Contracts Section 1 by James

Original Article:

Art. 1305. A contract is a meeting of minds between two persons whereby one binds himself,
with respect to the other, to give something or to render some service. (1254a)

Simplified Version:

A contract is an agreement between two people where one person agrees to provide something
or perform a service for the other.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John and Maria agree that John will paint Maria’s house for P10,000. This is a contract because
they both agreed on what John would do and how much Maria would pay.

Reason for the Article's Enforcement:

This establishes the basic concept of a contract as an agreement where both parties know their
obligations, providing a foundation for enforceable agreements.

Original Article:

Art. 1306. The contracting parties may establish such stipulations, clauses, terms, and
conditions as they may deem convenient, provided they are not contrary to law, morals, good
customs, public order, or public policy. (1255a)

Simplified Version:

Parties in a contract can set any terms they find appropriate, as long as they don’t go against
the law, morality, customs, public order, or policy.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John and Maria agree that John will paint her house by a specific date, setting terms that work
for both. However, they can’t include any illegal terms, like agreeing to work without payment if
it’s against labor laws.
Reason for the Article's Enforcement:

This protects parties’ freedom to create terms that suit their needs while ensuring contracts
remain fair and lawful.

Original Article:

Art. 1307. Innominate contracts shall be regulated by the stipulations of the parties, by the
provisions of Titles I and II of this Book, by the rules governing the most analogous nominate
contracts, and by the customs of the place. (n)

Simplified Version:

Contracts without a specific legal name or category follow the parties' terms, existing contract
laws, similar contract rules, and local customs.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John and Maria agree on a contract where he cares for her garden in exchange for free meals,
a type of contract not specifically named in law. Their agreement will follow the rules they set,
general contract laws, and related customs.

Reason for the Article's Enforcement:

This ensures that even unique or unnamed contracts have a legal framework, protecting both
parties’ interests.

Original Article:

Art. 1308. The contract must bind both contracting parties; its validity or compliance cannot be
left to the will of one of them. (1256a)

Simplified Version:

A contract must obligate both parties equally and can’t depend on the decision of just one party.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If John agrees to paint Maria’s house, the contract cannot say he’ll only paint it if he feels like it.
Both are bound by the contract, and John must fulfill his obligation.
Reason for the Article's Enforcement:

This prevents unfair contracts where one party has all control, ensuring mutual obligation and
balance.

Original Article:

Art. 1309. The determination of the performance may be left to a third person, whose decision
shall not be binding until it has been made known to both contracting parties. (n)

Simplified Version:

A third person can decide how the contract should be fulfilled, but their decision only takes effect
once both parties know about it.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John and Maria let a friend decide when John should start painting. This decision is binding only
once both John and Maria are informed.

Reason for the Article's Enforcement:

This allows flexibility in contracts while ensuring both parties are aware of any third-party
determinations before they take effect.

Original Article:

Art. 1310. The determination shall not be obligatory if it is evidently inequitable. In such case,
the courts shall decide what is equitable under the circumstances. (n)

Simplified Version:

If a third person’s decision is clearly unfair, it won’t be binding, and the court will decide what’s
fair.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John and Maria’s friend decides that John must start painting at 3 a.m., which is unreasonable.
The court could adjust this to a fair time if needed.

Reason for the Article's Enforcement:

This protects parties from unfair decisions by a third party, ensuring equitable outcomes in
contracts.

Original Article:

Art. 1311. Contracts take effect only between the parties, their assigns, and heirs, except when
rights and obligations are non-transferrable by nature, agreement, or law. Heirs are only liable
up to the value of inherited property.

If a contract includes a benefit for a third person, they may demand fulfillment if they accept
before revocation. Incidental benefits are insufficient; the benefit must be clearly intended.
(1257a)

Simplified Version:

Contracts apply to the parties, their heirs, or assignees, unless the contract or law prevents it.
Heirs are liable only for what they inherit. Third parties can claim benefits if the contract
specifies them and they accept it before revocation.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John agrees to a contract with Maria that benefits Paul, a third party. Paul can enforce this
benefit if he accepts it before John or Maria revokes it.

