances for which the recipient of rent is not liable, of the thing by which performance of obligations of the payer of rent is secured, the recipient of rent shall have the right to dissolve the contract and claim compensation of damages.

 


Article 6.446. Interest for delay of payment of rent

In the event of delay of the payment of rent, the payer of rent shall pay the interest established by laws or a contract to the recipient of rent.

 


Article 6.447. Protection of interests of a recipient of rent


1. The capital accumulated for the payment of rent shall not be subject to seizure on the ground of claims of the payer’s creditors and no exaction may be levied thereon. In the event of a dispute, the amount of non-seizable means shall be established by the court.


2. A stipulation to the effect that the rent is inalienable or that no exaction may be levied thereon shall be without effect unless the rent is paid gratuitously to the recipient as maintenance. In such event, the stipulation shall have effect only in respect of the amount of rent necessary to maintain the recipient.

 


Article 6.448. Substitution of a payer of rent


1. A payer of rent shall have the right to transfer his duty to pay rent to an insurance enterprise entitled to engage in such activity by paying it the value of the rent. In such event, the insurance enterprise shall acquire all rights and duties of the payer of rent.


2. The consent of the recipient of rent shall not be necessary for the substitution of the payer of rent provided for in paragraph 1 of this Article, however, the recipient of rent shall have the right to demand that the duty to pay rent be transferred to an insurance enterprise other than the one chosen by the payer of rent.

 


SECTION TWO

RENT IN PERPETUITY (PERMANENT RENT)


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SECTION TWO

RENT IN PERPETUITY (PERMANENT RENT)

 


Article 6.449. Recipient of rent in perpetuity (permanent rent)


1. Only natural persons or non-profit legal persons engaged in guardianship/curatorship may be recipients of rent in perpetuity (permanent rent) to the extent that this is not contrary to laws and the documents of their activities.


2. The rights of the recipient under a contract of rent in perpetuity (permanent rent) may be transferred by means of assignment of claim, or inheritance, or by reorganisation of the legal person unless otherwise provided for by laws or by the contract.

 


Article 6.450. Form and amount of rent in perpetuity (permanent rent)


1. Rent in perpetuity (permanent rent) shall be paid in money.  Its amount shall be established by the contract of rent.


2. It may be stipulated in the contract of rent in perpetuity (permanent rent) that the payment of rent may be effectuated by means of transferring things, carrying out works, or rendering services whose price corresponds to the value of the monetary amount of the rent.


3. Unless otherwise provided for by the contract, the amount of rent to be paid shall be indexed taking into account the minimum monthly wage established by legal acts.

 


Article 6.451. Periods of payment of rent in perpetuity (permanent rent)

Unless otherwise provided for by the contract of rent, the rent in perpetuity (permanent rent) shall be paid at the end of every month.

 


Article 6.452. Right of the payer of rent to purchase rent in perpetuity (permanent rent)


1. The payer of permanent rent shall have the right to refuse further payment of rent in perpetuity (permanent rent) by means of purchasing it.


2. The refusal to pay rent shall be valid only on condition that the recipient is notified by the payer of rent not later than three months prior to the termination of the payment of rent or within a longer period established by the contract.  Nevertheless, even in this event, the obligation to pay rent shall not terminate until the entire amount of the purchase is received by the recipient of the rent unless otherwise provided for by the contract. 


3. A clause of a contract of rent in perpetuity (permanent rent) upon the waiver of the payer’s right to purchase rent shall be null and void.


4. It may be provided for by a contract of rent that the right of purchase of rent in perpetuity (permanent rent) may not be effectuated during the life of the recipient of rent or during another period which cannot exceed thirty years from the day of concluding the contract of rent.


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Article 6.453. Purchase of rent in perpetuity (permanent rent) at the demand of the recipient of rent 

The recipient of rent in perpetuity (permanent rent) shall have the right to demand the purchase of rent by the payer thereof in the instances when:


1) the payer of rent fails to effectuate the payment within the set time limit by more than one year unless otherwise provided for by the contract;


2) the payer of the rent violates his obligation to secure the payment of rent (paragraph 2 of Article 6.445 of this Code);


3) the payer of rent is declared to be insolvent or other circumstances have arisen which clearly testify that the payer of the rent will not be able to pay the rent in the amount and within the time limits which have been established by the contract;


4) the immovable thing transferred under the contract of rent has become common ownership of several persons; 


5) in other cases established by the contract.

 


Article 6.454. Purchase price of rent in perpetuity (permanent rent)


1. The purchase of rent in perpetuity (permanent rent) shall be made at the price determined by the contract of rent.


2. If the price of the purchase of rent is not determined in the contract, the property which has been transferred for payment under the contract of rent in perpetuity (permanent rent) shall be purchased at the price corresponding to the yearly amount of the payable rent.


3. If the price of the purchase of rent is not determined in the contract, the property which has been transferred under payment of rent gratuitously shall be purchased at the price corresponding to the sum equal to the yearly amount of the payable rent and the value of the transferred property.

 


Article 6.455. Risk of accidental perishing or damage of property transferred under payment of rent in perpetuity (permanent rent)


1. The risk of accidental perishing or damage of property transferred gratuitously under payment of rent in perpetuity (permanent rent) shall be borne by the payer of rent.


2. In the event of accidental perishing or damaging of property transferred for payment under payment of rent in perpetuity (permanent rent), the payer of rent shall have the right to demand either termination of his obligation to pay the rent or a change of the conditions for the payment thereof.

 


SECTION THREE

RENT FOR LIFE


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SECTION THREE

RENT FOR LIFE 

 


Article 6.456. Recipient of rent for life


1. A rent for life may be paid to a natural person who has transferred property under the condition of payment of rent or to another natural person specified by him.


2. A rent for life may be paid to several natural persons. In this case, the participatory share of right to receive rent shall be equal unless otherwise provided for by the contract of rent.


3. In the case of death of one of the recipients of rent, his participatory share in the right to receive rent shall pass to the recipients of rent who survive him unless otherwise provided for by the contract of rent. The obligation to pay the rent shall terminate upon the death of the last recipient of rent. In the event of rent being constituted for the benefit of both spouses, on the death of either of the spouses the rent shall be reverted upon the life of the surviving spouse unless otherwise provided for by the contract of rent.


4. The contract of rent for life set up for the lifetime of a person who was dead at the moment of concluding the contract shall be null and void.

 


Article 6.457. Amount of rent for life


1. A rent for life shall be determined in the contract as a sum of money to be paid periodically to the recipient of rent during his life.


2. Rent for life shall be paid in sums and within periods stipulated in the contract. In the instances where the periods of the payment are not indicated in the contract, the rent must be paid every month by the first day of the following month.

 


Article 6.458. Dissolution of contract of rent for life at the demand of the recipient of rent


1. In the case of essential violation of a contract of rent for life by the payer of rent, the recipient of rent shall have the right to demand from the payer of rent the purchase of rent under the conditions provided for in Article 6.454 of this Code or dissolution of the contract and compensation of damages.


2. If an apartment, dwelling house or other property under payment of rent for life has been alienated gratuitously and the contract has been violated essentially by the payer of rent, the recipient of rent shall have the right to require a return of that property. In this case, the value of the property shall be set off against the purchase price of the rent.

 


Article 6.459. Risk of accidental perishing or accidental damaging of property transferred under payment of rent for life

Accidental perishing or accidental damaging of property transferred under payment of rent for life shall not relieve the payer of rent from the obligation to pay it under the conditions established in the contract.

 


SECTION FOUR

LIFE ANNUITY


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SECTION FOUR

LIFE ANNUITY

 


Article 6.460. Contract of life annuity


1. Under a contract of life annuity, the annuitant – a natural person – shall transfer a dwelling house, apartment, land plot or other immovable thing belonging to him to the ownership of the debtor of the annuity and the latter shall be obliged to maintain the annuitant and/or another person(s) specified by him for life.


2. The provisions of Section Three of this Chapter which regulate rent for life shall apply to a contract of life annuity unless otherwise provided for by this Section.

 


Article 6.461. Duty to grant life annuity


1. The duty of the debtor of the annuity to grant life annuity to the annuitant shall include providing him with a dwelling, clothes and other wear, alimentation and, where the state of health of the annuitant so requires, also providing care for him. The duty of the debtor of the annuity to pay the expenses of funeral services of the annuitant may also be provided for in the contract.


2. The value of the entire amount of annuity may be determined by the parties in the contract of life annuity.   In this case, the value of the total amount of maintenance per month may not be less than the amount of one minimum monthly wage. 


3. When deciding on the dispute between the parties concerning the content and amount of annuity, the court must be guided by the criteria of good faith, reasonableness and justice.

 


Article 6.462. Replacement of a life annuity by periodical payments

The possibility of replacing a life annuity in kind by the payment of periodical payments in money may be established by the parties in the contract. These periodical payments shall be paid during the life of the annuitant.

 


Article 6.463. Right of the debtor of the annuity to dispose and use alienated property


1. The debtor of the annuity may alienate, pledge or otherwise encumber the right in an immovable thing transferred to him in exchange for life annuity only upon prior written consent of the annuitant.  Such written consent must be confirmed by a notary.


2. The debtor of the annuity must take all necessary measures in order to prevent any decrease of the value of the thing transferred to him.


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Article 6.464. Termination of life annuity


1. The obligation of life annuity shall terminate with the death of the recipient of the annuity. 


2. In the event of essential violation by the debtor of the annuity of his obligations, the annuitant shall have the right to demand from the debtor of the annuity the return of the immovable thing transferred to him or the payment of the purchase price thereof under the conditions established in Article 6.454 of this Code. In this case, the debtor of the annuity shall have no right to demand compensation of the expenses related to the maintenance of the annuitant.

 


CHAPTER XXVII

GIFT

 


Article 6.465. Concept of a contract of gift


1. Under a contract of gift, one party (donor) transfers by gratuitous title property in ownership or a property right (claim) to another party (donee) or relieves the donee of a property duty to himself or to a third person.


2. A promise to gift property or a property right or to relieve someone of a property duty in the future shall not constitute a contract of gift. However, the beneficiary of the promise to be gifted in the future shall have the right to claim from the promisor damages incurred in preparing to accept the gift if the donor has refused to conclude the contract of gift without any justifiable grounds.


3. A contract of gift providing for the right of the donor to recover by his unilateral decision the gifted property or the property right shall be null and void.


4. Requirements in regard of a contract of gift whose parties are spouses shall be established by the provisions of Book Three of this Code.

 


Article 6.466. Transactions not deemed to be a gift


1. A contract providing for the transfer of a gift to the ownership of the donee after the death of the donor shall be null and void.  Relations of such kind shall be governed by the provisions regulating legal relationships of inheritance.


2. The donee’s unconditional renouncement of succession or a property right that he has not yet acquired shall not constitute a gift.


3. When between the parties to a contract of gift there exists a counter transfer of certain property or property rights or counter obligations, such contract shall not be deemed to be a gift. Legal consequences resulting from simulated transactions shall occur in such event. When one person transfers to another person property or a property right for remuneration, the contract of gift may be deemed to be constituted only for the part of the property or the property right in excess of the remuneration unless a different conclusion may result from the essence of the obligation concerned.


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Article 6.467. Contract of gift under condition


1. A person, in gifting the property, may establish a condition for the property to be used exclusively for a definite purpose without prejudice to the rights and legitimate interests of other persons.


2. In the event when the donee fails to comply with a condition established in the contract of gift, the donor shall have the right to demand, within judicial proceedings, the compliance with that condition or annulment of the contract of gift and return of the property.


3. A contract of gift providing for a duty of the donee to repay debts or perform other obligations which do not exist at the time of conclusion of the contract shall be null and void, except in cases where the future debt or obligation is clearly specified in the contract.

 


Article 6.468. Right of refusal of a donee to accept a gift


1. The donee shall have the right to refuse to accept the gift at any time before it is transferred to him.


2. If the contract of gift is made in the written form, the donor shall have the right to demand from the donee who has unreasonably refused to accept the gift compensation of damages caused by the refusal.

 


Article 6.469. Form of a contract of gift


1. A contract of gift of a sum of money exceeding one thousand five hundred euros must be concluded in the written form.


2. A contract of gift of immovable property likewise a contract of gift whose object exceeds fourteen thousand five hundred euros must be made in the form of a notarial act.


3. A contract of gift of a thing or a property right in it shall create legal consequences to the third persons only in the event if the contract is registered in the public register.


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Article 6.470. Capacity to make and receive gifts


1. A person legally incapable in this area may not act in the capacity of a donor. A person with limited legal capacity in this area may act in the capacity of a donor with the consent of the curator. Where the curator does not give his consent, the consent to act in the capacity of a donor may be granted by the court at the request of the person with limited legal capacity in this area. The consent of the curator shall not be required where the person with limited legal capacity in this area gives symbolic gifts, the value whereof does not exceed the amount of one base social benefit. It shall be prohibited for the guardian of a person legally incapable in this area to give the property of the latter as a gift in the name of the latter, except for giving symbolic gifts, the value whereof does not exceed the amount of one base social benefit.


2. Only the guardian of a person legally incapable in this area shall have the right to accept gifts made to the latter, except for symbolic gifts, the value whereof does not exceed the amount of one base social benefit. A person with limited legal capacity in this area shall have the right to accept gifts made to him with the consent of the curator. Where the curator does not give his consent, the consent to accept gifts may be granted by the court at the request of the person with limited legal capacity in this area. The consent of a curator shall not be required where a person with limited legal capacity in this area accepts symbolic gifts, the value whereof does not exceed the amount of one base social benefit.


3. A contract of gift shall be null and void where the donor is a person who does not own the gift or is not properly authorised to conclude such contract.


4. No longer effective from 14 July 2006.


5. A gift shall not be permitted to politicians, officials of state and municipal institutions, and other public servants, as well as to their close relatives where it is connected with the official position of the politician, official or public servant or with the performance of their official duties.


6. A contract of gift of property which does not exist at the time of conclusion of the contract likewise a contract of gift of property to be created in future shall be null and void.


7. A contract of gift may be annulled upon the action of the donor or his heirs if, at time when the contract of gift was concluded, the donor was terminally ill which rendered him incapable of expressing his true will.


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Article 6.471. Limitations to make a gift


1. The gift of property in joint common ownership shall be permitted exclusively upon the written consent of all participants in the joint common ownership.


2. The gift of property managed by the right of trust shall be permitted exclusively upon the written consent of the owner of the property unless otherwise provided for by laws or the contract.


3. The gift of the right of claim shall be effectuated in compliance with the rules established in Articles 6.101 to 6.104 and Article 6.107 of this Code.


4. A gift by means of the performance for the donee of his obligation to a third person or by acceptance of the debt of the donee to a third person shall be effectuated in compliance with the rules established in Articles 6.50, 6.115, 6.116, 6.118 and 6.119 of this Code.


5. A power of attorney to perform a gift in which the subject matter of the contract of gift is not specified and the donee is not named shall be null and void.

 


Article 6.472. Revocation of a gift


1. The donor shall have the right to start judicial proceedings with the action in revocation of a gift if the donee has committed an attempt on his life or the life of his close relatives, or has intentionally caused them serious bodily injury, also if, taking into consideration the nature of the gift, the personal qualities of the parties to the contract of gift and their interrelations, the donnee has committed against the donor such actions which are undoubtedly strictly reprehensible from the point of good morals.  In the event of the intentional deprivation of life of the donor made by the donnee, the heirs of the donor shall have the right to bring an action in revocation of a gift.


2. The donor shall also have the right to start judicial proceedings with the action in revocation of a gift if the treatment by the donee of the gifted property, which is of great non-pecuniary value to the donor, creates a real threat of its loss.


3. The revocation of a gift shall obligate the donnee to restore to the donor the property he has received under the contract of gift in accordance with the provisions of this Book pertaining to restitution if this property still exists at the moment of revocation of the gift.


4. The action in revocation on the grounds provided for in this Article may be brought by the donor or by his heirs within a one-year limitation period which is calculated from the day the donor or his heirs became aware or ought to have become aware of the arising of such grounds.


5. The provisions of this Article shall not apply to ordinary gifts of domestic character and to presents of minor value.


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Article 6.473. Duties of a donor


1. The donor must, under the contract, transfer the property to be gifted without any encumbrance of the right thereto which is not established in the contract and which would hinder the use or disposal, as well as the possession of the property by the donee.  


2. The donor may transfer only those rights in connection with the property gifted which he himself holds therein.


3. The donor shall not be liable for the latent defects in the property gifted if he was not aware or could not have been aware thereof.


4. The donee may claim from the donor compensation of damages if the donee has incurred expenses in connection with the lifting of the encumbrances of the right to the property or with the elimination of defects in that property, and if the donor was aware or should have been aware of those encumbrances and defects but failed to disclose that to the donee.


5. The donor shall pay the expenses related with the conclusion and performance of the contract unless otherwise provided for in the contract.

 


Article 6.474. Liability of the donee for debts of the donor

Unless otherwise provided for by laws or the contract, the donee shall only be liable for the debts of the donor which are directly connected with the received gift. 

 


Article 6.475. Compensation for damage

Damage caused to the life, health or property of the donee as a consequence of defects of the property gifted shall be compensated by the donor on the general grounds if it is proved that the defects arose before the transfer of the property to the donee and were not obvious, while the donor, although being aware of them, failed to disclose this to the donee.


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Article 6.476. Donations (aid and charity)


1. A gift of property or property right for certain useful purposes shall be deemed to be a donation.


2. No authorisation or consent shall be required for the acceptance of donations.


3. A donation must be used for the determined designation. If the donation is accepted by a legal person, the latter must keep accounts of all operations relating to the use of the donated property.


4. The designation of the donation may be stated by the person who makes the donation or expressed by the request or actions of the person receiving the donation. If the use of donated property in accordance with the specified designation becomes impossible in the consequence of a change of circumstances, it may be used for another designation only with the consent of the donor, and in the event of the donor’s death/termination, only by a decision of the court.


5. In the event of donated property being used not in accordance with the designation specified by the donor, the donor or his successors shall have the right to demand within judicial proceedings revocation of the donation. This provision shall not apply in respect of donations of domestic character or those of minor value.


6. Article 6.467 of this Code shall not apply to donations.

 


CHAPTER XXVIII

LEASE

 


SECTION ONE

GENERAL PROVISIONS

 


Article 6.477. Concept of a contract of lease


1. Under a contract of lease one party (lessor) shall undertake to grant to the lessee a thing for payment in temporary possession and use, and the other party (lessee) shall undertake to pay a lease payment.


2. The subject matter of a contract of lease may be any durable thing. Laws may establish the kinds of things the lease of which is prohibited or restricted.


3. A thing or its features enabling to define the thing which is to be transferred by the lessor to the lessee must be specified in the contract of lease.   In the absence of such features in the contract, and if the subject matter of the contract of lease cannot be determined on the basis of other features, the contract of lease shall not be considered concluded.


4. A lessor may be the owner of the property under lease or the persons to whom the right to lease another’s thing is granted by law or by the owner of that thing.

 


Article 6.478. Form of a contract


1. A contract of lease for a period of more than one year must be concluded in written form.


2. A contract of lease of immovable things for a period of more than one year may be invoked against third persons only in the event if it is registered in the public register in accordance with the procedure established by laws.


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Article 6.479. Term of a contract


1. A contract of lease may be fixed-term or concluded for an indefinite period, but in all cases the term of lease may not exceed one hundred years.


2. The term of a contract of lease shall be determined by agreement between the parties. If the term of the contract of lease has not been determined in the contract, the contract of lease shall be considered to have been concluded for an indefinite period.


3. Other terms may be established by laws for the leasing of property which is owned by the State.  

 


Article 6.480. Consequences of a contract of lease concluded for an indefinite period

If the contract of lease is indeterminate, both of the parties shall have the right at any time to repudiate the contract having warned the other party one month in advance, and in the event of the lease of immovable things, three months in advance. A more extensive period may be established in the contract of lease for the issue of warning about the termination thereof.

 


Article 6.481. Continuance of use of property after the expiry of the term of a contract

A contract of lease shall be considered to become concluded for an indefinite period where the lessee continues to use the property for more than ten days after the expiry of the term of the contract without any opposition from the lessor.

 


Article 6.482. Preferential right of the lessee to renew a contract of lease


1. The lessee who has duly performed his duties assumed under the contract of lease shall have a preferential right before other persons to renew the contract upon the expiry of the term thereof.


2. The lessor must inform the lessee in writing within the period determined in the contract of the latter’s right to conclude a contract of lease for a new term, and if such period is not determined in the contract, within a reasonable period before the termination of the contract of lease.


3. When concluding a contract of lease for a new term, the conditions of the contract may be modified by agreement between the parties.


4. If the lessor refused to conclude a contract with the lessee for a new term, but within a year from the termination of the contract of lease concluded a contract of lease upon the same thing with another person without informing the previous lessee, the latter shall have the right, at his choice, to claim either the transfer to him of the rights and duties of the lessee under the contract of lease concluded or compensation of damages resulting from the refusal to conclude a contract of lease for a new term.

 


SECTION TWO

RIGHTS AND DUTIES OF PARTIES TO A CONTRACT OF LEASE


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SECTION TWO

RIGHTS AND DUTIES OF PARTIES TO A CONTRACT OF LEASE

 


Article 6.483. Delivering property to the lessee


1. The lessor must deliver property to the lessee in the state corresponding to the conditions of the contract and designation of the property. The lessor must guarantee that the thing is fit to be used for the purpose for which it is leased throughout the whole period of the lease.


2. The lessor shall not be held liable for the defects of the property leased which were stipulated by him when concluding the contract.


3. The lessor must deliver to the lessee the documents relating to the thing leased and appurtenances thereof (technical passport, certificate of quality, etc.) which are necessary for the use of that thing unless otherwise provided for by the contract.


4. Neither the lessor nor the lessee shall have the right to change the form and designation of the leased property during the period of the lease.

 


Article 6.484. Consequences of not delivering the thing to the lessee   

In the event of the failure by the lessor to deliver into the use of the lessee the leased thing, its documents and appurtenances, the lessee shall have the right to recover this thing from the lessor and to claim damages caused by the delay of performance or to demand dissolution of the contract and compensation of damages caused by the non-performance of the contract.


