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[Taken
from The Compendium of Cambodian Laws, Council for the Development of
Cambodia, UNDP Project CMB96-005]
DECREE
No. 38D
REFERRING TO CONTRACT
AND
OTHER
LIABILITIES
This
Decree was adopted by the Council of State in Phnom Penh on October 28,
1988
·
Pursuant to the Constitution of the People's Republic of Kampuchea
(PRK);
·
Pursuant to the Law on the Organization of the National Assembly
and the Council of State of the PRK and its promulgation by Decree No.
04D, dated February 10, 1982;
·
Pursuant to the Law on the Organization of the Council of Ministers
of the PRK and its promulgation by Decree 03D, dated February 10, 1982;
·
Pursuant to the Law on the Formation of the Judiciary and
Prosecutor’s Office and its promulgation by Decree 02D, dated February
10, 1982;
·
Pursuant to the Law on the Establishment of the People’s Supreme
Court and the Prosecutor General's office attached to the People's Supreme
Court, and its promulgation by Decree 28D, dated July 31, 1985;
·
Pursuant to the Decree 34D, dated August 26, 1987, on the
Organization of the People's Supreme Court and the Prosecutor General's
Office attached to the People's Supreme Court;
·
Pursuant to the Decree 07D, dated July 13 1982, regarding the
competency and procedure for adoption of laws and regulations, and
·
Pursuant to a request by the Council of Ministers, it is hereby
decided that:
CHAPTER
I: CONTRACTS
Section
1: General Provisions
Article
1 :
A
contract is an agreement freely entered into by two or more persons to
create, change or terminate one or more obligations which bind them.
In
the above definition, a person may be a natural person or a legal entity.
A legal entity can enter into a contract through his/her own
representative.
Article
2 :
Every
contract shall link the personal interests of the contracting parties with
the interests of society. The contracting parties shall deal in an
atmosphere of trust and honesty, and every contract shall be executed
according to the principles of social ethics, especially so as to abolish
the exploitation of one party by another.
Section
2: Validity and Form of the Contract
Article
3:
A
contract is valid provided that it:
·
arises out of a real and free agreement.
·
is made by parties who have capacity to enter into a contract.
·
has a subject matter that is certain, possible to perform, lawful,
and consistent with public order and good customs.
Article
4:
Contracts
can be made orally or in writing . The law shall set up precise
formalities in making a contract. Every contract not consistent with the
formalities fixed by law shall be deemed void. Except where there is any
provision to the contrary, contracts involving money, or item(s) worth
more than 5000 Riels must be in writing.
Section
3: Voidness of Contracts
Article
5:
Every
contract shall be deemed void
·
that is illegal, and not consistent with public order or good
customs.
·
that is contrary to social interests or violating social ethics.
·
whose subject matter is impossible to perform.
Article
6:
Every
contract shall be deemed voidable
·
that is not resulting from a real or free agreement
·
that is made by a party lacking capacity to contract.
Article
7:
An
agreement that is the result of mistake, duress, or fraud is not a valid
agreement.
Article
8:
Mistake
shall be a ground for avoiding a contract if there is a mistake as to the
substance of the object which is the subject matter of the contract.
Mistake as to person cannot be a ground for avoiding a contract except
where the identity of the person is the basis of the contract.
Article
9:
Duress
is a ground for avoiding a contract if such duress is in the form of
mental or physical duress against a party to the contract, his/ her
husband or wife, any ascendants, or any descendants of the party.
Article
10:
Fraud
is a ground for avoiding the contract when there are acts of deception,
dishonesty, or misrepresentation committed by one party to the contract
without which the other party would not have entered into the contract.
Article
11:
When
entering into a contract, should any party take advantage of the situation
of another party to that party's detriment, then the aggrieved party can
always sue to rescind the contract.
Article
12:
When
making a contract, if there is a difference between the value of the
subject matter offered by one party and the value of the consideration in
return, then the aggrieved party can sue to rescind the contract on the
ground that he/she never intended the difference to be a gift.
