The meaning of the phrase ”law fraud”

The High Court of Cassation and Justice has ruled that the phrase ”law fraud” is used to denominate that operation which appears during the process of closing a juridical act, in order to dodge some imperative legal rules, by resorting to a different set of legal rules, which are misinterpreted so as to avoid the purpose the legislator has initially projected. In this case, by the means of law fraud, one does not break the letter of the public order law, but one chooses to pass over its spirit. The High Court has stated that, structurally speaking, law fraud comprises two elements: an objective element (external), given by the legal means that are actually put into practice and a subjective element, which consist in the intention to elude or not apply the legal rule. Therefore, the mere break of the legal provisions does not represent law fraud, because it is of utmost importance for one to prove the fact that the parts has acted by their own agreement, so as to avoid the legal imperative provisions. The High Court has also mentioned that, because the burden of proof regarding the existence of a law fraud belongs to the plaintiff, the latter cannot base his claims on simple assertions, being necessary to prove both the defendant’s intention and the fraudulent methods, by which the imperative legal rules were dodged. (Decision no. 1386 of the 4th of April pronounced in recourse by the Civil Section 2 of the High Court of Cassation and Justice, covering the acknowledgement of the absolute nullity of the bearer share sale contract).

:: The Source:

Alexandra-Adriana DOBRIȘAN

LinkedIn | Facebook