ON THE BORDERLINE BETWEEN A CONTRACT FOR WORK AND A TENDER AGREEMENT

 

In civil law, both the contact for work and the tender agreement regulates services aimed at the creation of work or the provision of a service. For this reason, as it can be difficult to distinguish between the two legal instruments it is necessary to clearly identify the elements that differentiate them and determine their legal classification, to correctly apply the respective regulations.

The Italian Supreme Court, Civil Section II, with judgment no. 10154/2025, recently intervened to rule on the issue, drawing a line between the two institutions and basing its decision on the distinctive criteria of the structure and size of the undertaking.

 

Article 2222 of the Italian Civil Code defines a contract for work as a legal transaction in which a person undertakes to perform work or provide a service for a fee, mainly using their own work and without being subject to the authority of the client. A tender agreement, governed by article 1655 of the Italian Civil Code and subsequent provisions, is defined as a contract whereby one party undertakes, with the organization of the necessary means ad at their own risk, to perform a work or service in exchange for a monetary consideration.

 

In the first instance judgment, the Court of Marsala had awarded the appellant compensation pursuant to Article 1150 of the Italian Civil Code in the amount of €30,000.00, based on the value of the manual labor carried out in the construction of the family home while excluding the existence of a tender agreement in the case at hand.

On appeal, the judge overturned that decision, reclassifying the legal nature of the activity in question, reclassifying it as a tender agreement, on the assumption that, in the absence of concrete evidence demonstrating that the customer had directly managed the organization of the work and the tools, also assuming the risk of the result, the status of entrepreneur of the person entrusted with the execution of a work or service would presume the intention of the parties to enter into a tender agreement and not a work contract.

 

As a result, the appellant was awarded a sum of €140,203.73, corresponding to the increase in value of the land due to the construction and incorporation of the family home. 

The appellant lodged an appeal with the Italian Supreme Court against the judgment of the Court of Appeal, citing six grounds for appeal. In particular, he challenged the classification of the agreement as a tender contract, arguing that neither the subjective nor objective elements required under Article 1655 of the Italian Civil Code were present.

 

He contended that the activity had been carried out by a person who did not have the status of contractor, but was personally involved in the construction of the family home in which he intended to reside with his future wife. He also pointed to the absence of objective elements such as the organization of the necessary means and the assumption of risk, which are essential to characterize a tender agreement.

The Court rejected the appeal, endorsing the reasoning of the Court of Appeal of Palermo which, according to the Supreme Court, had correctly classified the agreement between the parties as a contract for services. This classification was based both on the significance of the work — namely, the construction of a house involving substantial costs — and on the recognition of the appellant's status as an entrepreneur, even though not registered in the companies register. This status was deemed established because of witness statements made during the proceedings.

 

The Italian Supreme Court also clarified that the distinction between a contract for work and a tender agreement—both of which involve an obligation to perform work in exchange for payment, without subordination and with the assumption of risk by the performer—lies in the structure and size of the business entrusted with the work.

 

While a contract for work typically involves small enterprises (as inferred from Article 2083 of the Italian Civil Code, which defines small entrepreneurs as direct farmers, artisans, small traders, and those who carry out a professional activity primarily through their own labor and that of family members), a tender agreement presupposes a medium or large-scale business organization. In this regard, the contested judgment was deemed correct in classifying the relationship as a tender agreement, based on the significance of the work commissioned and the fact that it had been entrusted to a medium-sized enterprise.

 

In this regard, the contested judgment, starting from the significance of the commissioned work and considering the fact that it had been entrusted to an entrepreneur, rightly held—according to the Supreme Court—that its execution necessarily implied a business organization sufficient to qualify the contract as a tender agreement. Moreover, the Supreme Court, referring to its previous rulings, emphasized that the identification of the nature of the enterprise involved, for the purpose of classifying a contract as either a tender agreement or a contract for work, is ultimately a matter for the trial court to determine, as it entails an assessment of the evidence and the relevant factual elements.

 

In conclusion, the Court, based on the importance of the work commissioned and taking into account the fact that it had been entrusted to an entrepreneur, considered that its execution required a business organization such that the contract could be classified as a tender agreement. The Court further established that even when significant work is carried out, as in the case in question, with independent organization, a tender agreement may be recognized, with the consequent right to remuneration, regardless of other circumstances such as the fact that the contract may be in written or oral form (since written form is not required for either a contract for work or a tender agreement) or whether the contractor is registered in the companies register (since there is no provision making the contractor's right to remuneration conditional upon such registration).

 

Authors: Avv. Gianfilippo Chiricozzi e Matteo Carusi