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Article 6.485. Liability of the lessor for defects of the thing


1. The lessor shall be liable for defects of the thing leased which wholly or partially obstruct the use thereof for its designation even in those instances where the lessor was not aware of those defects at the time of concluding the contract.


2. In the event of discovery of such defects as indicated in paragraph 1 of this Article, the lessee shall have the right at his choice:


1) to demand from the lessor either elimination of those defects free of charge or a commensurate reduction of the lease payment, or compensation of the expenses of the lessee incurred in the elimination of the defects;


2) to withhold the amount of expenses incurred for the elimination of defects from the lease payment if the lessor was informed of this in advance;


3) to demand the dissolution of the contract before time.


3. The lessor who has been informed about the demands of the lessee or about the latter’s intention to eliminate the defects of the thing at the expense of the lessor shall have the right to replace the leased thing of inadequate quality with another analogous thing of adequate quality or to eliminate the defects of the thing himself free of charge. 


4. In the event where, after the satisfaction of the demands of the lessee or after the withholding of expenses for the elimination of defects from the lease payment, damages caused to the lessee are not fully compensated, he shall have the right to demand the reparation of the uncompensated part of the damages.


5. The lessor shall not be liable for those defects of the leased thing which were stipulated by him when concluding the contract or which should have been known to the lessee, or which could have been noticed by the lessee without any additional inspection when concluding the contract or delivering the thing, but which were not discovered through his own gross negligence.

 


Article 6.486. Rights of third persons to leased property


1. A lease of a thing shall not terminate or change the rights of third persons to that thing.


2. Prior to the conclusion of a contract of lease, the lessor must inform the lessee about all rights of third persons to the thing upon lease (pledge, servitude, usufruct, etc.).  If the lessor fails to perform this duty, the lessee shall have the right to demand a reduction of lease payment or dissolution of the contract and compensation of damages.


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Article 6.487. Lease payment


1. The lessee must pay the lease payment on time. Unless otherwise provided for by laws or the contract, he shall have the right to demand a commensurate reduction of the lease payment if, due to circumstances for which he is not responsible, conditions of the use of the thing established in the contract or the state of the thing have deteriorated substantially.


2. If the concrete amount of the lease payment or the method of its calculation is not determined in the contract, each of the parties to the contract shall have the right to apply to the court with the request to appoint independent experts for determination of the amount of the lease payment.


3. Upon agreement between the parties, the lease payment may be established in the following forms:


1) a fixed sum of money to be paid in a lump sum or in instalments;


2) a portion of the products, fruits or incomes received from the use of the leased thing; 


3) certain services supplied to the lessor by the lessee;


4) the duty of the lessee to improve the state of the leased thing at his own expense;


5) the duty of the lessee to transfer to the lessor a thing stipulated in the contract into his ownership or under lease.


4. The parties may agree on a combination of these forms for the determination of the amount of the lease payment or may establish another form of calculating the lease payment.


5. Unless otherwise provided for by the contract of lease, the lease payment may be changed by agreement between the parties within the periods agreed between them, but not more often than twice a year if laws do not foresee differently.


6. Unless otherwise provided for by the contract of lease, in the event of essential violation by the lessee of the periods for paying the lease payments, the lessor shall have the right to demand from the lessee effectuation of the lease payment in advance within the periods established by the lessor, but not for more than two consecutive payment terms.

 


Article 6.488. Right of a lessee to incomes received from the leased thing

The incomes, fruits, livestock increase received from the leased thing shall belong to the lessee unless otherwise provided for by the contract.


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Article 6.489. Use of leased property


1. The lessee must use the leased thing in accordance with the contract and designation of the thing.


2. The lessee must use the leased thing in such a way as not to hinder the use of that thing by other lawful users. 


3. The lessee shall be liable towards the lessor and other lessees for the performance of the duty determined in paragraph 2 of this Article. In addition, the lessee shall be liable for actions of other persons to whom he grants the right or possibility to use the leased thing.


4. Where one of the lessees violates the duty provided for in paragraph 2 of this Article, the other lessees shall be entitled to a reduction of the lease payment if the lessor has been notified of the hindrances.


5. The lessor shall have the right, without prejudice to the rights of the lessee, to check if the lessee uses the leased thing in a proper way. In addition, the lessor shall have the right to show the leased thing to a prospective lessee or acquirer.

 


Article 6.490. Sublease


1. The lessee shall have the right to sublease the leased thing only with the written consent of the lessor unless otherwise provided for by the contract. The contract of sublease may not be concluded for a period exceeding the term of the contract of lease.


2. A refusal of the lessor to consent to the sublease of the thing must be reasonably motivated. If the lessor refuses to consent without any reasonable grounds, the lessee shall have the right to dissolve the contract before its expiry.


3. If the consent of the lessor for the sublease of a thing is not necessary, the lessee, before concluding the contract of sublease, must inform the lessor about the contract of sublease and the sublessee.


4. If the contract of lease is void, the contract of sublease shall also be void.


5. The rules established in this Article shall also apply to the lease for use.


6. The lessee shall be liable towards the lessor both in the event of sublease and the lease for use.   If a sublessee substantially violates the contract of sublease and inflicts damage by his actions to the lessor or to other lawful users of that thing, the lessor shall have the right to demand dissolution of the contract of sublease.


7. In the event where the lessor fails to perform his obligations under the contract of lease, the sublessee may also submit a claim on behalf of the lessee.


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Article 6.491. Assignment or encumbrance of rights and duties of a lessee


1. The lessee shall have the right, upon the written consent of the lessor obtained in advance, to assign his rights and duties under the contract of lease, to pledge the right of lease or to transfer it as a property contribution or to effectuate any other encumbrance thereof unless otherwise provided for by the contract of lease.


2. In the event of the assignment of the rights and duties of the lessee to another person in accordance with the procedure established in paragraph 1 of this Article, the lessee shall be relieved from his obligations towards the lessor resulting from the contract of lease.

 


Article 6.492. Duty of the lessor to make major repairs of a leased thing


1. The lessor must make major repairs of the leased thing at his own expense unless otherwise provided for by laws or the contract. 


2. If the lessor fails to comply with the duty provided for in paragraph 1 of this Article, the lessee shall acquire the right, upon obtaining the authorisation of the court, to make major repairs and recover from the lessor the price of the repairs, or to withhold it from the lease payment, or to dissolve the contract and claim damages caused by failure to perform the contract. In this event, the lessee must submit to the lessor the estimate and invoice of the works of major repairs.


3. The lessee must provided all the conditions necessary for the proper performance of the duty of the lessor indicated in paragraph 1 of this Article.


4. In the performance of his duty indicated in paragraph 1 of this Article, the lessor shall have the right to require from the lessee to temporarily desist from the use of the leased thing if major repairs are necessary and urgent. If major repairs are not urgent and the lessee does not agree to be temporarily dispossessed of the leased thing, the lessor must obtain the authorisation of the court for the temporary restriction of the lessee’s right to use the leased thing.


5. The lessee whose right to use the leased thing is restricted shall have the right to obtain reduction of the lease payment, to demand compensation, or to apply for the dissolution of the contract of lease.


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Article 6.493. Duty of a lessee with regard to maintenance of a leased thing


1. The lessee must maintain the leased thing in a proper state and bear expenses for the maintenance of the thing and to make its current repairs at his own expense unless otherwise provided for by laws or the contract.


2. The lessee, on becoming aware of damage or any other serious defects of the leased thing for the elimination of which urgent major repairs are necessary, must immediately inform the lessor thereof.


3. In the event where the lessor, after he was informed by the lessee, fails to eliminate the defects, the lessee shall have the right to undertake the necessary repair works even without the authorisation of the court when it is necessary to ensure the preservation of the leased thing; in doing so the lessee shall inform the lessor accordingly and subsequently submit to him the documents confirming the value of the performed works as well as the replaced parts of the thing. Where necessary, the lessee may perform the necessary repairs of the thing by withholding the amount of the expenses from his payment of lease.

 


Article 6.494. Validity of a contract in the event of the transfer of a thing to another owner or in the event of death of a lessee


1. When the right of ownership of the leased thing passes from the lessor to another person, the contract of lease to be registered shall remain in force for the new owner, provided the rights resulting from the contract of lease have been registered in the public register in accordance with the procedure laid down by law.


2. The contract of lease shall remain valid even where the thing is passed from one state/municipal institution (lessor) to another.


3. Transfer of the right of ownership to the leased property from the lessor to another person shall be the grounds for the termination of the contract of lease in case of a demand of the lessee.


4. In the event of death of a lessee – natural person – who was leasing an immovable thing, his rights and duties under the contract of lease shall be passed to his heirs unless otherwise provided for by laws or the contract. In such event, the lessor shall have no right to refuse the heir of the deceased lessee the assignment of the rights and duties of the previous lessee for the remaining period of the lease, except in the cases when the conclusion of the contract was conditioned by the personal qualities of the lessee.


5. In the event of expropriation of the thing for public needs, the contract of lease shall terminate from the moment when the new owner of the expropriated thing (possessor) acquires possession of that thing.


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Article 6.495. Duty of a lessor to inform about a contract of lease

The lessor, in selling or in any other way transferring a leased thing, as well as pledging it or otherwise encumbering the right of ownership thereto, must inform the purchaser of the thing or the party to any other contract about the contract of lease in operation, likewise to inform the lessee of the intended sale, any other alienation of the thing, or of the encumbrance of the right thereto.

 


SECTION THREE

TERMINATION OF A C CONTRACT OF LEASE

 


Article 6.496. Termination of a contract of lease upon expiry of its time limit

A fixed-term contract of lease shall terminate upon expiry of its time limit unless the parties renew the contract by concluding a new agreement or in accordance with the procedure laid down in Article 6.481 of this Code.

 


Article 6.497. Dissolution of a contract before expiry of the term upon demand of the lessor


1. The lessor shall have the right to bring an action before a court for the dissolution of a contract of lease before expiry of the term if:


1) the lessee uses the thing in violation of the contract or not according to the designation of the thing;


2) the lessee intentionally or through negligence worsens the state of the thing;


3) the lessee fails to pay the payment of lease;


4) the lessee fails to perform major repairs in those cases where the laws or the contract obligate him to do so;


5) there exist other grounds provided for by the contract of lease.


2. Unless otherwise provided for by the contract of lease, termination of the contract of lease before expiry of the term shall also entail the termination of the contract of sublease.


3. The lessor shall have the right to demand dissolution of the contract of lease before expiry of the term only after he has sent a written warning to the lessee about the necessity to perform the obligation or eliminate violations within a reasonable time, but the lessee, having received such warning, failed to perform the obligation or to eliminate the violations within a reasonable time.


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Article 6.498. Dissolution of a contract before time upon demand of a lessee

The lessee shall have the right to bring an action to a court for dissolution of a contract of lease before time, if:


1) the lessor fails to carry out the repairs he is obliged to;


2) the thing by virtue of circumstances for which the lessee is not liable becomes not fit for use;


3) the lessor fails to transfer the thing to the lessee or hinders the use of the thing in accordance with its designation and the conditions of the contract;


4) the thing transferred has defects which were not stipulated by the lessor and were unknown to the lessee and which render the thing impossible to be used in accordance with its designation and the conditions of the contract;


5) there exist other grounds provided for by the contract of lease.

 


Article 6.499. Return of a thing to the lessor


1. Upon the termination of the contract of lease, the lessee must return the thing to the lessor in the state he received it, taking into account normal wear and tear, or in the state agreed in the contract.


2.  In the event where the lessee returns the thing after the term, the lessor shall have the right to demand effectuation of the lease payment for the entire time of the delay and compensation for damages incurred by such delay.


3. In the event of the failure on the part of the lessee to return the leased thing, he must compensate the lessor for the value of that thing, likewise to effectuate the payment of lease and compensate for other damages incurred by the lessor.

 


Article 6.500. Liability of a lessee for deterioration of a thing

In the event of the lessee causing deterioration of the leased thing, he must compensate the lessor for damages caused by the deterioration, except in the cases where the lessee proves that the deterioration occurred not due to his fault.

 


Article 6.501. Improvement of a thing


1. In the instances where the lessee with the permission of the lessor has made improvements of the leased thing, he shall have the right to compensation of the necessary expenses incurred by him for that purpose.


2. In the event where the improvements made by the lessee without the permission of the lessor are separable without harm to the leased thing, and where the lessor does not agree to compensate for them, they may be taken out by the lessee.


3. The value of improvements which are not separable without harm to the leased thing made by the lessee without the permission of the lessor shall not be subject to obligatory compensation.


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Article 6.502. Liability of a lessee for loss of a thing


1. The lessee shall be liable for the loss of a thing unless he proves that the loss was not due to his fault or the fault of other persons to whom he, upon the permission of the lessor, granted the right of use of the leased thing or allowed access thereto.


2. The lessee shall not be liable for the loss of an immovable thing by the reason of fire unless it is proved that the fire occurred due to his fault or the fault of other persons to whom he, upon the permission of the lessor, granted the right of use of the leased thing or allowed access thereto.

 


Article 6.503. Purchase of leased property


1. It may be provided for by laws or the contract of lease that the leased thing shall pass to the ownership of the lessee upon the expiry of the time limit of the contract of lease or before the expiry thereof if the lessee pays the entire amount of the price stipulated by the contract of sale by instalment (leasing).


2. Where the condition on the purchase of the leased thing is not provided for in the contract, it may be established by an additional agreement between the parties in which they may agree upon the set-off of the previously paid lease payment against the price of the thing. 


3. A prohibition of purchase of the leased thing may be established by laws or the contract.

 


SECTION FOUR

CONSUMER LEASE

 


Article 6.504. Concept of a contract of consumer lease


1. Under a contract of consumer lease, the lessor, i.e. the person whose permanent business activity is leasing of things, shall undertake to grant a movable thing to the lessee (consumer) into his temporary possession and use for payment for the personal purposes of the lessor or his family, or for household purposes thereof, provided that it is not connected with business or professional activity, while the lessee shall undertake to pay the payment of lease.


2. A contract of consumer lease shall be a consumer contract and shall be regulated, mutatis mutandis, by the rules governing consumer contracts established by this Code.

 


Article 6.505. Term of a contract of consumer lease


1. The term of a contract of consumer lease may not exceed one year.


2. Rules established in Articles 6.481 and 6.482 of this Code shall not apply to the contract of consumer lease.


3. The lessee shall have the right to repudiate the contract at any time, having warned the lessor about that not later than ten days before the repudiation of the contract.


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Article 6.506. Form of a contract of consumer lease

A contract of consumer lease must be concluded in written form or in any other specially determined form (invoice, tag, etc.).

 


Article 6.507. Duty of the lessor to make repairs of the thing under a contract of consumer lease

The lessor must make major and current repairs of the thing leased under a contract of consumer lease.

 


Article 6.508. Delivery of a thing to the lessee

Upon the conclusion of the contract of consumer lease, the lessor must, in the presence of the lessee, check the state of the thing being leased, familiarise the lessee with the rules for the use of that thing or furnish him with written instructions on the use thereof.

 


Article 6.509. Elimination of defects in a leased thing


1.  In the event of discovery of defects in the leased thing which wholly or partly obstruct the use thereof, the lessor must, within ten days from the date of receiving the statement of the lessee concerning the defects, unless a shorter period has been determined by the contract of consumer lease, eliminate the defects free of charge on the site or replace it with an analogous thing in a proper state.


2. In the instances where the defects in the thing appeared as a consequence of a violation by the lessee of the rules for the use and maintenance of the thing, the lessee must compensate the lessor for the costs of repair and transportation of the thing. 

 


Article 6.510. Lease payment


1. The lease payment shall be determined in the contract of consumer lease in the form of a sum of money to be paid in a lump sum or in several instalments.


2. In the event where the lessee returns the thing to the lessor before time, the latter must return to the lessee the corresponding part of the lease payment calculated from the day following the day of the actual return of the thing.


3. The lessor shall have no right to unilaterally increase the lease payment after the conclusion of the contract. 

 


Article 6.511. Limitation of the rights of the lessee

The lessor under the contract of consumer lease shall have no right to sublease a leased thing, to transfer his rights and duties under the contract of consumer lease to another person, to conclude a contract of loan for use in respect of that thing, to pledge the rights under the contract of consumer lease, or transfer them in the form of property contribution.

 


SECTION FIVE

LEASE OF MEANS OF TRANSPORT WITH PROVISION OF

SERVICES RELATING TO DRIVING AND TECHNICAL MAINTENANCE


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Article 6.512. Concept of a contract of lease of means of transport with provision of services relating to driving and technical maintenance


1. Under a contract of lease of means of transport with provision of services relating to driving and technical maintenance, the lessor shall undertake to grant means of transport to the lessee for his temporary use for payment and render services with regard to driving and technical maintenance thereof, while the lessee shall undertake to pay the lease payment.  


2. The rules established in Articles 6.481 and 6.482 of this Code shall not apply to a contract of lease of means of transport with provision of services relating to driving and technical maintenance.

 


Article 6.513. Form of a contract

Irrespective of its duration, a contract of lease of means of transport with provision of services relating to driving and technical maintenance must be concluded in writing.

 


Article 6.514. Duty of the lessor relating to maintenance of means of transport 

The lessor must, throughout the entire period of the contract of lease, ensure the proper technical state of the means of transport leased, likewise make the current and major repairs and provide necessary appurtenances.

 


Article 6.515. Duty of the lessor to provide services relating to driving and technical maintenance


1. The lessor must provide services relating to driving and technical maintenance of means of transport, which would allow ensuring its normal and safe operation in accordance with the conditions of the contract of lease.  In the contract of lease of means of transport, the parties may foresee other services to be provided to the lessee by the lessor.


2. The lessor must ensure that the skills of the person or persons who drive the means of transport as well as other requirements established thereto conform to the criteria determined in laws and the contract of lease of means of transport.


3. Persons driving the leased means of transport shall be employees of the lessor. They shall follow the instructions of the lessor with respect to the technical maintenance of the means of transport, as well as to the requirements of the lessee with respect to the use of the means of transport.


4. Unless otherwise provided for by the contract of lease of means of transport, expenses relating to the sustenance of the persons driving the leased means of transport, as well as their wages shall be borne by the lessor.

 


Article 6.516. Duty of the lessee to pay the expenses connected with the use of means of transport for commercial purposes

Unless otherwise provided for by the contract of lease of means of transport, the lessee must bear expenses arising from the use of means of transport for commercial purposes, the cost of fuel and other materials utilised, as well as the payment of dues.


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Article 6.517. Insurance of means of transport

Unless otherwise provided for by the contract of lease of means of transport, the duty to insure the means of transport and the civil liability of its operator shall rest upon the lessor.

 


Article 6.518. Contracts with third persons


1. Unless otherwise provided for by the contract of lease of means of transport, the lessee shall have no right to sublease the means of transport to third persons without the consent of the lessor.


2. Unless otherwise provided for by the contract of lease of means of transport, the lessee shall have the right, without the consent of the lessor, to conclude in his own name contracts of carriage as well as other contracts with third persons where this is not contrary to the purposes of the use of the means of transport.

 


Article 6.519. Liability for damage caused to means of transport

Where the leased means of transport is destroyed or damaged, the lessee must compensate the lessor for the damage caused if the lessor proves that the means of transport was destroyed or damaged due to the circumstances for which the lessee is responsible.

 


Article 6.520. Liability for damage caused to third persons

The lessor shall be held liable for the damage caused to third persons by the leased means of transport.  Having compensated the damage, the lessor shall have the right of recourse against the lessee for recovery of the amount paid in the event where the damage was caused through the fault of the lessee.

 


Article 6.521. Peculiarities of lease of individual types of means of transport with provision of services relating to driving and technical maintenance 

Peculiarities of lease of certain types of means of transport with provision of services relating to driving and technical maintenance may be determined by the codes regulating individual modes of transport.

 


SECTION SIX

LEASE OF MEANS OF TRANSPORT WITHOUT PROVISION OF

SERVICES RELATING TO DRIVING AND TECHNICAL MAINTENANCE

 


Article 6.522. Concept of a contract of lease of means of transport without provision of services relating to driving and technical maintenance


1. Under a contract of lease of means of transport without provision of services relating to driving and technical maintenance, the lessor shall undertake to provide the means of transport to the lessee in temporary possession and use for payment, while the lessee shall undertake to pay the payment of lease.


2. The rules established in Articles 6.481 and 6.482 of this Code shall not apply to the contract of lease of means of transport without provision of services relating to driving and technical maintenance.


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Article 6.523. Form of a contract

Irrespective of its duration, a contract of lease of means of transport without provision of services relating to driving and technical maintenance must be concluded in writing.

 


Article 6.524. Duty to maintain the means of transport

The lessee must, throughout the entire period of lease, ensure the technical maintenance and proper state of the means of transport leased and effectuate current and major repairs thereof unless otherwise provided for by the contract.

 


Article 6.525. Duty of the lessee in respect of driving and operation of the means of transport

The driving and commercial and technical operation of the means of transport leased shall be ensured by the lessee with his own forces and at his own expense.

 


Article 6.526. Duty of the lessee with regard to payment of expenses connected with the use of the means of transport and other expenses

Unless otherwise provided for by the contract of lease of means of transport, the lessee must bear expenses connected with the use and sustenance of the means of transport, likewise pay insurance contributions.

 


Article 6.527. Contracts with third persons


1. Unless otherwise provided for by the contract of lease of means of transport, the lessee shall have no right, without the consent of the lessor, to sublease the means of transport to third persons under the conditions of the contract of lease.


2. Unless otherwise provided for by the contract of lease of means of transport, the lessee shall have the right, without the consent of the lessor, to conclude in his own name contracts of carriage as well as other contracts with third persons where this is not contrary to the purposes of the use of the means of transport.

 


Article 6.528. Liability for damage caused to third persons

The lessee shall be held liable for the damage caused to third persons by the leased means of transport.

 


Article 6.529. Peculiarities of lease of individual types of means of transport without provision of services relating to driving and technical maintenance

Peculiarities of lease of certain types of means of transport without provision of services relating to driving and technical maintenance may be determined by the codes regulating individual modes of transport.

