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European Contract Law

Transcript of European Contract Law - buecher.de · European Contract Law Materials for a Common Frame of...

European Contract Law

European Contract LawMaterials for a

Common Frame of Reference:Terminology, Guiding Principles, Model Rules

Produced by Association Henri Capitant des Amis de la Culture Juridique Françaiseand

Société de Législation Comparée

Edited by

Bénédicte Fauvarque-Cosson and Denis Mazeaud

Prepared by

Jean-Baptiste Racine, Laura Sautonie-Laguionie, Aline Tenenbaum and Guillaume Wicker

ISBN 978-3-86653-067-6

The Deutsche Nationalbibliothek lists this publication in the Deutsche Nationalbibliografi e; detailed bibliographic data are available in the Internet at http://dnb.d-nb.de.

© 2008 by sellier. european law publishers, Munich.

All rights reserved. No part of this publication may be reproduced, translated, stored in a retrieval system or transmitted, in any form or by any means, electronic, mechanical, photo-copying, recording or otherwise, without prior permission of the publisher.

Design: Sandra Sellier, Munich. Production: Karina Hack, Munich. Typesetting: fi dus Publikations-Service, GmbH, Augsburg. Printing and binding: Friedrich Pustet KG, Regensburg. Printed on acid-free, non-ageing paper. Printed in Germany.

The full version of the work achieved by the Association Henri Capitant des Amis de la Culture Juridique Française and the Société de Législation Comparée, with extensive comments and notes on the third part of this work (not included in this volume) can be ordered at the Société de Législation Comparée (www.legiscompare.com).

This work is published in two separate volumes:Terminologie contractuelle commune – Projet de cadre commun de référence, edited by the Société de Législation Comparée and the Association Henri Capitant, coordina-ted by Bénédicte Fauvarque-Cosson and Denis Mazeaud, 2008, Collection droit privé comparé et européen, vol. 6, 532 p., 30 euros.

Principes contractuels communs – Projet de cadre commun de référence, edited by the Société de Législation Comparée and the Association Henri Capitant, 2008, coordinated by Bénédicte Fauvarque-Cosson and Denis Mazeaud, Collection droit privé comparé et européen, vol. 7, 655 p., 38 euros.

The print of this edition was supported by the Fondation pour le droit continental

List of Authors

Part I:Terminology

Directed by

Aline TENENBAUMMaître de conférences à l’Université Paris Est, Faculté de droit de Paris XII

Prepared by

Cécile CHAINAISProfesseur à l’Université de Picardie Jules Verne

Ghislain GUILLAUMEDoctorant, A.T.E.R., Université Paris Est, Faculté de droit de Paris XII

Aline TENENBAUMMaître de conférences à l’Université Paris Est, Faculté de droit de Paris XII

With the participation of

François CHÉNEDÉDocteur en droit, Faculté de droit de l’Université Panthéon-Assas (Paris II)

Chiara PERFUMIDottore di ricerca,Università degli studi di Brescia

Ina POPOVAB.A. (Hons.) (Cantab), Maitrise (Université Panthéon-Assas (Paris II)), L.L.M. (Harvard)

Thomas RIEHMDocteur en Droit, Ludwig-Maximilians-Universität München,Lecteur (DAAD) de droit allemand, Université Paris Est, Faculté de droit de Paris XII

V

Part II:Guiding Principles of European Contract Law

Directed by

Guillaume WICKERProfesseur à l’Université Montesquieu – Bordeaux IV

Prepared by

Laura SAUTONIE-LAGUIONIEMaître de conférences à l’Université Montesquieu – Bordeaux IV

Frédéric BUJOLIIngénieur d’études, chargé d’enseignement à l’Université de Nice-Sophia Antipolis

Part III:Revised Principles of European Contract Law

Directed by

Jean-Baptiste RACINE,Professeur à l’Université de Nice-Sophia Antipolis

Prepared by

Gilles AUZEROProfesseur à l’Université Montesquieu – Bordeaux IV(Guiding Principles – Chapter 2 of Revised PECL)

Évelyne BONIS-GARÇONProfesseur à l’Université Montesquieu – Bordeaux IV(Guiding Principles – Chapter 4 of Revised PECL)

Hélène BOUCARDProfesseur à l’Université d’Angers(Guiding Principles – Chapter 4 of Revised PECL)

Stéphanie CHRÉTIENDoctorante à l’Université Montesquieu – Bordeaux IV(Guiding Principles – Chapter 4 of Revised PECL)

VI

List of Authors

Marc DALLOZMaître de conférences à l’Université de Nice-Sophia Antipolis(Chapter 10 of Revised PECL)

Lê-My DUONGMaître de conférences à l’Université de Nice-Sophia Antipolis(Chapter 8 of Revised PECL)

Cédric DURASSIERAllocataire-moniteur à l’Université Montesquieu – Bordeaux IV(Guiding Principles – Chapters 4 and 16 of Revised PECL)

Nicolas FERRIERProfesseur à l’Université Toulouse I(Guiding Principles– Chapter 2 of Revised PECL)

Sophie HÉBERTDocteur en droit, Université de Nice-Sophia Antipolis(Chapters 9 et 10 of Revised PECL)

Marion HO-DACDoctorante à l’Université Montesquieu-Bordeaux IV(Guiding Principles)

Marine LACHENAUDATER à l’Université Montesquieu – Bordeaux IV(Guiding Principles – Chapters 4 et 16 of Revised PECL)

Éva MOUIAL-BASSILANAMaître de conférences à l’Université de Nice-Sophia Antipolis(Chapters 9 and 10 of Revised PECL)

Jean-Christophe PAGNUCCOMaître de conférences à l’Université de Caen(Guiding Principles – Chapter 2 of Revised PECL)

Irina PARACHKEVOVAMaître de conférences à l’Université de Nice-Sophia Antipolis(Chapters 9 and 10 of Revised PECL)

Gaël PIETTEProfesseur à l’Université Montesquieu – Bordeaux IV(Guiding Principles – Chapter 4 of Revised PECL)

Catherine PRIETOProfesseur à l’Université Paul Cézanne – Aix Marseille III(Chapter 6 of Revised PECL)

VII

List of Authors

Fabrice SIIRIAINENProfesseur à l’Université de Nice-Sophia Antipolis(Chapter 10 of Revised PECL)

