The contract of contracting refers to one of the supply agreements, and hence the sale. But its peculiarity lies in the fact that it regulates the purchase of agricultural products. Its production is associated with high risks. This is a dependence on weather, plant and animal diseases, a seasonal factor and so on. The manufacturer is a weaker party to the agreement. Therefore, in his regard, the law provides for increased methods of protection, increased rights and reduced liability. On the part of the procurer (or buyer), on the contrary, the level of responsibility increases. In the article, we consider what essential conditions of a contract of contract are provided for by law.
Concept and legal regulation
A contracting agreement includes an agreement according to which a producer of agricultural products must transfer it to a procurer who purchases the corresponding product for processing or sale. The procurer is obliged to accept and pay for it.
These relationships are enshrined in paragraph 5 of chapter 30 of the Civil Code. If there are no relevant provisions on contracting in this paragraph, the provisions of the law applicable to delivery shall apply. If the products are intended for state needs, then the rules on the supply for state needs apply.
Thing
The essential terms of the contract agreement include the subject, which is agricultural products. It should have a number of features, which include the following:
- Products should be grown by the manufacturer, but not purchased (these are crop and livestock products). Processed agricultural products cannot act as the subject of the treaty under consideration, since their production activities are in no way associated with adverse factors, due to which the parties are economically unequal. Such products are sold under a supply agreement. If the processor is also a manufacturer, then the contract can be attributed to contracting.
- Products are grouped by gender.
- Most often, it is the future, that is, when the contract is signed, the product does not yet exist. True, experts do not agree on this feature. Some experts believe that the subject of this agreement can be both future and already manufactured products, while others are confident that it can only take place with products that have yet to be grown.
- It is acquired by the procurer for the purpose of sale or processing with subsequent sale, but not for personal consumption.
If the contract does not contain at least one of the above characteristics, then it cannot be called contracting.
In addition to the subject matter, the essential terms of the contract of contracting include the quantity and range of products.If at least one of them is absent, the agreement shall be deemed not concluded.
Range
The general assortment must correspond to a pre-prepared plan. In expanded form, it is established by both parties by agreement. If the assortment is not established, it is determined by the contract. The parties may change it by amending the agreement accordingly.
Term
An essential condition of the contract agreement is also the fulfillment of the obligation to transfer products within the prescribed period. This follows from the fact that this agreement is one of the types of delivery. Products may be transferred at one time or in batches during a specified period. The transfer is carried out for a long time on the basis of paragraph 3 of Article 508 of the Civil Code.
Price
As in delivery, the price here does not apply to the essential terms of the contract. If there is no corresponding clause in the contract, the norms provided for by law with respect to the supply agreement shall apply.
Buyer Responsibilities
The buyer, being the procurer, as in the supply contract, is obliged to perform the following actions:
- Accept the products. In accordance with article 536 of the Civil Code of the Russian Federation, he accepts products at the place of production and independently exports them, unless otherwise provided by the concluded agreement. If the parties agreed to accept the products from the procurer (buyer) or at a specific place, the latter cannot refuse to accept it if the products are delivered on time and meet the essential conditions of the contract agreement.
- In case of violation, notify the other party in writing.
- Make payment. In the case of late payment, the buyer must pay a penalty in the form of penalties and fines. The value is established on the basis of the contract or in accordance with the law. Unless otherwise specified in the agreement, the buyer pays a fine of 1% for each delayed day.
- Return waste to the manufacturer at the cost established by the contract. This obligation arises only if the relevant provisions are provided for by agreement. This makes it an essential condition of the contract of contracting. In the Civil Code of the Russian Federation this is stated in paragraph 3 of Article 536.
Seller Responsibilities
The agricultural producer under the contract in question has the same obligations as in the case of supply. Similar consequences result from default. The manufacturer must transfer the products:
- To the buyer.
- Which is free from the rights of third parties.
- With the necessary documents and accessories.
- In the prescribed period.
- In quantity and assortment agreed in advance.
- Installed quality.
- In proper packaging.
Responsibility of the Parties
An agricultural producer who does not fulfill obligations or who does not fulfill them properly is liable only if there is fault. This is due to the fact that its activities are associated with great risks, namely:
- Barren period.
- Bad weather.
- Natural disaster.
- Other similar factors.
In this case, the manufacturer is obliged to prove the fact that his guilt in violation of the terms of the agreement is not. He is found not guilty if he has sufficient evidence. Innocence will also occur if the violation of the manufacturer’s obligations was associated with a corresponding violation of the procurer's obligations (for example, in connection with non-payment of the advance payment).
In case of violation of the prescribed essential conditions of the contract of contracting, the guilty party must bear responsibility established by the general provisions in accordance with the purchase and sale and delivery agreements.
Case Study
An agreement was concluded between the agricultural organization and the buyer, according to which the organization is obliged to deliver to the buyer the canned goods that were produced as a result of processing the purchased raw materials.Due to delays in delivery, the buyer appealed to the arbitration tribunal to recover the losses incurred. In the first instance, the plaintiff was denied on the basis that the agricultural organization was obliged to supply products that it produced. Consequently, these legal relations qualified as a contract of contract, and liability arises only in the presence of fault. But the facts suggest that the organization is not guilty.
The plaintiff filed a cassation appeal, and the court quashed the judgment on the basis of the following circumstances. As such an essential condition of the contract of contracting (in the Republic of Kazakhstan and the Republic of Belarus there are similar provisions) as the subject of the contract, the products produced by the agricultural organization should be made. If the organization supplied canned goods from products that it itself had grown, the contract could be called contracting. But the organization only processed the purchased raw materials. This activity is not risky, in which there is inequality on the part of the manufacturer. Therefore, this contract is a normal supply, but not a contract of contract.
Conclusion
From the article we learned about the essential terms of the contract of contracting, concept, legal regulation and basic types. It should be noted the main points:
- It has much in common with a supply contract, as well as a commission.
- If at least one of the prerequisites is absent, then the agreement will be considered invalid.
- In addition to the mandatory, you can provide other significant conditions of the contract.
- The Republic of Belarus and the Republic of Kazakhstan have similar legal provisions in relation to this agreement.
