According to the Civil Code (Article 168), invalidation of transactions is carried out in the event of non-compliance with their standards. The requirements that must be observed when concluding contracts may be determined by law or other legal act. At the same time, the industry affiliation of the norms, which the transaction comes into conflict with, does not matter.
Key condition
Legislation defines a group of contracts whose terms are contrary to the regulatory framework. Recognition of transactions as invalid is subject to intent. It can be present on any one side or on all participants at the same time. Intention involves understanding by the subject of the illegality of the actions taken. Its presence must be proved. Therefore, for example, the recognition by the tax authorities of a transaction as invalid should be documented. This provision applies in particular to controlled contracts.
Legal consequences of invalidation of transactions
They depend on several factors. As a general rule (when establishing the intent of both parties), all property received by them upon conclusion of the contract is recoverable in favor of the state. If the conditions were met only by one side, then everything received is withdrawn from the other subject. In this case, property is also transferred in favor of the state. If intent was present only at one participant, everything received in the transaction is returned to the other party, which did not know about the violation of legislative requirements.
Classification
The procedure and consequences of invalidating transactions depend on their nature. So, for example, the law distinguishes such a category as imaginary contracts. Their conclusion is not aimed at creating the corresponding legal consequences. Contracts are considered to be imaginary regardless of the form of their conclusion, as well as the actual fulfillment of the established conditions. There is a category of fake deals. They are also not oriented towards achieving appropriate results. Moreover, such agreements are concluded to conceal the other will of the parties. It is the proof of this fact that determines the recognition of transactions invalid. In this case, the rules established for the contracts, which in reality were meant. For example, an agreement was signed on the sale, but in fact the parties made a donation. In this case, the purchase and sale rules apply.
Nullity
This property is acquired by all transactions concluded by a legally incapable subject. This means that the citizen at the time of the conclusion of the contract could not understand the meaning of his behavior and manage it. Disability is established in court. Invalidation of transactions in such cases implies the absence of the results that they provided. If the conditions were met, then the rules on bilateral restitution of property in kind apply. If it is not possible to return material values, their monetary compensation is carried out. The legislation establishes additional rules. In particular, recognition of transactions as invalid involves compensation for damage to the injured party. This provision applies to cases where a legally capable entity knew or could have known about the incapacity of another participant. Together with these norms, an exception is defined. A transaction in which a legally incapable person participated may be deemed valid if it is concluded with a benefit to him.
A special case
In some cases, the invalidity of transactions takes place in situations where they were committed by competent persons, but who were at the time of their conclusion in a state in which they could not be aware of their actions and ensure control over them. Moreover, the reasons for such inability will not have legal significance. It can be caused by external circumstances (illness, physical trauma, loss of a loved one, and so on), and depend on the subject himself (for example, intoxication). In such situations, the fact that the transaction was completed under conditions in which the person could not understand his actions and control them should be proved. Witness testimony is not enough for this. Legislation provides for the examination of cases on invalidation of a transaction committed incompetent. To check the condition of the subject, the procedure is carried out by qualified doctors.
Invalidity of transactions with minors
Citizens who have not reached the age of 18 are not yet considered fully competent. Therefore, transactions made by persons of 6-14 years are void. The exception is cases provided for in Art. 28 Civil Code (paragraphs 2 and 3). Claims for recognition of transactions invalid in such situations are sent by parents, adoptive parents / guardians or another participant. In such situations, the rules of bilateral restitution also apply and damages are paid in favor of the minor. At the same time, the perfect action can be beneficial for the minor. In such cases, at the request of the guardians, parents, adoptive parents, transactions can be recognized as valid.
Additionally
Claims for invalidation of transactions may be sent by legal representatives of persons aged 14-18 years. These citizens are also considered minors and, accordingly, of limited legal capacity. In this regard, the transactions that they conclude may be recognized as null and void. This is allowed if they are committed without the consent of the legal representatives, when it is necessary. This rule does not apply to minors who have become competent (married, for example). As in the previous case, the consequences of the invalidity will be bilateral restitution and compensation for damage to the minor.
Misconception
In some cases, the subject may have a distorted view of the transaction. Misconception must be present at the time of conclusion of the contract and be significant. The misrepresentation may relate to the nature of the transaction or the characteristics of the subject, significantly reducing the possibility of its use. Misconception regarding the motive for concluding a contract will not be significant. If the transaction is declared invalid due to the fact that it was completed in a state of delusion, the rules on mutual restitution apply. In addition, the injured party has the right to demand compensation for damage caused. In this case, the injured participant must prove that the error appeared due to the fault of the defendant. If this is not done, then the subject, in the suit of which the invalidity will be recognized, shall compensate the defendant for real damage. This rule also applies if the error appeared due to circumstances beyond the control of the plaintiff.
Bonded contract
A transaction may occur in different circumstances. Not always they are favorable. For example, the conclusion of a transaction may take place under the influence of threat, violence, deception, in connection with difficult life circumstances. In such cases, they speak of enslaving agreements. The defendant in such situations takes advantage of the position of the plaintiff and, one might say, forces him to conclude a transaction on unfavorable conditions. Deception is the deliberate misrepresentation of another participant, the provision of incorrect, false information, and silence about important circumstances. Violence can be expressed in inflicting moral or physical suffering on the injured party or its relatives. Threat - mental pressure on the subject. It is expressed in a statement of harm to the victim subsequently if he does not agree to the transaction.
Severe circumstances
In itself, it does not act as a basis for recognition of invalidity. In this case, the observance of additional conditions. In particular, the conclusion of the transaction should take place in the presence of difficult circumstances on conditions that are extremely unfavorable for the victim. It is also important that the defendant in such a situation must take advantage of the complex situation of the subject. That is, he must be aware of the plight of the plaintiff, and he uses it to obtain benefits.
The results of enslaving agreements
Upon recognition of invalidity for any of the above reasons, the defendant returns everything received to the victim in kind. If this is not possible, the affected party will be reimbursed for the value of the property in money. The material assets received, as well as the compensation due to the victim, shall be exacted in favor of the state. If it is not possible to transfer the property in kind, its value shall be reimbursed in cash and transferred to the budget. The victim may also claim compensation for real damage.
Limitation period
The statement of claim may be filed within 3 years from the moment when the execution of the void transaction began. This period applies to contracts, the period for making claims on which did not expire until July 26, 2005 (before the entry into force of Federal Law No. 109, which amended Article 181, Part 1 of the Civil Code). For disputed transactions, a period of 1 year is set. The calculation of the period starts from the day when the threats or violence ended, under the influence of which the contract was signed, or when the applicant should have known or learned about the circumstances that serve as the basis for the presentation of claims.
Conclusion
The defect of one or several components of the transaction - non-compliance with their standards - leads to invalidity. Judicial procedures are designed to eliminate the results that arose during the conclusion of such contracts. In the absence of intent on both sides, they must return everything that was received from the transaction, or pay the appropriate amount of money. It should be said that a similar procedure is provided for in the laws of different countries. For example, the Civil Code contains article 215 "Invalidity of the transaction." It defines the grounds on which the contract between persons may be canceled.