Translation

Prepared by

Catherine KNIGHT and Maebh HARDING(Terminology, Revised Principles of European Contract Law)

Eleanor TANNER(Guiding Principles of European Contract Law)

With the assistance of

Corentin KERHUEL and Caroline LAFEUILLE

List of Authors

Short Table of Contents

Preface XXVII

Introduction to Terminology XXIX

Introduction to the Guiding Principles and to the RevisedPrinciples of European Contract Law XXXI

Part I:Terminology

Chapter 1: Contract 3Chapter 2: Obligation and Duty 39Chapter 3: Juridical Acts – Juridical Facts 66Chapter 4: Mandatory Rules and Ordre Public (Mandatory Rules of Public Policy) 101Chapter 5: Good Faith 150Chapter 6: Fault, Failure 203Chapter 7: Préjudice 252Chapter 8: Damages – Indemnity 275Chapter 9: Anéantissement – Destruction (of a Contract or a Contractual Clause) 320

Part II:Guiding Principles of European Contract Law

General Introduction 421Chapter 1: Freedom of Contract 423Chapter 2: Contractual Certainty 457Chapter 3: Contractual Fairness 515Text of the Guiding Principles of European Contract Law 571

Part III:Revised Principles of European Contract Law

Chapter 2: Formation 575Chapter 3: Authority of Agents 580Chapter 4: Invalidity of Contract 583Chapter 5: Interpretation 591Chapter 6: Contents and Effects (articles 6:101 to 6:108 of PECL) 593

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Chapter 7: Effects of Contract (articles 6:103; 6:109 to 6:111 of PECL) 594Chapter 8: Performance (chapters 7 and 16 of PECL) 596Chapter 9: Non-performance and Remedies in general 602Chapter 10: Particular Remedies for Non-Performance 604Chapter 11: Substitution of Parties (chapters 11 and 12 of PECL) 609

Short Table of Contents

Table of Contents

Preface XXVII

Introduction to Terminology XXIX

Introduction to the Guiding Principles andRevised Principles of European Contract Law XXXI

Part I:Terminology 1

Chapter 1: Contract

Main concerns 3I. A narrow perception of contract: a contract founded on the respect of

the given word 3A. Should an agreement made in a domestic (family) context be included

in the notion of contract? 3B. Should a gratuitous contract be included in the notion of contract? 4

II. Towards a widened conception of contract founded on reliance? 4III. The nature of the effects produced by contract 5

Acquis Communautaire and Acquis International 6I. The use of the term “contract” 6

A. The meaning of the word “contract” 61. The traditional terminological use of the word “contract” 62. The absence of a common definition of contract 7

B. The primacy of a conception of contract founded on exchange 81. The principle of reciprocity in the definitions relating to the subject

matter of a contract 82. A limited unilateralism in recent projects 9

II. The notion of “engagement” (undertaking) 10A. The various meanings of the term “engagement” 10

1. A clear multiplicity of meanings in Acquis Communautaire 102. A more limited polysemy in Acquis International 133. No ambiguity: international banking law and competition law 13a) “Engagement” (undertaking) in international banking law 13b) “Engagement” (commitment) in competition law 14

B. “Obligation freely assumed” (“Engagement librement assumé”) andmatters relating to a contract as per article 5.1 (Regulation n° 44/2001) 15

XI

III. The term “accord” (agreement) 16A. The various meanings of the term “agreement” when used traditionally 16

1. The use of the term “agreement” as a category of “contract”or “convention” 16

a) In a large number of texts, the word “agreement” is used to referto a type of contract 17

b) Sometimes, the term “accord” in French is understood as a categoryof “convention” 17

2. The agreement as a form of expressing consent 18B. Specific uses for the term “agreement” 18

1. The agreement, a tool for deregulation 182. The agreement in competition law 19

IV. Observations regarding quasi-contracts under European law 21

Comparative law 21I. The contract as a meeting of wills intended to produce legal relations 22

A. The contract as a meeting of wills with the intention of creatinglegal relations: a variety of examples 22

B. The specificity of competition law 24II. The contract as a declaration of intention capable of producing legal effects 25III. The contract as a binding promise without acceptance 26

A. The delicate distinction made between “engagement” and “contract” asa source of obligation 271. The delicate distinction made between “engagement”, “contract”

and “promise” under French and English law 272. The acceptance of the theory of unilateral undertakings:

the Belgian, German and Italian examples 29B. The specificity of the term “commitment” under competition law 30

IV. A contract as a specific relationship between two persons 30A. From contract to “contractual relationship” 31B. Relational contracts under American law 33V. Contract and quasi-contract 35

Chapter 2: Obligation and Duty

Main concerns 39I. The ambiguous use of the term “obligation” 39II. The legitimate use of the term “duty”? 40

Acquis Communautaire and Acquis International 41I. The interchangeable use of the terms ‘obligation’ and ‘duty’ 41

A. A reference to the global contractual relationship: a rare use 41B. A frequent use to refer to what is due by the obligor to the oblige 42

1. Texts of European origin 432. Texts of international origin 45

II. The autonomous use of the term ‘duty’ 47

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A. Specific nature of the obligations 48B. Sanctions specifically applicable to the breach of a duty 48

III. Specific use of the term ‘engagement’ (in French) 48

Comparative law 49I. The interchangeable use of the terms ‘obligations’ and ‘duty’ 50II. An independent use of the notion of ‘duty’/‘devoir’ 54III. Towards a common base in the distinction between ‘obligation’ and ‘duty’? 57IV. Terminological inconsistencies in the use of the term ‘engagement’ (in French) 60

A. Evidence of a confusion between ‘engagement’ and obligation 61B. Evidence of a specific use of the term ‘engagement’ as the source

of the obligation 63

Chapter 3: Juridical Acts – Juridical Facts

Main concerns 66I. Observation 66II. Relevance of the distinction 66III. Questions 67

Comparative law 67I. A systematization of the sources of obligations based on the distinction

between juridical act and juridical fact: a phenomenon anchored in countrieswith a civil law tradition 68A. The Roman origins of the classification of the sources of obligations 69

