Law of the Contract and Torts

Order

By the provisions of Articles from 749 to 770 of the Law of the Contract and Torts shall be regulated the notion of the contract of order, obligations of the person accepting the order and the orderer related to performing of order as well as the reasons for termination of the order.

By a contract of order the person accepting the order shall assume the obligation to the orderer to undertake specific transactions for his account. At the same time the person accepting an order shall be authorized to undertake such transactions.

The person accepting an order shall be entitled to remmuneration for his effort, unless otherwise provided by the contract or resulting from the nature of the mutual relations of the parties.

Persons Obliged to Respond to Offering an Order

One professionally engaged in performing other persons’ transactions, or in making public offers to perform such transactions, shall be bound, if unwilling to accept an offered order relating to such transactions, to notify without delay the other party thereof, otherwise he shall be liable for loss sustained by such party.

Obligations of the person receiving an order

Performing an Order as It Stands

A person accepting an order shall be obliged to perform the order in conformity with instructions received, and with the care of a good businessman, or head of household, while remaining within the limits of the order and, generally, taking care of the orderer’s interests which shall serve as his guidelines.

Should the person accepting the order consider that following the order according to instructions received would be harmful to the orderer, he shall draw his attention accordingly and request new instructions. Should the orderer fail to supply specific instructions concerning the job to be done, the person accepting the order shall, while being guided by the interests of the orderer, proceed as a good businessman or head of household, and should the order be without remuneration (free of charge), he shall proceed as he would with his own matters under the same circumstances.

Departures from Order and from Instructions

A person accepting an order may depart from the order and instructions accepted only in agreement with the orderer, and should it be impossible, due to shortage of time or some other reason, to demand the orderer’s consent, he may depart from the order and instructions only if, assessing all the circumstances, he is able to reasonably conclude that this is required in the interests of the orderer.

Should the person accepting the order exceed the limits of the order or depart from the instructions received, he shall not be considered as a person accepting an order, but as a manager without order, unless the orderer subsequently approve what was done by him.

Substitution

A person accepting an order shall perform the order personally.

He may entrust the performance of the order to another only after obtaining permission from the orderer, or if compelled by circumstances to do what he did. In such cases he shall be liable only for the choice of person substituting him and for the instructions communicated to such person. In remaining cases he shall be liable for the work of his substitute, and for accidental loss or damage to the object, which occurs with the person substituting him.

The orderer in each case may demand, directly from the substitute, the carrying out of the obligation in the order.

Rendering Account

A person accepting an order shall be obliged to render account of the transaction performed, while handing over to the orderer without delay everything he received on the ground of the affairs performed, regardless of whether what was received by him for the orderer was owed to the latter or not.

Submitting Reports

A person accepting an order shall be obliged, at the orderer’s request, to submit a report concerning the state of affairs, and render account even prior to the designated time.

Liability for Use of Orderer’s Money

If a person accepting an order uses for his own needs the money received for the orderer, he shall be bound to pay interest at the highest permitted contractual rate, counting from the day of use, and regarding other money owed and not handed over on time, he shall pay default interest, counting from the day he was obliged to hand the money over.

Joint Liability of Persons Accepting an Order

Should performing a transaction be entrusted by the same order to several persons to perform it jointly, they shall be jointly and severally liable for obligations in such order, unless otherwise stipulated.

Obligations of orderer

Advance Money

At the request by person accepting an order, the orderer shall be bound to pay to him a sum of money to cover anticipated expenses.

Reimbursement of Expenses and Assuming Obligations

An orderer shall reimburse a person accepting the order, even if his effort is not successful without his fault, all necessary expenses incurred by him in performing the order, together with interest from the day of expenditure. He shall be bound to assume the obligations of the person accepting the order while engaging on his own behalf in affairs entrusted to him, or shall disengage him from obligations in some other way.

Compensating Loss

An orderer shall compensate loss suffered by the person perorming the order through no fault of his own.

Level of Compensation

Unless otherwise stipulated, the orderer shall owe a usual amount of compensation and should there be no trade usage in this respect, he shall owe equitable amount

Payment of Compensation

Unless otherwise stipulated, the orderer shall be obliged to pay remuneration to the person accepting the order when his job is done.

Should the person accepting the order, without fault on his part, complete the order only partially, he shall be entitled to a proportionate part of the remuneration.

Should remuneration stipulated in advance be in obvious disproportion to services rendered, the orderer may request its reduction.

Right of Lien

In order to secure remuneration and recovery of expenses, the person accepting the order shall be entitled to acquire a lien over the orderer’s movables received under order, and over the sums of money he has collected for the account of orderer.

Joint Liability of the Orderers

Should several persons entrust the performance of an order to a person accepting the order, they shall be jointhy and severally liable to him.

Termination of order

Withdrawing from Contract

An orderer may withdraw from a contract. In case of withdrawing from a contract providing for compensation to the benefit of the person accepting the order, the orderer shall be obliged to pay to the latter a corresponding part of compensation, as well as redress loss sustained by him due to withdrawing from the contract – should there be no wellgrounded reasons.

Cancellation

A person accepting an order may cancel it by his own choice, but not at a bad time. He shall be obliged to redress the loss to the orderer, if sustained by him because of cancellation of the order at a bad time, unless well-grounded reasons existed for cancellation.

The person accepting the order shall be obliged to continue, after the cancellation, with performance of the transactions not permitting postponement, until the orderer becomes able to take care of them.

Death, Termination of a Corporate Body

An order shall be terminated by the death of a person accepting it.

Successors of the person accepting the order shall be obliged to notify the orderer of his death without delay, and to take measures necessary for protection of orderer’s interests, until he becomes able to take care of them himself.

An order shall be terminated by death of the orderer only if so provided in the contract, or if the person accepting the order accepted it because of his personal relations with the orderer. In such case the person accepting the order shall be obliged to continue with the entrusted transactions, to prevent eventual loss for the successors, until they become able to take care of them.

If either the orderer or the person accepting the order is a corporate body, the order shall come to an end on the termination of such corporate body.

Bankruptcy, Loss of Business Capacity

An order shall be terminated on the bankruptcy of the orderer or person accepting the order, or if either of them loses business capacity.

Moment of Termination of Order

If the orderer repudiates the contract, or in the case of his death or bankruptcy, or if he completely or partially loses business capacity, the order shall come to an end at the moment the person accepting the order becomes aware of the event causing the termination of order.

Should written authorisation be issued to the person accepting the order, he shall be bound to return it after the termination of the order.

Exceptions

Should an order be given to enable the person accepting it to achieve fulfilment of some of its claims against the orderer, the orderer shall not be entitled to withdraw from the contract, and the order shall not come to an end by death or bankruptcy of either the orderer or the person accepting the order; nor shall it come to an end should one of them be deprived, entirely or partially, of business capacity.

Read more:
General rules of fulfilment of obligations »
Issuing a payment order »
Doing business without order or authority »

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