Article
13:
A
party who asserts that he/she entered into a contract because of mistake,
duress or fraud, in order to avoid the execution of his/her obligations in
the contract, shall bear the burden of proof of their assertion.
Article
14:
People
who have fully reached 18 years of age can enter into a contract at any
time, except detainees as provided in the law.
Article
15:
Minors
under 18 years of age cannot create rights or duties and especially cannot
enter into a contract without consent from their legal guardian.
A
contract by a minor without prior consent from his/her legal guardian can
be executed on condition that his/her guardian has agreed to such a
contract after it has been entered into by the minor, but all contracts
made by a minor to meet everyday life needs shall not require the consent
of his/her legal guardian.
Article
16:
A
party who enters into a contract with someone who lacks capacity cannot
attempt to get out of his/her contract obligations on the ground of the
incapacity of the other party.
Article
17:
Every
contract dealing with items used in commercial trade shall clearly and
separately describe the items according to their quality and quantity.
Future
happenings can also be the subject matter of a contract. However, one
cannot contract to sell the inheritance of a person who is still alive
even with his consent.
Article
18:
Any
person can sue to absolutely rescind a contract defined in Article 5, at
any time .
Article
19:
Where
a contract is voidable because of incapacity, mistake, duress, or fraud, a
claim to avoid the contract can be made by the aggrieved party or by any
person who has lawful interest in the claim. The aggrieved party or any
person who has a lawful interest in the claim shall notify the other
party. The party receiving the notification shall reply without delay.
After
the notification the aggrieved party or any person having a lawful
interest in the claim can sue to rescind the contract within a maximum
period of 12 months.
Article
20:
The
right to sue to rescind a contract as provided for in Article 19 shall
cease to exist if, after suing, the party who has such a right agrees to
carry out his/her obligations or agrees, in writing, to withdraw the
action.
Article
21:
In
the case where there is nullity of a contract, the situation prior to
entering into contract shall be restored.
Section
4: Effects and Interpretation of the Contract
Article
22:
A
contract is a legally binding agreement between the parties. Amendments to
the contract can only be made with the consent of both contracting
parties.
A
contract shall be executed with honesty and according to the will of the
parties.
A
contract binds only the parties to the contract.
Article
23:
If
the contract is not clear in meaning, that contract shall be interpreted
according to common practices or customs of the place where the contract
has been made, but the interpretation shall not conflict with the
provisions of this law. If there is any ambiguity, the contract shall be
interpreted in favor of the debtor party.
Article
24:
The
debtor party shall fulfill his obligations under the contract by payment
from his personal and real properties available now and in the future.
Section
5: Statute of Limitations for Contracts
Article
25:
Except
where the law prescribes differently, obligations resulting from a
contract shall be deemed to have expired if the creditor party has not
sued for performance within 5 years of the date defined in the contract.
Where such a date is not defined in the contract, the date of
entering into the contract shall be such date.
Article
26:
The
limitation period shall be postponed if the debtor party is absent from
his/her residence and this absence has been certified by the local
authorities according to the law. The complaint of the creditor shall also
postpone the limitation period.
Article
27:
A
debtor or guarantor can assert the statute of limitations. If the debtor
or the guarantor fails to assert the statute of limitations, then the
People's Court can do so on their behalf.
Article
28:
A
debtor or guarantor who executes his/her obligations under the contract
after the limitation period has expired cannot then make a claim for the
amount of money or value given on the grounds that the limitation period
has expired.
Section
6: The Execution of the Contract
Article
29:
Obligations
in the contract shall be carried out in a timely and proper manner,
particularly with regard to quality, quantity, place, and duration
prescribed.
Article
30:
A
party to the contract is
·
a debtor when he has obligations to be executed.
·
a creditor regarding the rights that he/she is entitled to receive.