1. The tripartite distinction suggested by GAIUS 692. The four-part distinction put forward by JUSTINIAN 70

B. The progressive consecration of the distinction betweenjuridical acts and juridical facts in the French theory of classification ofobligations by reference to their sources 701. The arrangement of the Civil Code: a heavily criticized choice 702. The classification based on a distinction between juridical acts

and juridical facts is alive and well 72C. The adoption by certain civil law systems of the French classification

of the sources of obligation 761. Quebec law 76a) The classification of the Lower-Canada Civil Code (1866) 77b) The classification of the Quebec Civil Code 772. Belgian law 77

D. The development of the juridical act since the XIXth century 781. The juridical fact is abandoned 78a) The diversity of German classifications 79b) The original categories under Italian law 802. The juridical act breaks free 82a) The “Rechtsgeschäft” and similar terms under German law 82b) The “negozio giuridico” under Italian law 84

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E. Scottish law reveals the interaction between civil and common law systems 86II. The English law approach to the organization of the law of obligations 87

A. The traditional absence of a systematic approach 87B. The modern organization of the law of obligations 89

Acquis Communautaire and Acquis International 92I. There is no classification of the sources of obligations based on a distinction

between juridical act and juridical fact 93A. The lack of a distinction between juridical act and juridical fact in

Acquis International 93B. A distinction which is foreign to Acquis Communautaire 93

1. A piecemeal approach, incompatible with the systematization ofthe sources of obligation 93

2. A contested autonomy for the notion of contract 95II. Towards a classification of the sources of obligations 97

Chapter 4: Mandatory Rules and Ordre Public

Main concerns 101I. Observation 101II. Terminological guidelines 101

Acquis Communautaire and Acquis International 102I. Terminological uncertainties regarding the content of the

mandatory nature of rules 103A. Traditionally mandatory rules: the absolute command 103B. The internal mandatory rules give way: such rules are set aside in the

context of a transborder contract 107C. Reinforced international mandatory rules: a compulsory application 109

1. Reinforced mandatory rules 1092. Public order laws 1103. Ordre public/Public policy 111a) Rules regarding conflicts of laws and jurisdiction 111b) International arbitration 113c) The emergence of a European public policy

II. The uncertainty of sanctions incurred for the breach of mandatory rules 118A. The diversity of sanctions 118B. Towards a grading of mandatory rules? 120

Comparative law 122I. The traditional notion of ordre public and good morals (boni mores) 122

A. The safeguarding of society’s fundamental values 1231. The association of ordre public/public policy and good morals

(boni mores) 1242. Good morals in the widest sense, a concept which encompasses

public policy 126

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B. A notion with a variable content 1291. The sources of public policy 1292. The evolution of the notion in time 1313. The relativity of the notion in space 132a) Prostitution and public policy 133b) Agreements relating to surrogate motherhood 133c) Quota litis pacts and public policy 134i. The traditional prohibition of quota litis pacts 135ii. Quota litis pacts have found favour with English law 135iii. Contracts relating to the administration of justice 136

C. The generic notion of “fundamental principles” 1371. Public policy based on fundamental rights 1372. The notion of fundamental principles in PECL 139

II. Varying strength of the mandatory character 139A. Public policy, mandatory rules, illegality 140

1. Public policy and mandatory rules 1402. A preference for the notion of illegality 141

B. From absolute to relative mandatory character 1411. Normative texts which are absolutely mandatory 1422. Degrees of public policy 142a) The distinction between public policy of direction and public

policy of protection 142b) Critical appraisal of the terminological distinction between public

policy of protection and public policy of direction 144C. A variety of sanctions applying to a breach of mandatory rules 144

1. In civil law countries 145a) The traditional regime based on the distinction between

public policy of protection and public policy of direction 145b) The gradual appearance of less drastic sanctions 1472. Common law 147

Chapter 5: Good Faith

Main concerns 150General introduction 151I. Good faith: an historical perspective 151

A. Roman Origins 151B. Good faith in medieval law 154C. Good faith in the Nineteenth Century 155

II. Good faith: difficulties associated with the concept 156A. Good faith: a notion with uncertain boundaries 156B. Good faith: a ‘domesticable’ notion? 158

1. Rationalization attempts through legislation. Specificities ofAmerican and Dutch law 158

2. Rationalization attempts by legal theory 160

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Aquis Communautaire and Acquis International 162I. Good faith, an instrument of interpretation 164

A. A principle for the interpretation of international treaties 164B. A directive for the interpretation of rules relating to contracts 164C. A principle of contractual interpretation 166

II. Good faith, a standard of behaviour 167A. Positive law 168

1. The United Nations convention on contracts for theinternational sales of goods: an implied obligation of good faith 168

2. The United Nations convention on independent guaranteesand stand-by letters of credit 169

3. Community law 169B. Good faith in international and European codification proposals 173

1. A general principle 1732. The concrete meaning of good faith 174a) UNIDROIT principles 174b) PECL 176c) The PAVIA project 177

III. Good faith, a basis for the protection of mistaken belief 178A. The belief in the lawfulness of a situation 178B. The protection of a third party acting “in good faith” 179

Comparative law 181I. Good faith, an instrument of interpretation 182II. Good faith, a standard of behaviour 183

A. The completive function of good faith 1831. At the moment of formation of the contract 1852. During the performance of the contract 188

B. The adaptive function of good faith 189C. The restrictive function of good faith 190

1. General points on the relationship between good faith andthe notion of abuse 190

2. The relationship between good faith and abuse in the legislationagainst unfair contract terms 194

III. Good faith, a basis for the protection of mistaken belief 196A. Civil law countries 196B. Common law countries 197

IV. Alternatives to good faith: the specific contribution of English law 198A. Ideological considerations 199

1. The traditional reasons for the reticence in Englandto the importation of the concept of good faith 199

2. The recent evolution of English law 200B. Technical alternatives to the rejection of a general principle

of good faith 202

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Chapter 6: Fault, Failure

Main concerns 203

Acquis Communautaire and Acquis International 204I. The replacement of moral fault by the broader concept

of “contractual default” 205A. The moral neutrality of the terms “non-performance” or “failure” 205B. The more pronounced neutrality of the term “guarantee” 207

II. The limited role of moral breach in contractual default rules 208A. Distinction between the duty to achieve a specific result and

the duty of best efforts 208B. The regime governing exemption and limitation clauses 210C. Extent and conditions of remedies 211

