Legal transaction

A legal transaction, called a Rechtsgeschaft in German legal theory, is a voluntary act by which a person brings about the legal effect that person specifically intended. The concept originated in German jurisprudence as an alternative to the French approach to classifying legal facts, and it remains central to civil law systems built on the German law of obligations, including Austria, Switzerland, Greece, Turkey, South Korea and Japan, as well as some Napoleonic tradition systems such as Italy and Portugal that absorbed German legal thinking. German legal theory divides legal acts into lawful and unlawful categories, and the legal transaction is the principal lawful type. Three kinds are distinguished: constitutive transactions that create obligations, such as contracts and marriages; dispositive transactions that transfer or extinguish obligations, such as conveyances; and potestative transactions, unilateral acts that modify an existing legal relationship, such as rescission or abandonment of a right. A legal transaction is distinguished from a quasi transactional act, which produces legal consequences the actor did not intend, and from a de facto act, which arises involuntarily through accident or circumstance rather than deliberate intention.