 


SECTION SEVEN

LEASE OF BUILDINGS, CONSTRUCTION WORKS AND INSTALLATIONS


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SECTION SEVEN

LEASE OF BUILDINGS, CONSTRUCTION WORKS AND INSTALLATIONS

 


Article 6.530. Concept of a contract of lease of buildings, construction works and installations


1. Under a contract of lease of buildings, construction works and installations, the lessor shall undertake to transfer for payment a building, construction works or installation to the lessee in temporary possession and use or temporary use, while the lessee shall undertake to pay the payment of lease.


2. The provisions of this Section shall apply to the lease of enterprises to the extent that they are not contrary to the provisions of Section Eight of this Chapter.

 


Article 6.531. Form of a contract


1. A contract of lease of buildings, construction works and installations must be concluded in writing.


2. A contract of lease of buildings, construction works and installations may be invoked against third persons only if it is registered in the public register.

 


Article 6.532. Rights to a plot of land


1. Under a contract of lease of buildings, construction works and installations, the rights of the use of that part of the land plot which is occupied by the relevant buildings, construction works and installations and is necessary for the use thereof in accordance with their designation shall pass to the lessee simultaneously with the transfer of the subject matter of lease.


2. In the event where the lessor is the owner of the land plot on which the leased buildings, construction works or installations are situated, the land plot shall be provided for the use of the lessee under the right of lease or on any other right stipulated in the contract of lease of buildings, construction works and installations.


3. In the event where the rights of the lessee to the land plot occupied by the relevant buildings, construction works or installations are not determined in the contract of lease of buildings, construction works and installations, it shall be deemed that the lessee is granted, for the entire period of the lease, the right to use gratuitously that part of the land plot which is necessary for the use of the buildings, construction works and installations in accordance with their designation. 


4. The lease of buildings, construction works or installations situated on the plot of land which does not belong to the lessor by the right of ownership shall be permitted without the consent of the owner of this plot exclusively where this is not contrary to laws or the contract between the owner of the plot of land and the lessor of the buildings, construction works and installations.


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Article 6.533. Right of the lessee to use a land plot in the event of substitution of its owner

In the event where the land plot occupied by the leased buildings, construction works or installations is sold or transferred on any other grounds into the possession of another person under the right of ownership, the lessee shall retain the right to use that part of land plot which is necessary for the use of buildings, construction works and installations in accordance with their designation under the same terms as existed before the alienation of the land plot into the ownership of another person, providing the contract of lease was registered in the public register in accordance with the procedure established by laws.

 


Article 6.534. Payment of lease


1. The payment of lease shall be determined by agreement between the parties.


2. The payment of lease established in the contract shall include payment for the use of the land plot on which the leased buildings, construction works or installations are situated unless otherwise provided for by laws or the contract of lease.


3. In the instances where the payment of lease has been established per unit of space of the building, construction works or installation or any other dimension thereof, the lease payment shall be determined taking into account the actual size of the leased building, construction works or installation.

 


Article 6.535. Transfer of a building, construction works or installation


1. The transfer of a building, construction works or installation and the acceptance thereof shall be effectuated under the transfer and acceptance deed. The deed shall be signed by both parties.


2. Unless otherwise provided for by laws or the contract, the obligation of the lessor to transfer the building, construction works or installation to the lessee shall be considered to have been performed after the actual granting of the building, construction works or installation to the lessee or upon the signing of the transfer and acceptance deed.


3. In the event of one party of the contract avoiding to sign the transfer and acceptance deed of a building, construction works or installation under the conditions agreed in the contract of lease, it shall be considered as a refusal, respectively, by the lessor to perform his obligation with regard to the transfer of the relevant building, construction works or installation, or by the lessee to accept them.


4. Upon the termination of a contract of lease of a building, construction works or installation, they must be returned to the lessor in accordance with the rules determined in this Article.

 


SECTION EIGHT

LEASE OF AN ENTERPRISE


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SECTION EIGHT

LEASE OF AN ENTERPRISE

 


Article 6.536. Concept of a contract of lease of an enterprise


1. Under a contract of lease of an enterprise, the lessor shall undertake to grant to the lessee in temporary possession and use for payment an enterprise as a property complex used for business purposes, while the lessee shall undertake to pay the payment of lease. The granting of an enterprise as a property complex to the lessee shall also comprise a transfer of the plot of land, buildings, construction works, installations, equipment, other means of production specified in the contract, raw materials, stocks, working capital, rights to the use of the land, water and other natural resources, buildings, construction works or installations, likewise any other property rights connected with the enterprise, the rights to the product or service mark and the name of the firm as well as other exclusive rights. The transfer of an enterprise as a property complex shall also comprise the assignment of the rights to claim and obligation of debts determined in the contract of lease. The transfer of the rights of possession and use of property which is in the ownership of other persons, likewise the transfer of rights of possession and use of land and other natural resources shall be effectuated in accordance with the procedure established by laws.


2. The rights of the lessor acquired by him on the basis of an authorisation (licence) may not be transferred to the lessee under the contract of lease of the enterprise, except in cases provided for by laws or the contract. The inclusion in the composition of obligations of the transferable enterprise of such obligations whose performance by the lessee is impossible in the absence of pertinent authorisation (licence) shall not relieve the lessor from the relevant obligations to the creditors.


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Article 6.537. Rights of the creditors of the enterprise in the event of its lease


1. The lessor of an enterprise must, before the transfer thereof to the lessee, notify in writing the creditors of the enterprise about its lease.


2. A creditor of the enterprise who has not communicated to the lessor in writing his prior consent to the delegation of the debt shall have the right, within three months from the date of receiving notification about the lease of the enterprise, to demand dissolution of the contract concluded by him or early performance of that contract and compensation of damages.


3. A creditor of the enterprise who has not been informed about the lease of the enterprise in accordance with the procedure established in paragraph 1 of this Article shall have the right to bring the claims provided for in paragraph 2 of this Article against the lessor within the period of one year from the date when he became aware or should have become aware of the lease of the enterprise.


4. Upon the lease of the enterprise, the lessor and the lessee shall be solidarily liable for the debts of the enterprise which were delegated to the lessee without the creditor’s consent.

 


Article 6.538. Form of a contract


1. A contract of lease of an enterprise must be concluded in written form by means of drawing up one document.


2. Failure to comply with the requirements as to the form of a contract of lease of an enterprise shall render the contract null and void.


3. A contract of lease of an enterprise may be invoked against third persons only where it has been registered in the public Real Property Register and the Register of Legal Entities.

 


Article 6.539. Transfer of an enterprise


1. The transfer of a leased enterprise shall be effectuated under the transfer and acceptance deed.


2. The preparation of the enterprise for the transfer, including the drawing up of the transfer and acceptance deed, shall be the duty of the lessor to be performed at his own expense unless otherwise provided for by the contract of lease of the enterprise.


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Article 6.540. Use of property of a leased enterprise


1. Unless otherwise provided for by the contract of lease of the enterprise, the lessee shall have the right, without the consent of the lessor, to sell, exchange, transfer for temporary use raw materials, stocks, manufactured products which are part of the property of the leased enterprise, to sublease them and transfer his rights and obligations in respect of those valuables under the contract of lease, on condition that this does not entail violation of the provisions of the contract of lease of the enterprise and reduction of the value of the enterprise.


2. Unless otherwise provided for by the contract of lease of the enterprise, the lessee shall have no right, without the consent of the lessor, to make changes in the leased enterprise as a property complex, perform its reconstruction, modernisation, expansion of its capacity, technical re-equipment or introduce any other transformations.

 


Article 6.541. Duty of a lessee to ensure the operation of a leased enterprise


1. The lessee of an enterprise must, within the entire term of the lease, ensure proper technical state of the enterprise and perform its current and major repairs.


2. The lessee must bear all the expenses relating to the operation of the leased enterprise, pay for the insurance of the property of the enterprise and effectuate any other payments unless otherwise provided for by the contract of lease of the enterprise.

 


Article 6.542. Improvements of an enterprise


1. The lessee of an enterprise shall have the right to compensation for the expenses incurred in respect of inseparable improvements of the enterprise providing that the consent of the lessor for such improvement was obtained, except in cases when otherwise provided for by the contract of lease of the enterprise.


2. The lessor may be relieved from the obligation to compensate expenses indicated in paragraph 1 of this Article if he can prove that the expenses of the lessee increased the value of the enterprise incommensurately to the improvements of its quality and/or operational properties, or that when effectuating such improvements the criteria of good faith and reasonableness were violated.

 


Article 6.543. Arising of effects of nullity of transactions and other legal effects to a contract of lease of an enterprise

The provisions of this Code concerning the effects of nullity of transactions, the legal effects of dissolution or change of a contract, likewise those providing for the return of property or the recovery in kind shall apply to contracts of lease of an enterprise to the extent that this does not violate in essence the rights and interests of the lessor, lessee and other persons, and is not contrary to public order.


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Article 6.544. Return of a leased enterprise

In the event of the termination of a contract of lease of the enterprise, the lessee must return the enterprise to the lessor in accordance with the rules established in Articles 6.536, 6.537 and 6.539 of this Code.  The preparation of the enterprise for the transfer, likewise the drawing up of the transfer and acceptance deed shall be the duty of the lessee to be performed at his own expense unless otherwise provided for by the contract of lease of the enterprise.

 


CHAPTER XXIX

LEASE OF LAND

 


Article 6.545. Concept of a land lease contract


1. Under a land lease contract, one party (lessor) shall undertake to transfer for payment a plot of land to the other party (lessee) in temporary possession and use for the purposes specified in the contract and under conditions established therein, while the lessee shall undertake to pay the payment of land lease indicated in the contract.


2. Separate laws of the Republic of Lithuania may stipulate the peculiarities in respect of the lease of land to diplomatic and consular missions of foreign states, likewise the lease of land plots located in free economic zones, the territory of the seaport or any other specific locations.

 


Article 6.546. Subject matter of a land lease contract

The subject matter of a land lease contract shall be a plot of land (or a part thereof) in the state or private ownership formed in accordance with the procedure established by laws and registered in the Real Property Register.

 


Article 6.547. Form of a land lease contract


1. A land lease contract must be concluded in writing.


2. A land lease contract may be invoked by the parties against third persons only if it is registered in the public register in accordance with the procedure established by laws.


3. A land lease contract must be appended with the plan of the land plot to be leased, and in the event of the land to be leased for the period of up to three years, with the scheme of the land plot.  These documents shall form an inseparable part of the land lease contract.


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Article 6.548. Lessor of land and the lessee of land


1. The lessor of land in private ownership shall be the owner of the private land.


2. A contract of lease of public land shall be formed, within its remit, by an institution which performs the functions of the manager of public land.


3. In the event of a plot of land belonging to several persons under the right of co-ownership, the land plot concerned may be leased upon the written consent of all the co-owners.


4. Lessees may be natural and legal persons of the Republic of Lithuania and foreign states.

 


Article 6.549. Duration of a land lease contract


1. The duration of a contract of lease of land in private ownership shall be established by agreement between the lessor and the lessee.  The parties may also conclude an open-ended land lease contract.


2. The duration of a contract of lease of public land shall be established by agreement between the lessor and the lessee; nevertheless, the term may not exceed ninety-nine years.


3. A shorter maximum duration of a land lease contract may be stipulated by laws.


4. Where the land plot pursuant to the territorial planning documents is allocated to be used for public needs, such land plot shall be leased only for a period until it is expropriated for the intended purposes.  In the event of the contract being concluded for a longer period, it shall be deemed to be concluded only for the duration until the expropriation of the land plot.


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Article 6.550. Content of a land lease contract


1. The following must be indicated in a land lease contract: 


1) the lessor of the land;


2) the lessee of the land;


3) the data on the object of the land lease registered in the land cadastre and the public register;


4) duration of the lease of land;


5) the principal designation of land use;


6) conditions of use of the construction works and installations situated on the leased land and belonging to the owner of the land or any other persons by the right of ownership, as well as conditions for erecting new buildings and construction works, building of roads and water reservoirs, or other conditions, likewise the intended use of the buildings or construction works upon the expiry of the time limit of the land lease contract;


7) conditions of use of the surface and subterranean waters, mineral  resources (with the exception of amber, oil, natural gas and quartz-sand) found in the leased land to the extent that they are not contrary to laws;


8) special conditions of the use of land;


9) restrictions on the use of land;


10) land servitudes and other real rights;


11) payment for the land lease.  It shall include payment for the land reclamation installations, roads, bridges, engineering equipment, etc., likewise indexing of the payment in the event of the lease of public land;


12) other commitments of the lessor and the lessee related to the use of the land plot and its return upon the expiry of the land lease contract;


13) liability for infringements of the land lease contract.


2. A land lease contract may not provide for:


1) authorisation issued to the lessee to represent the owner of the land and dispose of the private land of this owner and any other immovable property situated therein;


2) the right of a lessee of land in private ownership to change the principal designation of land use.


3. The conditions of the land lease contract, which determine the manner of use of the leased land, must not conflict with the interests of environmental protection and those of the owners or users of the neighbouring land plots, as well as public interests.


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Article 6.551. Lease of public land


1. Public land, with the exception of cases provided for in paragraph 2 of this Article, shall be leased by competitive bidding in accordance with the procedure established by the Government to a person who offers the highest payment for the lease of land.


2. Public land shall be leased not by competitive bidding in the instances when it is built over by buildings, construction works or installations that belong to natural or legal persons by the right of ownership or are leased by them, likewise in other cases provided for by laws.

 


Article 6.552. Payment of land lease


1. Payment of lease of land in private ownership shall be determined by agreement between the lessor and the lessee.


2. Payment of lease of public land which is not leased by competitive bidding shall be determined in accordance with the procedure established by legal acts.

 


Article 6.553. Sublease of land


1. The lessee of land shall have the right, upon written consent of the lessor, to sublease the leased land in compliance with the requirements and conditions stipulated in the land lease contract.


2. Land designated for agricultural purposes may not be subleased for any other purposes than determined in the land lease contract.


3. The contract of the sublease of land shall be concluded in accordance with the requirements laid down for a land lease contract.

 


Article 6.554. Reimbursement of expenses incurred by the lessee for the improvement of land designated for agricultural purposes

Expenses incurred by the lessee for the improvement of land designated for agricultural purposes shall be reimbursed where it is provided for in the land lease contract or when both parties agree (by additional written agreement) prior to the commencement of the work concerned upon the character, scope and costs of the land improvement work.

 


Article 6.555. Duty of the lessor to repair land reclamation installations, roads, bridges and other engineering facilities 


1. Unless otherwise provided for by laws or the land lease contract, the lessor must repair, at his own expense, land reclamation installations, roads, bridges and other engineering facilities owned by him.  In the event where the lessor fails to perform this duty, which renders the land plot impossible to be used for its designation, the lessee shall have the right to dissolve the contract.


2. Where the lessor fails to perform the repair work indicated in paragraph 1 of this Article, which has been declared necessary and urgent by the relevant public authorities, the lessee shall have the right to perform the repair work himself and recover from the lessor, within judicial proceedings, the repair expenses necessary to ensure the functioning of the leased property.


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Article 6.556. Duty of the lessee in regard to the preservation of the soil and its quality, proper maintenance of land reclamation installations, roads, bridges, other engineering facilities and plantations


1. The lessee shall be prohibited from performing any actions in the leased land plot which might result in destruction or pollution of the fertile layer of the soil. Unless otherwise provided for by the land lease contract, the lessee must perform, at his own expense and within the procedure established by laws, minor maintenance work of the land reclamation installations, roads, bridges and other engineering facilities belonging to the lessor, preserve protective and other signs, likewise ensure the compliance with the environmental requirements in the territory. Where the lessee fails to perform these duties, the lessor shall have the right to recover, within the judicial proceedings, from the lessee the funds necessary for the performance of the indicated work and damages incurred as a result of the non-performance of the duties specified in this Article, and to dissolve the land lease contract.


2. In the event of improper use of agricultural land by the lessee which results in deterioration of its quality, the lessee of the land must compensate the lessor for the damages caused.

 


Article 6.557. Right of the lessee to compensation for erected buildings, construction works and installations


1. Upon the expiry of the time limit of the land lease or upon its dissolution before the term, the owner of the land shall compensate the lessee for the erected buildings, construction works and installations, the construction of which was provided for in the land lease contract; and where the buildings remain in the possession of the lessee by the right of ownership, the latter shall have the right to the land servitude, providing that it was stipulated in the land lease contract or in the additional written agreement.


2. In the event where the buildings, construction works and installations were erected without permission, or where the erected buildings, construction works and installations were not stipulated in the land lease contract, the lessee must demolish them and restore the land plot. If the lessee fails to comply, this shall be executed by the lessor at the expense of the lessee, or the buildings, construction works and installations concerned shall pass to the lessor by the right of ownership, providing they conform to the requirements established in the territorial planning documents and are legitimised in accordance with the procedure established by laws.


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Article 6.558. Validity of a land lease contract upon the substitution of the lessee of land


1. Upon the death of the lessee, the rights and duties thereof related with the lease contract shall pass on to his heirs, providing that they do not relinquish these rights and duties. In the event of the lessee’s heirs relinquishing the land lease contract, they must compensate the lessor for the damages incurred in connection with this.


2. Where the lessee of land is a legal person and it is being reorganised, his rights and duties pursuant to the contract shall pass on to the new legal person.

 


Article 6.559. Validity of a land lease contract upon the substitution of the lessor of land

In the event of the death of the land owner, or passing of the land ownership rights to another owner on any other legal grounds, or upon the substitution of the lessor of public land, the land lease contract shall be valid in respect to the new owner of the land or the new lessor of public land, providing that the contract was registered in the public register in accordance with the procedure established by laws.

 


Article 6.560. Duty of the lessor to notify about the lease contract

Before executing the sale or any other alienation of the leased land, likewise before mortgaging the land or otherwise encumbering the rights thereto, the lessor must notify the acquirer of the land plot as well as the prospective mortgager about the existence of the land lease contract, while the lessee must be notified about the forthcoming alienation of the land plot or any other encumbrance of the rights thereto.

 


Article 6.561. Prohibition to lease mortgaged land

In the event of failure by the owner of mortgaged land to satisfy debt obligations within the time established in the contract, and after a ruling is passed by a mortgage judge to arrest the mortgaged land, it shall be prohibited to lease the land concerned.

 


Article 6.562. Expiry of a land lease contract

A land lease contract shall be terminated:


1) upon the expiry of the time limit of lease;


2) after the death of the lessor of land where his heirs do not assume the rights and duties related to the lease contract, or in the case of absence of any heirs;


3) upon liquidation of the legal person that was the lessor of the land;


4) when the leased land is sold, gifted or otherwise alienated to the lessee;


5) upon the dissolution of the land lease contract on the grounds established in Articles 6.563, 6.564 and 6.565 of this Code;


6) by agreement between the parties.


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Article 6.563. Dissolution of a land lease contract upon the expropriation of land for public needs

In the event of the land being expropriated for public needs, the land lease contract shall be dissolved and the damages incurred by the lessor and the lessee compensated in accordance with the procedure established by laws.

 


Article 6.564. Dissolution of a land lease contract at the demand of the lessor before the expiry of its time limit


1. A land lease contract may be dissolved at the demand of the lessor before the expiry of its time limit:


1) if the lessee of the land fails to use the land in conformity with the contract or the principal designation of land use;


2) if the lessee of the land fails to execute payment for the land lease within the period of three months from the payment date established in the land lease contract;


3) in other cases provided for by law.


2. A written notice about the dissolution of a land lease contract must be given by the lessor to the lessees of agricultural land not later than three months prior to the dissolution of the lease contract, and to the lessees of any other land, not later than two months prior to the dissolution of the lease contract.


3. In the event of a contract of the lease of agricultural land being dissolved before the expiry of its time limit at the demand of the lessor, the harvest shall be gathered by the lessee, or the lessor shall compensate the lessee for the damages incurred due to the dissolution of the contract.

 


Article 6.565. Dissolution of a land lease contract at the demand of the lessee before the expiry of its time limit


1. In the event of lease of agricultural land, a lease contract of such land may be dissolved before the expiry of its time limit at the demand of the lessee upon prior notification of the lessor not later than three months before the dissolution, and in the event of lease of any other land, not later than two months before the dissolution of the contract of lease.


2. In the event of failure by the lessor to perform the duties specified in Article 6.555 of this Code, the lessee shall have the right to dissolve the land lease contract without being bound by the procedure established in paragraph 1 of this Article.

 


Article 6.566. Right of a lessee to renew a land lease contract

Upon the expiry of the time limit of a land lease contract, and along with the previous lessee there being several other contenders for the lease of the land on the same conditions, priority right to form a new land lease contract shall be awarded to the former lessee, providing that he duly performed the duties assumed under the land lease contract.


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CHAPTER XXX

LEASING (FINANCIAL LEASE)

 


Article 6.567. Concept of a leasing (financial lease) contract


1. Under a leasing (financial lease) contract, one party (the lessor) shall undertake to acquire from a third party a thing specified by the other party (the lessee) and place it, in return for payment, at the possession of the lessee for business purposes provided that, upon payment of the total amount stipulated in the leasing contract, the thing will pass to the ownership of the lessee, unless otherwise provided for by the contract. The provisions of this Chapter shall also apply mutatis mutandis in cases where the lessor is the owner of the leased property.


2. The lessor shall select the seller and the thing in accordance with the instructions of the lessee and shall not be liable with respect to the selection of the seller or the leasing object, unless otherwise provided for by the leasing contract.


3. The lessor may, under the contract, be a bank or another legal person operating for profit.

 


Article 6.568. Subject matter of a leasing contract


1. The subject matter of a leasing contract may be any non-consumable movable or immovable thing, with the exception of land and natural resources.


2. The lessor may transfer to third parties all or part of his rights related to the leasing contract and its subject matter. Such transfer of rights shall be without prejudice to the lessor’s obligations under the leasing contract where the time limit for meeting such obligations is due before transfer of such obligations to third parties and shall be without prejudice as to the substance of the leasing contract.


3. The lessee may transfer the right to the use of the subject-mater of the leasing contract or any other right under the leasing contract only upon a prior written consent of the lessor.