Comparative law 213I. The decline of the moral fault 215

A. Fault as a failure in the performance of the contract 2161. The standards of care: definition of fault based on the content of

the contract 2172. Objectivization of fault and the guarantee principle 221

B. Criticism of the subjective idea of fault 2231. The presumption of fault in case of non-performance is artificial 2232. The unsuitability of the moral fault in relation to a certain

reality of the contract 225II. The moral fault in the exemption from contractual liability 226

A. The lack of fault from the obligor, an increasingly immaterial parameterto exemption 2271. The expressions of the impossibility to perform a contract 227a) Establishing “impossibility” 227b) The difficulties in distinguishing between impossibility

and “imprévision” 2342. The difficult distinction between fault, impossibility and imputability 237

B. The impact of the obligee’s fault on the assessment of certain remediesto the non-performance 241

III. The residual role of serious fault (“faute caractérisée”) in the consequencesof the non-performance 242A. Some isolated consequences of serious fault 242B. Avoidance for non-performance: a necessary assessment of the extent

of the non-performance 245

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Chapter 7: Préjudice

Main concerns 252

Acquis Communautaire and Acquis International 253I. ‘Préjudice’, a consistent term 254

A. International texts 254B. European Community texts 256

II. Heads of damage/Categories of préjudice: poorly identified sub-categories 258A. Patrimonial categories of préjudice 258B. Non-patrimonal categories of préjudice 260C. Hesitations regarding certain specific categories of préjudice 262

1. Mental injury 2622. Personal injury 2623. Pure economic loss 263

Comparative law 264I. The distinction between the terms ‘préjudice’ and ‘dommage’ 265II. The heads of damage: the diverse categories of préjudice 267

A. Patrimonial préjudices 270B. Extra-patrimonial préjudice 270C. The emergence of new categories 273

Chapter 8: Damages – Indemnity

Main concerns 275

Acquis Communautaire and Acquis International 276I. “Damages”: an expression with a variety of meanings 276

A. Damages for late payment 2771. The exclusively moratory function of damages /interest for

late payment 2772. The deterrent and compensatory function of interest for

late performance in the directive on combating late payments 278B. Punitive damages 279C. Compensatory damages 281

1. Total compensation for the loss 2812. The principle of full compensation for the loss is abandoned

by the PAVIA Project 283II. The ambivalence of the term “indemnity” 284

A. An indemnity provided by a contractual provision 2841. The functional ambiguity of contractual indemnity clauses 2842. Terminological hesitation: from penalty clause to damages clause 285

B. An indemnity provided by a mandatory legal regime 2871. The traveller’s right to compensation 2872. The commercial agent’s right to compensation 288

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Comparative law 289I. “Damages”: an expression with a variety of meanings 290

A. Compensatory damages 2911. Various approaches to the notion of compensation 292a) The distinction made between “positive interest” and

“negative interest” 292i. The distinction between “expectation interest” and

“reliance interest” at common law 292ii. The protection of the “status ad quem” under German law 295iii. Swiss law and the distinction between “positive interest”

and “negative interest” 297b) The deficiencies in certain legal systems regarding the evaluation

of damages 299i. The principle of total reparation through the compensation for loss

sustained and lost profits 299ii. The issue of concurrent claims for termination and damages in

the event of non-performance 3012. Damages and their function of equivalent performance 302

B. Damages for late performance 303C. Punitive damages 307

1. Punitive damages, a controversial notion in contract 3072. The controversial acceptance of restitutionary damages 310

D. Penalty clauses and liquidated damages clauses 313II. The indemnity, a term with an uncertain use and an uncertain legal regime 317

Chapter 9: Anéantissement/Destruction [of a Contract or ofa Contractual Clause] (Nullity, Supervening Nullity, Inexistence, Dissolution,Termination, Ineffectiveness, Clauses deemed unwritten/struck out)

Main concerns 320

Acquis Communautaire and Acquis International 321I. The equivocal character of ‘nullity’ and ‘résolution’ 322

A. The situations in which to use the terms ‘nullity’ and ‘dissolution’ 3221. The situations of direct usage 322a) Nullity, sanction applicable to defects in contract formation 322b) “Résolution”, a sanction applicable to the non-performance or

the improper performance of the contract 3262. Instances of indirect usage 328

B. The inconsistency of the systems attaching to the terms ‘nullity’ and‘dissolution’ 3311. The relatively consistent system governing nullity 3312. The marked uncertainties of the system applying to dissolution 333

II. The disorder of complementary terms 335A. The abundance of complementary terms 336

1. ‘L’inefficacité’ (Ineffectiveness) of contract (PECL) 336

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2. The ban on the invocation of a clause (UNIDROIT principles) 3373. The extension of the terminological register by the PAVIA Project 3374. The destruction of the contract in cases of a change in circumstances 339

B. The uncertainty of systems allocated to complementary terms 340C. Towards a unified system for the right of revocation? 342

1. The confusion of community terminology 343a) The right of revocation, synonym for the résiliation of contract 343b) The rights of revocation and of cancellation: distinct terms 3442. The judicial efforts at harmonising the right of revocation 345

Comparative law 348I. Termination as a sanction for a defect of validity of a contract or clause 349

A. The use of the term ‘avoidance’ (nullity) as a generic term 3491. The ancient roots of the term 3502. The complexity of contemporary diversification 352a) The recognition of the distinction between absolute nullity and

relative nullity 353b) The persisting difficulties surrounding the distinction 359c) Towards a timid convergence of the respective regimes 362

B. Specific terms linked to nullity 3721. Rescission 3722. Inexistence 374a) The rejection of inexistence by certain systems 374b) The adoption of inexistence by other systems 3753. Clauses deemed ‘struck out’ or ‘unwritten’ 380a) The ab intio ineffectiveness of clauses deemed to be ‘struck out’ 380b) The German distinction between non-integrated clauses and

non-effective clauses 3864. Supervening nullity 387

II. Destruction of a contract as a sanction for non-performance 390A. The fine distinction between the terms ‘résolution’ and ‘résiliation’ 391