Reason for the Article's Enforcement:

This protects intended third-party beneficiaries while limiting heirs’ liability, ensuring contracts
remain enforceable only as intended.

Original Article:

Art. 1312. In contracts creating real rights, third persons who come into possession of the object
of the contract are bound thereby, subject to the Mortgage Law and Land Registration Laws. (n)

Simplified Version:

If a contract establishes a real right (such as ownership), any third party who gains possession
of the property is bound by the contract, in accordance with property laws.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John sells Maria a piece of land with a mortgage. If Paul later acquires the land, he must honor
the mortgage terms.

Reason for the Article's Enforcement:

This protects real property rights established by contracts, ensuring they remain valid even if the
property changes hands.

Original Article:

Art. 1313. Creditors are protected in cases of contracts intended to defraud them. (n)

Simplified Version:

Creditors are safeguarded against contracts made to cheat or deceive them.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If John transfers property to Maria to avoid paying his creditor, the creditor can take legal action
to protect their rights.

Reason for the Article's Enforcement:

This prevents parties from using contracts to evade debts, ensuring creditors’ rights are upheld.

Original Article:

Art. 1314. Any third person who induces another to violate his contract shall be liable for
damages to the other contracting party. (n)

Simplified Version:

A third person who persuades someone to break their contract will be liable for any damages
caused.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If Paul convinces John not to fulfill his contract with Maria, Maria can sue Paul for damages
caused by the breach.

Reason for the Article's Enforcement:

This discourages interference in contracts, protecting the rights of those who rely on others’
commitments.

Original Article:

Art. 1315. Contracts are perfected by mere consent, binding the parties to fulfill agreed terms
and all consequences in line with good faith, usage, and law. (1258)

Simplified Version:

Contracts are legally binding as soon as both parties agree, requiring them to follow agreed
terms and reasonable consequences.

Example of the Article Being Practiced in a Day-to-Day Scenario:

When John and Maria agree on a house-painting contract, they’re both bound by the contract
and any good-faith expectations or legal requirements.

Reason for the Article's Enforcement:

This ensures contracts are enforceable upon agreement, upholding fairness and good faith.

Original Article:

Art. 1316. Real contracts, such as deposit, pledge, and commodatum, are not perfected until
the delivery of the object of the obligation. (n)

Simplified Version:

Certain contracts (like deposits or loans) aren’t valid until the item involved is handed over.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If John agrees to hold Maria’s jewelry in deposit, the contract is only valid when he actually
receives the jewelry.

Reason for the Article's Enforcement:

This clarifies that physical possession is required for specific contract types, ensuring
enforceability only when the object is delivered.
Original Article:

Art. 1317. No one may contract in the name of another without authorization, unless legally
allowed to represent them. Unauthorized contracts are unenforceable unless ratified by the
represented party before the other party revokes it. (1259a)

Simplified Version:

Someone cannot make a contract on behalf of another person without permission unless legally
authorized. An unauthorized contract can only be enforced if the represented person later
approves it.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If Paul signs a contract for John without John’s permission, the contract is invalid unless John
later agrees to it.

Reason for the Article's Enforcement:

This prevents unauthorized agreements, protecting individuals from unwanted obligations

unless they choose to ratify them.

Original Article:

Art. 1318. There is no contract unless the following requisites concur:

1. Consent of the contracting parties;

2. Object certain which is the subject matter of the contract;
3. Cause of the obligation which is established. (1261)

Simplified Version:

A contract needs three elements to be valid: consent from both parties, a specific subject
matter, and a lawful reason for the obligation.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John and Maria agree that John will deliver 100 apples for P500. This is a valid contract
because both consented, apples are the subject, and the payment is the cause.
Reason for the Article's Enforcement:

This clarifies the essential components of a contract, protecting parties by ensuring all three
elements are present.

