Legal provisions of registrar marriage and the commercial companies as a form of joint economic activity

The comparison between two institutes from these separate branches of legislation which however regulate different in its nature public relations and are accepted even as contradictory by the system of valuables of the society may be seams very strange and for some people- unpleasant. But viewing it at a more close view one can find common features between them namely in the aspect “performing commercial activity”. This is the reason in the study to examine only those companies that perform their activity with the purpose of gaining profit not only these registered by the Commercial Law (CL) but also these civil companies under the Law for Liabilities and Contracts (LLC) excluding of coarse those that are juridical persons under the Law For Juridical Persons with Non-Commercial Activity (LJPNCA).

It is not possible to have no similarities between the institute “registrar marriage” and the already mentioned companies as far as the legislation is concerned. The similarities are significant and originate from the circumstance that “company “and” partnership”, “matrimony” and “married couple” are the basic elements on which the civil society is being built up as well as all other spheres of the life of man as a social being.

1. Incorporation

The origin of registrar marriage as well as of the company is a procedure that is regulated in details by the legislator using imperative norms the deviation from which is an obstacle to the establishing of the factual content. This strict regulation is justified by the mentioned already significance of these two institutes and by the necessity to bring sureness in the civil and the commercial turnover as well as in the social relations as a whole.

The establishing of the registrar marriage as well as the establishment o f the company is a formal act that as a rule includes (with the exception of the companies under the LLC):

  • Written form;
  • Obligatory participation of a state body (of the executive, respectfully of the legal authorities);
  • Publicity of the origin;
  • Registering in a special register with the respective body of the executive or legislation authorities.

2. Purpose

The establishment of a company is a special kind of a legal deal and its greatest peculiarity is the purpose. As a difference from the contracts as bilateral deals this deal lacks coinciding considerations, cross obligations as a whole it lacks the cross action as a basic attribute of the contract. That is why no matter that the constituent act is very often called a contract and the legislator to have adopted traditionally this concept, the establishment of a company contains rather the attributes of a multilateral deal and this is especially true for the personal companies but to a certain extent to the capital companies. The character of this deal is probably best shown in art.357 of the LLC: “two or more persons agree to join forces for the achievement of a joint aim” which turns the aim and at that the joint aim into a basic feature of the nature of a company.

The careful reading of the attempt for definition of the marital legal relations in art. 3 and 4 of the Family Code (FC) makes us find resemblance with the definition of the legal relations originating as a result from the establishing of the company. The principals of the family relations are: equal rights, one’s own will and stability of the matrimonial relations, concern and support between the family members. Among the basic functions of the family are: ensuring of possibilities for the development of the abilities of each member of the family as well as of the conditions for the fulfillment if their labour and public obligations, creating of relations in the family based on the mutual efforts and responsibility for its development; material help for the elder, sick and disabled members. Most clearly this could be seen in art.18 of the FC: “The spouses are obliged through mutual understanding and joint efforts and depending on their abilities, property and income to ensure the welfare of the family and to take care for the growing up, bringing up and support of the children.

To my opinion it will not be too much to say that the nature of marriage comes close to the definition “two persons agree to join their activity for the achievement of a joint aim” of coarse with the condition that the joint aim in the matrimonial relationship is far greater than the one of a company and includes the satisfying of many emotional, moral and spiritual necessities of man that could not be realized without one’s going into a marriage.

3. Privity of estate

The similarities in the legislation of the privity of estate of the registrar marriage on one side and on the other side- the companies are significant but concerning mainly the general partnership, limited partnership and civil companies, that is why I shall not compare the legislation of the privity of estate of the registrar marriage and the capital companies.

Along with the very origin of the matrimonial, respectively the company relations a joint property originates as well established as property of the physical persons that have entered into such relations. It seems that the regulation under art.358,i.2 of the LLC will have to be accepted to be applicable in the frame of the matrimonial unity as far as the logic as well as the ordinary relations in the turnover make it unavoidable: “The invested money, the replaceable things and things that are ruined during usage, are joint property of the partners. Each other thing is considered brought in for joint usage…”. Regarding the first hypothesis I consider it pointless to discuss a variation when a marriage has terminated and one of the spouses would demand the, let say, ” 43 levs or 5 kg of potatoes” that he/she have brought into the family house on the day of marriage. As far as the second hypothesis is concerned, obviously during the period of their marriage the spouses use together the belongings that each one of them had in his/her property before the marriage and during the marriage and after its termination keeps them according to art.20, i.1, p.1.

