- Preparation – steps taken by the parties going to perfection of the contracts. (Negotiation stage.
- Perfection – parties came to a definite agreement. Meeting of minds between the parties upon the object and cause.
- Consummation – death or termination of contract. Parties have performed their respective obligations.
Characteristics of Contract:
- Freedom of Contract – contracting parties may stipulate.
- Mutuality of Contract – contract must bind both contracting parties, it’s validity cannot be left only to one of them. Total absent of consent, the contract is void. If one of the contracting parties cannot give consent, the contract is voidable.
- Relativity of Contract – contracts take effect only between contracting parties, their assigns and heirs. exception those that are not transmissible by nature. (if you are a third person, you cannot question the contract).
- Consensuality of Contract. Ex. Future contract of commodatum or deposits. It’s not perfected unless delivery happened. Delivery is required.
Consent – manifested by meeting of the offer and acceptance upon the thing and the cause in which are to constitute the contract. The offer must be certain and the acceptance absolute. A qualified acceptance constitutes a counter offer. Art. 1319
Acceptance made by the telegram or letter does not bind the offerer except it came to his knowledge.
Art. 1320 Acceptance maybe express or implied.
Art. 1323 An offer becomes ineffective upon death, civil interdiction, insanity, or insolvency of either party before acceptance conveyed.
Earnest or Option Money – perfection of contract.
Business Advertisement is not a definite offer.