Original Article:

Art. 1319. Consent is manifested by the meeting of the offer and the acceptance upon the thing
and the cause which are to constitute the contract. The offer must be certain and the
acceptance absolute. A qualified acceptance constitutes a counter-offer.

Acceptance made by letter or telegram does not bind the offerer except from the time it came to
his knowledge. The contract, in such a case, is presumed to have been entered into in the place
where the offer was made. (1262a)

Simplified Version:

Consent occurs when an offer and acceptance match on the contract’s subject and purpose. An
acceptance with changes is a counter-offer. If acceptance is made by letter, it only binds the
offeror once they know about it, and the contract is considered made where the offer originated.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John offers to sell his bike to Maria, and Maria accepts without changes. If Maria accepts by
letter, the contract only starts when John reads it.

Reason for the Article's Enforcement:

This ensures clear consent in contracts, protecting both parties by defining when and where a
contract is created.

Original Article:

Art. 1320. An acceptance may be express or implied. (n)

Simplified Version:

Acceptance of a contract can be clearly stated (express) or shown through actions (implied).

Example of the Article Being Practiced in a Day-to-Day Scenario:

John offers to mow Maria’s lawn, and Maria nods in agreement. Her acceptance is implied
through her gesture.

Reason for the Article's Enforcement:

This provides flexibility in forming contracts, recognizing both verbal and nonverbal acceptance.

Original Article:

Art. 1321. The person making the offer may fix the time, place, and manner of acceptance, all of
which must be complied with. (n)

Simplified Version:

The offeror can set specific terms for how and when the offer should be accepted, and the
offeree must follow these terms.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John offers to sell Maria his car and specifies that she must accept by Friday at his house. If she
doesn’t follow these terms, the offer may be void.

Reason for the Article's Enforcement:

This gives the offeror control over the acceptance process, ensuring clarity and adherence to
specified terms.

Original Article:

Art. 1322. An offer made through an agent is accepted from the time acceptance is
communicated to him. (n)

Simplified Version:

If an offer is made through an agent, acceptance is valid once communicated to the agent.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John, through his agent Paul, offers to sell his bike to Maria. When Maria accepts and tells Paul,
the acceptance is valid.
Reason for the Article's Enforcement:

This recognizes agents’ roles in contract formation, ensuring that acceptance through an agent
is effective.

Original Article:

Art. 1323. An offer becomes ineffective upon the death, civil interdiction, insanity, or insolvency
of either party before acceptance is conveyed. (n)

Simplified Version:

An offer is void if either party dies, is legally restricted, becomes insane, or insolvent before the
offer is accepted.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John offers to sell his bike to Maria, but he passes away before Maria accepts. The offer is now
void.

Reason for the Article's Enforcement:

This protects both parties from obligations that could be unfair or impossible to fulfill due to
changes in circumstance.

Original Article:

Art. 1324. When the offerer has allowed the offeree a certain period to accept, the offer may be
withdrawn at any time before acceptance by communicating such withdrawal, except when the
option is founded upon a consideration, as something paid or promised. (n)

Simplified Version:

An offer with a deadline can be withdrawn before acceptance, unless the offeree has paid for
the option to keep the offer open.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John offers to sell his car to Maria, giving her until Friday to decide. He can withdraw the offer
before then unless Maria paid him to keep it open.
Reason for the Article's Enforcement:

This gives flexibility to withdraw offers while respecting any paid options that secure the offer’s
duration.

Original Article:

Art. 1325. Unless it appears otherwise, business advertisements of things for sale are not
definite offers, but mere invitations to make an offer. (n)

Simplified Version:

Business ads are usually just invitations for customers to make an offer, not binding offers
themselves.

Example of the Article Being Practiced in a Day-to-Day Scenario:

A store advertises a laptop for P20,000. This ad invites customers to make an offer; the store
isn’t bound to sell it to every person who responds.

Reason for the Article's Enforcement:

This distinguishes between actual offers and general advertisements, protecting businesses
from unintentional binding obligations.

