Legal regulations, and in particular the provisions of
the Civil Code, specify a number of agreements
frequently employed in business dealings. Yet, it
must be borne in mind that the solutions offered by
the drafters are not always in line with what is
intended by the parties seeking to contract certain
obligations. Under such circumstances, it should be noted that according to the principle of the freedom
of contract, parties may structure the legal
relationship between them at their own discretion
unless the substance or the purpose of the legal
relationship is contrary to its nature, statutory
regulations, or public policy.
Based on the above capabilities, undertakings can
conclude cooperation agreements. The cooperation
agreement is not defined expressly under statute,
thus giving the parties latitude in realigning it with
their intended project. The agreement should above
all specify what it is that it regulates. The parties
have extensive freedom in that respect and may
make all the aspects of their business they consider
significant, as long as it is not unlawful to do so,
subject to the contractual provisions. In turn, the
subject-matter of the agreement determines as a rule
the instrument’s level of detail; under the
cooperation agreement the parties may both limit
themselves to expressing their intention to undertake
a joint business project, without stipulating any far-
reaching obligations, and may also describe precisely
their mutual obligations and consequences of failure
to fulfil them. Cooperation agreements can be
concluded to carry out one or a number of projects.
In the practice of dealing, the cooperation agreement
would often establish a mere framework for
cooperation between two undertakings, with the
specific arrangements being implemented on the
basis of separate contracts.
It is a good practice in drafting cooperation
agreements to incorporate in them provisions
enabling their termination. If that is the case, both
partners are fully aware how to end their mutual
collaboration. If the parties fail to provide such
procedure expressly under the terms of the
agreement, the cooperation agreement expires with
the expiry of the term for which it has been
concluded. If the parties do not provide the term of
the agreement concluded between them, then each of
the parties is entitled to terminate it.
When the cooperation agreement is concluded, it is
also worthwhile regulating the consequences of non-
performance of the obligations adopted by the
parties. In the case of agreements concluded above
all to memorialise the intention to collaborate, the
parties often stipulate that they do not accept any
liability for the outcome of their respective actions.
If the subject-matter of the cooperation agreement calls for a more extensive involvement of the parties
and contemplates specific actions being taken by the
parties or a specific outcome achieved by them, then
the liability of the partners for non-performance or
unsatisfactory performance of the agreement is
greater. If the cooperation agreement specifies at
length the mutual obligations of the parties and one
of the partners fails to fulfil its obligations, then the
wronged party may seek damages for non-
performance or unsatisfactory performance of the
concluded agreement under provisions of general
application laid down under the Civil Code.
When signing the cooperation agreement, one should
bear in mind that it is not the name of it that
determines its legal status but above all the specific
provisions incorporated in it. Consequently, it may
happen that although the parties call the agreement
concluded between them cooperation agreement, in
fact it is a different type of nominate agreement
governed under the applicable regulations. While the
cooperation agreement is a highly flexible and
attractive way to regulate commercial relations,
but—as is true about any tool—it must be used
prudently and skilfully, to ensure that the parties are
comfortable with the result achieved by its
execution.
MILLER, CANFIELD,
W. BABICKI, A. CHEŁCHOWSKI I WSPÓLNICY SP.K.
ul. Batorego 28-32
81-366 Gdynia
Tel. +48 58 782-0050
Fax +48 58 782-0060
gdynia@pl.millercanfield.com
ul. Nowogrodzka 11
00-513 Warszawa
Tel. +48 22 447-4300
Fax +48 22 447-4301
warszawa@pl.millercanfield.com
ul. Skarbowców 23a
53-125 Wrocław
Tel. +48 71 780-3100
Fax +48 71 780-3101
wroclaw@pl.millercanfield.com
Disclaimer: This publication has been prepared for clients and professional associates of Miller Canfield. It is intended to provide only a summary
of certain recent legal developments of selected areas of law. For this reason the information contained in this publication should not form the
basis of any decision as to a particular course of action; nor should it be relied on as legal advice or regarded as a substitute for detailed advice in
individual cases. The services of a competent professional adviser should be obtained in each instance so that the applicability of the relevant
legislation or other legal development to the particular facts can be verified.