1. The confusion between ‘résolution’ and ‘résiliation’ in the countriesof a civil law tradition 391

2. Terminological uncertainty between ‘rescission’ and ‘termination’in the common law 396

B. Hesitations over the regime governing dissolution 3971. The conditions necessary for dissolution 398a) The relaxed requirement for actual non-performance 398b) From an assessment of the degree of fault to one of the seriousness

of the non-performance 3992. The implementation of dissolution 404a) The residual role of the judge in the declaration of dissolution 404b) The blossoming of an extrajudicial character for dissolution 4043. The effects of dissolution 407a) The mitigated retroactivity of dissolution for non-performance 408b) The obligations of restitution engendered by dissolution for

non-performance in the absence of retroactive effect 410

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III. Destruction of a contract, a consequence of the exercise of law detachedfrom contractual non-performance 411A. ‘Résiliation’: the right to sever a contract 411

1. Unilateral ‘résiliation’ 4112. Contractual résiliation/termination 414

B. Retraction 415

Part II:Guiding Principles of European Contract Law 419

General Introduction 421

Chapter 1: Freedom of Contract

Article 0-101: Freedom of the parties to enter into a contractI. General presentation of the principle 423II. Application of the principle in PECL 423

A. Direct applications 423B. Indirect applications 425

III. Applications of the principle in comparative law 426A. National laws 426B. International law and Acquis communautaire 432C. Codifications by legal scholars 435

IV. Proposed text 438

Article 0-102: Respect for the freedom and rights of third partiesI. General presentation of the principle 438II. Application of the principle in PECL 439

A. Relative effect of the contract 439B. Respect for the rights of third parties 439

III. Applications of the principle in comparative law 440A. National laws 440B. International law and Acquis communautaire 446C. Codifications by legal scholars 447

IV. Proposed text 449

Article 0-103: Freedom of the parties to modify or put an end to the contractI. General presentation of the principle 449II. Application of the principle in PECL 450III. Applications of the principle in comparative law 450

A. National laws 450B. International law and Acquis communautaire 454C. Codifications by legal scholars 455

IV. Proposed text 455

Chapter 2: Contractual Certainty

Article 0-201: Principle of binding forceI. General presentation of the principle 457II. Application of the principle in PECL 458

A. Binding force of contract 458B. Consequences of the obligatory effect of the contract 459C. Unforeseeable change of circumstances 459

III. Applications of the principle in comparative law 460A. National laws 460B. International law and Acquis communautaire 471C. Codifications by legal scholars 473

IV. Proposed text 477

Article 0-202: Right to performanceI. General presentation of the principle 477II. Application of the principle in PECL 478III. Applications of the principle in comparative law 479

A. National laws 479B. International law and Acquis communautaire 484C. Codifications by legal scholars 485

IV. Proposed text 487

Article 0-203: Rights and duties of third partiesI. General presentation of the principle 487II. Application of the principle in PECL 488III. Applications of the principle in comparative law 488

A. National laws 488B. International law and Acquis communautaire 495C. Codifications by legal scholars 495

IV. Proposed text 496

Article 0-204: Principle favouring the maintenance of the contractI. General presentation of the principle 496II. Application of the principle in PECL 497

A. Interpretation of the contract 497B. Validity of the contract 497C. Performance of the contract 499

III. Applications of the principle in comparative law 501A. National laws 501B. International law and Acquis communautaire 509C. Codifications by legal scholars 510

IV. Proposed text 514

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Chapter 3: Contractual Fairness

Article 0-301: General duty of good faith and fair dealingI. General presentation of the principle 515II. Application of the principle in PECL 515III. Applications of the principle in comparative law 519

A. National laws 519B. International law and Acquis communautaire 531C. Codifications by legal scholars 534

IV. Proposed text 537

Article 0-302: Performance in good faithI. General presentation of the principle 537II. Application of the principle in PECL 538III. Applications of the principle in comparative law 539

A. National laws 539B. International law and Acquis communautaire 545C. Codifications by legal scholars 545

IV. Proposed text 547

Article 0-303: Duty to cooperateI. General presentation of the principle 547II. Application of the principle in PECL 548III. Applications of the principle in comparative law 549

A. National laws 549B. International law and Acquis communautaire 551C. Codifications by legal scholars 552

IV. Proposed text 553

Article 0-304: Duty of consistencyI. General presentation of the principle 553II. Application of the principle in PECL 554III. Applications of the principle in comparative law 556

A. National laws 556B. International law and Acquis communautaire 564C. Codifications by legal scholars 566

IV. Proposed text 569

Text of the Guiding Principles ofEuropean Contract Law 571

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Part III:Revised Principles Of European Contract Law 573

Chapter 2: Formation

Section 1: Pre-contractual negotiations (addition) 575Section 2: General provisions 576

Chapter 3: Authority of Agents

Section 1: General provisions 580Section 2: Direct representation 580Section 3: Indirect representation 583

Chapter 4: Invalidity of Contract

Section 1: General provisions 583Section 2: Invalidity caused by vitiated consent 584Section 3: Invalidity for illegality 586§ 1 Violation of fundamental principles 586§ 2 Violation of a mandatory rule 586§ 3 Violation of the rights of third parties 587Section 4: The operation of invalidation 588§ 1 General provisions 588§ 2 Special provisions concerning the violation of fundamental principles 589Section 5: Consequences of invalidation 590§ 1 General provisions 590§ 2 Restitutions following the invalidation 590§ 3 Damages 591

Chapter 5: Interpretation 591

Chapter 6: Contents and Effects (formerly articles 6:101 to 6:108 of PECL) 593

Chapter 7: Effects of Contract (formerly articles 6:103; 6:109 to 6:111 of PECL) 594

Chapter 8: Performance (formerly chapters 7 and 16 of PECL) 596

Section 1: Conditions and time limits affecting when the contractualobligations become due 596Sub-section 1: Future events deferring performance 596§ 1 Condition 596§ 2 Specified time period for performance 597

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Sub-section 2: The effects of an obligation before the occurrence of an event 597§ 1 Conduct of the parties 597§ 2 Prerogatives of a creditor 598§ 3 Early performance 598Sub-section 3: Effects of an obligation upon the occurrence ofthe suspensive event 599Section 2: Other methods of enforcement 600

Chapter 9: Non-performance and Remedies in General 602

Chapter 10: Particular Remedies for Non-performance

Section 1: Right to performance 604Section 2: Withholding performance 604Section 3: Termination of the contract 605Section 4: Price reduction 607Section 5: Damages and interest 607