4. Unless otherwise provided for by the leasing contract, the lessor shall have no right, without a written consent of the lessee, to pledge the leasing object.

 


Article 6.569. Lessor’s duty to notify of the leasing contract

When acquiring a thing for the purpose of leasing it to the lessee, the lessor must notify the seller of his intention to transfer the thing, under leasing conditions, to a specific lessee.


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Article 6.570. Transfer of the leasing object


1. Unless otherwise provided for by the leasing contract, the seller shall transfer the thing, which is the subject matter of the leasing contract, directly to the lessee at the latter’s place of business.


2. Where the thing (the subject matter of the leasing contract) is not transferred to the lessee within the time limit specified in the leasing contract and if the time limit has not been specified in the leasing contract– within a reasonable time limit, the lessee shall have the right to terminate the leasing contract and claim damages where the failure to timely transfer the thing is due to circumstances the responsibility for which lies with the lessor.


3. The lessee shall have the right to suspend the payment of rentals until such time as the lessor has dully fulfilled his obligation to transfer the thing.

 


Article 6.571. Risk of accidental perishing of or damage to the thing


1. The risk of accidental perishing of or damage to the thing (the subject matter of the leasing contract) shall pass to the lessee from the moment when such thing is transferred to him, unless otherwise provided for by the leasing contract.


2. The lessee shall bear all costs in relation to the maintenance and repair of the thing.


3. Unless otherwise provided for by the leasing contract, the lessor shall not be liable to the lessee for the defects of the subject matter of the leasing contract, with the exception of cases where the lessee relied on the lessor’s experience and knowledge and also where the lessor intervened in the selection of the seller and the subject matter of the contract.


4. The lessee must use and maintain the thing with diligence and due care and keep it in the condition in which it was handed over to him subject to fair wear and tear and to any modification agreed by the parties in the contract.


5. Where the lessee fails to comply with the duty provided for in paragraph 4 of this Article, the lessor shall have the right to require the payment of the total price of the contract or termination of the contract and compensation for damages.

 


Article 6.572. Effect of the leasing contract on third parties


1. The lessor’s right of ownership in the subject matter of the leasing contract which is not subject to registration may be enforced against third parties only if the leasing contract has been registered in accordance with the procedure established by laws.


2. In the case of the lessee’s bankruptcy, the lessor’s rights may be enforced against the lessee’s creditors and the insolvency administrator only if the leasing contract has been registered in accordance with the procedure established by laws.


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3. The leasing contract whose subject matter is an immovable thing shall mutatis mutandis be subject to the rules provided for in paragraph 2 of Article 6.478 of this Code.


4. The lessee shall be liable for any damages incurred by third parties as a result of the use of the subject matter of the leasing contract.

 


Article 6.573. Seller’s liability


1. The seller shall be directly bound towards the lessee with respect to all claims resulting from the contract for the sale of the leasing object (with respect to the quality and completeness of the property, hand-over period, etc.). Save for the duty to pay for the acquired property, the lessee shall enjoy all rights and duties of the buyer provided for in this Book to the same extent as if he were a party to the sales contract. However, the lessee shall not have the right to terminate the sales contract without the consent of the lessor.


2. The lessor and the lessee shall have the rights and duties of solidary obligation with respect to the seller’s creditors.


3. Unless otherwise provided for by the leasing contract, the lessor shall not be liable to the lessee for the failure on the part of the seller to comply with his obligations, with the exception of cases where the lessor was responsible for the selection of the seller. Where the seller is selected by the lessor and the former is in breech of the sales contract, the lessee shall have the right to make claims resulting from such contract, at his own discretion, to both the seller and the lessor.  In such case, the seller and the lessor shall be solidarily liable to the lessee.

 


Article 6.574. Termination of the leasing contract

In the event of a material breech of the leasing contract by the lessee, the lessor must require in writing that the lessee eliminates, within a reasonable time limit, the breach if this is possible taking into account specific circumstances. Where the lessee fails to do so, the lessor shall have the right to require early payment of rentals or to terminate the leasing contract. Where the leasing contract is terminated, the lessor shall have the right to require that the subject matter of the agreement be returned to him and to recover such damages as would place the lessor in the position in which he would have been had the lessee duly performed the contract.  

 


CHAPTER XXXI

LEASE OF DWELLINGS

 


SECTION ONE

GENERAL PROVISIONS


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CHAPTER XXXI

LEASE OF DWELLINGS

 


SECTION ONE

GENERAL PROVISIONS

 


Article 6.575. Scope of application

The provisions of this Chapter shall determine the procedure of formation, performance and termination of contracts of lease of dwellings where the premises concerned belong to:


1) natural persons;


2) the State or municipalities;


3) legal persons.

 


Article 6.576. Concept of a contract of lease of a dwelling

Under a contract of lease of a dwelling, the lessor shall undertake to provide, for payment, the lessee with a dwelling for temporary possession and use for residence, while the lessee shall undertake to use the premises in accordance with their designation and pay the payment of lease.

 


Article 6.577. Grounds for concluding a contract


1. Contracts of lease of state-owned or municipal dwellings shall be concluded upon the decision of state or municipal institutions. Enterprises, offices or organisations shall conclude contracts of lease of dwellings with their employees within the framework of a collective agreement, and in the event where such agreement is not concluded, the lease shall be effectuated on the grounds and within the procedure of an agreement between the administration and the employees.


2. Contracts of lease of dwellings leased by enterprises, offices or organisations and natural persons on commercial grounds (for profit) shall be concluded by agreement between the parties.


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Article 6.578. Parties to a contract


1. Parties to a contract of lease of a dwelling shall be the lessor and the lessee.   


2. The lessor shall be the owner of the dwellings or the possessor thereof upon any other legal grounds.  A lessee may act in the capacity of a lessor of dwellings if he forms a contract of sublease under the procedure established by laws.


3. A lessee shall be a natural person who concludes a contract of lease of a dwelling in his own name and in his own interests, or those of his family, or the former members of his family. In the event where a minor who does not have parents or cannot live with them remains residing in the dwelling, a contract of lease of the dwellings in his name may be formed by a person authorised by law.


4. The lessor shall have no right to refuse forming a contract of lease of a dwelling with a person, or to extend it, or to impose more onerous conditions on the lessee for the sole reason that the person concerned is a pregnant woman or this person has minor children, with the exception of cases where such refusal is justified by the size of the dwelling or by the arrest thereof (paragraph 2 of Article 6.587 of this Code).


5. Dwellings may be provided for the possession and/or use of legal persons on the grounds of a contract of lease of a dwelling or upon any other contract. Such dwellings may be used by the legal person exclusively for housing natural persons.

 


Article 6.579. Form of a contract


1. In the event where the lessor is the State, municipality or a legal person, a contract of lease of a dwelling must be concluded in writing. It shall be signed by an authorised official and the lessee. 


2. Contracts of lease between natural persons may be concluded orally.


3. A fixed-term contract of lease of a dwelling must be concluded in writing irrespective of who is the party thereto.


4. A contract of lease of a dwelling may be invoked against third persons only in the event of it being registered in the public register in accordance with the procedure established by laws.


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Article 6.580. Content of a contract


1. A contract of lease of a dwelling must include the following data: the address of the leased premises, the number of rooms or any other premises, dwelling space, engineering (technical) installations present in the premises, the appurtenances and the conditions for the use of common premises, the amount of the lease payment and periods for this payment, and the procedure for the payment for public utilities.


2. A contract of lease of a dwelling may likewise provide for other conditions.


3. At the time of concluding a contract of lease of a dwelling, the lessor must submit to the lessee a copy of the the statutes of the association of owners of the residential building or a copy of any other document establishing the requirements for the care, use and maintenance of common premises and other rules. A copy of this document shall be an inherent part of a contract of lease of a dwelling. However, a lessee shall have no right to demand dissolution of the contract of lease of a dwelling solely on the grounds of the lessor’s failure to furnish him with a copy of this document.


4. Null and void shall be the terms of the contract of lease of a dwelling which:


1) establish civil liability of the lessee without the fault thereof;


2) enable the lessor to unilaterally modify the terms of a lease contract;


3) establish the dependence of the lessee’s rights upon the number of his family members, with the exception of cases where the change of the lessee’s rights is justified by the size of the dwelling;


4) limit the right of the lessee to purchase things or receive services from persons whom the lessee wishes to chose at his own discretion;


5) provide the lessor with the right to demand from the lessee the payment of lease in the form of a lump sum for the whole duration of the lease in the event of the lessee’s delay to make the payment of lease for one period;


6) enable the lessor to perform unilateral assessment of the state of the dwelling and make a conclusion on it being fit for residence;


7) establish civil liability of the lessee in excess of the actual damage inflicted to the lessor.


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Article 6.581. Subject matter of a contract

Only a fit for residence dwelling house or its part, a separate apartment or an isolated dwelling consisting of one or several rooms with related non-residential premises may be the subject matter of a contract of lease of a dwelling. A part of a room or a room which is connected with another room by a common entrance (communicating rooms), likewise non-residential premises (kitchens, corridors, storage rooms, etc.) may not be the subject matter of a separate contract of lease of a dwelling. In apartments which are leased to several lessees under separate contracts of lease, such non-residential premises may be leased for common use.

 


Article 6.582. Duration of a contract


1. A contract of lease of a dwelling may be open-ended or fixed-term.


2. A written contract of lease shall be deemed to be concluded from the date when the parties sign it, while an oral contract shall be deemed to be concluded from the day when the parties agree on the conditions of the contract or a permission to take residence in the premises concerned is given.


3. A fixed-term contract, the duration of which is determined by a certain event, shall become open-ended in the case of non-occurrence of this event.  Where the date of the occurrence of the event concerned is put forward to a later time, the fixed term of the contract shall be postponed accordingly.  


4. The parties may renew a fixed-term contract of lease of a dwelling by concluding a new fixed-term or open-ended contract of lease.


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Article 6.583. Payment of lease


1. The lessee shall effectuate payment for the lease of the dwelling.


2. The lessee must effectuate the lease payment for the dwellings every month not later than by the twentieth calendar day of the following month unless other periods are provided for by agreement between the parties. Payment of lease for the state and municipal dwellings shall be calculated in accordance with the procedure established by the Government.


3. Payment of lease for the dwellings leased out by enterprises, offices and organisations to their employees shall be determined in the collective agreement, and in the instances where organisations do not conclude such agreements, it shall be determined by agreement between the organisation and the employees concerned; however, the maximum amount of the lease payment may not exceed the maximum lease payment determined in accordance with the procedure established by the Government.


4. The amount of lease payable for dwellings leased out on commercial grounds by enterprises, offices, organisations and legal persons shall be determined by agreement between the parties; however, the maximum amount of the lease payment may not exceed the maximum lease payment determined in accordance with the procedure established by the Government.


5. The lessor shall have no right to demand the payment of lease in advance, with the exception of the lease payment for the first month.


6. The contract of lease of a dwelling may provide for an adjustment of the amount of lease payment by agreement between the parties, but not more often than once a year. The clauses of a contract of lease of a dwelling entitling the lessor to unilaterally adjust the lease payment or to demand such adjustment before the expiry of a twelve-month period from the date of conclusion of the contract or more often than once a year shall be null and void.


7. In the event of a dispute between the parties, the lessee shall have the right to perform the payment of lease into a depository account in accordance with the procedure established in Article 6.56 of this Code.


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Article 6.584. Payment for water, energy and public utilities


1. In the event of lease of state or municipal dwellings, payment for cold and hot water, electric energy, gas, heating and public utilities (disposal of garbage, lifts, cleaning of common-use premises and the territory, etc.) shall be effectuated separately from the payment of lease.   Payment for cold and hot water, electric energy, gas, heating and public utilities shall be executed in accordance with the procedure established by the Government within the period indicated in paragraph 2 of Article 6.583 of this Code. 


2. The amounts, periods and procedure of payment for public utilities in the event of lease of dwellings by legal persons to their employees shall be determined within the framework of the collective agreement, and in the instances where organisations do not conclude such agreements, it shall be determined by agreement between the administration and the employee concerned.


3. In the event of lease of dwellings by legal and natural persons on commercial grounds, the issues of payment for cold and hot water, electric energy, gas, heating and public utilities shall be determined by agreement between the parties. 

 


Article 6.585. Validity of a contract of lease of a dwelling upon the change of the owner of the dwelling

In the event of the right of ownership to a dwelling having passed from the lessor to another person, the contract of lease of a dwelling shall remain valid in respect of the new owner, providing the contract of lease of the dwelling was registered in the public register in accordance with the procedure established by laws.


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Article 6.586. Grounds for declaring a contract null and void 


1. A contract of lease of a dwelling may be declared null and void upon the grounds of nullity of transactions established in this Code when, inter alia, the data presented to the lessee in respect of the lessor’s rights to the dwelling are false; the contract of lease of a dwelling prejudices valid rights of other persons to that dwelling; the actions of officials related to the conclusion of the contract of lease of a dwelling were unlawful.


2. A contract of lease of a dwelling may not be declared null and void upon the demand of the lessor if he knew that the other person, at the moment of conclusion of the contract, by reason of his condition was unable to comprehend the meaning of his actions or to control them, or the contract was concluded with a lessee who was legally incapable in this area or of limited legal capacity in this area.


3. In the event of a contract of lease of a dwelling being declared null and void, the lessee, together with all other persons residing with him, shall be evicted without other dwelling being granted to them, except in cases specified in paragraph 4 of this Article.


4. In the event of a contract of lease of a state or municipal dwelling being declared null and void on the grounds of it having violated valid rights of other persons to that dwelling while the lessee did not know and could not have known thereof, the lessee, together with all other persons residing with him, shall be evicted with another dwelling being granted to them.  In other instances, the lessee shall be entitled only to compensation for damages incurred by him.


5. A contract of lease of a dwelling may be declared null and void within a three-year limitation period. This time limit shall start to run from the date of conclusion of the contract.


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Article 6.587. Duties of the lessor of a dwelling


1. The lessor must transfer to the lessee a dwelling that is vacant and fit for residence, as specified in the contract of lease of the dwelling. The dwelling shall be deemed not fit for residence if it is in such a state that residing therein would pose danger to the health or safety of the lessee or that of his family members, or public safety and health.


2. The lessor shall have no right to refuse to conclude or extend a contract of lease of a dwelling, or to impose more onerous conditions for the sole reason that the lessee or a member of the lessee’s family is pregnant, likewise if the lessee or a member of the lessee’s family has children, with the exception of cases where the lessor cannot lease the dwelling due to its arrest or because of the size thereof (paragraph 4 of Article 6.578 of this Code).


3. Clauses of a contract of lease of a dwelling which exclude or limit civil liability of the lessor in respect of the lessee, or which establish liability of the lessee without his fault, shall be null and void.


4. Clauses of a contract of lease of a dwelling which enable the lessor to unilaterally modify the conditions of the lease contract because of an increase in the number of the lessee’s family members, or restrict the right of the lessee to purchase things or receive services from persons chosen by the lessee shall be null and void.


5. Clauses of a contract of lease of a dwelling which establish in respect of the lessee penalty in excess of real damages incurred by the lessor, or which entitle the lessor to demand from the lessee the payment of lease in the form of a lump sum for the whole duration of the lease in the event of the lessee’s failure to pay the lease on time shall be null and void.


6. The lessor must ensure the proper use of the dwelling house in which the leased dwelling is situated, provide or ensure that the necessary public utilities specified in the lease contract are provided to the lessee for payment, guarantee the repair of the common property of the multi-apartment house and of the equipment for the provision of public utilities situated in the house.


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Article 6.588. Members of the lessee’s family


1. Members of the lessee’s family shall be the spouse/cohabitee, their minor children, parents of the lessee and those of the spouse, residing together with the lessee.


2. Children of full age, their spouses/cohabitees and grandchildren of the lessee shall be attributed to his family members where they maintain a common household with the lessee.


3. Guardians and person under guardianship, having taken residence in the dwelling of their guardian or the person under guardianship, shall not acquire the rights of a member of the family of the guardian or the person under guardianship. In the event where they continue to reside together and maintain a common household after the termination of guardianship, they may be recognised as family members under judicial proceedings upon the request of either of them.


4. Close relatives, other dependants who have resided with the lessee, his family members or with any one of them at least for a period of one year and have maintained a common household, may be recognised as family members of the lessee under judicial proceedings.


5. By taking residence in the leased dwelling, parents, children of full age and their spouses/cohabitees shall acquire the rights of family members if they maintain a common household with the lessee and upon consent of the lessee and his family members.


6. The lessee and his family members of full age shall be liable towards the lessor for the actions of the lessee’s family members who violate the contract of lease of a dwelling.


7. The number of persons residing in a dwelling shall be limited by the necessity to ensure normal sanitary conditions and availability of normal conveniences for each of them.

 


Article 6.589. Rights and duties of the lessee’s family members


1. The family members of the lessee of a dwelling shall have the same rights and duties arising from the contract of lease of a dwelling as the lessee himself.


2. Natural persons who have ceased to be members of the lessee’s family but continue to reside in the leased dwelling shall have the same rights and duties as the lessee and his family members.


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Article 6.590. Right of family members to take occupancy of the leased dwelling


1. In accordance with the contract of lease of a dwelling, the right to take occupancy of the dwelling shall be enjoyed by those family members of the lessee as well as former family members who are indicated in the contract. In the event of those persons failing to take occupancy of the dwelling within six months from the date of conclusion of the contract, they shall forfeit the right to take this occupancy. For persons who are temporarily away, this term shall start to run upon the expiry of the time limit established in Article 6.591 of this Code; in the event of an earlier return of these person, it shall start to run from the date of their return.


2. The lessee of a state or municipal dwelling or the members of his family of full age shall have the right, upon the consent of other family members of full age, to house in the dwelling the spouse/cohabitee, children, his own parents and those of his spouse. Minor children shall not need such consent for taking occupancy together with their parents. The lessee of dwellings of enterprises, offices, organisations and natural persons leased out on commercial grounds shall have the right to house the persons specified in this paragraph only with the permission of the lessor. Such permission shall not be required in respect of the spouse/cohabitee of the lessee or his family member and their minor children. The contract of lease of a dwelling may establish other clauses regulating the taking of occupancy by family members.


3. Having taken occupancy, a family member shall acquire equal rights and duties with other family members or former family members of the lessee  to the dwelling unless otherwise agreed at the moment of taking occupancy.


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Article 6.591. Preservation of the right to use a state or municipal dwelling upon temporary departure


1. Upon temporary departure of the lessee, the right to the state or municipal dwelling shall be retained by his family member or a former family member for six months on condition that the lease payment and public utilities will be paid.


2. Upon temporary departure of the lessee, the right to the state or municipal dwelling shall be retained by his family member or a former family member for the whole duration of the absence thereof in the following cases:


1) upon departure to receive medical treatment: for the whole duration of the treatment;


2) upon departure to study: for the whole duration of the study;


3) upon departure for an extended business trip abroad: for the whole duration of the business trip;


4) upon departure to take over the duties of a guardian or curator: for the whole duration of those duties;


5) in respect of children placed in an educational institution, or with relatives, a guardian or curator: for the whole duration of the children’s stay at the institution or with the persons concerned;


6) in respect of conscripts or persons serving in an international military unit: for the duration of the service established by laws;


7) in respect of detained persons: for the whole duration of investigation and court proceedings.


3. Upon the expiry of the circumstances indicated in paragraph 2 of this Article, the temporarily absent lessee, his family member or a former family member shall retain the right to the leased dwelling for a further six months.


4. Upon the expiry of the period indicated in paragraph 3 of this Article, the temporarily absent lessee, his family member or a former family member shall forfeit the right to the leased dwelling.


5. In the event where the temporarily absent person, who returns after the fixed term, is accepted by the remaining lessee, members of the family or former members of the family to take occupancy of the leased dwelling, the forfeited right to the leased dwelling shall be deemed restored.


6. Upon the action of the temporarily absent person, the court may recognise his right to the leased dwelling if it is established that he has missed the term specified in this Article due to important reasons.


7. The right of a temporarily absent person to a leased dwelling shall terminate before the term specified in this Article in the event of a dissolution of the contract of lease of a dwelling unless it is otherwise provided for in the contract.


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Article 6.592. Use of a state or municipal dwelling upon temporary departure of the lessee, a member of his family or former member of his family

Upon temporary departure of the lessee of a state or municipal dwelling, a member of his family or former member of his family, the remaining members of the family or former members of the family shall have the right to maintain occupancy of the dwelling. In the event where there are no remaining lessee, members of his family or former members of the family, the departing lessee may sublease the dwelling or temporary residents may take occupancy of the dwelling. Upon the return of the person who was temporarily absent, the sub-lessee or the temporary resident must immediately vacate the dwelling, and the persons who fail to vacate the dwelling concerned shall be evicted without prior notice and without another dwelling being provided to them.

 


Article 6.593. Reservation of a state or municipal dwelling

In the event of the lessee, a member of his family or all members of his family departing to another location or abroad for a period exceeding six months, the state or municipal dwelling leased by him may be reserved. A dwelling shall be reserved on condition that the payment of lease and for public utilities will be effectuated. A decision in respect of reservation shall be taken by a relevant state or municipal institution. A refusal to execute reservation may be disputed under judicial proceedings. The reservation of a dwelling shall be made in the form of a written contract between the relevant state or municipal institution and the departing persons, providing that the remaining family members give their consent thereto. The consent of the remaining persons shall be expressed in the form of their signature in the reservation contract. A refusal to give consent may be disputed under judicial proceedings.

 


Article 6.594. Use of a reserved state or municipal dwelling


1. In the instances where not all members of the family depart, the reserved state or municipal dwelling shall be used by the remaining persons.  In the event of departure of the lessee and all of his family members, the lessee shall have the right to permit the dwelling to be used by other persons under a contract of sublease or allow temporary dwellers to take occupancy thereof.  It may be stipulated in the contract of reservation that the State or municipality will lease the dwelling under a fixed-term contract of lease.


2. Upon the return of the lessee or any member of his family, the persons maintaining occupancy in the dwelling concerned must, upon the demand of the former,  immediately vacate the dwelling, irrespective of the termination of the reservation period. 


