Faults in economic contracting influence the solution of judicial litigation

Faltas en la contratación económica influyen en la solución de los litigios judiciales

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Faults in economic contracting influence the solution of judicial litigation

September 28th, 2018

Liliana Hernández Díaz

The Chambers of the Economic of the popular provincial courts are responsible for knowing and resolving, in the first instance, the conflicts that arise between natural or legal persons due to the breach of economic contracts; this allows the judges to examine, each year, a significant number of agreements that are signed to ensure the development of productive, commercial activities and the provision of services in the country.
Guideline number 5 of the Economic and Social Policy of the Party and the Revolution indicates that it continues to strengthen the role of the contract as an essential instrument of economic management, raising the demand for compliance among economic actors.
Since 2013, Decree Law 304, "On economic contracting", and Decree 310, "On types of contracts", which eliminated the legislative dispersion that, in contractual matters, characterized the Cuban legal system, were established. the rules and principles that must be observed from the negotiation, to ensure transparency and cooperation between the parties, and endowed them with greater autonomy in forecasting commitments.
In correspondence with the objectives of the activity of the courts, mainly those of fulfilling and enforcing the socialist legality and safeguarding the economic, social and political order established in the Constitution, the Supreme People's Court identified the bad practices of the companies in the hiring economic, appreciated from the processing of judicial processes related to this matter, which determined the need to improve the proceedings of the courts and raise the requirement of negative behavior of the representatives of the entities and their lawyers.
In this sense, the Governing Council of the Supreme People's Court approved several provisions to standardize and guide the judicial practice and, from its application, positive results were achieved and the quality of the claims presented by the entities improved.
However, it is noted that there are still entities that do not honor the signed economic contracts and ignore that, from what is agreed in these, commitments are established that must be fulfilled and that, if objective causes that affect the natural execution of as agreed, taking into account the principles of good faith and the duty to inform that sustain contractual relationships, those involved must communicate to evaluate the causes and renegotiate what is possible, in addition to the obligation to collaborate so that the other party that will be affected by the possible non-compliance can take the necessary measures to reduce the effects.
Only when there is no possible understanding between those involved, after the necessary exchange between them, is that, as a last resort, they can go to court, a prior action that must be documented and that the plaintiff will have to provide when presenting his / her brief of demand, as an essential requirement for admission.
In some cases, insufficiencies persist in these steps that the contracting parties must carry out, in order to collect the debt or fulfill the obligation that is claimed, before going to court, because the documents they provide, to demonstrate the actions taken , are formal, fill "conciliation models" without, in its content, appreciate analysis or evaluation of the causes of non-compliance, essential information of what happened, the negotiation and proposals for new deadlines or form of execution of the agreement .
Claims for non-compliance with the payment obligation are those with the highest incidence in the courts, with 74.5% of the total processes processed, and the amounts claimed in judicial offices, on occasion, are high. Still some entities present demands for nonpayment by amount less than 3000 pesos (CUP and CUC), established by Instruction No. 220 of 2013, the Governing Council of the Supreme People's Court, as a minimum limit to access the courts for this type of infringement.
Very little is claimed for the specific non-fulfillment of the contracted obligation, in relation to the delay, non-execution, missing, quality, breakdowns, among others. However, these violations are evident in many legal proceedings, when the defendants object to the claim for payment required and it is, at that moment, when they claim that they do not pay because the service was not provided, the merchandise was not received, or this did not have the expected quality, which shows that, before being ordered to pay, the executives of the receiving entities remained impassive in the face of the counterparty's breach of its contractual obligations.
The most complex processes that are processed in the courts are those related to breaches of cargo transport contracts by trucks and rail, essentially those that participate in the port-transport-internal economy operation, due to the existence of shortages, breakdowns and the non-completion of planned transportation.
In the transportation activity, there are shortcomings in the drafting of some contracts and, consequently, in their execution, because the parties do not agree and do not adequately define their responsibilities. The carrier does not want to respond for the goods that he moved, although he has participated in the manipulation of this and signed the documents that accompany it, for which he alleges that the seals of the loads, boxes or hoppers arrived without alterations.