Concerning the property obtained after the establishing of matrimonial respectively company relations, the basic rule is that a joint property is available as well as personal property of each one of the persons participating in these relations and at the same time the spouses, respectively the partners in the company, are jointly and unlimitedly liable (The limited companies – only the complimentary) for the obligations, that they have undertaken for the satisfaction of the joint needs in the interest of the joint activity. As far as the differentiation between personal and public property is concerned there is a great difference in the legislation as far as the FC creates a detailed system of rules, regulating this matter mainly through fictions and presumptions because the relations between spouses suppose far greater integration of property areas which supposes greater difficulties in limiting of the personal property. As far as the shares in the joint property are concerned they are considered to be equal if some thing else will not be proved (in marriage) respectively if something else has not been agreed (in the companies) a characteristic peculiarity here being the fact that with marriage the shares are established only after the termination of the property entity.

The right of management and disposition with the joint property is by principle regulated in a similar way as far as the general management of the joint matters is the right of each of the spouses, respectfully each f the partners, and for the disposition deals the mutual consent is demanded.

In view of the peculiarities in registrar marriage and with some separate kinds of companies, the legislative regulation includes certain variations of this principle. The tendency here is that regarding the disposition of the joint property in a family, the law provides for comparatively more possibilities for deviation from the principle mostly as far as the interests of scrupulous third persons is concerned, as the civil turnover would have been in difficulty if it is required that in each deal the opposite party is checked for being or not in matrimonial relations (see in this sense art.22,i.3-5 and art.23 of the FC).

4. Termination. Consequences

Along with the specific grounds for termination, born out of the special character of marriage, respectfully of the company, there are general grounds as well as for example:

Mutual consent, respectfully decision of the partners; death of one of the spouses, respectfully one of the partners.

Greater similarities could be found in the way of terminating and the consequences from the termination of the marriage, respectfully the company. The termination as well as the establishing is regulated as a complicated factual corpus delicti, the legal regulation contents predominantly imperative rules and here again we exclude the civil company under the LLC. The procedure of termination is developed before the court (with the exception of the hypothesis – death of one of the spouses) and the court is the authority that terminates the matrimonial, respectfully the company’s, relations when the respective prerequisites are available. The termination is registered in the respective registers thus ensuring publicity of the establishing as well as of termination of a marriage or of a company. After the termination each one of the spouses, respectfully the partners, is due to receive his share of the joint property.

5. A marriage settlement

After the short comparison of the legislation in force regarding the registrar marriage and the company I would like to fix on the marriage settlement as far as it is admissible and usable in a range of countries for the regulation of the relations between the spouses and as far as in Bulgaria also there is a discussion for its forthcoming introduction.

The marriage settlement is not unknown in humane history, there is information that even in ancient Egypt such settlements have been signed for the regulation of the property relations after the termination of the marriage. Today it is known to almost every European legislation, as an agreement between future or actual spouses regulating the property relations during marriage and after its termination. It is not often that the legislators permit the presence in the settlement of clauses regarding the personal relations or the situation of the children. The settlement is formal – in some countries the written form is sufficient in others a notary verification is requested and in third – a notary act. In France it is due to be published, in The Netherlands – to be registered in court in a special public register which very mush resembles the procedure on establishing of a company, with the envisaged registering and eventually publishing. In most of the countries it is permissible even such a settlement to be made between persons that have not entered and have no intention to enter into matrimonial relations in order to regulate relations originating from physical cohabitation. After the conclusion of such a settlement and its eventual registering in the Register for spouses property the law treats the parties to such a settlement in a way that is identical to this of a lawfully married couple.

The conclusion of a marriage settlement brings even closer the characteristics of the legal regulation of marriage and a company. This would allow to avoid the complicated system of fictions and presumptions put into the FC giving possibility to the spouse even to the partners to define themselves the regime of their property relations, the size of shares the way of managing and disposing with the joint property and other matters that are being decided by the constituent act of a company. With this settlement, however, one should not apply the general contract rules, even more- it will not have as its characteristic the cross-action but will be more like a legal deal with which two persons agree to join their activity for the achievement of a common purpose. Consequently when developing the legal regulation of the marriage settlement one should apply the rules of the article of association of the company under art.357 of the LLC and those of the CL rather than the regulations of the remaining contracts under the LLC.

The resemblance in the legal regulation of the marriage and the company is due not only to their significance but also to the relative stability of the relations, which they regulate. And yet since ancient times the matrimonial institution has been some times used for joint performance of economic activities, for joint satisfying of the material necessities and today with the introduction of the marriage settlements and agreements between partners with no matrimonial relations this will become even more widely spread practice. But to this purpose the society has introduced another more widely spread form, which though having similarities with the legal regulations of marriage, still remains an instrument for the satisfying only of the economic interests – the company. An attempt should be made for the maximum liberation of the matrimonial institution from the accompanying property relations that are more suitable to accompany an agreement.

Because I believe and I have heard friends say that marriage is one of the best things in the life of a man.