Chapter 11: Substitution of Parties (formerly chapters 11 and 12 of PECL)

Section 1: Assignment of claims 609Sub-section 1: General principles 609Sub-section 2: Effects of assignment as between assignor and assignee 610Sub-section 3: Effects of assignment as between assignee and debtor 611Sub-section 4: Order of priority between assignee and competing claimants 612Section 2: Substitution of new debtor (renumbered) 613Section 3: Transfer of contract 613

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Preface

In January 2003, the European Commission called for a “Common Frame of Reference”in its Action Plan on a “More Coherent European Contract Law”. The “Joint Networkon European Private Law”, also called “CoPECL Network of Excellence”, was establishedin May 2005 and funded by the European Commission under the Sixth Research Frame-work Programme, in view of preparing the Common Frame of Reference (CFR). TheAssociation Henri Capitant des Amis de la Culture Juridique Française and the Sociétéde Législation Comparée agreed to take part in this European project. To this effect, theyformed a specific working group (AHC-SLC Group).

Within the network, the AHC-SLC Group belongs to the “Evaluative and supportivegroups”. Its task is to analyse the rules put forward for the Common Frame of Reference,having particular regard to its philosophical underpinnings. In order to do so the AHC-SLC first concentrated on the work relating to “Terminology” and on the values ofEuropean contract law, which can be expressed in the form of “Guiding principles”.Later on, during a meeting in Paris, it was suggested that the AHC-SLC Group shouldalso contribute to the task of drafting model rules. The AHC-SLC Group decided to workon the set of rules which is the product of work carried out, for many years, by theCommission on European Contract Law (Lando Commission): the Principles of EuropeanContract Law (PECL). This codification already serves as a model, in Europe and all overthe world, for those who wish to harmonize their contract law.

On December 31, 2007, several documents, drafted by various groups in the network,were sent to the Commission. During the months that followed, they have had their ownlives.

The Draft Common Frame of Reference (DCFR), prepared by the Study Group on aEuropean Civil Code and the Research Group on EC Private Law (Acquis Group), partlybased on a revised version of the Principles of European Contract Law, was published bySellier. european law publishers, in a volume entitled: “Principles, Definitions and Model Rulesof European Private Law. Draft Common Frame of Reference (DCFR), Interim Outline Edition”.

The “Principles of European Insurance Contract Law”, drafted by a separate Groupcalled the “Project Group Restatement of European Insurance Contract Law” (InsuranceGroup) constitute a separate set of rules applying to the field of insurance law.

The documents delivered by the AHC-SLC Group – Terminology, Guiding Princi-ples, Revised version of the Principles on European Contract Law (PECL) – are published inFrench in a specific collection of the Société de Législation Comparée, dedicated toEuropean and Comparative Law.

The contributions of the AHC-SLC Group to the Common Frame of Reference fulfilldifferent purposes, in accordance with the three tasks set by the Action Plan of theEuropean Commission: identifying guiding principles, reflecting upon definitions andterminology, drafting model rules.

For the elaboration of these materials for the CFR, specific teams were set up, led byacademics specialized in the relevant field of study. Our own role in this process has beento act as academic directors of these three projects. We are most grateful to all the

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members of the AHC-SLC Group who achieved a significant collective work, especiallyto the team leaders who dedicated a lot of time and energy to this project: ProfessorGuillaume Wicker who directed the group on “Guiding Principles of European ContractLaw”, Professor Jean-Baptiste Racine who directed the group in charge of the “Revisionof PECL” and Dr Aline Tenenbaum who directed the group on “Common Terminology”.

The entire work was published in French, in February 2008, in two separate volumesentitled: Projet de cadre commun de référence – Terminologie contractuelle commune andProjet de cadre commun de référence – Principes contractuels communs (volumes 6 and 7 ofthe collection “Droit privé comparé et européen” of the Société de Législation Com-parée, B. Fauvarque-Cosson dir.).

The present English volume does not contain the full version of the two Frenchbooks. Unfortunately, the extensive comparative comments which accompany the Re-vised Principles of European Contract Law have not been translated, due to lack of timeand financial means. However, it should be emphasized that the texts proposed in thethird part of this book are systematically based upon deep and innovative comparisonswhich assemble information on the “Acquis communautaire”, international codifica-tions, national laws and also national drafts. This work is available in Principes contrac-tuels communs (pp. 215-743, to be ordered at www.legiscompare.com).

We hope that our work will contribute to the final Common Frame of Reference in anumber of different ways.

First, the work on the guiding principles can contribute to the growing debate con-cerning the values which underlie the different types of legal proposals in any future CFR,whether these legal proposals are in the form of principles, rules or even definitions.

Secondly, the work on a revised version of PECL, insofar as it concentrates on thelaw of contract (general law of contract) draws attention to the fact that acceptance ofthe idea (and even function) of a CFR still leaves open the question of its form andcontent. In particular, the revised version of PECL proposed here follows PECL in pre-ferring a simple structure with clear and relatively short rules, confined to the general lawof contract, rather than extending to the law of obligations and beyond as in the case ofthe Draft Common Frame of Reference (DCFR).

Thirdly, the work on legal terminology is intended to be of practical use in theelaboration of the final versions of the CFR, that is to say, its translations into all theofficial EU languages. Indeed, were a CFR to be given formal recognition by the EuropeanCommission (in some form and for some purpose yet to be fixed), the question wouldimmediately arise as to its translation into all of the 23 official languages. While, ofcourse, the work on terminology presented here does not purport to deal with all theconceptual problems nor involve all the languages nor even language families in Europe,it is hoped that it can contribute significantly to the forging of the linguistic toolsnecessary for the many “toolboxes”.

Bénédicte FAUVARQUE-COSSON,Professeur à l’Université Panthéon-Assas, Paris II,

Secrétaire générale de la Société de Législation Comparée

Denis MAZEAUD,Professeur à l’Université Panthéon-Assas, Paris II, Secrétaire général de l’Association

Henri Capitant des Amis de la Culture Juridique FrançaiseApril 2008

Preface

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Introduction to Terminology

Objectives and Method of the Terminology Group

The research group known as the “Terminology Group” was formed as part of the Frenchacademic Group constituted by the Société de Législation Comparée and the Associa-tion Henri Capitant des Amis de la Culture Juridique Française. The work carried out bythis Group has specific objectives (1), which themselves determined the method whichwas adopted (2).