Article
31:
A
creditor shall not be compelled:
·
to accept an object other than that which he/she is entitled to
receive even though the value of the other object is equal or higher.
·
to accept the partial execution of the contract. But depending on
the goodwill and the difficulty of the debtor, the People's Court can
extend or delay the time for execution of the contract and make an order
to suspend the creditor's action. In such a case, the reasons for the
decision shall be clearly stated, and the People’s Court shall exercise
this power with great care.
Article
32:
The
execution of the contract shall take place at the residence of the debtor
if the contract has not specified a place.
Article
33:
If
there is no specific duration of time within which to execute the
contract, then the debtor can pay or provide at any time, and the creditor
can request payment at any time.
CHAPTER
II: SOME FREQUENTLY USED CONTRACTS
Section
1: Sale
Article
34:
A
sale is a contract in which one person has the obligation to transfer
ownership of an object or right to another person who has the obligation
to compensate for the value of that object or right.
Article
35:
Contracts
involving the following shall be deemed void:
· the sale of another's property.
· the sale of a husband's belongings to his wife and vice-versa.
· the sale of joint-tenancy property "that can not be divided
" by one co-owner without the consent of the other co-owner.
1.
Obligations of the vendo
Article
36:
The
vendor shall maintain the sale item in good condition until the due date
for delivery so that he is able to execute his obligations under the
contract.
Article
37:
The
vendor shall not change or modify the sale item by any means from the date
of the sale until its delivery.
Article
38:
The
vendor shall be liable for damage occurring to the sale item up until the
time of delivery. The sale can be canceled if the item has been lost or
substantially damaged prior to delivery or when the vendor cannot find a
substitute. If the sale has been canceled, the vendor shall pay damages to
the purchaser relating to the loss of the sale item or any damages
resulting from the vendor’s fault.
Article
39:
The
vendor shall inform the purchaser of all essential attributes and other
substantial conditions relating to the sale item, particularly information
concerning rights that others have in the sale item, if any. The vendor
shall hand deliver to the purchaser all documents relevant to the sale.
Article
40:
The
vendor shall hand over not only the main sale item but also any
derivatives and accessories.
In
the case of real property sale, the delivery of the property deed is
deemed to be delivery of that real property. Expenses incurred in the
delivery shall be the vendor’s responsibility unless otherwise stated in
the sale contract.
Article
41:
Regarding
real property, the conveying of the vendor's rights to the purchaser is
deemed valid providing that the sale deed has been certified and
registered. From the certification and registration date, a third party
has no rights to the property. Regarding personal property, the conveying
of the vendor's right is deemed valid and a third party has no right to
object from the time the personal property is delivered into the hands of
the purchaser except where the sale is done through certified deed. In the
latter case, the third party cannot object from the day the deed has been
certified.
Article
42:
The
vendor is not responsible for any external defects but shall be liable for
latent defects in existence prior to the sale. If the purchaser can prove
that such a defect existed prior to the sale, then the purchaser can ask
to rescind the contract or to reduce the price.
Where
the purchaser refrains from buying or asks to reduce the price, the
purchaser shall bring his claim within 1 year of the date of delivery. If
no claim is brought within 1 year, the purchaser's silence shall
constitute agreement.
Article
43:
The
vendor shall guarantee the purchaser protection from any action by a third
party to deprive the purchaser of the sale item, such action being a third
party claiming a right to the sale item.
Article
44:
In
the event of a third party threatening suit to deprive the purchaser of
the sale item, the purchaser can refer the third party to the vendor
immediately. The vendor, by any means, shall use his or her documents to
prevent the third party from bringing a claim against the purchaser, or to
defeat the third party interest by means of a court decision.
Article
45:
If
the vendor, so called upon by the purchaser to act on his behalf, succeeds
in resolving the problem with the third party, the purchaser is not
entitled to damages.
If
the vender is unable to resolve the situation, then legal action shall
proceed as usual.
