Contrato de Suministro en el Código Civil Peruano PDF

# De comerciantes, protectores y justicieros: algunos comentarios al contrato de suministro en el código civil peruano ## Eduardo Benavides Torres - Abogado. Profesor de Derecho Civil - Universidad de Lima - Pontificia Universidad Católica del Perú ## Unas palabras previas - The relaunch of "Adv...

# De comerciantes, protectores y justicieros: algunos comentarios al contrato de suministro en el código civil peruano ## Eduardo Benavides Torres - Abogado. Profesor de Derecho Civil - Universidad de Lima - Pontificia Universidad Católica del Perú ## Unas palabras previas - The relaunch of "Advocatus" is excellent news for the legal community. - Advocatus left a profound mark in its first stage, bringing together a group of students who made a notable impact on the academic scene in the late 80s and early 90s. - It is a double satisfaction for me to contribute to the first issue of the journal in its second stage. - The initial stage of Advocatus coincided with my entrance into teaching at the Faculty of Law and Political Sciences of the University of Lima in 1988. - I have shared a relationship of common concerns, research, intense debate, and friendship with many promotions, but I've dedicated this article to my former students from the 1989 first semester course of Typical Contracts. - We shared intense academic days, both inside and outside the classroom, moments of conversation and companionship, and a friendship that has continued over the years. - That group has made a notable contribution to the world of law. - Many of them are brilliant professionals with outstanding careers, professors who grace several of our Faculties of Law, researchers who have been honored with postgraduate scholarships, etc. - That old group of restless and rebellious students bears a great deal of responsibility for this article. - I remember that one of the first topics I discussed in class with my students from that year’s class was Supply. - To my surprise, what I had anticipated would be a single class discussion became an intense topic of debate for weeks. - With the bold and insightful critical thinking that the University of Lima fostered in its students, they were not content with just a general overview of the topic and, on the contrary, demanded that I delve deeper into the analysis of the articles of the Code. - From that moment and into the following cycles, Supply became one of the popular topics in the classes of the Contracts II course until, a few years ago, the curriculum reform considered that this contract should be discussed, instead, in a subsequent course, the course of Commercial and Banking Contracts. ## Problemática del suministro - Why should there be so much debate about this figure? - We don't believe that the problem lies in whether or not Supply should be regulated. - The 1984 Peruvian Civil Code has comprehensively regulated the Supply Contract and we consider that this is a wise decision. - While few modern Civil Codes have incorporated this contract, those systems that have given it legal recognition (Colombia, Guatemala, Honduras, El Salvador...) have done so almost exclusively in the Commercial Code. - Our Code has followed the example of the Italian Civil Code, doing justice to a legal relationship that, due to its importance, usefulness, and relevance, deserved special treatment in our contractual legislation. - Gone are the days when Supply was classified as a mere variety of purchase and sale, where it was considered that, in the periodical deliveries of the supplier, there was only a modified agreement, the term, which did not change the legal nature of the purchase and sale contract. - Today there is no longer any discussion in contractual law regarding its autonomy. - It is clear that the time factor that nourishes the relationship created by Supply is not an added, incidental factor, nor is it an added modality to the contract that does not change its substance, but is a vital, invigorating element of the contract. - The development of the execution over time is what gives meaning to the bond of obligation and contributes to the satisfaction of the contractual purpose. - By incorporating Supply into the Peruvian Civil Code it has been also acknowledged that we are dealing with a contract that fulfills a very important economic and social function, which is used frequently in the commercial field and for which companies, especially, need to find contractual rules that make it easier for them to establish relationships of Supply as secure as they are flexible. - However, the problem arises in the legal treatment that, with very good intentions, our Civil Code has given to what could be considered the most mercantile of all the contracts regulated by our Code. - This treatment, as we shall see in the following lines, far from achieving the legislator’s objective—to encourage the creation of Supply relationships—has obscured the contours of the institution and made its application and free development difficult. - This is so much so that, when, in 1997, during the works of the Civil Code Reform Commission, the first meeting of the Sub-Commission of Special Contracts was held, all its members, including jurists from the groups of Manuel de la Puente y Lavalle, Max Arias Schreiber, and Fernando Vidal, agreed that the articles relating to Supply required urgent amendments. - Max Arias Schreiber himself, the distinguished President of the Sub-Commission and, at the same time, the person who defended the respective report in the Civil Code Reform Commission that produced the 1984 Civil Code, acknowledged on that occasion his dissatisfaction with the treatment of this contract in our Code and announced his intention to present a proposal for amendment. ## The concept of supply in the civil code of 1984 - The key to understanding the problems of our Civil Code regarding the Supply contract lies in the very definition of this contract, contained in article 1604 of the Code. - Article 1604 of the Peruvian Civil Code defines Supply as follows: "Article 1604.