Navigating Standard Contracts: Understanding Article 686 of Record and Civil Obligations
Article 686 of the Albanian Civil Code governs standard contracts and general conditions, requiring their awareness, invalidating terms that disproportionately harm the other party's interests, and mandating special written approval for clauses favoring the drafter to ensure fairness and prevent disputes.
In commercial practice, many companies use standard contracts, the terms of which are drafted in advance by one party, but not every term included in the contract necessarily produces the intended effects. Article 686 of the Civil Code of the Republic of Albania sets out three rules to keep in mind:
Knowledge of contract terms
General conditions have an effect against the other party if, at the time of concluding the contract, they knew them or should have known them by exercising ordinary care.
Terms that compromise the interests of the other party
Terms that cause loss or disproportionate damage to the interests of the contracting party are invalid, especially when they differ substantially from the principles of equality and impartiality provided for in the Civil Code.
Clauses requiring special written approval
The law provides for this requirement for certain clauses that favor the party that drafted them in advance, such as those limiting liability, the possibility of withdrawing from the contract, the suspension of its implementation, or the right to submit defenses. This requirement also applies to other categories specified in the final paragraph of Article 686.
Why does this matter for business?
A company that uses standard contracts must check not only their content, but also the manner in which clauses are included and approved. Likewise, before signing, the other party must carefully review the conditions that may affect its responsibility, rights, and obligations. A well-drafted contract aims not only to define the obligations of the parties, but also to prevent future disputes.
What should be kept in mind?
When reviewing the general conditions of a contract, both the manner of their incorporation into the contractual relationship and the content and compliance with specific legal requirements are important. Special written approval does not preclude checking the validity of a clause according to other rules of Article 686.