Article
46:
If
the court decides to deprive the purchaser of the subject matter, the
vendor shall return the amount received to the purchaser. In addition, the
vendor shall be liable for damages. The
amount of damages shall include the expense of making the contract and
other relevant expenses incurred since the date of the sale.
Article
47:
In
the event of vendor’s death, his obligations shall fall to his heirs.
Article
48:
If
the vendor obtained the property by way of a felony or misdemeanor, then
the purchaser, if so aware, can ask to rescind the contract even though
there is no threat from a third party to deprive the purchaser of the
property.
Contracts
contrary to this shall be deemed void.
Article
49:
If
the same property has been sold successively to many persons the last
purchaser shall refer back to the immediate vendor to guarantee his
rights. And this vendor, if
need be, shall refer back respectively to his/her immediate vendor in the
sale chain.
2.
Obligations of the purchaser
Article
50:
The
purchaser shall pay the contract price on the day and at the place already
determined. If the date and the place are not stipulated in the contract,
payment shall take place at the place of delivery.
Article
51:
The
contract can impose on the purchaser an obligation to pay interest on the
contract price if payment is late. The interest rate shall not exceed 5%
per annum. Should the interest rate not be stipulated in the contract, the
purchaser is liable to pay only the price mentioned in the contract, but
where the sale item yields income or profit, the interest shall be
calculated according to the rate set by law.
Article
52:
If
the purchaser has received the sale item, and if a third party brings a
claim to deprive the purchaser of the sale item, then the purchaser can
postpone payment. The purchaser shall pay the vendor only if and after the
problem with the third party is resolved.
Article
53:
The
vendor is entitled to retain possession of the sale item until the
purchaser delivers payment.
Article
54:
On
the due date if no payment is made by the purchaser, the vendor can
rescind the contract if he does not wish to bring an action for payment.
As long as full payment is not made, the vendor can always rescind the
contract.
Article
55:
The
rescission of the contract requires both contracting parties to return to
each other what they have received. The purchaser shall return the sale
item with any interest and income gained. The vendor shall pay back the
amount paid by the purchaser and shall pay interest according to the rate
provided by law, calculated from each last payment date.
Section
2: Interest Bearing Loan
Article
56:
An
interest bearing loan is a contract whereby one person delivers money to
another person and the latter is obligated to repay that amount together
with an additional amount according to the duration of the contract.
Article
57:
The
contract shall be in writing. The contract shall clearly state the names
of the parties, residence of the parties, loan amount, amount of interest,
loan duration and maturity date. The borrower shall sign his name to the
contract.
Article
58:
If
the maturity date and the interest rate have not been provided for in the
contract, it is presumed that the parties agree to contract for 1 year
period without interest.
Article
59:
A
lender shall be allowed to charge interest on a loan provided that there
is an agreement to this between the contracting parties. The interest rate
shall not exceed 5% per annum unless otherwise provided by law.
Article
60:
Any
interest overcharged by the lender during the debt period shall be
deducted from the principal amount. If the repayment is in excess of the
principal amount and the interest allowed by law, the creditor shall be
compelled to refund such excess to the borrower together with interest
calculated from the date of repayment by the borrower. In this case the
lender will be criminally liable according to the provisions of the
criminal law in effect.
Article
61:
A
legal action as to the interest cannot be commenced prior to the discharge
of the contract. In the event
of a borrower’s death, repayment of the entire debt can be demanded
immediately by the lender and the obligation for repayment shall pass to
the heirs of the deceased who shall be bound to pay the outstanding debt
out of the deceased's estate and before the estate is distributed.
Article
62:
The
lender shall deliver the loan deed or document certifying payment to the
borrower when he repays the loan fully.
Article
63:
A
interest bearing loan relating to personal property must comply with the
provisions regarding the loan of money.
Section
3: Secured Personal Property
Article
64:
A
secured personal property contract is a contract whereby a debtor delivers
his personal property to a creditor to be held as security for a debt.