- Supply is a contract by which the supplier obliges himself to provide another person with periodic or continuous deliveries of goods.” - Max Arias Schreiber says that Supply has been defined as the “agreement by which a subject, known as the supplier, obliges himself to make deliveries for another, known as the supplied, of goods that can be periodic or continuous.” - He adds further that “from this definition it follows that we are dealing with a contract of reciprocal and deferred prestations that produces a transfer of ownership to the extent the object is consumable and that this transfer does not occur when something is provided for use or enjoyment. The contract, generally onerous, can be agreed upon without consideration, without being thereby denatured.” - There are several observations and questions that immediately arise from this definition and we will address them in the following lines: a) In the first place, the definition does not mention any consideration for the supplied. As we all know, in Supply, the supplier’s prestation to deliver goods to the supplied is in exchange for consideration from the supplied to pay the supplier a price for these goods. However, the article makes no mention of the price of the Supply. b) In the second place, it is not clear from the article under discussion what the content of the supplier’s prestation is. It is not surprising, then, that commentators on the Code should have differing views on the matter. Some argue that this prestation consists of delivering goods in ownership while others think that this delivery of goods can also, on occasion, be for use, and finally, some views lean toward acknowledging that services can also be part of the supplier’s prestation. c) Thirdly, it is not clear what types of goods are the subject matter of Supply (movable property, immovable property, consumables, specific goods, intangible goods, etc.). d) Finally, the definition seems to suggest that the supplier must provide not one but several "deliveries of goods." This is understandable in the case of periodic prestations, where each delivery is independent of the next, but we can not understand how this would apply when the prestation is only one but continuous. - Let’s examine these unclear points in the concept of Supply in more detail: a) Supply as a Bilateral Onerous Contract. The supposed oversight of the legislator concerning the supplied’s consideration in article 1604 is not actually such. In the Exposition of Motives of the 1984 Civil Code, Max Arias Schreiber states that "conceptually, Supply constitutes the agreement of wills destined for the delivery of material goods in the form of a successive performance and against the payment of a price.” By acknowledging that Supply is a contract in which there is an exchange of goods for price, he then corrects himself, however, to clarify that this contract “is onerous, in principle, because the consideration is represented by the payment of the price," but that “there is no obstacle to its creation without consideration.” In his "Exegesis of the Peruvian Civil Code,” he seeks to refine this definition: "This contract is ‘destined for the delivery of material goods (and also of services when the law so provides) in the form of a successive (continuous or intermittent) performance and against the payment of a price, unless it has been agreed upon without consideration." He adds, "and while it generally agreed upon without consideration, nothing prohibits its being agreed upon gratuitously, which is not usual, without being thereby denatured." Therefore, we are not dealing with an unintentional oversight, as one can see for greater clarity in the second paragraph of article 1605, which imposes the written form as a formality ad solemnitatem in Supply without consideration. The Peruvian legislator, however, has considered that there was no reason to maintain, in the development of Supply, the traditional characteristics as a bilateral and onerous contract. The 1942 Italian Civil Code, which served as inspiration for our Code and whose regulation of Supply is the direct source of the respective articles in our Code, advanced a concept of Supply Contract as a bilateral contract for reciprocal prestations: "Article 1559.- Supply is the contract whereby one party obliges himself, in exchange for a price, to make periodic or continuous deliveries of goods." Italian authors universally accept that Supply is a bilateral contract of reciprocal prestations, meaning that, across from the supplier’s prestation to deliver goods, there is always the supplied's prestation to pay for them and that there is a relationship of reciprocity between the two prestations. Moreover, there is no doubt that, according to the provisions of the Italian Civil Code, the Supply contract is considered an onerous contract: between the two prestations—delivering goods and paying the price—there must be equivalency, since one is in exchange for the other. The Draft Reform of Contracts in the Civil Code, 1980, by Max Arias Schreiber, in relation to the Supply contract, repeated almost word for word the definition of the Italian Code: “Article 1.