Quick summary: In Guatemala, you can make a contract verbally: this is one of the four forms recognised by the Código Civil (Civil Code), Art. 1574. A contract is formed by simple consent unless the law makes a formality an essential requirement for validity (Art. 1518). However, Art. 1575 sets limits: a contract worth more than Q300 must be in writing, and a commercial contract may be verbal if it does not exceed Q1,000. Contracts that must be registered or annotated in the registries require an escritura pública (public deed) regardless of their value (Art. 1576), as do solemn contracts (Art. 1577). The Código de Comercio (Commercial Code) says commercial contracts are not subject to special formalities for validity (Art. 671).
This page explains the rules on the form of civil and commercial contracts. It does not cover employment contracts. Labour Code rules on verbal employment contracts are covered in Guatemala employment contract types in RECIT.
The four ways to contract (Art. 1574)
| Form | Meaning of Art. 1574 |
|---|---|
| 1º | Through an escritura pública |
| 2º | Through a documento privado (private document) or an acta (record) drawn up before the local mayor |
| 3º | Through correspondence |
| 4º | Verbally |
Art. 1574 opens with “Toda persona puede contratar y obligarse” [Any person may contract and bind themselves]. Art. 1256 sets out the general rule on freedom of form: when the law does not prescribe a specific form for a legal transaction, the parties may use whichever form they consider appropriate.
When the law requires more than a spoken agreement
| Type of contract | Form required by law | Article |
|---|---|---|
| Civil contract worth no more than Q300 | Art. 1575 does not require it to be in writing | CC 1575 |
| Civil contract worth more than Q300 | Must be in writing | CC 1575 |
| Commercial contract worth no more than Q1,000 | May be verbal | CC 1575 |
| Commercial contract (Código de Comercio rule) | No special formalities for validity; if made in Guatemala to have effects in the country, it must be drawn up in Spanish | CCom 671 |
| Contract that must be registered or annotated in the registries | Escritura pública, regardless of value | CC 1576 |
| Contract expressly classified as solemn | Escritura pública; invalid without it | CC 1577 |
| Extension, ratification or amendment of a contract | The same form that the law requires for the original contract | CC 1578 |
Art. 1575 requires a contract worth more than three hundred quetzales to be in writing. If it is a commercial contract, it may be verbal if it does not exceed one thousand quetzales.
Art. 1575 sets the form requirement. Art. 1576 contains a specific rule for contracts requiring registration, explained below.
Contracts requiring registration: either party can demand a deed (Art. 1576)
The first paragraph of Art. 1576 says that contracts which must be registered or annotated in the registries must be recorded in an escritura pública, regardless of their value. The second paragraph adds that, nevertheless, these contracts will be valid and either party may compel the other to execute the escritura pública if their essential requirements are established through a judicial admission by the obligated party or other written evidence.
Solemn contracts (Art. 1577)
Art. 1577 requires contracts expressly classified as solemn to be recorded in an escritura pública. Without that essential requirement, they are invalid.
What every contract needs, whether verbal or written
| Element | What the Código Civil says | Article |
|---|---|---|
| What a contract is | A contract exists when two or more people agree to create, modify or extinguish an obligation | 1517 |
| When it is formed | By the parties’ simple consent, except when the law makes a particular formality an essential requirement for validity | 1518 |
| Requirements for validity | Legal capacity of the person expressing their will, consent free of defects, and a lawful subject matter | 1251 |
Commercial contracts (Código de Comercio, Art. 671)
Art. 671 of the Código de Comercio says that commercial contracts are not subject to special formalities for validity. It adds that, whatever the form and language in which they are made, the parties are bound in the manner and on the terms on which they appear to have intended to bind themselves. Contracts made in Guatemalan territory that are to have effects there must be drawn up in Spanish. Código Civil Art. 1575, cited above, mentions one thousand quetzales for a verbal commercial contract.
For foreign readers, the Spanish-language requirement in Art. 671 applies to commercial contracts made in Guatemala that are to have effects there.
What this page does not cover
- How to prove a verbal contract in court: this page does not cover litigation procedure.
- Verbal employment contracts and payments due when employment ends.
- The costs of formalising a contract in writing: see Notary fees.
Related procedures
General information, not legal advice. The Civil Code provisions discussed here come from the CENADOJ (Organismo Judicial) commented edition; the Commercial Code provisions come from the Archivo General de Protocolos (Organismo Judicial) copy. Judicial commentary is not quoted as statutory law.