Determining the absolute nullity of successive execution contracts concluded under the old civil code in regard to the provisions of the new civil code

Author:Cristina Dinu
Position:Assistant Lecturer, PhD, Faculty of Law, Department of Law, 'Transilvania' University of Brasov
Pages:147-153
SUMMARY

Absolute nullity is regulated by the provisions of article 1247 of the Civil Code1 as that legal sanction which applies to the contract “concluded with the violation of a legal provision which protects a general interest”. Article 1247 represents the legal background of absolute nullity, regulating general aspects of this institution, the people who can invoke absolute nullity, the ways by which it can be invoked and the interdiction of confirming contracts which are null. The current article aims to analyze in situation in which a legal provision regulated as a special norm of law states the sanction of absolute nullity in regard to successive execution civil contracts, concluded under the current Civil Code, but fully executed at the time the absolute nullity is analyzed.

 
CONTENT
Determining the Absolute Nullity of Successive Execution Contracts... 147
DETERMINING THE ABSOLUTE NULLITY OF SUCCESSIVE
EXECUTION CONTRACTS CONCLUDED UNDER
THE OLD CIVIL CODE IN REGARD TO THE PROVISIONS
OF THE NEW CIVIL CODE
Cristina DINU
Assistant Lecturer, PhD, Faculty of Law, Department of Law
“Transilvania” University of Braşov
cristina.dinu@unitbv.ro
Abstract
Absolute nullity is regulated by the provisions of article 1247 of the Civil Code1 as that legal
sanction which applies to the contract “concluded with the violation of a legal provision which
protects a general interest”. Article 1247 represents the legal background of absolute nullity,
regulating general aspects of this institution, the people who can invoke absolute nullity, the ways by
which it can be invoked and the interdiction of confirming contracts which are null. The current
article aims to analyze in situation in which a legal provision regulated as a special norm of law
states the sanction of absolute nullity in regard to successive execution civil contracts, concluded
under the current Civil Code, but fully executed at the time the absolute nullity is analyzed.
Keywords: absolute nullity, civil contracts, contracts with succesive execution, sanctions,
New Civil Code.
Introduction
Although our current legislation did not provide a definition of the nullity of
the civil act, we appreciate that such a definition can be drafted based on the
regulation of article 1247 of the Civil Code. Based on our own opinion, the nullity
of the civil act appears to be a sanction which applies to a civil legal act, which
deprives this act of its legal effects because when the act was concluded, its
validity conditions were not respected.
In order to analyze whether this sanction applies at the present time, we
believe it is both important and appropriate to analyze the way in which the
conception of this institution has evolved across time. As a result, it is necessary to
1 Article 1247 Absolute nullity
(1) The contract which is concluded with the violation of legal provisions which protect a
general interest is null.
6. Absolute nullity can be invoked by any interested party, by action or by exception.
7. The court is held to invoke absolute nullity.
8. The absolutely null contract is not to be confirmed except for the cases stated by law.
Law Review vol. VII, special issue, December 2017, p. 147-153
148 CRISTINA DINU
mention that, in the past, nullity was analyzed by applying the rule quod nullum
est, nullum producit effectum, meaning that a null act can’t cause any legal effect.
Subsequently, considering the idea according to which nullity is a legal means
by which legality is reestablished after it was violated when the act was concluded, the
thesis of the adequacy of the effects of nullity, in regard to the purpose of the law,
was established. According to this idea, only those effects which violate the law
must be removed, as the other effects of the law can be maintained. It was starting
with this conception that nullity was seen as partial and subject to remedy2.
In order to fully understand and apply nullity, we believe that it must be
limited by similar legal provisions, as the rescission and dissolution of the contract,
the caduceus character of the contract, the revoke or lack of publicity of the civil
legal act. If, in case of nullity, its cause is contemporary with the conclusion of the
act, in case of rescission or dissolution, the cause is the guilty non execution by one
of the parties, thus being subsequent to the conclusion of the civil act. The same
distinction is valid in case of caducity, as the ineffectiveness cause is subsequent to
the conclusion of the civil act and is independent form the will of the author. Thus,
whereas nullity entails a non valid judicial civil act, caducity entails a valid legal
act. In case of the lack of publicity, this institution is to be applied for not
performing a publicity operation subsequent to the valid conclusion of a legal act,
as it is not a cause which deprives the legal act of its effect and is contemporary
with its conclusion.