3. Persons who fail to vacate the reserved dwelling shall be evicted without prior notice and without other dwelling being provided to them.


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Article 6.595. Sublease of a dwelling


1. The lessee shall have the right, upon the written consent of all the family members residing together with him as well as that of the lessor, to sublease the dwelling. The contract for the sublease of a dwelling may be formed both in written and oral form, and for fixed or indeterminate term; however, the duration of the contract of sublease may not be longer than the duration of the contract of lease.


2. The payment for the sublease of a dwelling shall be determined by agreement between the parties.


3. Upon the termination of the period of sublease, the sublessee shall have no priority for a renewal of the contract and must, upon the demand of the lessee, vacate the premises held under the contract of lease. In the event where a contract of sublease is formed without a term being fixed, the lessee must notify the sublessee three months in advance about the dissolution of the contract of sublease.  In the event of the refusal of the sublessee to vacate the dwelling, he must be evicted under judicial proceedings without another dwelling being provided to him.


4. Upon concluding a contract of sublease, the lessee shall continue to be liable towards the lessor under the contract of lease.

 


Article 6.596. Temporary dwellers


1. Having agreed among themselves and having accordingly informed the lessor beforehand, the lessee and his family members may allow temporary gratuitous occupancy in the dwelling in their use to other persons (temporary dwellers) without forming a contract of sublease. Upon the demand of the lessee or his family members, temporary dwellers must vacate the dwelling immediately. In the event of their refusal to vacate the dwelling, the lessee and his family members shall have the right to apply to the court for the eviction of the temporary dwellers without another dwelling being provided.


2. The lessee shall be liable towards the lessor for the actions of temporary dwellers.


3. The lessor shall have the right to deny permission for the occupancy of temporary dwellers in the instances where their occupancy would violate sanitary requirements and pose threat to the health and safety of others or would infringe the legitimate interests of the lessor.


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Article 6.597. Eviction of sublessees and temporary dwellers upon termination of the contract of lease of a dwelling


1. Upon termination of a contract of lease of a dwelling, a contract of sublease shall also terminate at the same time. The sublessee, as well as the temporary dwellers who refuse to vacate the dwelling shall be evicted under judicial proceedings without another dwelling being provided to them.


2. Rules providing for the priority of the lessee to renew a contract of lease of a dwelling shall not apply in respect of a contract of sublease.

 


Article 6.598. Modification of a contract


1. A contract of lease of a state or municipal dwelling may be modified in the cases specified in Articles 6.599 to 6.603 of this Code. In the instances where the lessee, his family members or former family members refuse to modify the contract of lease on the grounds established in the collective agreement or the agreement between the administration and the employees, the dispute between the parties to the contract of lease of a dwelling shall be resolved in judicial proceedings.


2. Any modification of a contract of lease of dwellings of enterprises, offices, organisations and legal persons leased out on commercial grounds may be effectuated exclusively upon agreement between the lessee and the lessor.


3. Upon modification of a written contract of lease of a dwelling, a new written contract shall be concluded with the modifications of the previous contract indicated therein.


4. The lessor must notify the lessee in writing of the intended modifications of the clauses of the contract of lease of a dwelling in accordance with the time limits and the procedure established in paragraph 4 of Article 6.607 of this Article.

 


Article 6.599. Modification of a contract upon dividing the apartment


1. An adult member of the family of the lessee and a former member of the family shall have the right to conclude a separate contract of lease of a dwelling (to divide the apartment) if the lessor, the lessee and other family members of full age do not object.  Such family member, taking in regard the part of the dwelling area attributable to him, may lease a separate isolated dwelling premise.  In such event, separate contracts of lease of dwellings shall be concluded with every lessee. The lessee, his family members of full age or former family members may determine the procedure and conditions for the use of the leased dwelling without modifying the contract of lease.


2. Any disputes arising from the division of an apartment or determination of the procedure and conditions for the use of the leased dwelling shall be resolved in judicial proceedings.


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Article 6.600. Modification of a contract where one dwelling is exchanged for several ones


1. In the event where such possibilities exist, the State or a municipality may exchange, with the consent of the lessee, his family members or former family members, the dwelling leased by them for several other dwellings. In this event, every member of the family shall be entitled to an area not exceeding ten square meters of the contractual dwelling space, while the dwelling occupied before shall remain within the hold of the municipality. Upon the request of the lessee, his family members of full age or former family members, one contract of lease of a municipal dwelling may be exchanged for several ones. Any disputes arising from the modification of a contract where one dwelling is exchanged for several ones shall be resolved in judicial proceedings.


2. The lessees and their family members who were not entitled to state support before the modification of the contract may acquire this right after the lapse of five years from the modification of the contract.

 


Article 6.601. Modification of a contract upon the uniting of the lessees into one family


1. When several natural persons (lessees) maintaining occupancy of one leased dwelling under separate contracts of lease unite to make one family, they may conclude one contract of lease of the leased dwellings (to join the apartments) upon the consent of their family members and the lessor.  The contract shall be concluded with the lessee proposed by the members of the united family.


2. Refusal of a lessee to conclude one contract of lease may be challenged in court.

 


Article 6.602. Modification of a contract upon recognition of another family member as the lessee


1. Upon the agreement between the lessee and his family members, the original lessee may be replaced by another person.


2. Upon the agreement between the family members of the lessee, the contract of lease of a dwelling shall be changed in the event of the lessee’s death where his family members continue to occupy the leased dwelling and inform the lessor accordingly within two months after the lessee’s death.


3. Disputes arising from the recognition of a family member as the lessee shall be resolved in judicial proceedings.


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Article 6.603. Modification of a contract upon the transfer of a vacated room


1. In the event where, in a dwelling leased by the State or municipality to several lessees under separate contracts of lease, an adjacent room which is not isolated from the dwelling of one of the lessees is vacated, at the request of that lessee this room shall be transferred to his use.


2. In the instances where an isolated room is vacated, it shall be transferred to the use of the lessee who has the least total useful floor area per one family member, or to another lessee in the event of a refusal by the former. In the event of refusal by all the lessees, the vacated dwelling shall be leased to other lessees.


3. Upon the vacated room being transferred to another lessee, the contract of lease of the dwelling shall be modified.

 


Article 6.604. Modification of a contract of lease of a dwelling after termination of labour relations by the lessee


1. Where the lessee terminates the labour relations with the legal person whose dwelling he is leasing, this shall not constitute grounds for the termination of the contract of lease of a dwelling. In this event, the contract of lease of a dwelling may be modified by the legal person on the grounds and in accordance with the procedure determined in the collective agreement, and in the organisations where such agreement is not concluded, pursuant to the agreement between the administration and the employees. Any disputes between the legal person and the lessee, his family members or former family members related with such modification of the contract shall be resolved in judicial proceedings.


2. Upon termination of the labour relations between the lessee and the lessor, the payment for the lease of the dwelling shall be determined in accordance with the procedure established in paragraph 4 of Article 6.583 of this Code.

 


Article 6.605. Right of the lessee to modify and change the plan of the dwelling


1. The lessee of a dwelling of the State, municipalities and legal persons and his family members may modify and change the plan of the dwelling and non-residential premises only upon written permission of the lessor and the consent of the family members of full age residing together, as well as upon the consent of other persons concerned whose rights and legitimate interests may be violated in the course of executing modification and change of the plan of the dwelling and non-residential premises. In the event of disagreement between the lessee, his family members and other persons concerned, the dispute may be resolved in judicial proceedings.


2. Paragraph 1 of this Article shall not apply in the instances of current repair of the dwelling which must be performed by the lessee unless otherwise provided for by the contract.


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Article 6.606. Relocation of the lessee for the duration of major repairs and reconstruction of the dwelling


1. Upon the necessity to perform major repairs or  reconstruction of the premises leased by the State, municipalities, enterprises, offices and organisations to their employees, the repairs of which cannot be effectuated without vacating the premises, and in the event where the dwelling is retained after the repairs, the lessor shall offer to the lessee together with his family members to temporarily take residence in another dwelling for the duration of the repairs. The dwelling offered must conform to sanitary and technical requirements. In the event of the lessee’s refusal to move to the dwelling offered, the lessor may demand his relocation under judicial proceedings.


2. In the instances where the leased dwelling might be rendered smaller or larger in area as a consequence of the major repairs or reconstruction, the lessee shall have the right of choice whether to lease that dwelling. Where the lessee agrees to lease the increased or reduced dwelling after the repairs or reconstruction, he shall move or be relocated to another dwelling for the duration of the repairs or reconstruction in accordance with the procedure established in paragraph 1 of this Article.


3. The contract of lease of a dwelling shall not be interrupted for the duration of the major repairs or reconstruction; however, the lessee shall have the right to pay the lease payment for the temporary dwelling.


4. The lessee shall have the right to move back into the dwelling after the completion of the major repairs or reconstruction. Where the lessee refuses to lease the increased or reduced dwelling, likewise where the dwelling is not retained as a result of major repairs or reconstruction, the lessee shall be provided with another properly equipped dwelling.  In the cases where the lessee refuses to move into another adequately equipped dwelling provided, the lessor may relocate him under judicial proceedings.


5. Issues related to vacating, for the duration of major repairs or reconstruction, dwellings leased by enterprises, offices, organisations and legal persons on commercial grounds as well as other related issues shall be resolved by agreement between the lessor and the lessee.   In all cases, the lessor must inform the lessee about the intended repair work due to which the lessee has to be temporarily relocated not later that fourteen days in advance before the start of the work. In the event where the lessor lacks the possibility to temporarily relocate the lessee for the duration of the repair, he must, before the date of the relocation, pay compensation to the lessee adequate to cover the costs of temporary relocation thereof. By agreement between the parties, the costs of the relocation of the lessee for the duration of the repair may be included into the future lease payment.


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Article 6.607. Priority right of the lessee to renew the contract of lease


1. Upon expiration of the term of the contract of lease, the lessee shall have priority right to conclude a contract of lease of the dwelling for a new term providing that he duly performed the conditions of the contract. The contract shall be renewed for the same term, and where the previous term of the contract exceeded twelve months, the contract shall be renewed for twelve months unless the parties agree otherwise.


2. The lessor must, not later than three months before the termination of the contract of lease, inform the lessee in writing about his proposal to conclude a new contract of lease under the same or different conditions or about his refusal to renew the contract where he does not intend to lease out the premises concerned at least for a period of one year.  In the event of failure by the lessor to perform this duty, and if the lessee does not refuse to renew the contract, the contract of lease shall be deemed to be renewed for the same period and under the same conditions.


3. In the instances where the lessor, after having refused to renew a contract of lease, leases the same dwelling within a period not exceeding one year to another person under the same conditions, the lessee shall have the right to demand that such contract be declared null and void and claim compensation of damages caused by the refusal to renew the contract. This provision shall not apply in the event where the lessee refused to renew the contract under the conditions proposed by the lessor and did not apply to the court for the approval of the conditions of the contract.


4. Upon renewing the contract, the lessor shall have the right to modify the conditions of the contract of lease, likewise the term of the contract of lease and the amount of the lease payment if he has informed the lessee about the intended modification of the conditions in writing not later than three months and not earlier than six months before the expiry of the period of the contract of lease. In the cases where the duration of lease is shorter than twelve months, such notification must be submitted to the lessee not later than one month before the expiry of the term of the contract of lease. The clauses of the new contract of lease must be clearly indicated in the notification.


5. In the event where the lessee disagrees with the modifications of the clauses of the contract of lease proposed by the lessor, he must, within one month from the date of receiving the notification, inform the lessor in writing about such disagreement or about a dissolution of the contract of lease.  Where the lessee fails to comply with this requirement, he shall be deemed to have agreed with the new clauses for the renewal of the contract of lease.


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6. In the event where the lessee objects to the modifications of clauses of the contract of lease proposed by the lessor and informs the latter accordingly within the time limits and in accordance with the procedure established in paragraph 5 of this Article, the lessor wishing to renew the contract of lease under new conditions shall have the right, within one month from the receipt of the notification from the lessee, to apply to court for the determination of the conditions of the contract of lease under judicial proceedings. Where the lessor fails to do that, the contract shall be deemed to have been renewed under the previous conditions.


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Article 6.608. Exchange of dwellings


1. A lessee of a state or municipal dwelling, having received written consent of all his family members of full age residing together with him, including those temporarily absent, and with the consent of the lessor, may exchange the dwelling with another lessee of a state or municipal dwelling.


2. Objections of the State or municipalities to such exchange of dwellings may be challenged in court.  


3. The exchange of dwellings shall be formalised by new contracts of lease.   The contract of exchange shall become effective from the last day of the conclusion of a new contract of lease of a dwelling, and where the dispute is decided by the court, from the day when the court judgment becomes final.


4. In the event where the family members fail to agree upon the exchange, while the change of dwellings might offer a possibility of resolving the conflict developed in the family, any of the family members shall have the right to demand within judicial proceedings compulsory exchange of the leased dwelling by another dwelling or dwellings in different houses/apartments.

 


SECTION TWO

TERMINATION OF A CONTRACT OF LEASE OF A DWELLING

 


Article 6.609. Right of a lessee to dissolve the contract


1. The lessee of a dwelling shall have the right to dissolve the contract of lease by giving the lessor a written notice a month in advance.  In the event of failure by the lessee to comply with this requirement, the lessor shall have the right to compensation of damages incurred.


2. The lessee may revoke his warning before the expiration of its time limit if the lessor has not concluded a contract of lease of that dwelling with another lessee.


3. In the event where the lessee, his family members and former family members depart to take residence elsewhere, the contract of lease of a dwelling shall be deemed to be dissolved from the date of their departure.


4. Upon receiving the lessee’s warning in respect of the dissolution of the contract, the lessor shall have the right to inspect the condition of the dwelling premises upon having informed the lessee beforehand about the date and time of such inspection. In this event, the lessor shall also have the right to show the premise to a prospective lessee upon having informed the lessee beforehand about the date and time of such visit. Except in urgent cases, the lessor shall have no right to inspect the dwelling premise or show it to a prospective lessee in the hours between 9:00 p.m. and 9:00 a.m.


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Article 6.610. Procedure of dissolving a contract and evicting persons

A contract of lease of a dwelling may be declared null and void, it may be dissolved, likewise the eviction of natural persons from the dwelling premises may be executed exclusively within judicial proceedings, except in the cases of eviction executed with the sanction of the public prosecutor provided for in this Code.

 


Article 6.611. Dissolution of a contract upon the violation of conditions of the contract of lease by the lessee

In the instances where the lessee regularly (at least for three months unless a more extended period is provided for in the contract) fails to pay the lease payment or the payment for public utilities, where the lessee, his family members or other persons residing together with him destroy or damage the dwelling or use it for a purpose other than its designation, the contract of lease may be dissolved and the persons concerned evicted from the dwelling without other dwelling being provided. In the event where the lessee, his family members or other persons residing together with him create, by their improper behaviour, such conditions which render it impossible for other persons who reside together or in the neighbourhood to lead a normal life, they may be evicted upon the request of the lessor or the latter persons without other dwelling being provided.

 


Article 6.612. Eviction from wilfully occupied dwellings

Where persons wilfully occupy a dwelling, i.e. move in without concluding a contract of lease, they shall be evicted through court proceedings, without another dwelling being provided.    In the instances where persons wilfully occupy a dwelling, i.e. move in without concluding a contract of lease, they shall be evicted within judicial proceedings without another dwelling being provided to them.

 


Article 6.613. Effects of termination of a fixed-term contract of lease of a dwelling 

Upon the expiration of the time limit of a contract of lease of a dwelling, the lessee, his family members or former family members must vacate the dwelling upon the demand of the lessor, while those who fail to comply shall be evicted without another dwelling being provided to them.

 


Article 6.614. Dissolution of an open-ended contract of lease of a dwelling


1. An open-ended contract of lease of a dwelling leased by legal and natural persons on commercial grounds may be dissolved upon the demand of the lessor with a written notice issued to the lessee six months in advance.


2. Upon the expiration of the time limit indicated in paragraph 1 of this Article, the lessee, his family members or former family members must vacate the dwelling, while those who fail to comply shall be evicted without another dwelling being provided to them.


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Article 6.615. Eviction from dwelling houses or apartments at risk of collapse

Where dwellings of the State, municipalities or legal persons are at risk of collapse or become unfit for habitation due to natural disasters, fire or technical wear and tear, natural persons shall be evicted with the sanction of the public prosecutor with another adequately equipped dwelling being provided to them. This dwelling shall be provided by the owner of the building where the dwelling which is at risk of collapse or unfit for habitation is located. In such instances, the former contract of lease shall be deemed to have terminated.

 


Article 6.616. Dissolution of a contract and eviction of persons with another adequately equipped dwelling being provided


1. Natural persons may be evicted from dwellings of the State, municipalities and legal persons leased to their employees with another adequately equipped dwelling being provided to them in the following instances:


1) the residential house in which the dwelling is located is subject to demolition;


2) the dwelling is not retained after major repairs, reconstruction or change of planning of the premises;


3) the dwelling is converted into premises for other designation.


2. Another adequately equipped dwelling shall be provided by the lessor or other legal person in whose interests the residential house is being demolished, reconstructed or whose planning is being changed and the dwelling is converted into premises for other designation.

 


Article 6.617. Provision of another adequately equipped dwelling to evicted persons


1. Another adequately equipped dwelling provided must be located in the same residential district and be properly equipped in accordance with the conditions of that district, it must also conform to the sanitary and technical requirements.


2. Another adequately equipped dwelling provided may not be of smaller floor area or have fewer rooms than the previously occupied dwelling. Where in the previously occupied dwelling the useful floor area per member of the family was smaller than established by laws, upon eviction, the floor area provided may not be smaller than established. The dwelling provided must be of such size as to avoid the necessity of sharing a room by two persons over nine years of age of different gender, except spouses, and must conform to the condition of health of those to be evicted as well as to other circumstances.


3. Upon the request of the lessee, he may be also provided with a smaller dwelling.


4. The court judgment upon the dissolution of the contract of lease of a dwelling and eviction of the lessee must indicate the total floor area and the number of rooms in the dwelling to be provided to the evicted person.

 


SECTION THREE

EMPLOYEE HOUSING ACCOMMODATION


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SECTION THREE

EMPLOYEE HOUSING ACCOMMODATION

 


Article 6.618. Legal status of employee housing accommodation


1. Employee housing accommodation shall be provided by the employer for the purpose of housing employees/civil servants, taking in regard the character of their employment/service or conditions established by laws, for the period until the change in the character of their employment/service, termination of the labour relations with the employer, or disappearance of the conditions established by law.


2. Dwellings shall be attributed to the category of employee housing accommodation or removed therefrom as well as the lists of the categories of employees eligible for employee housing accommodation shall be determined by a decision of a public authority or a governmental institution, a municipal council or a management body of the legal person concerned.


3. Public authorities or governmental institutions, municipal councils or legal persons shall attribute to the category of employee housing accommodation only vacated dwellings belonging to them by the right of ownership or trust.

 


Article 6.619. Procedure for providing and using employee housing accommodation


1. The decision concerning the provision of employee housing accommodation shall be taken by a person authorised by a public authority or a governmental institution, an executive municipal institution or a management body of the legal person. On the basis of this decision, a contract of lease of employee housing accommodation shall be concluded.  The conclusion of such a contract shall be effectuated in accordance with the procedure established by this Code in respect of contracts of lease of a dwelling unless otherwise provided for by laws.


2. The procedure for the use and accounting of employee housing accommodation shall be established by the Government or its authorised institution.


3. Employee housing accommodation shall be used in accordance with the rules of the contract of lease of a dwelling established in Articles 6.581 to 6.587, paragraph 1 of Article 6.590, and Articles 6.605 and 6.606 of this Code.

 


Article 6.620. Eviction from employee housing accommodation

Upon the termination of an employment/service contract, the employee to whom employee housing accommodation was provided in accordance with the established procedure must vacate the leased employee housing accommodation together with the family members residing with him.  Natural persons who fail to do so shall be evicted without another dwelling being provided to them, except in cases stipulated in Article 6.616 of this Code.


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Article 6.621. Eviction from employee housing accommodation by providing another dwelling

In the cases stipulated in Article 6.616 of this Code, natural persons evicted from employee housing accommodation shall be provided with another dwelling, likewise in the events when the evicted persons are:


1) employees/civil servants discharged from employment/service as a result of their capacity for work having been rated at 0-40 per cent or having been rated as having high or moderate special needs due to the reasons related to their employment/service;    

 


2) members of the family of an employee/civil servant who was the lessee of the employee housing accommodation and is dead or missing due to the reasons related to the employment/service.

 


Article 6.622. Provision of another dwelling to evicted natural persons

Another dwelling provided to evicted natural persons must be in the same residential district and conform to the sanitary and technical requirements.

 


SECTION FOUR

LEASE OF A DWELLING IN DORMITORIES

 


Article 6.623. Dormitories


1. Workers, civil servants, students and pupils may be accommodated in dormitories during their time of employment or study. Dormitories shall be dwelling houses built and equipped specifically for this purpose. The procedure for providing accommodation in a dormitory and the use thereof shall be established in the collective agreements of legal persons. In the organisations where such agreement is not concluded, this procedure shall be established upon the agreement between the administration and the employees, and in educational establishments and higher education and research institutions, upon the decision of the management bodies thereof.


2. Upon the expiration of the employment contract or the period of study, the employees shall be evicted from the dormitory, except in cases provided for by Article 6.621 of this Code. The persons who study shall be evicted at the end of an academic year. Dormitory dwellers may be evicted without other dwelling being provided in the instances where they create, by their improper behaviour, such conditions which render it impossible for others to maintain occupancy together or in the neighbourhood, likewise in the instances where they continuously damage the dwelling or use it not according to its designation.


3. Eviction from dormitories shall be effectuated in accordance with the judicial proceedings.

 


Article 6.624. Prohibition to sublease dormitory dwellings

Lessees who maintain occupancy in dormitories shall have no right to sublease their dwelling or to provide occupancy for temporary dwellers.


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Article 6.625. Temporary relocation

In the event of necessity (due to repair, emergency, etc.), the lessor shall have the right to relocate the lessee without the latter’s consent from one dwelling in the dormitory to another dwelling either in the same or another building within the same neighbourhood.