Original Article:

Art. 1326. Advertisements for bidders are simply invitations to make proposals, and the
advertiser is not bound to accept the highest or lowest bidder, unless the contrary appears. (n)

Simplified Version:

Invitations for bids are not binding offers, and the advertiser can choose not to accept any bid.

Example of the Article Being Practiced in a Day-to-Day Scenario:

A company invites bids for a construction project but isn’t required to accept the highest or
lowest bid.

Reason for the Article's Enforcement:

This allows businesses to review bids without obligation, ensuring fair selection of proposals.

Original Article:

Art. 1327. The following cannot give consent to a contract:

1. Unemancipated minors;
2. Insane or demented persons, and deaf-mutes who do not know how to write. (1263a)

Simplified Version:

Certain people, such as minors, those with mental disabilities, and illiterate deaf-mutes, cannot
legally give contract consent.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If a minor attempts to enter a contract with an adult, the contract is invalid due to lack of legal
capacity.

Reason for the Article's Enforcement:

This protects vulnerable individuals from entering contracts without proper understanding or
capacity.

Original Article:

Art. 1328. Contracts entered into during a lucid interval are valid. Contracts agreed to in a state
of drunkenness or during a hypnotic spell are voidable. (n)

Simplified Version:

Contracts made during a clear-minded period are valid, but those made while intoxicated or
hypnotized can be canceled.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If John, while drunk, agrees to sell his car to Maria, he can later void the contract.

Reason for the Article's Enforcement:

This protects individuals from being bound by agreements made under impaired judgment.
Original Article:

Art. 1329. The incapacity declared in Article 1327 is subject to the modifications determined by
law and is understood to be without prejudice to special disqualifications established in the laws.
(1264)

Simplified Version:

The incapacity rules for contract consent have legal exceptions and can be subject to additional
restrictions by law.

Example of the Article Being Practiced in a Day-to-Day Scenario:

A minor may have contractual capacity in specific situations under the law, such as certain
employment agreements.

Reason for the Article's Enforcement:

This acknowledges exceptions and other legal restrictions on contractual capacity.

Original Article:

Art. 1330. A contract where consent is given through mistake, violence, intimidation, undue
influence, or fraud is voidable. (1265a)

Simplified Version:

If consent to a contract is obtained through mistake, force, threats, undue influence, or fraud,
the contract can be canceled.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If Maria agrees to sell her property to John because he threatens her, she can later void the
contract due to intimidation.

Reason for the Article's Enforcement:

This protects individuals from being forced into contracts under unfair conditions, ensuring true
consent.
Original Article:

Art. 1331. In order that mistake may invalidate consent, it should refer to the substance of the
thing which is the object of the contract, or to those conditions which have principally moved one
or both parties to enter into the contract.

Mistake as to the identity or qualifications of one of the parties will vitiate consent only when
such identity or qualifications have been the principal cause of the contract.

A simple mistake of account shall give rise to its correction. (1266a)

Simplified Version:

A mistake invalidates consent if it’s about the main item or key terms of the contract. Mistakes
about a party’s identity matter only if they were essential to the agreement. Minor calculation
errors can simply be corrected.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If John mistakenly thought Maria’s car was brand new and agreed to buy it based on this, he
could void the contract. But if it was just a miscalculation in the price, they could correct it.

Reason for the Article's Enforcement:

This protects against significant misunderstandings that affect the contract, allowing minor
mistakes to be fixed without canceling the agreement.

Original Article:

Art. 1332. When one of the parties is unable to read, or if the contract is in a language not
understood by him, and mistake or fraud is alleged, the person enforcing the contract must
show that the terms thereof have been fully explained to the former. (n)

Simplified Version:

If one party can’t read or understand the contract’s language, the other party must prove they
explained it clearly if there’s a dispute over mistake or fraud.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John, who doesn’t understand the contract language, signs it. If Maria later enforces it, she must
show that she fully explained its terms to him.
Reason for the Article's Enforcement:

This ensures fair understanding and prevents exploitation in contracts, especially when one
party may lack language or reading skills.