Only the black letter rules have been translated into English and are reproduced inthis book. The commentaries and comparative analysis, which have not been translatedfor lack of means, can be found in the French book entitled Principes ContractuelsCommuns. This book has been published by the Société de législation comparée (seethe references in the first pages of the present book).

1. The objectives

The present study comprises a comparative terminological analysis of a particular set ofconcepts. Far from attempting to establish an exhaustive legal glossary, the TerminologyGroup focused on the following notions or groups of notions: contract, obligation and duty,juridical act /fact, public order and mandatory rules, good faith, fault and breach, damage,damages and ending of the contract.

Throughout the work which was carried out, the Terminology Group was concernedthat some legal words which seem to have a straightforward meaning in the context ofone legal system, might carry a different sense in another legal system, even though theword itself appears to possess a clear equivalent in that other system. For example, theFrench term “contrat” can be translated into English by the word “contract”, but theseterms do not necessarily express an identical underlying concept in the two systems.These differences, whether minor or fundamental, stem from the variety of legal conceptsused in the Member States’ legal systems.

Therefore, the purpose of this study of terminology is not to create a new completedogmatic contractual terminology to be applicable in a uniform manner (as is envisagedin the case of the drawing up of the Common Frame of Reference). Instead, the Termi-nology Group took as its starting point the terminology in current usage, and sought toexplain and explore the difficulties affecting the use of certain terms adopted by the legalsystems included in the study, and, where possible, to propose how their use should bemade more apparent and more exact. This sometimes led the Terminology Group, eitherto suggest the jettisoning of certain terms as redundant (because synonymous with an-other concept) or, instead, to underline their irreducible particularity to an individuallegal system.

In order to implement these objectives, the Terminology Group has adopted a spe-cific method followed for each concept which has been analyzed.

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2. The method

The method adopted by the Terminology Group is based on a two-stage analysis. Firstly,each concept was assessed from what has been called the “Acquis” viewpoint. Secondly,each concept was examined from a comparative perspective and in different legal sys-tems.

As far as the first step is concerned, the “Acquis” which is contemplated covers a widerange of laws, regulations, rules, soft law elements and various codifications, to the extentto which they relate to contractual issues. Accordingly, the term “Acquis” should beunderstood to encompass the “Community acquis (Acquis Communautaire)”1 in theclassical sense and what has been described as “Acquis International”. The former in-cludes the Treaty, Directives and Regulations, Community Conventions such as theRome Convention on the law applicable to contractual obligations, other Europeanconventions such as the Convention on Human Rights and the Principles of EuropeanContact Law drafted by the commissions under the chairmanship of Ole LANDO. Thelatter comprises international conventions, such as the Vienna Convention on the in-ternational sale of goods, the Hague Convention of 1955 on the law applicable to inter-national sale of goods, international elements of soft law, such as the UNIDROIT Prin-ciples and the Uniform Customs and Practices for Documentary Credits.

When it comes to the comparative analysis found at the second stage of our analysis,attention was paid to reflect the diversity of legal systems and approaches. Therefore,most of the Member State laws, case law and academic works were examined – withoutattempting exhaustiveness given that such an attempt would be doomed to failure. Inaddition, other non-Community systems were considered, such as the American Uni-form Commercial Code, the Louisiana codification, the laws of Quebec, in order tocomplement, and sometimes even to shed a different light on, European approaches.

For each concept examined, this two-stage analysis opens with general guidelines.These guidelines are not presented as a set of strict or rigid definitions, but rather asquestions aimed to bring out the main differences and/or similarities resulting from thecomparative analysis and also the possible translation difficulties. Moreover, in manycases the responses offered by Community lawyers or by the Community authoritiesthemselves to the terminological questions addressed are closely connected with thesubstance of the notion considered and the regime of rules governing it. These variousstudies of the contractual concepts in current use should therefore lead lawyers in Mem-ber States to reflect on the terms which they themselves use and on their translation witha view to the future Common Frame of Reference.

Aline TENENBAUMJanuary 2008

Introduction to Terminology

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1 The expression “Community acquis” appears in article 5.B of the Treaty. Although it is accep-ted, its definition varies depending on the context in hand. Generally, the Community acquis“is the body of common rights and obligations which bind all the Member States togetherwithin the European Union. It is constantly evolving” (definition laid out by the Council andadopted in the Glossary dispatched on the gateway to the European Union, www.europa.eu.int)/ For a more limited definition, see e.g. Green Paper on the review of the consumeracquis 02/08/07, COM (2006) 744 final.

Introduction to the Guiding Principles andRevised Principles of European Contract Law

The Principles of European Contract Law delivered by the Commission headed by Pro-fessor Ole Lando, represent a fundamental step towards the construction of a commoncontract law. They have acted as a triggering element: it was only from the time of theirpublication that the very idea of a European contract law began to take real shape. Theyalso demonstrated that such a work was possible: overcoming the divergence of nationallaws in the area of contract to show that a common law can be discovered and con-structed. The Principles of European Contract Law thus constitute an academic work ofconsiderable importance.

Since 2001, the European Commission has launched a general consideration of aEuropean contract law. Today, there is even discussion of a facultative instrument in thearea. Under the framework of common research for European contract law, the Associa-tion Henri Capitant and the Société de Législation Comparée have put in place a work-ing group responsible for developing a ‘common terminology’ and’ guiding principles ofcontract law’. This working group has also undertaken to revise the Principles of Euro-pean Contract Law elaborated by the Lando Commision. These Revised Principles ofEuropean Contract Law are published in the present work, together with some GuidingPrinciples of European Contract law, (drawn up from the basis of the Revised Principles).These Guiding Principles could form part of a first Chapter of the Revised Principles ofEuropean Contract Law

I. Revision of the Principles of European Contract Law (PECL)

As PECL represents the fruit of the collective reflection of jurists of all horizons, con-scientious to reconcile the diverse European legal cultures, they could not be revisedwithout great care. As PECL represent a work of compromise, based on indepth analysisof comparative law, they must be subjected to a critical examination which excludes theirappreciation according to one national law or in particular French law. Thus it wasimportant that the revision of the Principles of European Contract law did not turn intoa militant work in favour of such or such national legal system, but rather proved thecoherence of the Principles and their operative value. This revision is undertaken toimprove both the effectiveness of the Principles and their intelligibility. The goal hasbeen to reflect on the ‘best’ law of contract possible, in particular, to reconcile freedom ofcontract and contractual justice and to satisfy practical needs, without sacrificing theo-retical coherence.