-By Supply, the supplier obliges himself to carry out periodic or continuous deliveries of goods, in exchange for a price." Arias Schreiber’s proposal in relation to the definition of the Supply contract was repeated unchanged by the Project of the Revisory Commission in its article 1636. However, article 1567 of the Project of the Revisory Commission, which became definitive article 1604 of the Civil Code, eliminated the phrase "in exchange for a price," thereby cheerfully cutting off one of its fundamental features, leaving it as a contract that could be both bilateral and unilateral. With this unfortunate amputation, the legislator has thought that he was enriching the definition of Supply that he borrowed from the Italian Civil Code. He thought, citing Ruben de Marina y Borrego, that what was essential in the concept of Supply was provision for a purpose or to satisfy a specific need and that there was no reason why this contract could not be agreed upon without consideration or gratuitously. He believed that what was important was the supplier’s prestation and that the consideration was secondary, as it could occur or not occur. At first glance, it would seem that the Peruvian legislator's ingenious innovation, if not useful, is, at the very least, harmless. After all, why not allow—in application of the principle of private autonomy and freedom of contract—that the parties may agree freely as to whether the supplier’s prestation to provide goods shall have a monetary consideration or not. However, we believe that this is not the problem. We do not debate the possibility of agreeing upon a supply of goods without consideration or gratuitously. What we must ask ourselves is whether the regulation of Supply in the Civil Code should be done based on Supply as we know it, as it occurs in reality, as it results from commercial practice and the development of the past few decades, or, rather, whether we should seek an abstract paradigm. Perhaps it may not be convincing to quote, for that effect, the authoritative opinions of contractual doctrine according to which onerousness and bilaterality are typical characteristics of Supply. Nor will we use arguments of legal tradition, stemming from lineage and ancestry, which we have always defended as insufficient to decide how to legislate on a specific type of contract. However, we believe it to be indispensable, when regulating the figure, to have clarity concerning the legal situation regulated, the interests at stake, and the economic and social function of the contract. This leads us to ask, what is Supply for, what function does it perform in a market economy, what are the interests that need to be regulated or protected? The answer may lie quite close to the origins of this dynamic contract. While its roots seem to go back to the Middle Ages, the time when Supply gains recognition as a contract that performs a function different from that of purchase and sale, comes later, after the industrial revolution. With mass production, industrialization of economies and large-scale manufacturing, industries need to guarantee their adequate supply for long periods. This is where the function and great usefulness of Supply are discovered. Supply is, above all, a contract for the supply of goods. The interest that is sought to be fulfilled is that of companies being adequately supplied during a certain period of time that is related to the development of their operations. Thus, an industrial company will seek to establish a relationship of Supply that guarantees adequate and timely supply of the raw materials, consumables, and intermediate products involved in its production cycle. A trading company may enter into Supply contracts for the merchandise it plans to buy for resale, it will probably be much more useful to enter into a distribution contract, because in this case it is the function behind it, and the interest of the creditor, that is dedicated not so much to supply as to marketing, which are two very different functions. However, the marketing company also has supply needs: it requires office supplies, electric power, fuel for its trucks and cars, security equipment, warehouse supplies, packaging materials, advertising and promotional materials, etc. , to meet these needs, Supply is the right vehicle for regulating the interests of the parties. The same applies to companies involved in the provision of services, agricultural businesses, construction companies, mining companies, hotels, and any other activity. Some may argue that there is nothing in the concept of Supply to suggest that its scope is limited to the business scene and to relationships between entrepreneurs, where, obviously, onerousness will be present through a price the supplied pays for the supply of goods. That is true, but so too are the citizens' own supply needs, for electricity and drinking water, for example, for domestic use, etc., which are efficiently met through Supply relationships where the supplied pays a price in exchange for receiving certain goods on a continuous or periodic basis. However, in either of these situations, the logic behind the contract is the same, and the function of supply is the engine. On the other hand, to imagine a Supply contract where the conduct of providing the goods to the supplied is gratuitous involves introducing an element into the relationship that is entirely foreign to Supply: the spirit of generosity. In doing so, I do not mean to suggest that Supply is confused with donation, because acts of generosity constitute an extensive category that encompasses many contracts and legal acts of disposal