Original Article:

Art. 1333. There is no mistake if the party alleging it knew the doubt, contingency or risk
affecting the object of the contract. (n)

Simplified Version:

A person can’t claim mistake if they were aware of the risks or uncertainties involved in the
contract.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If John knows there’s a risk of the car he’s buying having mechanical issues, he can’t later claim
a mistake based on those potential issues.

Reason for the Article's Enforcement:

This prevents parties from voiding contracts on the basis of known risks, promoting responsible
decision-making.

Original Article:

Art. 1334. Mutual error as to the legal effect of an agreement when the real purpose of the
parties is frustrated, may vitiate consent. (n)

Simplified Version:

If both parties misunderstand the legal impact of their agreement, and it prevents the contract’s
purpose, it can invalidate consent.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John and Maria agree on a property exchange, both thinking it exempts them from certain
taxes. If they learn this was incorrect, they can void the contract due to mutual error.

Reason for the Article's Enforcement:

This protects parties from contracts based on shared legal misunderstandings, ensuring that
both truly understand the agreement.

Original Article:

Art. 1335. There is violence when in order to wrest consent, serious or irresistible force is
employed.

There is intimidation when one of the contracting parties is compelled by a reasonable and
well-grounded fear of an imminent and grave evil upon his person or property, or upon the
person or property of his spouse, descendants, or ascendants, to give his consent.

To determine the degree of intimidation, the age, sex, and condition of the person shall be borne
in mind.

A threat to enforce one's claim through competent authority, if the claim is just or legal, does not
vitiate consent. (1267a)

Simplified Version:

Violence means using serious force to get consent. Intimidation is when someone consents out
of reasonable fear of harm to themselves or loved ones. Legitimate threats to assert a legal
claim don’t count as intimidation.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If John threatens to harm Maria’s property unless she sells her car to him, Maria’s consent is
invalid due to intimidation.

Reason for the Article's Enforcement:

This protects individuals from coercive tactics in contracts, ensuring that consent is freely given.

Original Article:

Art. 1336. Violence or intimidation shall annul the obligation, although it may have been
employed by a third person who did not take part in the contract. (1268)

Simplified Version:
Contracts can be voided if violence or intimidation was used, even if it was by someone not
directly involved in the contract.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If Paul, a third party, intimidates Maria into agreeing to a contract with John, the contract is
voidable due to Paul’s influence.

Reason for the Article's Enforcement:

This protects parties from outside pressures, ensuring they only agree to contracts by free
choice.

Original Article:

Art. 1337. There is undue influence when a person takes improper advantage of his power over
the will of another, depriving the latter of a reasonable freedom of choice. Relevant factors
include confidential or family relations, mental weakness, ignorance, or financial distress. (n)

Simplified Version:

Undue influence happens when someone misuses their authority over another, limiting their
freedom to choose, especially in cases involving close relationships or vulnerability.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If Maria pressures her financially dependent sister into selling her car for less than its worth, it
could be undue influence.

Reason for the Article's Enforcement:

This safeguards people in vulnerable positions from being coerced into contracts by those they
trust or depend on.

Original Article:

Art. 1338. There is fraud when, through insidious words or machinations of one of the
contracting parties, the other is induced to enter into a contract which, without them, he would
not have agreed to. (1269)

Simplified Version:
Fraud occurs if one party uses deceitful tactics to persuade the other to enter a contract they
otherwise wouldn’t have agreed to.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If John lies about the car’s condition to get Maria to buy it, she can later void the contract
because of fraud.

Reason for the Article's Enforcement:

This prevents parties from using deception in contracts, ensuring agreements are based on
honest information.

Original Article:

Art. 1339. Failure to disclose facts, when there is a duty to reveal them, as when the parties are
bound by confidential relations, constitutes fraud. (n)

Simplified Version:

If one party fails to share important information they’re obligated to disclose, especially in
trusted relationships, it counts as fraud.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If John, Maria’s financial advisor, convinces her to invest without revealing risks, it could be
considered fraud.

