DECLARATORY RELIEFS OF ANNULMENT OR NULLITY OF CONTRACTS VERSUS INJUNCTIVE / COERCIVE RELIEF RESULTING FROM THE DECLARATION OF ANNULMENT OR NULLITY

Abstract

When parties draw up and sign a contract, they intend the agreement to be legally binding for both parties and enforceable in court. A contract that is null (absolute invalidity) or void (relative invalidity) does not create any rights or obligations. It has no legal eff ect at any time. The party claiming the invalidity of the contract has the right to initiate a legal dispute regarding that invalidity. The invalidity of contracts is a very complex issue, so the purpose of this paper is to examine some Portuguese civil procedure issues arising from the absolute invalidity of contracts. The consequences of the invalidity of the contract are, as a rule, ex tunc (in integrum restitutio) – the restitution of the money or other goods received under the contract or the restitution of movable or immovable property, and, possibly, compensation of harm. In Portuguese law, both the annulment and the declaration of nullity of contracts have a retroactive eff ect (ex tunc). The present study analyses the diff erent types of actions in the Portuguese Civil Procedure Act. It also intends to defend the orientation which states that the actions destined to invalidate or, lato sensu, to impugn an act or a legal transaction (of declaration of nullity or annulment), whose intention is essentially formulated in the initial claim form, are generally (declarative) constitutive actions – susceptible of implying condemnations in the restitution of goods being returned following the signing of an invalid contract – and not (declarative) actions of simple evaluation.