A
creditor in possession of such secured property is entitled to be paid out
of the proceeds of the sale of such property in priority to all other
creditors.
Article
65:
A
secured personal property contract must be in writing. The contract shall
only be considered valid when the creditor is in possession of the secured
property.
The
amount of the debt and the secured property must be specified and
described clearly in the contract. If the contract fails to specify the
amount of interest and the date of payment, the debt shall be considered
to have no interest for one year from the date the contract is signed.
Article
66:
A
creditor is not entitled to dispose of the secured personal property as he
pleases. The creditor is obligated to take reasonable care of and preserve
the secured property. In the event that the secured property is damaged or
lost through the creditor’s fault, he must repair the damage or
compensate the debtor for the loss of, or damage to, the secured property.
Article
67:
Unless
otherwise stipulated in the written contract, a creditor may not use or
take profit from the secured personal property. The creditor is allowed to
receive only the profit from the secured loan. Such profit shall be used
for necessary expenses in priority to other uses.
If
a creditor uses the secured property in breach of the terms of the
contract, the debtor may file a complaint to withdraw the secured
property.
Article
68:
If
the creditor disposes of the secured property without the prior consent of
the debtor, the creditor shall be criminally liable under the provisions
of the criminal law in effect.
Article
69
When
payment is due and the debt is fully paid, the creditor must restore
possession of the secured property to the debtor. If a portion of the debt
is still outstanding on the due date, the creditor may still maintain
possession of the secured property until the outstanding balance is paid.
Article
70:
When
payment is due and the debtor does not fulfill his obligations, the
creditor may submit a request to the People's Court to have the secured
property liquidated.
The
proceeds acquired from the sale of the secured property shall be paid
first to the creditor who is in possession of the secured property. The
balance of the sale proceeds shall be paid to the debtor, or paid to any
creditors to whom payment is due.
If
the proceeds from the sale of the secured property are not sufficient to
satisfy the debt, then the debtor still remains liable to the creditor for
the outstanding balance.
Article
71:
A
personal property secured contract shall be considered void if the
contract stipulates that the creditor shall become the actual owner of the
secured personal property in the event that the debtor fails his
obligations under the contract .
Section
4: Services Contracts
Article
72:
A
services contract is a contract whereby one party undertakes to perform
the work for another party for a fee proportionate to the work.
Article
73:
If
the fee is not specified in the contract, the court shall determine the
fee according to customary practices at the place where the work was
performed.
Article
74:
The
work must be clearly described in the contract. If the work to be
performed is not performed in compliance with the terms of contract, the
hiring party may:
a)
or may not accept the results of the work done by asking the contractor to
pay damages and other compensation for any loss, if that occurs, to the
employer, and in such case the contract may be terminated; or
b)
shall require the contractor to make the necessary corrections within a
specific time agreeable to both parties and require the contractor to pay
out of his or her own money in order to comply with the terms of the
original contract; or
c)
shall accept the resulting work by reducing the fee.
Article
75:
If
the time for completion of the work is specified in the contract and if
the work is not completed within that period of time, the contract may be
terminated notwithstanding the possible damages which the hiring party may
claim for.
However,
if delay in the work results from a force
majeure, the hiring party may not claim for damages.
Article
76:
If
the hiring party fails to advance money or supply raw materials within a
certain time frame as stipulated in the contract, he may not terminate the
contract on the basis of the work delay. The contractor can cancel the
contract on the ground of such delays. In such a case, the contractor is
entitled to receive a reasonable fee for the work that he has already
completed.
Article
77:
The
hiring party may terminate the contract at any time before performance has
been completed, provided he pays to the contractor the fees and other
expenses related to the work already performed.
Article
78:
If
the work is destroyed before it is completed through the contractor’s
fault and if the hiring party has paid the contractor in advance and/or
supplied materials, the hiring party is entitled to receive compensation
equal to the value of the loss and other expenses which he has paid toward
the works. However, if the damage is caused by a force
majeure, both contracting parties have no legal recourse against each
other .