In the unloading of the ships, storage and extraction of the loads of the port enclosure, losses and delays are detected that are also object of judicial processes. Another incidence is noticed in the opening and checking of the merchandise received in containers, and the delay in the return of these.
In some contracts, the place of delivery is not properly defined, and it is not foreseen how and who certifies the weighing, measurement and quality parameters during the execution of the contract, especially at the time of receipt.
We have observed that due attention is not given, with the seriousness and responsibility required, to the delivery of the goods, their verification, weighing and signing of the documents that support this act, which makes it difficult to clarify the facts and the delimitation of liability when there are non-compliances.
Some entities, when signing contracts of sale and supplies, agree that the payment will be made for the billing and not for the goods actually received, although there are missing in the delivery, which distorts the accounting, when paying a product not received.
The claims are sustained in facts that clearly warn that their origin is the commission of crimes and the corresponding denunciation was not made, so that the criminal jurisdiction against the violators of the law is proceeded, since, in reality, only It operates in the economic jurisdiction for the purposes of the financial accounting justification of the company.
There is no justification for signing omitted contracts, in aspects that are essential in the transaction, such as the price, the products subject to these, the amounts to be delivered and the compliance deadlines. There is an incorrect use of the "proformas" of contracts, they are signed directly without the necessary negotiation and adaptation to what is the object of the transaction, and even leave blank spaces.
Neither are guarantees foreseen for the fulfillment of the agreed obligations and, in those referred to late interest (due to the delay in complying with the payment obligation) and other penalties, the percentage of these is not agreed in the contract. that must be negotiated and fixed by the parties so that it can be demanded, in consideration that, although previously this amount was established by the Bank now, under the current legislation, the contracting parties must rationally determine it.
It is unfortunate that, in the contracts, clauses that are contradictory or irrational are reflected, that the contractors themselves can not then clarify or determine the true will embodied in them, which leads to their non-application by the courts in the settlement of conflicts , because ineffective.
Abusive clauses are also placed on contracts, as in the case where penalties are stipulated only for breaches by the client and not for the supplier or executor of the service, which confirms an imbalance in the relationship.

The causes and manner of its termination are not included in the legal transaction, or it is foreseen in an abusive manner for one of the parties. In recent years, lawsuits have increased, due to the unilateral determination of one of the contracting parties to terminate the contract before the term of validity, without meeting the budgets or the agreed procedure for these cases.
The contracting standard establishes that "abusive clauses in which one of the parties is obliged to submit to burdensome or disproportionate conditions, and that are the result of an imposition of the other party derived from its privileged positioning in the relationship". But it is noted that the nullity or modification of these clauses, which can be requested to the court after the contract was signed and the discrepancy with the stipulations that it considered abusive, is incorrectly requested because those affected do so because of the breach of the contract, after a long time time of concerted and executed, for reasons that were foreseeable and not overdue, when they had to act before to correct or change the clauses that now they believe unfair.
On the other hand, it is regulated that the basic business units (UEB) do not have their own legal personality, act in the name and on behalf of the entity to which they belong, however, sometimes, they go to court without the proper authorization of the company, which causes that they can not defend or claim the rights with respect to the economic contracts that they signed on behalf of it.
In the judicial processes, the participation of the new subjects of the non-state sector is increased, mainly the self-employed workers and the non-agricultural cooperatives, whose economic relations are regulated by the same rules of contracting and the rights and guarantees are respected. legal entities on equal terms with state entities.
Despite having an excellent regulatory body on economic contracting, in force more than five years ago, and with the provisions of the Governing Council of the Supreme People's Court, which make their application viable and collect clear calls for attention to bad practices, there are still economic sectors and state companies that have not reacted, which indicates lack of control and lack of demand from the executives of the entities involved, underestimation of the unavoidable function of the contract as a regulator of relations between economic subjects, and weaknesses in the advice legal to companies, issues that do not accept delay in their solution, in order to increase the sustainable economic development that the country needs.
* Esp. Liliana Hernández Díaz, president of the Economic Chamber of the Supreme People's Court

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