where the purpose of benefiting the beneficiary is the distinguishing feature. It is clear that in a Supply contract without consideration, different from donation, because the bond of obligation is one of duration and not of instantaneous performance, but akin to donation in the “animus donandi", there is a function, a purpose, and a play of interests that is not that of onerous Supply. A contract whereby a charitable person, guided by philanthropic spirit, agrees to deliver a certain number of food rations every week to a children's home for the poor, for a period of one year, does not perform the same economic and social function nor meet the same interests as a contract entered into by a mining company to regularly supply a steelworks or a foundry or a refinery with the minerals or metals necessary for its operations, in exchange for the respective monetary consideration. What we are not arguing for is a prohibition on entering into gratuitous unilateral Supply contracts. What we contend is that the definition of Supply needs to be amended in order to clearly draw the contours of a contract that is characterized by onerousness. While it is true that the Code regulates the economically and socially significant type of contract, Supply without consideration, with reciprocal prestations, this does not preclude the parties from agreeing upon atypical gratuitous Supply contracts, nor does it preclude the parties from agreeing in a bilateral Supply contract to waive reciprocity for the purpose of agreeing upon autonomous prestations, in which case we would have an atypical Supply contract for autonomous prestations. Nor would it prevent the parties from agreeing that some or both prestations are performed in favor of a third party. This is true, by virtue of the principle of freedom to configure the internal content of the contract. The Peruvian Civil Code, in articles 1353 and 1354, broadly recognizes the right of individuals to enter into atypical contracts and to freely agree upon the content of their contracts. b) Supplier Prestation. According to article 1604 of the Code, the supplier is required to "make periodic or continuous deliveries of goods." The legislator has translated thus the final part of article 1559 of the Codice ("..prestazioni periodiche o continuative di cose."). The first question that comes to mind cannot be more natural and immediate. We know that continuous prestations are those that are carried out uninterruptedly in time and that periodic prestations are those that are carried out intermittently, in pre-established periods; that is, in a staggered manner. However, it is unclear what the supplier's prestations, which are stipulated in article 1604, consist of. Because we have been taught that prestations always consist of doing something, something else, or not doing something. Article 1604 speaks of deliveries of goods, without specifying whether they are deliveries of goods in ownership, deliveries of goods only for use, or performing some other type of conduct (a "doing") in relation to these goods (for example, repairing them, maintaining them, manufacturing them, demolishing them, etc.) or whether it is, rather, a matter of forbearance (a "not doing") in relation to those goods. b-1) Supply for Use We might suspect that the legislator has intended to convey that the supplier's prestation is to deliver goods. However, in light of this, the following question arises: is this delivery in ownership or could it also be made only for their use, with the supplied having the obligation to return the goods once used? In the Exposition of Motives of the Civil Code, Max Arias Schreiber confesses that his intention has been to incorporate intermediate provisions, understanding that the supplier’s prestation may be to deliver goods in ownership or for use or enjoyment. “It is, generally, a matter of consumables that pass into the ownership of the supplied, but, as we have already explained, the prestation may consist of the use or enjoyment of a non-consumable good, as occurs in the case of repeated provisions of suits and furniture destined for theatrical activities (supply for use or enjoyment)." In his Exegesis, commenting on article 1604, he says that it follows from the definition of Supply that "this contract leads to the transfer of ownership of the object of the prestation if it is consumable and that the possibility may also occur that only a good is provided for use or enjoyment, and that it be returned to its owner at the end of the contract." Arias Schreiber seems to follow Messineo, who argued that sometimes the utilization of the good involved the enjoyment of the thing for a certain period of time, without the ownership of the thing leaving the supplier’s patrimony, and cites, for that effect, the use of clothing and modes of transportation. The legislator's choice seems to be confirmed by the reading of article 1609 that refers to the “supply of goods in ownership,” implying that other modalities of Supply might exist where the delivery of goods does not occur “in ownership.” We respectfully disagree with our dear teacher. In this matter, as with the onerous nature of Supply, we believe that we must be clear about the function and usefulness of the contract. If the function they have intended to guarantee and the practical purpose that the parties seek to achieve through this contract is linked to the supplied’s supply, that supply demands the acquisition of the goods that are the subject matter of the Supply in ownership. Energy, fuels, raw materials, consumables... are required by the supplied for a definitive purpose and not