 


SECTION FIVE

HOTELS, HOMELESS SHELTERS AND RESIDENCY IN

THE PREMISES OF HEALTH AND SOCIAL CARE INSTITUTIONS    

 


Article 6.626. Hotels


1. Legal and natural persons shall have the right to possess hotels, which are especially equipped premises for the temporary accommodation of visitors.


2. Hotels shall be established and operated on commercial grounds.


3. Natural persons who maintain occupancy in the hotel for a longer period than agreed or without paying for the hotel, or violate the requirements for the use of the hotel, shall be evicted with the sanction of the public prosecutor under the motion of the administration without another dwelling being provided.


4. This Article shall also apply for short-term (not exceeding two months) contracts of lease of dwellings concluded for the time of holiday and for recreational purposes.

 


Article 6.627. Homeless shelters

The rules in respect of the operation and use of homeless shelters established on charity or any other grounds and granting the possibility to gratuitously spend the night for persons in need shall be determined and registered with the municipality by their founders. Any disputes related with the use of such homeless shelters and eviction therefrom shall be decided pursuant to those rules.

 


Article 6.628. Residency in the premises of health and guardianship/curatorship institutions

Persons who, for the purposes of medical treatment or care, temporarily or permanently reside in the premises of health and guardianship/curatorship institutions shall not be deemed to be lessees.  The relationships between such persons and health and guardianship/curatorship institutions shall be determined by relevant service contracts and laws.

 


CHAPTER XXXII

UNCOMPENSATED USE OF A THING (LOAN FOR USE)


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CHAPTER XXXII

UNCOMPENSATED USE OF A THING (LOAN FOR USE)

 


Article 6.629. Concept of a contract of loan for use


1. Under a contract of uncompensated use of a thing (loan for use), one party (lender) shall transfer a durable thing for temporary uncompensated possession and use to another party (loan recipient), while the loan recipient shall undertake to return this thing in the same state in which it was received, taking into account normal wear and tear, or in a state stipulated in the contract.


2. Provisions of paragraphs 2 and 3 of Article 6.477, Articles 6.478, 6.479, 6.481, paragraphs 1 and 2 of Article 6.489, and Article 6.501 of this Code shall apply correspondingly to a contract of loan for use.

 


Article 6.630. Limitations on concluding a contract of loan for use

Legal persons operating for profit shall have no right to transfer a thing under a contract of loan for use to persons who are founders, participants or members of the bodies of those legal persons.

 


Article 6.631. Legal effects of a promise to transfer a thing for uncompensated use

Failure to honour a promise to transfer a thing for uncompensated use without adequate grounds shall vest the loan recipient with the right to claim compensation of expenses incurred in relation with the acceptance of the thing to be transferred for uncompensated use.

 


Article 6.632. Lender

The right to transfer a thing for uncompensated use shall be enjoyed only by the person who is the owner of the thing, or by other persons authorised by the owner or by laws.

 


Article 6.633. Transfer of a thing for uncompensated use


1. The lender must transfer a thing to the loan recipient in a state corresponding to the conditions of the contract of loan for use and the designation thereof.


2. A thing shall be transferred to the loan recipient with all of the auxiliaries and documents relating thereto (instruction manuals for use, technical passport, etc.) unless otherwise provided for by the contract.


3. In the event where such auxiliaries and documents were not transferred, and without them the thing cannot be used for its designation, or its use without the auxiliaries and documents loses value for the loan recipient, the latter shall have the right to require such auxiliaries and documents to be transferred to him by the lender, or to dissolve the contract and demand from the lender compensation for the damages suffered.


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Article 6.634. Liability of the lender for defects of the thing


1. The lender shall be liable for defects of the thing transferred for uncompensated use which he intentionally or through gross negligence did not stipulate when concluding the contract for use, as well as for the damage caused to the loan recipient by these defects.


2. In the event of discovery of such unstipulated defects, the loan recipient shall have the right, at his choice, to require from the lender uncompensated elimination of the defects or compensation of the costs of their elimination, or dissolution of the contract and compensation of the direct damages incurred.


3. The lender, who was notified about the demands of the loan recipient, or of his intention to eliminate the defects of the thing at the expense of the lender, shall have the right to immediately replace the defective thing with another analogous thing of adequate quality.


4. The lender shall not be liable for the defects which were stipulated by him at the time of conclusion of the contract, likewise for the defects that were known to the loan recipient beforehand or ought to have been discovered by the loan recipient during the transfer of the thing, or its inspection, or testing when concluding the contract.

 


Article 6.635. Rights of third persons to the thing transferred under the contract of loan for use


1. The transfer of a thing for uncompensated use shall not constitute grounds for the change or termination of the rights of third persons in that thing, providing those rights have been registered in the public register in accordance with the procedure established by laws, except in cases where those rights are not subject to registration pursuant to laws.


2. When concluding a contract of loan for use, the lender must warn the loan recipient about the rights of third persons in the thing transferred. The failure to perform this duty shall give the loan recipient the right to demand dissolution of the contract and compensation for the direct damages incurred.

 


Article 6.636. Duty of the loan recipient to maintain and preserve the thing

The loan recipient must maintain and preserve the thing transferred to him under the contract, likewise to perform current and major repairs, and to bear all expenses for the maintenance thereof unless otherwise provided for by the contract. 

 


Article 6.637. Duty of the loan recipient to use the thing in accordance with its designation


1. The loan recipient must use the thing transferred to him only in accordance with its designation specified in the contract. 


2. Without prior written consent of the lender, the loan recipient shall have no right to let third persons use the thing transferred to him.


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Article 6.638. Risk of accidental perishing of or damage to the thing


1. The loan recipient shall bear the risk of accidental perishing of or damage to the thing if the thing perished or was damaged while being used for other purposes than those indicated in the contract, or transferred to a third person without prior written consent of the lender. The loan recipient shall also bear the risk of accidental perishing of or damage to the thing if he continued using the thing after the expiry of the time limit of the contract of loan for use, or taking into account the actual circumstances, he could have saved the thing by using his own property, but failed to do so.


2. If the loan recipient, with the purpose of saving the thing transferred to him, destroys his own thing, or permits it to be destroyed, he shall have the right to claim from the lender compensation for the necessary and immediate expenses incurred in the attempt to save the transferred thing.


3. The loan recipient shall not be liable for accidental perishing of or damage to the thing if it occurred in the course of its normal use in accordance with its designation indicated in the contract.

 


Article 6.639. Liability for damage caused to third persons

The loan recipient shall be liable for damage caused to third persons as a consequence of the use of the thing transferred under the contract of the loan for use unless he proves that the damage was caused by intent or gross negligence of the lender or a person to whom the thing was transferred with the consent of the lender.

 


Article 6.640. Prohibition to use the right of retention   

The loan recipient shall have no right of retention in respect of a thing transferred to him, except in cases where the obligation of the lender entails compensation of necessary and immediate expenses related with the preservation of the thing.


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Article 6.641. Dissolution of a contract of loan for use before time


1. The lender shall have the right to demand dissolution of the contract before time in the instances where the loan recipient:


1) uses the thing not in accordance with its designation;


2) fails to fulfil the duty to maintain and preserve the thing;


3) substantially worsens the state of the thing;


4) transfers the thing to third persons without the consent of the lender.


2. The lender shall also have the right to demand dissolution of the contract of loan for use before time in the instances where due to unpredicted and extraordinary circumstances the thing is urgently and inevitably needed by the lender himself.


3. The loan recipient shall have the right to demand dissolution of the contract before time:


1) in the event where defects of the thing are discovered, which make the normal use of the thing impossible or obstructed and about the existence of which he did not know or could not have known at the time of concluding the contract;


2) if the thing, by virtue of circumstances for which the loan recipient is not liable, becomes not fit for use in accordance with its designation;


3) if at the time of concluding the contract the lender failed to warn him about the rights of third persons in that thing;


4) in the event of the failure by the lender to transfer the auxiliaries or documents related to the thing.

 


Article 6.642. Right to withdraw from a contract of loan for use


1. Each of the parties to a contract of loan for use shall have the right to terminate, at any time, an open-ended contract of loan for use having notified the other party thereof three months in advance unless another time limit has been provided for by the contract.


2. Unless otherwise provided for by the contract, the loan recipient shall likewise have the right to terminate, at any time, a fixed-term contract of loan for use having notified the other party about the intended termination of the contract at least one month in advance.

 


Article 6.643. Change of the parties to a contract of loan for use


1. The lender shall have the right to sell the thing or transfer it for use to a third person for payment.  In this event, the rights and duties under the previous contract of loan for use shall pass to the new owner or user if that contract, in the case of it being subject to registration, was registered in the public register in accordance with the procedure established by laws, or the new owner and user knew or should have known about it at the time of concluding the contract.


2. In the event of the death or reorganisation of the lender, his rights and duties shall pass to the successor of his rights.


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CHAPTER XXXIII

CONTRACTING

 


SECTION ONE

GENERAL PROVISIONS

 


Article 6.644. Concept of a contract for work


1. Under a contract for work, one party (the contractor) shall undertake to perform certain work at his own risk in accordance with the instruction of another party (the client), and transfer the results thereof to the client, while the latter shall undertake to accept the work performed and pay for it.


2. The provisions determined in this Section shall be correspondingly applicable to individual types of contract (consumer, construction, etc.) unless otherwise provided for by the provisions of other Sections of this Chapter.


3. The contractor and the client shall not be bound by any relations of subordination or other affiliation.

 


Article 6.645. Subject matter of a contract for work


1. A contract for work shall be concluded for the manufacture or transfer of the results of a certain work, or for the performance of any other work with the ensuing transfer of the results created in the process of this work to the client.  Prior to the conclusion of the contract, the contractor must submit to the client all the necessary information related to the performance of the work, likewise the information concerning the materials and the time necessary for the performance of the work.


2. Where the contract is concluded for the manufacture of a thing, the contractor shall transfer to the client, together with the manufactured thing, the rights thereto. 


3. Unless otherwise provided for by the contract, the contractor shall perform the work at his own risk and independently determine the methods of fulfilling the task set by the client.


4. Where the character and value of the work performed is relatively insignificant in comparison with the value of the manufactured, purchased or processed thing, the contract shall be deemed to be a sales contract rather than a contract for work.

 


Article 6.646. Permits/licences for individual types of work

It may be provided for by laws that certain types of work may be performed only upon obtaining a permit/licence issued in accordance with the procedure established by laws.  

 


Article 6.647. Performance of work using the materials and means of the contractor


1. Unless otherwise provided for by the contract, the contractor must perform the work agreed in the contract using his own materials and with his means and forces.


2. In performing the work using his own materials, the contractor shall be liable for any inferior quality of the materials.


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Article 6.648. Performance of work using the materials of the client


1. In supplying the contractor with materials, the client must also transfer to him the documents certifying the conformity of the materials.


2. Where the materials supplied by the client are not fit for use or defective, of which the contractor needs to know, the contractor must immediately notify the client thereof.


3. If the work is performed in whole or in part using the materials of the client, the contractor shall be liable for the improper consumption of the materials. The contractor must submit to the client a report on the expenditure of the materials and return the balance thereof or, with the consent of the client, reduce the price of the work by taking into account the cost of the unconsumed materials remaining with the contractor.


4. Where the work is performed using the materials of the client under the contract of client order, the receipt issued by the contractor to the client when concluding the contract must contain the precise name, description and valuation of the materials determined by agreement between the parties. 


5. The contract for work may provide for the consumption rate of the materials, the time limits for the return of their balance and basic waste, likewise the liability of the contractor for the failure to perform these duties, or improper performance thereof.


6. Where the contractor has not achieved the result stipulated by the contract or the result achieved has defects which make the thing unfit for use in accordance with the designation provided for in the contract or it its normal designation due to defects in the materials granted by the client, the contractor shall have the right to demand payment for the work performed only if he proves that the defects in the materials were impossible to be noticed in accepting them from the client.

 


Article 6.649. Distribution of risks between the parties


1. Unless otherwise provided for by laws or a contract for work:


1) the risk of accidental perishing or damaging of the materials or equipment transferred for the performance of work shall be borne by the party granting them;


2) the risk of accidental perishing or damaging of the result of the work fully completed or that of its intermediary stage shall be borne by the contractor until the acceptance thereof by the client.


2. In the event of delay in the transfer or the acceptance of the result of the work performed, the risks provided for in paragraph 1 of this Article shall be borne by the party in delay.


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Article 6.650. General contractor and the subcontractor


1. Unless the laws or the contract for work stipulate that the contractor has to perform the task personally, the contractor shall have the right to involve other persons (subcontractors) to perform his obligations. In the event where subcontractors are involved for the performance of the task, the contractor shall act in the capacity of a general contractor.


2. The contractor who has involved subcontractors to perform the contract in violation of laws or the rules established in the contract shall be liable towards the client for any damage caused by the subcontractors in the performance of the contract.


3. The general contractor shall be liable towards the client for the failure to perform or improper performance of the obligations by the subcontractors, and towards the subcontractors, for the failure to perform or improper performance of the obligations by the client.


4. Unless otherwise provided for by laws or the contract, the client and the subcontractor shall have no right to raise monetary claims to one another connected with the violation of the contracts concluded by each of them with the general contractor.


5. With the consent of the general contractor, the client shall have the right to conclude contracts with other persons for performance of individual works.  In this event, those persons shall be directly liable towards the client for the failure to perform or improper performance of the contract.

 


Article 6.651. Particularities of a contract for work where the work is performed by several persons


1. Where the work is performed by two or more persons, in the event of the indivisibility of the subject matter of the obligation, they shall be liable towards the client as solidary co-debtors and co-creditors.


2. In the event of the divisibility of the subject matter of the obligation, each of the persons indicated in paragraph 1 of this Article shall acquire the rights and duties with respect to the client within the limits of the corresponding participatory share (partial obligation) unless otherwise provided for by the contract.


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Article 6.652. Time limits for the performance of work


1. The beginning and end of performance of work shall be indicated in the contract for work. The parties may also determine the time limits for completing individual stages of work (intermediate time limits).


2. Unless otherwise provided for by laws or the contract, the contractor shall be liable for the violation of the time limits for both the beginning and end of work, likewise for the violation of the intermediate time limits.


3. Upon the agreement of the parties, the time limits for the performance of the work specified in the contract may be changed in accordance with the procedure indicated in the contract for work.


4. Where the contractor violates the time limit for the performance of the entire work, the client shall have the right to refuse acceptance of the work performed as a result of fulfilment of the obligation and claim damages from the contractor related to the delay in fulfilment in the cases where, due to the delay, the fulfilment of the obligation became of no significance to the client.


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Article 6.653. Price of work


1. The contract for work shall specify the price of work or the methods and criteria for its calculation.  In the event where the price is not specified in the contract, it shall be determined in accordance with the procedure established in Article 6.198 of this Code.


2. The price indicated in the contract for work shall include the payment to the contractor for the work performed and the compensation of expenses incurred by him.


3. The price of the work specified in the contract may be determined by drawing up a definitive or approximate estimate. Where the work is performed in accordance with the estimate drawn up by the contractor, the estimate shall enter into force and become part of the contract for work from the moment it is confirmed by the client.


4. Where it is necessary to perform additional work or where, for any other important reasons, the contractor has to increase the price of some individual works, he must inform the client thereof in due time. If the client refuses to increase the price, the contractor shall have the right to withdraw from the contract. In this event, the contractor shall have the right to demand from the client payment for the work performed. The contractor who fails to inform the client in due time about the necessity to increase the price for the work must perform the contract for the price foreseen therein.


5. In the instances where a definite price for the work to be performed is indicated in the contract, the contractor shall have no right to increase the price, nor the client to reduce it. The same provision shall apply to those instances where, at the moment of concluding the contract for work, it was not possible to determine the exact amount of work subject to performance nor all the expenses necessary for the performance thereof.


6. In the event of a substantial increase of the price of materials or equipment supplied by the contractor, or also of the services rendered to the contractor by third persons, and where the contractor could not have foreseen such increase at the time when the contract for work was concluded, the contractor shall have the right to demand an increase of the established price of the work or to dissolve the contract in accordance with the provisions established in Article 6.204 of this Code.

 


Article 6.654. Economies of the contractor


1. In the event where the actual expenses of the contractor prove to be lower than those taken into account in determining the price of work, the contractor shall retain the right to the payment for work as established in the contract for work unless the client proves that the economies produced negative effect on the quality of work as determined in the contract.


2. A distribution of the economies received may be provided for in the contract.


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Article 6.655. Procedure for payment for work


1. Unless advance payment for work performed or individual stages thereof has been provided for in the contract for work, the client must pay the contractor the stipulated price after the final acceptance of the results of work on condition that the work has been performed properly and on time or, with the consent of the client, before the set time limit.


2. The contractor shall have the right to demand an advance payment or an earnest only in the instances provided for in the contract.

 


Article 6.656. Right of the contractor to exact remuneration due to him

Where the client fails to perform his obligation to pay the remuneration established in the contract for work or other amount agreed by the parties to the contract, the contractor shall have the right to exact the amounts due to him under the contract for the work performed using the equipment belonging to the client, balance of the unused materials, or any other property of the client, until full payment by the client, or to retain the result of the work until proper performance of the obligation by the client.

 


Article 6.657. Liability of the contractor for failure to preserve the property granted to him by the client

The contractor must take all measures necessary to ensure the preservation of the property entrusted to him by the client and shall be liable towards the client for any loss or damage of this property.


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Article 6.658. Rights of the client during the performance of work


1. The client shall have the right to verify the progress and quality of work at any time without interfering in the economic and commercial activities of the contractor.


2. In the event of the contractor failing to embark upon the performance of work on time, or where he is working so slowly that the completion of the work on time becomes clearly impossible, the client shall have the right to revoke the contract and claim compensation of damages.


3. If during the performance of work it becomes evident that it will not be properly performed, the client shall have the right to designate a reasonable period to the contractor for the elimination of defects, and in the event of the failure to perform this demand by the independent work contractor within the designated period, to revoke the contract and either claim compensation of damages or authorise a third person to rectify the work at the expense of the contractor.


4. In the event of emergence of important reasons, the client shall have the right, at any time before the work is completed, to revoke the contract at the same time effectuating payment to the contractor for the performed part of the work and compensating the damages caused by the dissolution of the contract, including into the damages the economies received by the contractor due to the dissolution of the contract.


5. In the event of defects being discovered in the course of acceptance of the work, the client shall have the right to deduct from the amounts due to the contractor for the work performed the amount necessary to eliminate the defects.  The client shall retain this right also in the instances where hidden defects of work are discovered. However, the client shall have no such right in the event where the contractor adequately ensures the performance of his obligation.


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Article 6.659. Circumstances of which the contractor is obliged to warn the client


1. The contractor must immediately warn the client and, until receiving instructions from him, suspend the work in the event of discovering:


1) unfitness or inferior quality of the materials, other property or documents received from the client;


2) possible consequences threatening the fitness or stability of the work due to the compliance with the instructions of the client concerning the methods of performance of work;


3) other circumstances beyond the control of the contractor which threaten the fitness, stability or security of the work.


2. The contractor who fails to warn the client about the circumstances indicated in paragraph 1 of this Article, or continues to work without awaiting for the receipt of the client’s reply within the period indicated in the contract, or, where this period is not indicated, within a reasonable time, or fails to comply with the timely instructions of the client, shall not be entitled to refer to the circumstances indicated in paragraph 1 of this Article and shall be liable for the defects of the thing.


3. If the client, notwithstanding a timely and substantiated warning by the contractor concerning the circumstances indicated in paragraph 1 of this Article, within a reasonable time fails to replace unfit or inferior quality materials, other property or documents, or to change his instructions concerning the methods of performance of work, or to eliminate other circumstances which threaten the fitness or stability of the work to be performed, the contractor shall have the right to revoke the contract and claim compensation of damages.

 


Article 6.660. Assistance of the client


1. The client must, in the instances and in accordance with the procedure established in the contract for work, render assistance to the contractor in the performance of work.  Where the client fails to perform this duty, the contractor shall have the right to claim from him compensation of damages, including additional expenses caused by idle time or postponement of the time limits for the performance work or by the increase of the cost of work.


2. In the instances where the performance of work under the contract has become impossible as a consequence of failure on the part of the client to fulfil his obligation indicated in paragraph 1 of this Article, or improper fulfilment thereof, the contractor shall have the right to demand the payment of the price specified in the contract, taking into account the part of the work performed, and the compensation of damages, or to dissolve the contract.


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Article 6.661. Legal effects of the failure to perform counter-duties of the client


1. The contractor shall have the right not to embark upon the work, or to suspend the work in progress in the event of failure on the part of the client to perform his counter-duties established in the contract for work (failure to grant materials, equipment, documents, etc.), or if the client obstructs the performance of the contract by the contractor, or if there any other circumstances which explicitly testify to the fact that the contractor will fail to perform his duties on time (Article 6.219 of this Code).


2. Unless otherwise provided for by the contract for work, the contractor shall have the right, in the circumstances indicated in paragraph 1 of this Article, to revoke the contract and claim compensation of damages.


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Article 6.662. Acceptance of work performed


1. The client must, within the periods and in accordance with the procedure provided for in the contract for work, inspect with the participation of the contractor and accept the work performed or its result.  In the event of discovering any deviations from the terms of the contract which impair the quality of the result of work, or any other defects in the work, the client must immediately inform the contractor accordingly. The acceptance of the work performed shall be formalised by drawing up an act by which the client certifies an unconditional acceptance, or that with a reservation clause, and the contractor certifies the transfer of the work performed.


2. Having discovered any defects of work in the course of acceptance, the client may rely upon the fact of the defects only in the instances where in the act or any other document certifying the acceptance of the work performed, these defects were recorded, or the right of a subsequent claim on the part of the client concerning their elimination is stipulated.


3. Unless otherwise provided for by the contract, the client, having accepted the work without verification, shall lose the right to rely upon the fact of defects which could have been discovered by ordinary means of acceptance of the work (obvious defects).


