Legal Definitions - arra

Arra refers to a small sum of money or a valuable item given by one party to another as a token or guarantee that a contract or agreement has been made and will be honored. Originating in Roman and civil law systems, it serves as tangible proof that a bargain has been struck, binding both parties to their commitments. It is essentially an earnest payment that confirms the existence of an agreement.

Here are some examples illustrating the concept of arra:

• Booking a Custom-Made Item: Imagine a client commissioning a unique piece of jewelry from a artisan. To confirm the order and ensure the artisan begins work, the client pays a small, non-refundable deposit upfront. This initial payment acts as arra, signifying that both parties have agreed to the terms – the client to purchase the jewelry and the artisan to create it – providing concrete evidence of their commitment before the full payment is due upon completion.

• Securing a Rental Property: A prospective tenant finds an apartment they wish to rent and wants to ensure it isn't leased to someone else while they complete their background checks and gather the full security deposit. They might provide a small "holding fee" to the landlord. This holding fee functions as arra, confirming the tenant's serious intent to rent and the landlord's agreement to temporarily remove the property from the market for them, solidifying their mutual understanding of the impending lease.

• Confirming a Service Appointment: A business owner needs a specialized consultant for a critical project and schedules a specific date for their services. To guarantee the consultant's availability and commitment, the business owner might pay a small booking fee. This booking fee serves as arra, establishing a firm agreement between the parties for the consultant's services on the agreed date, even before the larger service contract is fully executed or the main payment is made.