An analysis of the law which applies
Absolute nullity is that specific type of nullity which sanctions the disrespect,
when concluding a civil legal act, of a legal provision which protects a general
interest. The legal background of absolute nullity is article 1247 of the Civil Code,
but it is also regulated in numerous special legal texts, such as article 23 first
alignment of Law no 176/20103 regarding integrity in exercising public functions
and offices4.
Absolute nullity can be invoked by whomever has an interest according to
article 1247 first alignment; we must mention that, in the new regulation, invoking
2 Ghe. Beleiu, Romanian Civil Law, eighth revised and completed edition by M. Nicolae si P.
Trusca, Universul Juridic Publishing House, 2003, pages 215-216,
3 Published in the Official Bulletin of Romania no 621 of September 2nd 2010
4 Law no 176/2010, article 23
(1) In case of a conflict of interest, if they are connected to the situation of conflict, all legal or
administrative acts concluded, directly or through other people, with the violation of legal provisions
regarding conflict of interest, are subject to absolute nullity.
(1) The complaint for establishing absolute nullity of legal or administrative acts concluded with
the violation of legal obligations regarding conflict of interest can be filed by the agency even if the
person no longer holds that office.
(2) The court will rule on absolute nullity and the reinstating of parties in the previous situation.
Determining the Absolute Nullity of Successive Execution Contracts... 149
absolute nullity by the court of law is not only a mere possibility, it is an obligation
of the court.
Absolute nullity is not subject to the statute of limitation, if the law does not
state otherwise. Absolute nullity can’t be remedied by confirmation. While the old
code did not expressly state this possibility, practitioners assumed this was the
case, based on an article in regard to donation; however, the new Civil Code
expressly states in article 1247 fourth alignment that a contract which is absolutely
null is not subject to confirmation, except for the cases stated by law5.
The example of absolute nullity regulated by article 26 of Law no 176/2010
was not random, as the present article aims to analyze the enforcement of absolute
nullity regulated by this special text of law, by corroborating it with the civil
contract of successive execution, fully executed when the complaint was filed
before the court of law, based on the provisions of article 23 of Law no 176/2010.
In analyzing this legal provision, we believe it is necessary to detail the nature
and effects of the successive execution contract, as regulated by the current Civil
Code. Thus, we can define the successive execution contract as that mutual legal
act, in which the obligations of one or both parties are set to be executed in time, by
a continuous performance or a series of actions repeated at a certain period of time.
According to the principle of retroactivity of the effects of nullity, it causes
effect not only for the future but also for the past, as this principle derives from the
principle of legality, which entails reestablishing the law after it was violated at the
conclusion of the legal act.
In the old regulation of the Civil Code, the retroactive annulment of successive
execution contracts was a true exception from the principle of retro-activity, based
on a legal deficiency and also given the effective impossibility of reversing the
performed actions which had already been executed. Thus, doctrine provided the
example of lease, which was determined to be absolutely null, the parties were
unable to return to the previous conditions; if returning rent money was not a
problem, returning the use of a certain location was a major obstacle in establishing
annulment is retroactive and also in enforcing the principle which derives form it,
namely restitutio in integrum (reestablishing the previous situation). The same
arguments fully apply in case of other successive execution contracts, as
performing services in public restaurants, in case of the support contract and so on.
The reasons for the old regulation entailed the impossibility of reinstating the
parties in their previous situation; it also entailed that fact that the restitution of
certain performances is impossible (as is the case of the lease contract); in some
cases, the person who is obliged to return performances is not a professional able
to return successive performances which were fully executed (as is the case of a
performance which consists of delivering food products by a professional towards
a beneficiary).
5 http://www.ziaruldeiasi.ro/recomandari-zdi/regimul-si-efectele-nulitatii-in-noul-cod-
civil~ni8qn8 – website accessed August 23rd, 2017
150 CRISTINA DINU
However, in the current regulation of the Civil Code, the lawmaker changed
its optics. According to article 1254 of the Civil Code, the null contract is
considered to never have been concluded. In this situation, “each party must
return to the other party, in nature or by equivalent, the received performance,
according to the provisions of article 1639 - article 1647 even if these performances
were successively executed or had a continuous character”. Thus, in the current
regulation, the absolute nullity of some successive execution contracts no longer
represents an exception from the principle of the retroactivity of nullity, thus
regulating the principle of the retroactive dissolution of the annulled contract, but
also the principle of the restitution of the parties’ performances, based on the same
null contract.