to be returned later. When the supplied needs goods to be used and then returned to their owner (for example, a machine, a generator, etc.), the function that they are faced with is another. The user requires the use of the good for a period and for a specific purpose, for which our contract law provides us with other reliable instruments: the contract of lease and the contract of loan. According to article 1666 of the Civil Code, "By Lease, the lessor obliges himself to transfer temporarily the use of a good to the lessee for a certain agreed rent." Let’s take the case cited repeatedly by Max Arias Schreiber as a prototype of Supply for use: a theater company enters into a contract with a store to supply it with suits that will be used in each performance and then returned. The teacher anticipates our objections: "Of course, we can not ignore the possibility that the contract may be one of lease, given its potential similarity and, ultimately, we would have to consider the parties’ common intent (Article 1363 of the Civil Code)." Indeed, when a theater company contracts for costumes that it may use and then return, in exchange for a fee, we are actually facing a lease agreement, and it is forcing the issue to argue that this could be categorized as Supply. If, as Arias Schreiber suggests, we should abide by the parties' intention, is it not true that, when the parties intend to create a temporary use relationship for a good that will subsequently be returned to its owner, in exchange for a fee, they generally assume that they are moving within the sphere of rental and not of Supply? Isn't it true that, after all, the parties agree that, in order to require gala attire for a ball, costumes for a carnival party, bathing suits for swimming in a pool, etc., they understand that they are entering into a rental agreement and not a Supply agreement? What justification could there be, then, for the Code to embrace a double regulation, an overlay of legal figures? We do not believe that the result is positive in terms of clarity. Quite the opposite, individuals could become confused as to what the correct structure to adopt might be. Some have argued that the distinction between the two contracts lies in the inherent intermittent nature of Supply. For example, could it be argued that if one rents a boat for fishing every Sunday, for three months, the contract is one of Supply and not of Lease? Or would it be tenable in practical terms that the rental of a tennis racket, or golf clubs, or a horse for riding, an hour a week, over the course of a month, would make this a Supply for use and not a Lease? Obviously, the essential element of the term of the rental agreement and its continuous nature is not altered if intervals and modalities are established regarding the use of the leased good, such as, for example, when the traveler rents several vehicles for staggered distances as he moves from one city to another. Victor Raul Ramirez, for his part, argues that in Supply there must be uncertainty regarding the quantity of goods that are allowed for use. "Once again, we insist, if the object of the obligation of the person who is going to give something to another to use is not determined in terms of quantity, it can be said we are facing a Supply contract." Ramirez argues that the goods that are involved in a Lease agreement must be determined at the time of entering into the contract. Therefore, if, for example, the circus owner contracts for the Saturday and Sunday deliveries of 30 bicycles for use by the circus's jugglers during the performances, in exchange for a fee, the contract would be one of Lease if it is entered into for a period of twelve months. However, it would be one of Supply if it is made for an indeterminate term, given that, assuming that 30 different bicycles are delivered every day, the quantity of goods to be delivered would be undeterminate and, therefore, could not be a Lease. We find the argument outlined by the author hard to accept. As Kafka puts it in the mouth of his character in "The Trial", "How subtle Law is!" We do not find the argument persuasive that the distinction between Supply and Lease could depend on whether the contract is made with a certain term or not. Moreover, our Code embraces a system of contractual law that holds that contracts have binding effects and that, in terms of the subject matter of the contract, it suffices that the prestations be possible, lawful, and determined or determinable. What will interest the parties, of course, is that the quantity of goods to be delivered be determined at the time of execution. We do not understand why, as a consequence, a Lease agreement for a good that is determinable in quantity and quality could not be made? Is it possible to rent a certain number of parking spots that will be determined based on the number of attendees at a social gathering? In conclusion, we propose that the definition of Supply in the Civil Code be amended to make it clear that the supplier's prestation is to deliver goods in ownership, thereby eliminating possible confusion with the lease contract and with the contract of loan. b-2) Supply of Services. However, the ambiguity and imprecision of the concept of Supply in our Civil Code do not end there. It is so broad that some have suggested that a broad interpretation of it could allow for prestazioni services. Arias Schreiber himself argues that the Code has discarded the broader view, which considers Supply to be similar to the letting of services. However, he also maintains that, in the matter of general clauses of contract, according to articles 1394 and 