Reason for the Article's Enforcement:

This ensures transparency in trusted relationships, protecting parties from hidden information.

Original Article:

Art. 1340. The usual exaggerations in trade, when the other party had an opportunity to know
the facts, are not in themselves fraudulent. (n)

Simplified Version:

Marketing exaggerations aren’t considered fraud if the other party could verify the truth.
Example of the Article Being Practiced in a Day-to-Day Scenario:

If a car dealership advertises a car as “the best on the market,” it’s not fraud if Maria could
assess the car herself.

Reason for the Article's Enforcement:

This acknowledges common sales tactics, distinguishing them from deceptive practices.

Original Article:

Art. 1341. A mere expression of an opinion does not signify fraud, unless made by an expert
and the other party has relied on the former's special knowledge. (n)

Simplified Version:

An opinion isn’t fraud unless an expert gives it, and the other party relies on their expertise.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If a mechanic tells Maria that a car “seems in great shape,” she can’t claim fraud unless he
presented himself as an expert.

Reason for the Article's Enforcement:

This protects general opinions from being misinterpreted as deceit while holding experts
accountable for misleading advice.

Original Article:

Art. 1342. Misrepresentation by a third person does not vitiate consent, unless such
misrepresentation has created substantial mistake and the same is mutual. (n)

Simplified Version:

A third party’s misrepresentation only invalidates consent if it causes a major mistake that
affects both contract parties.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If Paul misrepresents facts to both John and Maria, leading them to an incorrect agreement, the
contract could be voided due to mutual mistake.

Reason for the Article's Enforcement:

This provides protection from third-party deception only when it significantly impacts both
parties’ understanding.

Original Article:

Art. 1343. Misrepresentation made in good faith is not fraudulent but may constitute error. (n)

Simplified Version:

An honest mistake in representation isn’t fraud, but it can still be an error that affects the
contract.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If John mistakenly overstates his car’s mileage in good faith, it’s not fraud, but Maria may still
adjust or void the contract.

Reason for the Article's Enforcement:

This distinguishes between intentional fraud and honest errors, allowing reasonable
adjustments.

Original Article:

Art. 1344. For fraud to make a contract voidable, it should be serious and should not have been
employed by both parties. Incidental fraud only obliges the person employing it to pay damages.
(1270)

Simplified Version:

Fraud makes a contract voidable if it’s significant and wasn’t done by both parties. Minor fraud
requires compensation but doesn’t void the contract.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If John lies about his job to secure a lease from Maria, she can void the contract. If it’s a minor
lie, John may only owe damages.

Reason for the Article's Enforcement:

This allows contracts to be voided only for serious fraud, ensuring minor issues are handled with
fair compensation.

Original Article:

Art. 1345. Simulation of a contract may be absolute or relative. The former takes place when
the parties do not intend to be bound at all; the latter, when the parties conceal their true
agreement. (n)

Simplified Version:

Contract simulation can be absolute, where there’s no real intent to bind, or relative, where
parties hide their actual agreement.

Example of the Article Being Practiced in a Day-to-Day Scenario:

John and Maria pretend to sign a contract with no intent to follow it (absolute) or use a fake
contract to hide their real terms (relative).

Reason for the Article's Enforcement:

This helps identify simulated contracts, ensuring that only genuine agreements are enforced.

Original Article:

Art. 1346. An absolutely simulated or fictitious contract is void. A relative simulation, when it
doesn’t harm a third party and is lawful, binds the parties to their real agreement. (n)

Simplified Version:

An entirely fake contract is void. If a simulation is partial and lawful, it’s valid as long as it doesn’t
harm others.

Example of the Article Being Practiced in a Day-to-Day Scenario:

If John and Maria create a false sale of property, it’s void. But if they agree on hidden terms that
don’t affect anyone else, their true agreement is valid.

Reason for the Article's Enforcement:

This prevents entirely fake contracts from being enforced but allows real agreements behind
lawful simulations.