4. Having discovered, after the acceptance of the work, defects thereof or any deviations from the contract which could not have been discovered by ordinary means of acceptance of the work (latent defects), likewise those intentionally concealed by the contractor, the client must notify the contractor thereof within reasonable time after their discovery. 


5. In the event where a dispute arises between the contractor and the client because of the defects of the work, each party shall have the right to demand expert examination. The expenses of the expert examination shall be borne by the contractor, except in cases where the expert examination establishes the absence of any violations of the contract on the part of the contractor, or any causal link between the actions of the contractor and the defects discovered. In such events, the expenses of the expert examination shall be borne by the party which requested such examination, and if it was designated by agreement between the parties, by both parties equally.


6. Unless otherwise provided for by the contract for work, in the event where the client evades acceptance of the work performed, the contractor shall have the right, upon the expiry of one month from the date when the work should have been accepted under the contract and after having notified the client in writing twice, to sell the result of the work and to deposit the amount received, less all payments due to him, in the name of the client (Article 6.56 of this Code).


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7. In the event where the evasion of the client to accept the work entails delay in the transfer of the results of the work, the risk of accidental perishing or damaging of the result of the work shall pass to the client from the moment when the transfer of the result to the client should have been executed.


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Article 6.663. Quality of work


1. The quality of the work performed by the contractor must conform to the conditions of the contract for work and, in the absence of any determination of quality in the contract, to the requirements ordinarily presented for work of the respective nature. The result of the work performed must, at the moment of transfer to the client, possess the characteristics specified in the contract for work or ordinarily required and must be fit for use in accordance with its designation within the limits of a reasonable period.


2. In the event where obligatory requirements for work to be performed are established by the law or the contract for work, the contractor, acting as an entrepreneur, must comply with those requirements. The parties may establish in the contract for work a duty of the contractor to perform the work in accordance with requirements which are higher than the established obligatory requirements.

 


Article 6.664. Guarantee of the quality of work


1. In the event where a guarantee period for the result of the work is established by the law or the contract for work, the result of the work must correspond to the established quality requirements during the entire guarantee period.


2. Unless otherwise provided for by the contract for work, the guarantee of the quality shall extend to all component parts of the result of the work.


3. In the event of defects being discovered during the guarantee period, the contractor must gratuitously eliminate the defects or compensate to the client the expenses of their elimination.


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Article 6.665. Liability of the contractor for the improper quality of work   


1. In the instances where the work is performed with deviations from the conditions of the contract, which renders the result of the work unfit for use in accordance with its designation as determined in the contract or impairs the possibilities (conditions) for its use in accordance with its designation under the contract and, where the designation is not specified in the contract, in accordance with its ordinary use, the client shall have the right, unless otherwise provided for by the law or the contract, at his choice to require from the contractor:


1) elimination of defects without compensation within a reasonable period;


2) commensurate reduction of the price for work;


3) compensation of his expenses for the elimination of the defects when the right of the client to eliminate them has been provided for in the contract for work.


2. The contractor shall have the right instead of eliminating the defects to perform the work anew without compensation and compensate to the client damages caused by the delay of performance. In this event, the client must return the result of work previously transferred to him to the contractor, provided that it is possible to do so in view of the character of the work.


3. Where the contractor fails to eliminate the deviations from the contract or other defects within a reasonable time, or the defects prove to be essential and cannot be eliminated, the client shall have the right to dissolve the contract and claim the compensation of damages.


4. The conditions of a contract for work which relieve the contractor from liability for certain defects shall not exempt him from liability if the client proves that such defects were caused by the fault or gross negligence of the contractor.


5. In the event where the work was performed using the materials of the contractor, the contractor shall be liable for the quality of the materials as a seller under a sales contract.


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Article 6.666. Time limit for the discovery of defects of work


1. Unless otherwise provided for by the law or the contract for work, the client shall have the right to present demands connected with defects in the result of work on condition that they have been discovered within the time limits established in this Article.


2. In the instances where no guarantee period is established, the defects in the result of work must be discovered within a reasonable time but not exceeding two years from the date when the result of work was transferred unless other time limits are provided for by the law or the contract for work.


3. The client shall have the right to present demands connected with defects in the result of work which were discovered within the period of guarantee.


4. In the instances where the guarantee period provided for by the contract does not exceed two years and the defects in the result of work are discovered by the client upon the expiry of the guarantee period but within the limit of two years from the date when the result of work was transferred, the contractor shall be held liable for those defects if the client proves that the defects arose before the transfer of the result of the work or for reasons which occurred before that moment.


5. Unless otherwise provided for by the contract for work, the guarantee period shall start to run from the moment when the result of the work was accepted or ought to have been accepted by the client.


6. The rules established in paragraphs 2 to 6 of Article 6.335 of this Code shall apply for the calculation of the guarantee period unless otherwise provided for by law or the contract for work, or any other conclusion arises from the essence of a particular contract for work.

 


Article 6.667. Prescription


1. Prescription for claims arising in connection with defects of the work performed shall constitute one year, except in cases provided for by this Code.


2. In the instances where, under the contract for work, the result of the work was accepted in parts, the prescription shall commence from the date of acceptance of the result of the work as a whole.


3. In the event where a guarantee period is established by the law or the contract for work, and the statement concerning the defects was presented within that guarantee period, the prescription shall commence from the date of the statement concerning the defects.

 


Article 6.668. Duty of the contractor to transfer information to the client

The contractor must transfer to the client, together with the result of the work, information about the use of the subject matter of the contract for work if such duty of the contractor is established in the contract for work, or the character of the information is such that without it the use of the result of the work is impossible for the designation specified in the contract.


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Article 6.669. Duty of the parties in respect of confidentiality

If any of the parties in the framework of performance of a contract for work has received information from the other party considered to be commercial secret or any other confidential information stipulated in the contract, this party shall have no right to communicate such information to third persons without the consent of the other party.

 


Article 6.670. Return of property to the client

In the instances where the client dissolves the contract on the grounds provided for in paragraph 2 of Article 6.658 and paragraph 3 of Article 6.665 of this Code, the contractor must return to the client the materials and any other property transferred, and where this proves to be impossible, compensate their value in money.

 


Article 6.671. Legal effects of the dissolution of a contract for work before acceptance of the result of work

In the event of the dissolution of a contract for work on the grounds provided for by the law or contract before the acceptance of the result of work, the client shall have the right to demand transference to him of the result of the work performed, and the contractor in this event shall have the right to demand payment for the actually performed work.

 


SECTION TWO

CONTRACTING FOR CONSUMER WORK

 


Article 6.672. Concept of a contract for consumer work


1. Under a contract for consumer work, the contractor, who is an entrepreneur, shall undertake to perform, in accordance with the order of the client, who is a consumer, certain work intended to satisfy domestic or other personal needs of the client or those of his family, while the client shall undertake to accept the result of the work performed and pay for it.


2. The contract for consumer work shall be governed by the provisions of this Code on the consumer contract.

 

 


Article 6.673. Guarantees of the client


1. The contractor shall have no right to demand inclusion of additional work or services into a contract for consumer work.  The client shall have the right to refuse payment for work or services that have not been indicated in the contract.


2. The client shall have the right, at any time before the acceptance of the result of work, to dissolve the contract, having paid a part of the determined price commensurate to the work performed.


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Article 6.674. Granting information to the client about the proposed work   


1. Prior to the conclusion of the contract, the contractor must submit to the client all the necessary and accurate information related to the proposed work, its types, price and form of payment, also, upon the request of the client, other data related to the contract and the work to be performed. In the event where it is significant due to the character of the work, the contractor must indicate to the client the specific person who will perform the work provided for in the contract. 


2. The client shall have the right to dissolve the contract without paying for the work performed and claim compensation of damages in the instances where, as a consequence of incompleteness or inaccuracy of information submitted by the contractor, a contract was concluded for the performance of work not possessing the properties which the client had in mind.

 


Article 6.675. Performance of work using the materials of the contractor


1. If the work is performed using the materials of the contractor, upon the conclusion of the contract, the client shall pay for the materials the entire or a part of the price specified in the contract, the materials shall be paid for by the client when concluding the contract in whole or in a part of the price specified in the contract, with the final payment executed to the contractor after the completion of the work.


2. The contract for consumer work may specify that the material is granted by the contractor on credit, also that the client will pay for the material by instalments.


3. A change of price of the material after the conclusion of a contract for consumer work shall not entail a resettlement of accounts.

 


Article 6.676. Price and payment for work


1. The price of work shall be determined by agreement between the parties to the contract for work.


2. The work must be paid for by the client after the transference of the result of the work by the contractor.  With the consent of the client, the work may be paid for when concluding the contract in full or by issuing an advance, or the payment may be effectuated later at the time agreed upon by the parties. 

 


Article 6.677. Duty of the contractor to notify the client about the conditions of use of the result of work

In transferring the result of work to the client, the contractor must notify him about the conditions of its use and indicate to the client the requirements to be complied with when using the result of the work, as well as possible consequences for the client himself and other persons of the failure to comply with such requirements.


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Article 6.678. Legal effects of discovery of defects in the work


1. In the event of the discovery of defects during the acceptance of the result of work or during the use thereof, the client must, within the time limits established in Article 6.666 of this Code, at his choice, present one of the demands stipulated in Article 6.665 of this Code, or require repeated performance of the work without compensation, or claim compensation for the expenses incurred by him for the elimination of the defects.


2. The demand concerning the elimination without compensation of such defects in the result of the work which may pose danger to the life or health of the client or other persons may be presented by the client or his legal successor within two years, and where the subject matter of the contract was a building, installation or any other construction works, within the period of ten years from the moment of acceptance of the result of work unless a more extended period is determined by laws or the contract. Such demand may be presented irrespective of when these defects were discovered, likewise if they were established after the expiry of the guarantee period.


3. Where the contractor fails to fulfil the demands specified in paragraph 2 of this Article, the client shall have the right, within the same period, to require either the return of part of the price paid for the work or compensation for the expenses incurred by him for the elimination of the defects.

 


Article 6.679. Legal effects of the failure by the client to appear for receipt of the results of work


1. In the event of the failure by the client to appear for receipt of the result of work or other avoidance to accept the work, the contractor must warn the client in writing of his duty to accept the result of the work.


2. In the event of the failure by the client to take over the result of work within two months from the date of the warning indicated in paragraph 1 of this Article, the contractor shall have the right to sell the subject matter of the contract for a reasonable price and to deposit the amount received, less all payments due to him, in the name of the client into a depository account of the notary, bank or any other credit institution located in the place of residence of the client.

 


Article 6.680. Rights of the client in the event of the failure by the contractor to perform the work indicated in the contract or improper performance thereof

In the event of the failure by the contractor to perform the work indicated in the contract for consumer work or improper performance thereof, the client shall have the right to take advantage of the rights of a purchaser established in Article 6.334 of this Code.

 


SECTION THREE

CONSTRUCTION CONTRACTING


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SECTION THREE

CONSTRUCTION CONTRACTING

 


Article 6.681. Concept of a construction contract


1. Under a construction contract, the contractor shall undertake, within the period established in the contract, to build the construction works or perform other construction work according to the task of the client, while the client shall undertake to create the necessary conditions for the contractor to perform the construction work, to accept the result of the work performed, and pay the price stipulated in the contract.


2. A construction contract shall be concluded for the construction or reconstruction of enterprises, buildings, dwelling houses and other construction works, as well as for the performance of assembly, launching or any other work. The provisions of this Section shall likewise apply to work related to major repairs of buildings or installations unless otherwise provided for by the contract.


3. A construction contract may establish the duty of the contractor to ensure the maintenance of the constructed object after its acceptance by the client within a period specified in the contract.


4. In the instances when under a construction contract the work is performed for the purpose of satisfaction of a natural person’s (client’s) personal, family or household needs not related with his business or profession, the provisions governing the contract for consumer work shall apply to this contract.

 


Article 6.682. Distribution of risk between the parties


1. The risk of accidental perishing or damage of the object of construction or a part thereof shall be borne by the contractor until its acceptance by the client.


2. In the event of accidental perishing or damage of the object of construction or a part thereof before its acceptance as a consequence of inferior quality of materials, components or structures granted by the client, or due to the performance of erroneous instruction of the client, the contractor shall have the right to demand payment of the entire price of the work indicated in the contract, provided that the contractor has performed the duties established in paragraph 1 of Article 6.659 of this Code.  In the event of the failure by the client to comply with the request of the contractor to change materials, components, structures or instructions which may pose a threat to the surroundings or would result in essential violations of the technical regulations established in the construction documents, the contractor must immediately dissolve the contract.


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Article 6.683. Insurance of the object of construction


1. A construction contract may establish the duty of the party on whom the risk of accidental perishing or damage of the construction object is placed to insure the construction object, materials or other property used in the construction process, likewise the duty to insure civil liability of that party for damage caused to other persons.  


2. The party on whom the duty to insure the construction object or his civil liability is placed must submit to the other party, within the periods established in the contract, the evidence of conclusion of the contract of insurance, also the data on the insurance enterprise, the sum of insurance and the essential conditions of insurance.

 


Article 6.684. Technical construction regulations and estimates


1. The contractor must perform the construction work in accordance with the requirements established in the technical construction regulations and the contract/contractual documentation determining the price of work and quality requirements applicable to the construction works/work.


2. The composition of the documents related with the contract (technical construction regulations) must be indicated therein. The contract must likewise specify which of the parties and within what period must grant certain technical construction regulations.


3. Unless otherwise provided for by the construction contract, the contractor shall be deemed to be obliged to perform himself all the work indicated in the technical construction regulations.


4. Where the contractor discovers, in the course of construction, the need for work which is not indicated in the technical construction regulations and which requires performance of additional construction work and a corresponding increase in the price of the contract, the contractor must inform the client accordingly. Where the contractor does not receive a reply from the client to his communication within the period established in the contract or, where such period is not indicated in the contract, within a reasonable time, the contractor shall have the right to suspend the performance of the work concerned. In this case, the damages caused by the suspension of the work must be borne by the client unless he proves the absence of necessity to perform additional work.


5. In the event of the failure by the contractor to perform the duty indicated in paragraph 4 of this Article, he shall be deprived of the right to demand payment from the client for the additional work performed and claim compensation of damages incurred unless he proves that the necessity for immediate actions was in the interests of the client while the suspension of work might have brought about perishing or damage of the construction object.


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Article 6.685. Change in the contractual documentation


1. The client shall have the right to make changes in the contractual documentation on condition that the price of the additional work caused by the changes does not exceed fifteen per cent of the total price of construction work specified in the contract, and the changes do not alter the character of the work provided for in the contract. The parties may also provide for other conditions for making changes in the contractual documentation.


2. The contractor shall have the right to demand a revision of the price of the contract if, for reasons beyond his control, the actual price of the work has increased by more than fifteen per cent (Article 6.204 of this Code).


3. The contractor shall have the right to claim compensation for reasonable expenses incurred by him in connection with the establishment and elimination of the defects in the contractual documentation.

 


Article 6.686. Supply of materials and equipment for construction


1. The duty relating to the supply of materials, equipment, components and other structures for construction shall be borne by the contractor unless the construction contract attributes this duty to the client.


2. The party whose duty it is to supply materials and equipment for construction shall be liable for the defects thereof which render those materials and equipment impossible to be used without impairing the quality of the construction work unless it is proved that it was impossible to use those materials and equipment due to circumstances for which the other party is liable.


3. In the event where the defects referred to in paragraph 2 of this Article are discovered in the materials and equipment provided by the client, and the client refuses to replace them, the contractor must dissolve the contract and demand payment for the actually performed work.


4. The contractor shall have no right to use the materials provided by the client for his own needs unless otherwise provided for by the contract for work.

 


Article 6.687. Payment for work


1. The client must pay for the construction work performed within the periods and in accordance with the procedure determined in the construction contract.


2. The parties may agree upon payment at certain periods or in full after acceptance of the object of construction.


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Article 6.688. Other duties of the client


1. The client must provide, in a timely manner, a land plot for construction (construction site).  The size and condition of the land plot provided must conform to the conditions specified in the construction contract and enable the timely commencement of proper performance and timely completion of the construction by the contractor.


2. In the instances and in accordance with the procedure provided for by the contract, the client must also transfer for the use of the contractor buildings and installations, provide transportation services, install temporary electric power or water supply networks, obtain the necessary permits authorising the contractor to perform certain work, as well as render other services provided for in the contract.


3. Payment for the services specified in paragraph 2 of this Article shall be effectuated in the instances and pursuant to the procedure established in the construction contract.

 


Article 6.689. Right of the client to control and supervise construction work


1. The client shall have the right to exercise control and supervision of the course and quality of construction work being performed, the compliance with the schedules of construction work, the quality of the materials supplied by the contractor, and the use of the materials provided by the client.  In implementing this right, the client shall have no right to interfere in the economic and commercial activities of the contractor.


2. Upon the discovery of any deviations from the conditions of the contract which may impair the quality of construction work or any other defects, the client must immediately notify the contractor thereof. Failure by the client to notify about the detected defects shall deprive him of the right to rely on them in the future.


3. The contractor must follow the client’s instructions received in the course of the construction if such instructions are not contrary to the conditions of the construction contract and the technical construction regulations, and do not represent interference in the economic and commercial activities of the contractor.


4. Where the contractor fails to properly perform the contract, he shall have no right to rely on the fact that the client failed to exercise control and supervision of the construction work, except in the cases where the duty of the client to exercise such control and supervision is established by law or the contract.


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Article 6.690. Participation of the projecting and other institutions in the fulfilment of the duties and exercise of the rights of the client


1. The client shall fulfil his duties and exercise his rights relating to control and supervision of the construction with the participation of the projecting and other institutions (engineer, constructor, consultant, etc.). The rights and duties of the projecting institution relating to control and supervision of the construction shall be determined in the contract concluded between the client and the projecting and other institutions, as well as in the construction contract.


2. The list of construction works subject to authorial supervision of the construction to be exercised by the projecting institution shall be determined by the technical construction regulations.


3. Mandatory expert examination of projects may be established by laws.

 


Article 6.691. Cooperation of the parties to a construction contract


1. In the course of performing a construction contract, the parties to the contract shall be obliged to cooperate (duty of cooperation). In the event of appearance of obstacles which hinder proper performance of the contract, each of the parties to the contract shall be obliged to take all reasonable measures within their control to eliminate such obstacles. The party which fails to perform this duty shall lose the right to claim compensation of damages caused by the failure to eliminate the relevant obstacles.


2. Expenses incurred by a party in eliminating the obstacles specified in paragraph 1 of this Article shall be borne by the other party in the instances and amounts determined in the construction contract.

 


Article 6.692. Duties of the contractor related to ensuring environmental protection and work safety

When performing construction and work connected therewith, the contractor must comply with the requirements of laws and technical construction regulations concerning environmental protection and work safety. The contractor shall be liable for the violation of these requirements.

 


Article 6.693. Legal effects of conservation of construction work

If, for reasons beyond the control of the parties, the construction work is suspended and the construction object subjected to conservation, the client must effectuate payment in full for all the construction work performed until conservation, likewise compensate damages caused by the suspension of work and conservation of the object, including therein all the advantages which the contractor has received or could have received as a consequence of the termination of work.


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Article 6.694. Handing over and acceptance of work  


1. Upon receipt of the contractor’s notification of the readiness to hand over the result of work or, where this is provided for in the contract, of the completion of a stage of the work performed, the client must immediately  embark upon the acceptance thereof. The conditions of handing over and acceptance of work shall be determined by laws and the contract for work concluded by the parties.


2. The acceptance of work shall be organised and effectuated by the client at his expense unless otherwise provided for by the construction contract. In the instances provided for by laws and technical construction regulations, representatives of the relevant state and municipal institutions shall participate in the acceptance of the result of work.


3. Having accepted the result of an individual stage of work, the client shall bear the risk of accidental perishing or damage of this result, except in cases where this occurs due to the fault of the contractor. In the instances where the client starts to use the construction works before acceptance, the risk of accidental perishing thereof shall be borne by the client unless otherwise provided for by the contract.


4. The handing over of the work and the acceptance thereof shall be formalised by an act to be signed by both parties. In the event of the refusal of one of the parties to sign the act, a relevant notation shall be made thereon, and the act shall be signed by the other party. A unilateral act of handing over may be declared null and void by the court if it decides that the first party had substantial grounds for the refusal to sign the act.


5. In the instances provided for by laws or the construction contract or where it arises from the character of work, preliminary testing and control measurements must be performed prior to the acceptance of the result of the work. In those instances, the acceptance of work may be effectuated only upon obtaining positive results of the preliminary testing and control measurements.


6. The client shall have the right to refuse acceptance of the result of work in the event of discovery of defects which render it impossible to use the result for the purposes established in the construction contract and which cannot be eliminated by the client or the contractor.


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Article 6.695. Liability of the contractor for the quality of work 


1. The contractor shall be liable to the client for any deviations from the requirements of the technical construction regulations and also for the failure to achieve the indicators of the objects of construction specified in these documents or the contract (productive capacity of the enterprise, resistance, etc.).


2. In the event of reconstruction of constructions works and installations, the contractor shall be liable for any reduction or loss of reliability, durability or resistance of the construction works or installations.


3. The contractor shall not be liable for minor deviations from the technical construction regulations made with the consent of the client if he proves that these deviations have not influenced the quality of the construction object and will not bring about any negative consequences.

 


Article 6.696. Liability for the collapse of a construction works


1. The contractor, the architect, the contractor of an expert examination of the design documentation of a construction works and the technical supervisor of the construction shall be respectively liable for the collapse of the constructions works and the resultant damage if the object collapsed due to the defects in the design, constructions or the performance of construction work, or due to unsuitable ground soil.


2. The architect, the contractor of an expert examination of the design documentation of the construction works, or the technical supervisor of the construction may be relieved from liability if it is proved that the collapse of the object was not caused by defects in the design, constructional defects or inadequate supervision or control of the construction work, but through faulty actions of the contractor or the client.


3. The contractor may be relieved from liability if it is proved that the collapse of the object occurred through the fault of the architect, the contractor of an expert examination of the design documentation of the construction works, or the technical supervisor of the construction who were chosen by the client, or through faulty actions of the client.


