Supreme Court rules private contract terms override civil code on termination

The Supreme Court ruled that parties to a mandate contract must follow agreed-upon grounds and procedures for termination rather than default provisions in the Civil Act. The April 2 decision clarifies that private agreements supersede statutory norms regarding contract dissolution and damages when explicitly defined by the parties.

In a case concerning an agent's status, the high court stated that Article 689 of the Civil Act is a discretionary rule that can be excluded or modified through mutual consent. Consequently, contracting parties cannot terminate based on statutory grounds alone or ignore their agreed framework for calculating damages if they have established distinct conditions for ending the relationship.

The bench noted an exception where foundational trust required for such continuous contracts has been irreparably damaged. Even without specific contractual grounds, a party may dissolve the relationship if the other side commits a breach of duty or engages in improper conduct that makes maintaining the contract untenable.