DIFFERENCES BETWEEN CONTRACT AND AGREEMENT (WITH EXAMPLES) - DUDAS - 2025

The differences between contract and agreement lie in the fact that the obligations or benefits of each of the parties are different; that is, in the agreement there is a parity between the parties seeking a common goal, while in the contract the goal that prompts them to celebrate it is not necessarily the same.

The agreement and the contract are almost always used synonymously, perhaps attending to their common points: that two or more people are required and that it is an agreement of wills between the participants. However, legally it is said that the convention is the genus while the contract is the species.

In the agreement, the parties pursue a common objective; instead, in the contract the parties may have different interests. Source: pixabay.com

There are many types of contracts. Legally, some are called nominated contracts (it refers to having a name) and others are called unnamed (they do not have a name, or a specific name was not attributed to them).

Likewise, there are different classifications of contracts, which can address the number of parties -bilateral, multilateral, unilateral- or the way in which they are executed -if at the same time they are consummated (instantaneous) or if their execution takes place day by day. (of successive tract).

In the case of agreements, they also have their own classification, which is very similar to that of contracts; the same structure is used.

Main differences between contract and agreement

On rights and obligations

In an agreement the parties seek to modify or extinguish rights or obligations that are common to them, while in contracts the parties create obligations and / or rights, the latter having a patrimonial essence.

Written and verbal

Contracts can be written or verbal; On the other hand, in general the agreements are written, since they are agreements where the will of the parties prevails.

Legal framework

Contracts are always usually framed within the law, there are rules that regulate each particular contract.

In the case of agreements, this is not always the case; That is why they must be written, so that in this way the parties know the scope of their responsibilities, since the autonomy of the will prevails in them.

Examples of contracts

Work contract

The employment contract is an agreement of wills in which a person called employer or employer agrees to pay remuneration to a third party, called worker or employee, to perform work.

In this case, it is appreciated that there is what is called an obligation to give, which is the payment that the employer must make to the worker for the work performed. The worker has an obligation to do what refers to the materialization of his work.

In employment contracts the consideration of each of the parties is contrary; that is, unlike agreements, each party has a different interest. Likewise, it can be seen that there is a profit.

Leasing contract

It is a contract by means of which one party undertakes to make a movable or immovable property available to the other, the latter having to pay a remuneration in money.

The parties to this contract are called the lessor (the owner of the property) and the lessee (the one who has the enjoyment and use of the property).

Loan agreement

It is also often called a use loan contract, since through it one person makes the use of an asset available to another in exchange for the other taking care of it and restoring it within the term agreed between both.

Unlike the lease, there is no obligation on the part of the borrower (person who uses the property) to pay the lender (owner of the property) a fee or royalty. This type of contract is framed within non-onerous contracts.

For example, let's think of a person who has a vacation home in a remote place, in a region or province other than the one they live in, but that home requires maintenance and care. So the owner proposes to a third party to live in the house and take care of it for a while.

Examples of agreements

Payment agreement

The payment agreement is an agreement between two or more parties, through which one of them agrees to pay in installments a certain amount of money that it owes to the other party, who accepts the installments and the payment of the debt in installments.

When analyzing this type of agreement we see that the purpose of it is to extinguish the relationship between the debtor and the creditor of the debt or credit.

This type of agreement is very common in situations in which there is a pre-existing debt acquired by the debtor, who has stopped payments at some point.

It may also happen that you have not stopped paying, but that the debt reaches amounts of money or very high interest. Therefore, both parties seek to reconcile and reach a payment agreement.

Specific case

A classic example is the case of a company that is domiciled in a certain municipality and has been fined for violating a rule. These fines are usually very high and, if they are not paid on time, they generate interest, which increases the amount of the debt significantly.

Then, the local government gives you the opportunity to make a payment agreement in which the debt and interest are divided, and must be paid in the exact terms that both parties determine. Otherwise, the debtor would default and could suffer other types of sanctions that are also established in said agreement.

Cooperation agreement

There are government organizations that establish cooperation agreements with other government or private organizations through which both commit to contribute certain resources, strengths or knowledge in a certain area, in order to promote its growth and development.

An example of this are education agreements, through which a company grants scholarships to students of an institution (which can be public or private). In return, after completing their academic load, these students must carry out professional practices at said company.

References

1. Carvajal, P. «Arts. 1437 and 1438 of the Civil Code. “Contract” and “convention” as synonyms in terms of sources of obligations »(August 2007) in Scielo. Retrieved on May 19, 2019 from Scielo: scielo.conicyt.cl
2. "Civil Code" (May 2000) in the Library of the National Congress of Chile. Retrieved on May 19, 2019 from the Library of the National Congress of Chile: leychile.cl
3. "Contracts and agreements" (S / F) in Ecosur. Retrieved on May 19, 2019 from Ecosur: ecosur.mx.
4. “Individual Work Contract” (January 2012) at the Labor Department, Government of Chile. Retrieved on May 19, 2019 from the Directorate of Labor, Government of Chile: dt.gob.cl
5. “Types Of Contracts” (S / F) in USLegal. Retrieved on May 19, 2019 from USLegal: contracts.uslegal.com