1396 of the Civil Code, Supply contracts for services may be entered into. A careful reading of articles 1394 and 1396 of the Civil Code leads us to conclude that there is no mention at all of Supply of services. Article 1394 states that the Executive Branch will specify the provision of goods and services that should be contracted in accordance with general clauses of contract approved administratively. While this article refers to the "provision of goods and services", the term “provision” is not used technically as synonymous with Supply but in a broader sense, as a result of the action of providing; that is, to prevent the things needed for a purpose. As Manuel de la Puente y Lavalle explains, the reference to contracts concerning goods and services that can be the subject matter of provision is generic and not limited to those goods and services that could be contracted through a Supply contract. The intention has been, instead, to refer to goods and services that are clearly linked with public interest (basic services, emergency healthcare, educational services, public transportation, etc.) that must be contracted under a legal obligation—using a contract that incorporates general clauses approved and, consequently, filtered, in order to prevent abuse, by the administrative authority, regardless of whether the goods and services are contracted through purchase and sale, letting of services, Supply, etc. Nor do we find any trace of Supply of services in article 1396: “Art. 1396. In contracts offered in accordance with general clauses of contract approved by the administrative authority, the consumption of the good or the utilization of the service, automatically produces a right to payment on the part of the client, even if he has not formalized the contract or is incapable" We could not possibly interpret this article in such a manner as to suggest that the term "use of the service" refers to the Supply of services. On the contrary, our Code regulates five types of service contracts and the "doy para que hagas" and "hago para que des" forms of contract, as well as the existence of many atypical service contracts, so it is difficult to associate that phrase with Supply of services. In his commentary on this article, the great teacher Manuel de la Puente y Lavalle, who inspired this norm, states that this article "applies to those who acquire goods and services through their intervention in contracts entered into in accordance with general clauses of contract approved by the administrative authority” without linking it to Supply at all. A segment of the doctrine maintains that the Supply contract could also apply to services. Article 968 of the Colombian Commercial Code and article 707 of the Guatemalan Commercial Code also include services as the subject matter of the supplier’s prestation. A great deal of the Mexican doctrine also agrees with this. Diaz Bravo mentions the contracts for telephone, cable television, telex, paging, etc. services with Teléfonos de México, and Messineo even goes so far as to include the use of certain modes of transportation within Supply. In contrast, the Italian doctrine argues that Supply is clearly distinguished from the contract for work (appalto) because the former is intended to provide deliveries of things and the latter to provide a service or to perform a job. Among us, the majority of opinions seem to favor the alternative of including services within the territory of Supply. Thus, when Max Arias Schreiber, along with Manuel de la Puente, one of our most distinguished contractual law experts, presented a report to the Special Contracts Sub-Committee of the Civil Code Reform Commission, he expressed "serious doubts as to the scope that article 1604 should have when it refers exclusively to goods" and, correcting an earlier stated point, stated that "the expression 'good' was an error, not a deliberate action. It should be 'goods and services' on the other hand, as well as the expression of the subject matter of the contract. " - His conclusion is that there no excuse for extending Supply to services, but that the law is clear that services can be supplied and that therefore the Code should clearly stipulate that. - He states that the definition of the Supply contract should include goods and services, and not only that. - He goes on to say that this shouldn’t be an option, but a requirement in the Code. - However, he also acknowledges that the definition of Supply should be adjusted to reflect modern contractual law and that, while the Code recognizes Supply as a legally and socially significant type of contract, it should be clarified that Supply can also be agreed upon “without consideration.” - He adds that it should be up to the parties to decide if they want to use the Supply contract in its more typical and “usual” form. - He also acknowledges that the Code should include provisions, such as those concerning the length of the contract, that allow Supply contracts to be used and that are actually used in the real world, while recognizing that the “without consideration” element should also be included in the definition of Supply. - It should also be noted that, while the traditional definition of services in the Code does not cover the full range of services that are currently available in the market, this is not justification for broadening the definition of Supply. - He goes on to argue that “the Code should not be rewritten to address the fact that the definition of Supply needs to include services, but rather, the Code should include a provision making clear that indeed, services can be supplied.” - He also