Article
79:
The
contractor shall be liable for the performance of the work by his
employees.
Article
80:
If
the work is completed, the contractor may collect his fees upon delivery
of the contracted work. Payment of the fee shall be deemed to be an
implied acceptance of the work done.
Article
81:
If,
after delivery of the work to the employer, any defects in the work become
apparent as the result of the contractor’s fault, the contract can
·
be rescinded; or
·
part of the fee shall be refunded to the hiring party; or
·
the repairs shall be done at the contractor's expense.
The
hiring party may only make such a claim when the defect becomes apparent
during the period under warranty. If the period of warranty is not
stipulated in the contract, the hiring party may claim anytime within
three years from the date of acceptance of the work.
Article
82:
Where
the contractor is a natural person and where the contractor dies, the
contract shall be void.
Section
5: Contract for Carriage
Article
83:
A
contract for carriage is a contract whereby a person who is a carrier
undertakes to transport passengers, luggage or goods from one place to
another for a fee determined by an agreement of the parties or a fee
determined by the state .
Article
84:
Where
a carrier delays in delivery, a sender is entitled to terminate the
contract and require:
-
the
carrier to pay transportation fees and any money paid in advance to other carriers;
-
·the
carrier to pay compensation for any damage caused by delay in delivery,
loss or destruction of the transported luggage or goods, or decrease in price caused by
such delay in delivery.
Article
85:
Where
the sender delays in delivering the luggage or goods being transported, a
carrier is entitled to require the sender to pay compensation for any loss
or damages and to terminate the contract.
Article
86:
A
carrier is liable for the loss of, or damage to, the transported luggages
or goods. A carrier is also liable for any accidents to the passengers
during his transport.
A
carrier is not liable if the injury is caused by a force
majeure or by the negligence of the passengers themselves.
If
the luggages or goods being transported are stolen, the carrier shall be
liable to pay for the stolen luggages or goods.
Article
87:
A
carrier is liable, with respect to the luggages or goods, for any loss or
damage that is not caused by a force
majeure or by the natural destruction of the luggages or goods
themselves.
The
carrier is particularly liable for any loss or damage resulting from
unreasonable delays in the transport.
Article
88:
Any
action for compensation for loss or damage shall be commenced within one
year from the date an owner becomes aware that the luggage or goods have
been lost or damaged or from the date the passengers become victims.
Section
6: Bailment Contract
Article
89:
A
bailment contract is a contract whereby a person (the "bailee")
keeps in custody the personal property of another person ("the bailor")
gratuitously or for a fee, and returns that property to the bailor or to a
person clearly designated by the bailor at a specified time or at the time
when the property is demanded back.
Article
90:
As
a fundamental rule, if no fee is specified in the contract, a bailee shall
receive no fee.
Article
91:
A
bailee must preserve and return the bailed property at a specified time or
at the time when the bailor demands it back.
The
bailee is not entitled to use the bailed property without the
authorization of the bailor.
Article
92:
A
bailee is liable for any damage or loss to bailed property resulting from
fault on the part of bailee.
If
the bailed property is damaged or lost by reason of a force
majeure, no compensation shall be awarded.
Article
93:
If
the bailment is for a fee and the bailed property is lost by reason of
theft, a bailee is bound to pay compensation.
If
the bailment is gratuitous and the bailed property is lost by reason of a
theft, the bailee is not bound to pay compensation if the bailee has
sufficient evidence proving that he carefully safeguarded the bailed
property.
However,
a hotel owner, store owner or restaurant owner is liable for the loss
through theft of the property of its guests or customers where such
property is kept in the custody of the hotel owner or restaurant owner.
Section
7: Loan for Use
Article
94:
A
loan for use is a loan without any interest or fee. A person who lends
property to someone else for use retains ownership in the property.
Article
95:
A
borrower may not sell, exchange or lend the loan property without the
consent of a lender.
