We have accumulated significant experience, industry knowledge, and expertise in providing business contract legal advice. We advise on preparing contractual documentation and structuring agreements and disputes. Our drafting expertise is drawn in part from our litigation expertise, having seen what can happen when agreements are not drafted to take into account a business’ particular circumstances and the specific requirement for the transaction
OVERVIEW
Governing laws
The pacta sunt servanda principle is one of the basic pillars of contract law, recognized in Peru. Together with contractual freedom, the autonomy of the will is enshrined as a basic principle governing contracts. This also configures the principle of the intangibility of the contract, that is, neither the parties, except by mutual agreement, nor the judge can modify the terms of a contract. A contract is an agreement between private parties creating mutual obligations enforceable by law. The basic elements required by the Peruvian Civil Code for a contract are: mutual assent, explicit or tacit, expressed by a valid offer and acceptance; capacity and its object should be licit and possible. Parties may agree to draft a contract according to a specific form, therefore if it is not fulfilled it becomes void. For instance, there could be an agreement that the contract should be made by Escritura Pública.
Contracts are mainly governed by the Código Civil. Private agreement terms are valid unless they are prohibited by law. Government procurement is governed by Código Civil and by specific laws as well.
Breach of contract
Remedies for breach of contract include emergent damages and loss of profits ( profits not obtained). There are no punitive damages in business contracts.
Force Majeure
Conditions to claim force majeure: is the non-attributable cause, consisting of an extraordinary, unforeseeable, and irresistible event, which prevents the execution of the obligation or determines its partial, late, or defective fulfillment.