In regard to the restitutio in integrum principle, legislative technique is mixed,
as the legal text states the ways in which performances can be returned regardless
of the cause of restitution. As for the effects of nullity, articles 1639-1647 of the new
Civil Code are meant to ensure the practice of the principle of the restitution of
performances by pointing out its limits and exceptions. As a result, this legislative
solution found it article 1254 third alignment of the Civil Code contains merely
general solutions, mandatory in case the nullity of the contract was established
previous to the execution of performances, regardless of whether it is unilateral or
reciprocal, the amount or means of execution (successive or continuous)6.
According to article 1640 of the Civil Code, if restitution can’t occur in nature,
because of impossibility or a serious impediment or if restitution regards the
already performed services, restitution is made by equivalent. In this situation, the
value of performances at the time the debtor received what must be returned will
be considered.
Restitution by equivalent is an indirect execution of the obligation as is legally
regulated by article 1073 and 1530 of the Civil Code. There are numerous
impediments for the restitution of performances, starting with the intuitu personae
character of the obligation to do (executed by the creditor of the obligation of
restitution) until the lack of specific quality needed for the person who must return
the performance. These specific cases will be subject to the courts’ analysis as the
situation is inevitably becoming contentious. Unlike the old approach of the
retroactive character of the effects of nullity, in regard to successive execution acts,
given the impossibility of reestablishing the previous situation, nullity causes
effects only for the future - ex nunc- similar to the situation of dissolution of
contract; article 1254 third alignment of the Civil Code expressly regulates
retroactivity, the ex tunc effect in case of successive execution contracts or
continuous contracts (in regard to the equivalent of the lack of use and the
restitution of fruits). This new approach ensures the coherence of the principle of
6 Fl. A. Baias, E. Chelaru, R. Constantinovici, I Macovei (coordinators), New Civil Code,
comments by articles, articles 1-2664, C. H. Beck Publishing House, Bucharest, 2012, pages 1313-1314
Determining the Absolute Nullity of Successive Execution Contracts... 151
retroactivity of nullity, according to which the absolutely null contract is
considered to never have been concluded7.
The analysis of the principle of retroactivity of nullity in case of successive
execution contracts is closely connected with the interpretation of article 6 of the
new Civil Code, as there are quite a few situations in which absolute nullity of
successive execution contracts concluded during the old regulation is analyzed and
established after the coming into force of the new Civil Code. In such situations,
the following question arises: does absolute nullity cause retroactive effects according to
the old regulation or these contracts concluded during the old regulation are true exceptions
from the principle of retroactivity of absolute nullity?
Article 6 first alignment of the current Civil Code states that civil law is
applied as long as it is in force and legal acts concluded before the coming into
force of the new law can’t generate other legal effects except those stated by the
law which was in force when they were concluded. However, the previously
mentioned text discusses legal acts concluded during the old regulation, but does
not mention legal acts which are null at the time they were concluded. The answer
is also provided by the current lawmaker in article 6 third alignment which states
that “legal acts which are null when the new law comes into force are subject to
the provisions of the old law, as they can’t be considered valid according to the
provisions of the new law”. The current regulation is mainly based on the non
retroactivity of the new civil law, but also on the ultra activity of the old civil law.
These principles entail the fact that the new civil law does not affect the past and
can’t impair on judicial situations established (created, modified or ended) nor the
effects they caused before it came into force.
As a result, a court of law which is invested based on the new Civil Code with
a complaint in determining absolute nullity of successive execution contracts
concluded and executed during the old law, will have to make a clear distinction in
regard to applying civil law in time, in order to give way to the principle of ultra
activity of the old criminal law and non retroactivity of the new civil law.
Case study
Judicial practice has seen situations in which complaints were filed for
establishing the absolute nullity of successive execution contracts concluded and
fully executed during the old Civil Code, based on legal provisions of special
character, as is article 23 of Law no 176/2010. The situation which was the basis of
such a complaint was the fact that, previous to filing this complaint, the National
Integrity Agency started a control in order to track the existence of situations in
which people who held public offices were in any conflict of interest at the time
their contract was concluded, thus executing civil contracts by which public
finances were spent.
7 Fl. A. Baias, E. Chelaru, R. Constantinovici, I Macovei (coordinators), New Civil Code, …..
pages 1725-1726
152 CRISTINA DINU
Once the conflict of interest was definitively established, the person who
occupied a public office, the public servant who helped conclude successive
execution civil contracts (either by not contesting the report of the Agency, or by
unsuccessfully contesting it), the Agency acted as regulated by article 23 and the
following of Law no 176/2010 by filing a complaint for the establishing of absolute
nullity and reestablishing of the previous situation. In such cases, although the
judge is sovereign and his ruling is mandatory, we believe that judicial practice
must also be considered and analyzed as it presents several similar cases.