Article
96:
A
borrower must use the loaned property in a good and proper manner,
safeguard it as if he is the owner and use it in a manner consistent with
its purpose.
The
borrower is liable for the expenses of safeguarding and maintaining the
loaned property.
Article
97:
If
the loan property is damaged or lost by reason of a force
majeure, the borrower is not liable for any compensation. However,
where the damage or loss is the result of the borrower’s fault, the
borrower shall be liable for compensation to the lender.
Article
98:
A
borrower must return the loaned property to the lender at the time
specified in the contract. If no time is specified in the contract, the
lender may demand the return of the loaned property at any time.
Article
99:
If
a borrower improperly uses the loaned property in a manner inconsistent
with its normal function, the lender may immediately demand back his
property, even prior to the time for return as specified in the contract.
Section
8: Lease
Article
100:
A
lease is a contract wherein a lessor promises to lease his property for a
fee to a lessee to use temporarily.
The
property to be leased may be either real property or personal property.
Article
101:
The
duration of a lease may or may not be limited, but where the duration of
the lease is not limited, the duration of the lease may not exceed 12
years.
A
lease contract which has as its duration a period of more than one year
must be in writing.
Article
102:
Where
a lease contract is not in writing and one party denies the existence of
the lease, the evidence to prove the lease shall be based on the testimony
of witnesses so long as the duration of such lease contract does not
exceed one year.
Article
103:
A
lessor shall lease to a lessee only property which is in good condition so
as to prevent any incidents that may cause the
lessee undue problems, and shall guarantee the lessee protection from
claims of any third person who asserts any right to the leased property
such as a right of mortgage.
Article
104:
A
lessor is liable for major repairs to the leased property except where
otherwise provided by law or in the contract.
Article
105:
A
lessee shall pay rent according to the price fixed in the terms of the
contract, shall use the property in accordance with its normal function
and for the term specified in the contract, shall maintain the leased
property in good condition and shall be liable for any minor or simple
repairs except where otherwise provided for in the law or the contract.
Article
106:
When
discharging the contract, the lessee shall return the leased property to
the lessor in the same state or condition as when he took the
property--that is, with no destruction, no damage and no alteration to the
leased property resulting from use of the property by lessee during the
lease.
Article
107:
A
lessor may terminate the contract if a lessee does not perform his
obligations or if the lessee improperly uses the leased property in a
manner inconsistent with its normal function or uses it in a manner which
causes damage to the leased property
Article
108:
A lessee may not sublet the leased property to any other persons
without the consent of the lessor except where otherwise provided for in
the contract.
Article
109:
A
lessee who sublets the property shall still be bound by the same
obligations under the contract with the lessor, and in particular shall be
liable to the sub-lessee regarding unpaid rent, and any destruction or
damage to the leased property resulting from the sublease.
Article
110:
Where
a lease contract has no limited duration period, a party may not terminate
the contract unless there is notification in advance of at least one month
or at most two months.
Article
111:
Where
a lessor dies, the contract remains in effect. If a lessee dies, the
contract shall not remain in effect unless the lessee's heirs want to
continue with the lease contract.
Section
9: Contract of Guarantee
Article
112:
A
contract of suretyship is a contract whereby a third party called a
"guarantor" agrees with the creditor by contract to undertake or
to perform the obligations of the debtor in the event that the debtor
fails to perform his obligations to the creditor. This contract shall be
in writing.
Article
113:
One
debt may have any number of guarantors.
Article
114:
Any
contract of guarantee relating to obligations which are void by law shall
be of no effect. But if such voidness results from the debtor being a
minor, then the contract shall be deemed valid.
Article
115:
Legal
action against the guarantor can be taken either concurrently with an
action against the debtor, or later.
Article
116:
After
the decision of the People's Court, the guarantor can request that the
properties of the debtor be seized prior to the guarantor's property.