4. Where it is impossible to establish through the fault of which of the specific persons indicated in paragraph 1 of this Article the collapse of the construction works has occurred, they shall all be solidarily liable.


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Article 6.697. Guarantee of the quality of work


1. Unless otherwise provided for in the construction contract, the contractor shall ensure, throughout the whole guarantee period, the compliance of the object of construction with the indicators established in the technical construction regulations and its fitness for use for the designation specified in the contract.


2. The parties to the contract shall have the right to establish, upon their agreement, a more extended guarantee period.


3. The contractor, the architect, the contractor of an expert examination of the design documentation of the construction works, and the technical supervisor of the construction shall be liable for the defects discovered within the guarantee period unless it is proved that the defects occurred as a consequence of the normal wear and tear of the object or parts thereof, its inappropriate use, or improper repair made by the client or third persons engaged by him, or any other faulty actions of the client or third persons engaged by him.


4. The guarantee period shall be interrupted for the entire period during which the object could not be used as a consequence of the discovered defects for which the contractor is liable.


5. Upon discovering defects of the object within the guarantee period, the client must make a claim to the contractor within a reasonable time from their discovery.

 


Article 6.698. Guarantee periods


1. The contractor, the architect, the contractor of an expert examination of the design documentation of the construction works and the technical supervisor of the construction shall be liable for the collapse of the object or any defects if the object collapsed or the defects were discovered within the time limit of:


1) five years;


2) ten years, where hidden elements of the construction works (constructions, pipelines, etc.) exist;


3) twenty years, where intentionally concealed defects exist.


2. The time limits specified in paragraph 1 of this Article shall start to run from the day when the result of all the work completed by the contractor is handed over to the client (when the construction is carried out by contracting) or from the day of completion of construction (in the case of self-dependent or mixed-type construction).    

 


Article 6.699. Elimination of defects at the expense of the client


1. A construction contract may provide for the duty of the contractor, at the request of the client and at the client’s expense, to eliminate the defects of the work for which the contractor is not held liable.


2. The contractor shall have the right to refuse fulfilment of the duty indicated in paragraph 1 of this Article in the instances where the elimination of the defects is not directly connected with the subject matter of the construction contract or they cannot be eliminated for reasons beyond the control of the contractor.

 


SECTION FOUR

CONTRACTING FOR DESIGN AND SURVEY WORK


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SECTION FOUR

CONTRACTING FOR DESIGN AND SURVEY WORK

 


Article 6.700. Concept of a contract for design and survey work

Under a contract for design and survey work, the contractor (architect, surveyor) shall undertake to perform survey and design work in accordance with the task of the client, draw up technical documentation or produce any other result of work and transfer it to the client, while the latter shall undertake to accept the result and pay for it.

 


Article 6.701. Task of design and survey work


1. Within the periods and in accordance with the procedure established in the contract, the client must submit to the contractor the task for design and survey work as well as any other data necessary for drawing up the technical documentation. The task and other primary data may also be prepared by the contractor under the authorisation of the client. In that event, the task shall become obligatory to both parties from the moment when it is confirmed by the client.


2. The contractor must perform the work in compliance with the requirements of the task and other primary data and may depart therefrom only with the consent of the client.

 


Article 6.702. Duties of the contractor


1. The contractor must:


1) perform design and survey work in accordance with the requirements established by the contract, the task and other primary data;


2) coordinate the prepared technical documentation with the client in accordance with the procedure stipulated in the technical construction regulations, and in the cases established by the law, with the relevant state or municipal institutions, or perform an expert examination of the technical documentation;


3) cooperate with the client in the course of performing the work and coordinating the prepared technical documentation;


4) within the periods and in accordance with the procedure established in the contract, transfer the prepared technical documentation or the result of the survey work to the client;


5) safeguard commercial secrets or any other confidential information of the client.


2. The contractor shall have no right to transfer the result of work to third persons without the consent of the client.


3. The contractor must guarantee to the client the absence of the right of any third persons to prohibit or obstruct the performance of design or survey work, nor prohibit or obstruct the performance of work in accordance with the technical documentation prepared by the contractor.


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Article 6.703. Liability of the contractor for the quality of work


1. The architect/surveyor shall be liable for improper drawing up of the technical documentation or performance of survey work, as well as for the re-performance of the construction work as a consequence of improperly performed design/survey work or improperly drawn up technical documentation, as well as for defects of work/documentation which were discovered in the course of the work in accordance with the prepared technical documentation or when accepting the result of survey, or in the process of operation of the object produced on the basis of that work.


2. In the instances of discovery of defects in the technical documentation or in the survey work, the contractor must, at the request of the client, correct without compensation the defects of the technical documentation or re-perform the survey work, and compensate for the damage to the client, unless otherwise provided for by the contract.


3. Mandatory expert examination of projects may be established by laws.

 


Article 6.704. Duties of the client

In accordance with a contract for design and survey work, the client must:


1) pay to the contractor the established price in full after the completion of all the work or in parts after the completion of individual stages of work provided for in the contract; 


2) use the result of work received from the contractor exclusively for the purposes specified in the contract, not transfer it to third persons, nor publish the data of the result of the work without the consent of the contractor;


3) cooperate with the contractor in the course of work and coordination of the prepared technical documentation;


4) compensate the contractor for additional expenses caused by a change of the task or the primary data, where the changes were conditioned by the circumstances beyond the control of the contractor;


5) involve the contractor as a third person in a lawsuit brought against the client by third persons in connection with defects in the technical documentation or design and survey work.

 


SECTION FIVE

CONTRACTING FOR WORK FINANCED FROM THE BUDGET OF THE STATE

OR MUNICIPALITIES

 


Article 6.705. Performance of construction and design work for the needs of the State or municipalities


1. Construction, design or survey work, as well as architectural and engineering activities and related technical consultations intended for the satisfaction of the needs of the State or municipalities financed from the budget of the State or municipalities shall be performed under contracts for works concluded on the basis of a public tender, except in cases provided for by laws.


2. Contracts for works referred to in paragraph 1 of this Article shall be governed correspondingly by provisions of this Code unless otherwise provided for by laws.


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Article 6.706. Content of a contract for work concluded on the basis of a public tender

In the event where a contract for work is concluded on the basis of a public tender, the content of the contract shall be determined in accordance with the announced conditions of the tender and the proposals submitted by the contractor who has won the tender.

 


CHAPTER XXXIV

RESEARCH, EXPERIMENTAL,

DEVELOPMENT AND TECHNOLOGICAL WORK

 


Article 6.707. Concept of a contract for research, experimental, development or technological work


1. Under a contract for research, one party (the executor) shall undertake to conduct research in accordance with the terms of reference of the other party (the client), and, in accordance with a contract for experimental, development or technological work, to work out a model of a new product or its production development documentation, or a new technology, while the client shall undertake to accept the work and pay for it.


2. A contract with the executor may be concluded for the performance of the work in total or for its individual stages (elements).


3. Unless otherwise provided for by laws, the risk of accidental impossibility to perform the contract shall be borne by the client.


4. The conditions of the contract must correspond to the provisions on intellectual property established by this Code and other laws.

 


Article 6.708. Performance of work


1. The executor must conduct research personally. The executor shall have the right to involve third persons for the performance of research work pursuant to the contract only upon a written consent of the client.


2. The executor shall have the right to involve third persons for the performance of experimental, development or technological work unless otherwise provided for by the contract.  Relations between the executor and third persons shall be governed accordingly by Article 6.650 of this Code.

 


Article 6.709. Confidentiality of information


1. Unless otherwise provided for by the contract, both parties must ensure confidentiality of information related with the subject matter of the contract, the performance of the contract and the results obtained.  The type of information to be deemed confidential pursuant to the contract shall be determined by agreement between the parties.


2. Each of the parties may divulge the information deemed confidential pursuant to the contract exclusively upon the consent of the other party.


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Article 6.710. Right of the parties to the result of work


1. The parties to the contract shall have the right to use the result of work performed to the extent and on the terms determined in the contract.


2. Unless otherwise provided for by the contract, the client shall have the right to use the results of the work transferred, and the executor shall have the right to use the results of the work obtained for their own needs.   

 


Article 6.711. Duties of the executor

Under a contract for research, experimental, development or technological work, the executor must:


1) perform the work in accordance with the terms of reference agreed upon with the client and transfer the results of the work to the client within the period indicated in the contract;


2) agree with the client upon the necessity of using the legally protected results of intellectual activity that belong to third persons and the acquisition of the rights for the use thereof;


3) eliminate by his own means and at his own expense defects violating the conditions of the contract or the terms of reference, which occurred through his fault;


4) immediately inform the client about the impossibility of obtaining the anticipated results or the inexpediency of continuing the work;


5) guarantee to the client that the transferred results of the work performed do not violate the exclusive rights of other persons.

 


Article 6.712. Duties of the client


1. The client must transfer to the executor the information indicated in the contract as necessary for the performance of work, accept the results of the work performed and pay for them.


2. The contract may provide for the duty of the client to transfer to the executor the terms of reference and agree with him upon the programme and theme of the work.

 


Article 6.713. Impossibility of achieving the anticipated results in conducting research

In the event where, in the course of conducting research, it becomes obvious that it is impossible to achieve the anticipated results as a consequence of circumstances beyond the control of the executor, the client shall be obliged to pay the executor for the work performed before the impossibility became obvious, but not in excess of the respective part of the price of the work specified in the contract.

 


Article 6.714. Impossibility of continuing experimental, development or technological work

In the event where, in the course of performance of experimental, development or technological work, it becomes obvious that it is impossible or inexpedient to continue the work through no fault of the executor, the client shall be obliged to pay a part of the price of the work specified in the contract which is proportional to the part of the work performed, as well as to pay other reasonable expenses incurred by the executor in attempting to perform the work.


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Article 6.715. Liability of the executor for violation of the contract


1. The executor shall be liable towards the client for violation of the contract unless he proves that the contract was violated not through his fault.     


2. The executor shall be obliged to compensate to the client for the damages caused by the defects of the work within the limits of the value of the work performed in the event where it is established in the contract that the damages shall be subject to compensation within the limits of the value of the work performed. Lost incomes shall be compensated only in the instances provided for in the contract.

 


CHAPTER XXXV

PROVISION OF REMUNERATIVE SERVICES

 


SECTION ONE

GENERAL PROVISIONS

 


Article 6.716. Concept of a service contract


1. Under a service contract, one party (the provider of services) shall undertake to provide to the other party (the client), by commission of the latter, certain services of non-material nature (intellectual) or other services which are not related to the creation of a material object (to perform certain actions or pursue certain activities), and the client shall undertake to pay for the services provided.


2. The provisions of this Chapter shall apply only to those services in respect of which no relationship of employment or other subordination exists between the provider of services and the client.


3. The rules established by the provisions of this Chapter shall apply to the provision of audit, consultancy, personal healthcare, veterinary, information, education, tourist or other remunerative services, to the exclusion of the services provided in accordance with the rules laid down in Chapters XXXIII, XXXIV, XXXVI, XXXVIII, XL, XLI, XLII, XLIV, XLVI, XLVII and L of this Book.


4. The consumer service contract shall be governed by the provisions of this Code on the consumer contract.


5. Other laws may establish additional requirements applicable to remunerative services of individual types, which are not provided for in this Chapter.


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Article 6.717. Performance of the service contract


1. Unless the service contract establishes otherwise, the provider of services must provide the services himself.


2. In compliance with the contract, the provider of services shall be free to choose the methods and measures to perform the contract.


3. Unless the contract establishes otherwise, the provider of services may involve third persons to perform the contract. In the latter case, however, the provider of services shall be personally liable to the client for the proper performance of the contract.


4. Where services are provided by more than one person, all providers of the services shall be liable for the proper performance of the contract, to the exclusion of the cases where the non-performance of the contract or improper performance thereof occurred through no fault of anyone of them.

 


Article 6.718. Priority of the interests of the client


1. The provider of services must be honest and reasonable in the provision of services, so as to serve the best interests of the client.


2. Having regard to the type of services, the provider of services must, in the provision of services, act in accordance with the established practices and standards applicable to the relevant profession.


3. The provider of services must provide the services in accordance with the terms of the contract and following the instructions of the client. If the instructions of the client are in violation of laws, established rules of the professional activities, standards, professional ethics or the terms of the contract, the provider of services shall have the right to refuse to follow such instructions and to terminate the contract.


4. The provider of services shall have the right to deviate from the terms of the contract or the instructions of the client where specific circumstances necessitate such deviation for the interests of the client or in order to discharge the latter’s commission, and where the executor was unable to inform the client thereof in advance.  In this case, the executor must notify the client of the deviations as soon as the circumstances permit.


5. If the contract provides for an obligation on the part of the provider of services to achieve a certain result, the provider of services may be relieved from liability for the non-performance of the said obligation only where the provider of services proves that he could not meet the obligation for reasons of force majeure.


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Article 6.719. Duty of the provider of services to furnish information  


1. Before entering into a service contract, the provider of services must provide the client with detailed information concerning the nature of the services to be provided, the terms of their provision, the price of the services, the schedule for the provision thereof, possible consequences, and any other information which may have an influence on the client’s determination to enter into the contract.  


2. Where public services are rendered, or where the provision of services constitutes a business of the provider of services, the client must be given public access to the information indicated in paragraph 1 of this Article either at the registered office of the provider of services or at any other place freely accessible to each potential client.


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Article 6.720. Price of services and payment


1. The price of services shall be fixed by agreement between the parties and may be modified after the conclusion of the contract only in accordance with the terms of the contract and in the cases stipulated by the contract.


2. The client shall be obliged to pay an increase in the price of services exceeding the price fixed at the time of the conclusion of the contract only where the provider of services furnishes proof that the increase was unavoidable to ensure proper performance of the contract and could not have been foreseen at the time of the conclusion of the contract.


3. The client shall pay for the services rendered within the time and in accordance with the procedure established in the contract.  Unless the contract provides otherwise, the client shall be obliged to pay the whole price when all the contracted services are provided.  By agreement between the parties, part of the price may be paid at the time of the conclusion of the contract or at any agreed time thereafter, and the final settlement shall be effectuated upon the performance of the contract by the provider of services.


4. If the performance of the contract is impossible through the fault of the client, the client shall be obliged to pay the whole price fixed in the contract, unless the contract provides otherwise.


5. If the performance of the contract is impossible as a result of the circumstances for which no party to the contract is responsible, the client shall be obliged to remunerate the provider of services for the actual expenses incurred by the latter, unless the contract provides otherwise.


6. The client shall also be obliged to reimburse the provider of services for the expenses incurred by the latter and related to the performance of the contract to the extent that such expenses are not covered by the price of the services. The client shall also be obliged to reimburse the provider of services for the latter’s losses related to the provision of services and incurred at the time of the provision of services in the event of unforeseen specific circumstances for which the provider of services is not responsible. Where the provision of certain services constitutes professional activities (business) of their provider, the client shall be obliged to reimburse such provider for the losses incurred by the latter only where the losses result from specific circumstances not covered by a normal risk characteristic to a certain type of profession or business.


7. If services are provided by commission of two or more clients, all the clients shall bear solidary liability to the provider of services in the cases provided for in this Article.


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Article 6.721. Unilateral termination of the contract


1. The client shall have the right to unilaterally terminate the contract even though the provision of services by the provider is already in progress. In this case, the client must pay the provider of services a part of the agreed price in proportion to the services rendered and reimburse other reasonable expenses incurred by the provider of services for the purpose of performance of the contract before the date of receipt of the notice of termination of the contract from the client.


2. The provider of services shall have the right to terminate the contract unilaterally for important reasons only.  In this case, the provider of services must fully reimburse the client for the losses incurred.

 


Article 6.722. Report of the provider of services 

Unless the service contract provides otherwise, the provider of services must:


1) at the request of the client, communicate to him all the information on the services rendered and the progress in their provision;


2) at the request of the client, forthwith submit a report to the client on the services rendered or progress in their provision;


3) forthwith furnish to the client all what the provider of services has received during the provision of services for the benefit of the client.

 


Article 6.723. Termination of the service contract


1. The death of the client does not terminate the contract unless it has been entered into specifically in view of the personal qualifications of the client, or the performance of the contract thereby becomes impossible or useless. The contract on the said grounds shall be terminated from the date the provider of services becomes aware or ought to have become aware of the death of the client. The provider of services must, in all cases, ensure that all adequate measures available to him are taken to protect the interests of the client.


2. The contract shall be terminated by the death or legal incapacity in this area of the provider of services, or his limited legal capacity in this area unless analogous services may be adequately continued by his successors who are entitled thereto. The successors of the provider of services, who are aware of the commission, must ensure that all adequate measures available to them are taken to protect the interests of the client.

 


Article 6.724. Subsidiary application of other provisions of this Code to service contracts

The provisions of this Book, which establish general provisions of the contract for work (Articles 6.644 to 6.671) and regulate the contract for consumer work (Articles 6.672 to 6.680) shall apply to service contracts in so far as they are not in violation of Articles 6.716 to 6.723 of this Code and peculiarities of the subject matter of the service contract.     

 


SECTION TWO

PROVISION OF PERSONAL HEALTHCARE SERVICES


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SECTION TWO

PROVISION OF PERSONAL HEALTHCARE SERVICES

 


Article 6.725. Contract for personal healthcare services


1. Under a contract for personal healthcare services, a person who is entitled to provide healthcare services due to his professional or business activities (the provider of healthcare services) shall undertake to provide to the other party (the patient) healthcare services stipulated in the contract, and the patient shall undertake to pay the agreed price to the provider of healthcare services. Where personal healthcare services are provided to a third person rather than the person who has entered into the contract, the said third person shall be considered as the patient (the actual recipient of personal healthcare services).  In this case, the person who has entered into the contract shall be the client.


2. The concept of personal healthcare services referred to in paragraph 1 of this Article shall mean activities, including examination and counselling directly relating to an individual, undertaken for the purpose of treating the individual, preventing him from falling ill or assessing the condition of his health. This concept shall also include nursing of the patient and related activities, as well as material provision for the patient, which is necessary for the pursuit of personal healthcare activities, with the exception of pharmaceutical activities.


3. The rules of this Section shall not apply to the following types of activities: activities intended for determining the health condition of an individual or for providing healthcare to an individual who is represented by the provider of such care in the settlement of a dispute in court or in the fulfilment of obligations, so that the represented individual receives insurance benefits or social benefits; as well as activities aimed at determining one’s endowment or aptitude for learning, fitness to work or to perform a specific type of activity; and forensic pathology. Similarly, the rules of this Section shall not apply to personal healthcare services the costs of which are paid (compensated), pursuant to laws, from the budget of the compulsory health insurance fund, the State budget or municipal budgets.

 


Article 6.726.  Patients who are minors


1. A minor who has reached the age of sixteen may enter into the contract for personal healthcare services in his own name and perform other legal actions directly related to such a contract. 


2. A minor who has reached the age of sixteen shall be responsible for the fulfilment of all obligations arising from this contract, and this may not have any affect on his parents’ duty to bear the costs of care for and upbringing of the minor.


3. Laws may provide for the cases where only a person of full age may become party to the contract for personal healthcare services.


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Article 6.727. Provision of information to the patient


1. The provider of personal healthcare services must inform the patient, in a form comprehensible to the latter and with an explanation of the special medical terms involved, of the condition of his health, disease diagnosis, possible treatment methods, prognosis of the treatment and other circumstances which may have an effect upon the patient’s decision to consent to or refuse the proposed treatment, as well as of the consequences of the patient’s refusal of the proposed treatment.


2. The provider of personal healthcare services shall have the right to withhold the information indicated in paragraph 1 of this Article from the patient only in those instances where such notification would have a detrimental effect upon the patient (would cause harm to the health of the patient or even endanger his life). In such instances, all the information indicated in paragraph 1 of this Article shall be submitted to the patient’s representative and shall be considered as information provided to the patient.  The said information shall be communicated to the patient as soon as the risk of causing the said harm to the patient by the notification of such information is eliminated. 

 


Article 6.728. Right not to know


1. The information provided for in paragraph 1 of Article 6.727 of this Code must not be provided to the patient against his will. The will of the patient must be clearly expressed and attested by his signature. 


2. The restrictions on the provision of information to the patient, as provided for in paragraph 1 of this Article, shall not apply where the patient’s reluctance/refusal to receive information may result in harmful effects upon the patient or other individuals.


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Article 6.729. Consent of the patient


1. The patient may not be treated or be provided any other healthcare and/or nursing against his will, unless otherwise established by legislation. The laws may provide for the cases where a written consent of the patient is required for the provision of healthcare services to the patient.


2. The patient under the age of sixteen may not be treated or be provided any other healthcare and/or nursing against the will of at least one of his parents or his statutory representative, unless the laws provide otherwise. The patient under the age of sixteen, on condition that his age and the level of development permit him to correctly assess the condition of his health and a proposed course of treatment, may not be treated against his will, unless the laws provide otherwise. The laws may provide for the cases where a written consent of at least one of the parents of the minor or of his statutory representative is required to provide healthcare services to the patient. The doctor must select the methods of treatment that would most suit the interests of the minor.


3. The modalities of treatment of the patient and the patient with mental or behavioural disorders who are unable to correctly assess the condition of their own health shall be established by the relevant laws.

 


Article 6.730. Indication of the patient’s consent in his medical documents 

The provider of personal healthcare services must include information on all the actions undertaken (personal healthcare services), to which the patient has given his consent, into the medical documents of the patient, and the patient or his representative must attest these documents by their signature.

 


Article 6.731. Cooperation of the patient with the provider of personal healthcare services

The patient must give to the provider of personal healthcare services all possible information and assistance which may be reasonably required for the performance of the contract.

 


Article 6.732. Degree of care

In the pursuit of his activities, the provider of personal healthcare services must ensure such a degree of care which is expected from an honest provider of personal healthcare services.  His activities must be based on responsibility stipulated by the relevant laws, other legal acts and professional standards of providers of healthcare services.

 


Article 6.733. Necessity of patients’ medical documents

Providers of personal healthcare services must keep at their disposal (process and fill in) patients’ medical documents of the established form and type (patient medical records and other medical documentation), fill in the said documents and store them in accordance with the procedure prescribed by laws.