Judicial practice
On a national level, there are a series of court decisions which provide a strong
starting point in creating a unified national judicial practice. According to one of
these decisions8, the clear distinction in regulation between the old Civil Code and
the new one is analyzed, thus “the court states that successive execution contracts
represented an exception from the principle of reestablishing the previous situation
(restitutio in integrum) and from the principle of retroactivity of the effects of nullity as
opposed to the objective impossibility of reestablishing the previous situation, as the effects
of nullity will only occur in the future (ex nunc). According to article 1254 of the new Civil
Code, (1) The absolutely null or annulled contract is considered to never have been
concluded. (2) The dissolution of the contract entails the dissolution of all subsequent acts
concluded as a result of the contract. (3) In case the contract is dissolute, each party must
return to the other party, in nature or by equivalent, the received performances, according
to the provisions of articles 1639-1647, even if these performances were executed
successively or are of continuous character. In case of contracts which were analyzed by the
courts of law, the performances which can’t be returned in nature are catering services or
security services which were performed in the benefit of third parties. For all the previously
mentioned reasons, the court will dismiss as unfounded the complaint of the National
Integrity Agency”.
As a result, the distinction made in the present analysis coincides with the
previously quoted point of view, as the timeframe of the enforcement of the civil
law must be thoroughly analyzed. This analysis is particularly important as the
institution of absolute nullity was subject to a change in the legislative approach as
opposed to the old regulation; thus, contracts or acts with successive or continuous
execution were treated differently.
Conclusions
If, before the coming into force of the current Civil Code, establishing the
absolute nullity in regard to this type of contracts or acts was a true exception from
the principle of retroactivity of the effects of nullity and from the principle of
reestablishing the previous situation, at the present time, establishing absolute
8 Civil sentence no 1155/CA/14.11.2016 of Brasov Tribunal – not definitive at the time this
article was drafted.
Determining the Absolute Nullity of Successive Execution Contracts... 153
nullity in case of successive execution contracts is fully regulated, thus causing the
effects which are specific to the institution of nullity as regulated by article 1639-
1648 of the Civil Code.
The transition issues between the old regulation and the current one, as
discussed and analyzed in the present paper are still matters of interest, as the
require special attentions from practitioners and all people involved in analyzing
the effects of absolute nullity based on the new regulation, in regard to the
contracts concluded during the old legislation. Such situations are frequently seen
in practice and resolved based on current laws, thus creating a unified and
constant practice.
However, we believed this analysis is important both for practitioners and for
the general receivers of the civil common law, in order to establish clear conclusions
and well documented answers to the question mentioned in the introductory part of
this material: does absolute nullity cause retroactive effects according to the old regulation or
successive execution contracts concluded during the old law continue to represent true
exceptions from the principle of retroactivity of absolute nullity?
Our conclusions supports the idea according to which new civil law is not
retroactive, whereas old civil law is ultra active (as it applies to successive
execution contracts concluded during the old law, but analyzed during the present
regulation of the new Civil Code).
Thus, the analysis for establishing absolute nullity after the coming into force
of the new Civil Code in regard to successive execution contracts or continuous
contracts concluded during the old law, must always regard the civil law which
was in force when the civil acts were concluded, namely the old regulation. Hence,
this category of successive execution acts is a true exception form the retroactivity
of the effects of absolute nullity but also from the principle of reestablishing the
previous situation (restitutio in integrum), even if the establishing of absolute
nullity occurs after the coming into force of the new Civil Code.
Bibliography
Fl. A. Baias, E. Chelaru, R. Constantinovici, I Macovei (coordinators), New
Civil Code, comments by articles, articles 1-2664, C. H. Beck Publishing House,
Bucharest, 2012
Ghe. Beleiu, Romanian Civil Law, eighth revised and completed edition by
M. Nicolae si P. Trusca, Universul Juridic Publishing House” 2003
Civil Code – Law no 287/2009 published in the Official Bulletin of Romania no
505/15.072011
Old Civil Code – published in the Official Bulletin of Romania no
271/04.12.1864.
Law no 176/2010 regarding integrity in exercising public offices for the change
and completion of Law no 144/2007 regarding the creation, organization and
functioning of the National Integrity Agency, as well as the change and completion
of other laws.