Article
117:
After
the sale of the debtor's properties, if the amount obtained is not
sufficient to satisfy the debt, then the guarantor shall be liable for the
balance.
Article
118:
In
a case where there are many guarantors, each guarantor shall be liable for
the entire debt as though there were only one guarantor. All guarantors
shall be jointly liable for the payment of debt.
Article
119:
Where
the guarantor has paid the debt of the debtor, all rights vested
in the creditor shall pass to the guarantor. The guarantor is entitled
to demand from the debtor repayment of the amount he has paid, as well as
any interest and other expenses incurred from the date the debt was paid.
Article
120:
Where
one guarantor pays the debt of the debtor, and the debtor is in a state of
insolvency, this guarantor can take legal action to recover such payment
from any other guarantors who shall in turn pay their share individually.
CHAPTER
III: OTHER LIABILITIES
Article
121:
Any
person who causes damages to others by reason of his own fault shall be
liable in compensation for such damage. Even where the damage is caused by
involuntary acts such as carelessness or negligence in control or
maintenance, the offender shall be liable.
Article
122:
The
insane and minors under 14 years old are deemed incompetent. These persons
shall not be liable for damage they have caused to others.
Article
123:
Parents,
guardians, and other persons who are in charge of or take care of
incompetent persons shall be personally liable for damage caused by those
incompetent persons.
Article
124:
Minors
aged over 14 years but less than 18 years shall
be liable for damage they have caused to others. To compensate for the
damage such minors and their parents or guardians shall be jointly liable.
In a case where the minors have no funds or no property out of which to
compensate for the damage, their parents or guardians shall pay instead.
Article
125:
State,
social, and collective organizations or enterprises shall be liable for
damage resulting from the actions of their officials, staff, workers, at
the time of, or while performing work for their employer.
Article
126:
Employers
shall be liable for damage caused to others, due to acts committed by
their employees during, or at the time of, performing work for the
employer.
Article
127:
Owners
of animals, or persons who use animals, shall be liable for damage caused
to others by such animals while under their control or where such damage
occurred during any time that the animals had escaped or were lost.
Article
128:
Property
owners shall be liable for damage caused to others if such damage is due
to negligently failing to properly maintain, control or repair the
property.
Article
129:
Where
damage is caused by a group of offenders, that group shall be jointly
liable to the victim. In some cases, the People's Court can decide that
each offender shall compensate the victim in proportion to his level of
participation in the commission the offense.
Article
130:
Where
an offender who is jointly liable with others has paid by himself the
whole compensation, he can request a proportionate contribution from the
others according to their level of their involvement in the commission of
the offence.
Article
131:
Where
an organization or a person is responsible for damage caused by another
person, that organization or person is entitled to take legal action
against that other person to recover the damages.
Article
132:
In
a case where the damage is caused partly by the victim, he shall be liable
for his part of that damage.
Article
133:
Any
person who has caused damage to others is not liable to bear the
responsibility resulting from such damages if:
1.
The damage was caused by a
force majeure,
2.
The damage was caused entirely by the fault of the victim.
Article
134:
If
the damage occurs in a situation where the victim voluntarily agreed to
assume the risk of such damage, and if it does not affect or threaten the
social interests, no compensation for such damage will be awarded.
Article
135:
The
limitation period for claiming compensation for damages will be limited to
three years.
CHAPTER
IV: FINAL PROVISIONS
Article
136:
All
contracts which have been signed before the promulgation of this Decree
and are not consistent with it shall be solved through the policies of the
Party and of the state, or through equity, customs, and traditions.
The
settlement of the above said contracts is available only for five years
since this Decree has become effective.
Article
137:
The
Council of Ministers, the People's Supreme Court, the Prosecutor General
attached to the People's Supreme Court shall be responsible for the
implementation of this Decree within their respective capacities .
Article
138:
This
Decree shall become effective upon its promulgation.
Phnom
Penh, 28 October 1988
For
the Council of State
President
Signature
and Seal
HENG
SAMRIN
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