contends that “this shouldn’t be an option, but a requirement.” - In other words, services should be included as an integral part of the definition of *Supply*. - In his opinion, that article should not be eliminated, but rather, it should be made more flexible. ## The goods in Supply - The doctrine has been debating for a long time whether all goods can be the subject matter of Supply or only certain categories of goods can be contracted for in this manner. - Max Arias Schreiber states that “ordinarily the goods that are agreed to be supplied are not present goods, but future goods.” - Borja Soriano similarly holds the opinion that “ordinarily the subject matter of the prestation of the supplier is not ‘present’ but 'future' goods.” - Anibal Torres argues that “any good that serves to satisfy the needs of humankind can be the subject matter of the supplier’s prestation,” although he excludes intangible goods. - As we have stated, Ramirez Vásquez gives such a broad meaning to the term “goods” that it even encompasses services. - Garrigues and Broseta consider that goods to be supplied should be generic movable property. Messineo considers that the goods that are typically the subject matter of Supply are consumables. - In principle, we see no reason why present goods and non-consumables should be excluded from Supply, but rather, that present goods can be the subject matter of Supply, as well as future goods, and consumables as well as non-consumables (for example, clothing, footwear, armaments, etc.). - We do not believe, however, that any good can be the subject matter of Supply. - The fact that the term “goods” was used does not mean that any good can be the subject matter in this relationship. - Following mercantile doctrine, we believe that the supplied goods must meet the following characteristics: A. **They must be goods that can be delivered in ownership.** B. **They must be goods that are generically referred to. ** That is, goods designated by their type and quantity (although this quantity might not only be determined but also determinable), which are more appropriately designated as uncertain goods. - Thus, specific goods, such as those related to the sale of real estate, are excluded. - We agree with Gabriel Correa’s many arguments on the matter, which are: - specific goods, by their nature, are not suitable to meet lasting needs, but only instantaneous ones, much less those that are subject matter of continuous or periodic deliveries. - Also, in the case of specific goods, the creditor's interest revolves around the identity of the good, and in Supply, the supplied’s interest revolves around the supply itself. C. We agree that, generally, the goods subject to the supplier’s prestation are movable goods. - It would be quite rare for a real estate property to be subject matter of Supply since these properties must, at the same time, be uncertain goods. - As an intellectual exercise, we can imagine a Supply contract for agricultural plots of a certain size in a certain valley—a certain amount of plots per agricultural season, or—as Correa mentions—a supply for 10 lots per month in a cemetery for the burial of corpses. - However, what is clear is that these would be contracts that, while possible to enter into, have very little practical use, since, in order to gain access to the registration of the transfer of ownership over the plots in the Real Estate Property Register, the supplier and the supplied would need to execute a deed and a public deed of transfer of ownership for each case. D. While the majority of doctrine leans toward thinking that the goods provided for Supply must be tangible, we do not find grounds for this exclusion if we are dealing with generic intangible goods. - Moreover, the Revisory Commission deliberately replaced the term “things”, which appeared in the Italian Code and was reproduced in Arias Schreiber’s Draft Project, with the term “goods” precisely to prevent it from being understood exclusively as tangible goods. - An intangible tangible good can be subject matter of delivery in ownership and can be applied by the supplied to meet their interests. - Supply, of course, could not cover specific intangible goods, such as a trademark or a credit right, but I do not see why there could not be an agreement for uncertain intangible goods. - For example, I imagine a contract for supplying a certain type of information (for example, market, credit, legal, etc.), with a certain periodicity or continuously, using certain appropriate means. - And, why not, for example, enter into a contract for intangible goods, such as a certain amount of oxygen, natural gas, energy, etc.? ## d) Periodic or Continuous Prestations? - When article 1604 speaks of "periodic or continuous deliveries of goods", using *the plural*, it seems to imply that, when dealing with a continuous prestation, for example, the supply of electric power, there is not a single type of delivery, but rather, several types of deliveries. - It is well known that there are two types of Supply: - **The first is periodic Supply.** In this case, the prestations are carried out in determined or determinable periods, also known as *successive performance* or *successive performance.* In successive prestations, each delivery constitutes an independent, autonomous, and distinct prestation, which sets the periodic Supply deliveries apart from deferred execution purchase and sale deliveries. In the latter, even though the delivery of goods is broken down into several partial deliveries, none of these deliveries has any meaning in itself, nor does it satisfy any particular interest