Plurilateral contract (Italian law)

Introduction

Article 1321 of the Italian Civil Code defines a contract as "the agreement of two or more parties to constitute, regulate or extinguish between them a patrimonial legal relationship."

Introduced with the Civil Code of 1942, the article thus recognizes the possibility of "two or more parties" participating in the contract, where "party" to the contract refers to a unitary center of interests, regardless of whether it then consists of one or more persons.

Plurilateral contracts with common purpose and other contracts with multiple parties

Alongside the notion of contract, the Civil Code recognizes and regulates the category of plurilateral contract.

A plurilateral contract with common purpose is defined as a contract that under Articles 1420, 1446, 1459 and 1466 of the Civil Code is characterized by the following elements:

a) presence of two or more parties: by qualifying the center of interest as a party, the party remains unitary even when it includes several persons. E.g. buying and selling where the selling party or the buying party corresponds to more than one person. In such a case, the contract remains bilateral.

b) common purpose: the common purpose characterizes the cause of the plurilateral contract and distinguishes it from the exchange contract. Indeed, in the latter, the performance of each party benefits the other party, and the benefit of each derives from the performance of the other. In the plurilateral contract with common purpose, on the other hand, the performance of each party does not immediately benefit the others, but ends up indirectly benefiting all the parties, including the one who performs it.

c) variability of the number of parties: both at the time of the conclusion of the contract and subsequently, the number of parties may vary. This means that the obligation or performance of one of the parties may cease without resulting in the nullity, annulment or termination (due to non-performance or supervening impossibility of performance) of the contract.

Only contracts with these characteristics can be defined as plurilateral (with common purpose) within the meaning of the Civil Code. Therefore, they are not technically plurilateral contracts:

• contracts with more than two parties but characterized by the invariability of the number of parties;
• plurilateral exchange contracts, where the commonality of purpose is lacking. E.g., transaction contract with more than two parties.

Discipline

The Civil Code dedicates the following rules to the plurilateral contract:

• art. 1420 c.c.: "In contracts with more than two parties, in which the performance of each is directed to the attainment of a common purpose, nullity affecting the bond of only one of the parties does not amount to nullity of the contract, unless its participation should, according to the circumstances, be considered essential".
• Art. 1446 c.c.: "In the contracts indicated in Article 1420, nullity affecting the bond of only one of the parties does not import nullity of the contract, unless the participation of that party should, according to the circumstances, be considered essential".
• Art. 1459 c.c.: "In the contracts indicated in Article 1420(1) the non-performance of one of the parties does not import the termination of the contract with respect to the others, unless the non-performance should, according to the circumstances, be considered essential".
• Article 1466 of the Civil Code: "In the contracts indicated in Article 1420, the impossibility of performance by one of the parties does not import dissolution of the contract with respect to the others, unless the missed performance should, according to the circumstances, be considered essential".

These rules are, in any case, an application of the principle of contract preservation.

In addition, to these rules dictated generally for the plurilateral contract are added the specific disciplines dictated for the main plurilateral contracts: associative contracts.

The associative contract

The prototype plurilateral contract with common purpose is the company contract, as the associative contract. However, not all plurilateral contracts are associative contracts, although in most cases they are: for example, associations, companies, consortia, and temporary business associations are plurilateral associative contracts.

References

T. Ascarelli, Le unioni di imprese, in Riv. dir. comm. dir. gen. obbl., 1935, I, p. 152 ss., in part. p. 178 ss.;

A. Belvedere, Contratto plurilaterale, in Digesto Disc. Priv., IV, Sez. civ., Utet, Torino, 1989, p. 270 ss.;

S. Maiorca, Contratto plurilaterale, in Enc. Giur. Treccani, X, Roma, 1988;

E. Minervini, Contratto plurilaterale, in Enc. Dir. I tematici, I, Contratto, Giuffré, Milano, 2021, p. 450 ss.