Making purchases or conducting other types of businesses usually involves the signing of a contract. In Malta, contracts and their legal binding falls under the regulations of the Civil Code. The contract is defined as an agreement or accord between one or more parties. The contract is concluded in order to create, regulate or dissolve certain obligations. Contracts, according to the Maltese law, can be unilateral, bilateral or multilateral.
Legislation related to contracts in Malta
Malta does not have a specific law targeting all types of contracts, but it has specific legal frameworks providing for each type of contract. The Employment Act provides for work contracts and their termination. The Insurance Business Act provides for contracts between insurers, reinsurers and their clients. Malta also has a specific legislation covering property rental contracts.
With respect to commercial contracts, these are regulated to the Company Law which provides for the obligations of companies signing contracts, the elements a commercial contract should contain and the remedies in case of breach of the agreement.
The validity and types of contracts in Malta
In order to be valid, the parties concluding the contract must have the mental capacity and consent to sign the agreement and must be aware of the content of the contract. In order to sign a contract, all parties must be adults, otherwise the contract is null.
Every contract must have a subject that will be a determinate thing or service. Signed contracts will legally bind parties into respecting the content of the agreement. The contract will be carried out in good faith and can only be revoked with the consent of both parties. According to the Maltese laws, agreements can be considered as contracts and quasi-contracts. Quasi-contracts are designed to create an obligation toward a third person or a reciprocal agreement between parties.
The sale contract in Malta
According to the Maltese law, sale contracts are agreements in which a party is legally bound to supply a good or a product for a certain price. The other party involved in the contract will have to pay the required price for the product or service supplied. The sale will be completed once the transfer of property has taken place and the price has been paid.
Contracts between Maltese companies
Companies will conclude many contracts for different services, purchases or sales they make. When going into business with a Maltese company and signing a contract, it is advisable for the contract to be drafted in a clear and unambiguous way, so it may be easier to enforce. These features of the contract may be applied to all types of contracts starting with the sales contracts, settlement contracts and even employment agreements.
Our lawyers in Malta will help clients draft all types of commercial contracts. You can contact our law firm in Malta if you require legal assistance in registering a company or hiring personnel for your enterprise.