The work consisted of analysing each article making up the Principles. This analysiswas systematically divided into two parts. In the first stage, each article of the Principlesgave rise to a discussion. This discussion was composed of two elements: first, a com-mentary of the article (to explain its meaning and scope and if applicable its deficiencies)and then a comparative analysis of the article (in order to establish the convergence of

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the Principles with other texts: the UNIDROIT Principles of International CommercialContracts, the Vienna Convention on Contracts for the International Sale of Goods, theEuropean Contract Code Proposal (also called PAVIA Project), the French proposals forthe Reform of the law of obligations and prescription, and on occasion the Draft Com-mon Frame of Reference). In the second stage, the revised provisions were completed:these were the result of an effort to explain the reason and content of each provision andthen to come up with a revised text.

In most cases, the original Principles of European Contract Law are restated in ex-tenso. Sometimes they are reworded or reformulated to ensure greater clarity or to makethem more concise. In other cases, the principles are completed or replaced by newprovisions. For example, with regard to the avoidance and termination of contract: theprinciple of extra-judicial termination is retained but the procedure is modified. Therevised articles are accompanied with a gloss intended to facilitate their reading. If thearticle is identical to that of the original Principles of European Contract Law, the glossreads ‘restatement’. If the number of the article has changed but the content has re-mained the same, the gloss reads ‘renumbered’. If the article is a product of the reformu-lation of the Principles, either in whole or in part, the gloss reads ‘modified’, ‘reworded’,‘completed’ or ‘reformulated’. Finally if the article is entirely new, the note reads ‘addi-tion’.

Not all the chapters of the original Principles of European Contract law have beensubject to analysis. Thus, there is no commentary of Chapter 1 ‘General Provisions’,Chapter 10 ‘Plurality of Parties’, Chapter 11 ‘Assignment of Claims’, Chapter 13 ‘Set-Off’, Chapter 14 ‘Prescription’ or Chapter 17 ‘Capitalisation of Interest’. It seemed to themembers of the working group that it was necessary to focus on shaping a ‘solid core’ ofcontract law; including the formation of a contract, its validity, its interpretation, itseffect, and performance as well as the case of substitution of parties.

The structure of the Revised Principles of European Contract has changed. AlthoughChapters 2 (‘Formation’), 3 (‘Authority of Agents;) and 5 (‘Interpretation’) retain theirtitles, by contrast, Chapter 4 (‘Validity’) and Chapter 15 (‘Illegality’) are combined in thebody of Chapter 4, which is newly titled (‘Invalidity’). Chapter 6 (‘Contents and Effects’)is divided in two: a Chapter 6 ‘Content’ and a Chapter 7 ‘Effects’. Chapter 7 is renum-bered as Chapter 8 (‘Performance’) also including in its content the provisions of Chap-ter 16 (‘Conditions’). The former Chapter 8 (‘Non-performance and Remedies in Gen-eral’) has become Chapter 9 and the former Chapter 9 (‘Particular Remedies for Non-Performance’) has become Chapter 10. Finally a Chapter 11 has been created ‘Substitu-tion of Parties’).

The work is concluded by a synthesis including the totality of the provisions; in totalnearly 200 articles.

II. Guiding Principles for European Contract law

The Principles of European Contract law have opened up the possibility of a unifiedcontract law. In this respect, the construction of a common basis for contract law impliesthe elaboration of Guiding Principles of European Contract Law, in a manner that couldbe more regulatory than prescriptive. The purpose of these Guiding Principles differsfrom that of the Principles of European Contract Law; it is perhaps less ambitious, but

Introduction to the Guiding Principles and Revised Principles of European Contract Law

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certainly less constraining. The Principles of European Contract Law put forward ageneral collection of provisions regulating a contract from its formation to its end.However, this general regulation of contract could be preceded, either in time or mate-rially, by principles of general value, intended to clarify the provisions of the Principles ofEuropean Contract law. Moreover, these Guiding Principles are not intended to proposea solution for each individual question of contract law but rather to clarify guidingconcepts which could form a common legal culture, and allow the construction of acommon European contract law.

Many ways are a priori, conceivable as being effective in establishing Guiding Prin-ciples of European Law. In particular, a body of principles could be defined with aregulatory aim but also a prescriptive part so that these principles could constitute afoundation for a European Contract Code. Bearing in mind the considerable work al-ready realized by the Lando Commission, it has seemed preferable to lead the elaborationof these Guiding Principles by contemplating the Principles of European Contract lawand also the revision work to which they were subject. The guiding principles are notintended to supplant the Revised Principles of European Contract law; on the contrary,the two works are intended to mutually complement each other. On one hand thePrinciples of European Contract Law constitute the main source used to identify theGuiding Principles. On the other hand, the Guiding Principles could represent, from nowon, a guide for the interpretation and application of the Principles of European ContractLaw. In effect, the meaning of the Revised Principles of European Contract Law can beclarified by the Guiding Principles; of which the Revised Principles of European Con-tract Law are merely a particular application. Of course, the Guiding Principles of Eu-ropean Contract Law were designed to have their own independent existence. But inconformity with their initial inspiration, they were equally designed to be associated withthe Revised Principles of European Contract Law. In that capacity, the guiding principlescould usefully take a position at the start of the Principles of European Contract law inthe form of a preliminary chapter.

In accordance with the first stage of the method adopted by the working group, it isvery clear from the text of the Principles of European Contract Law that guiding prin-ciples have already been identified. In particular, attention has been paid to the provi-sions of the first chapter ‘General Provisions’. But, the results obtained could usefullybe completed by cross-referencing the provisions of the other chapters. Thus, whereasthe first chapter brought out the fundamental importance of freedom of contract2 andcontractual fairness,3 the study of the body of other provisions has shown that the Prin-ciples of European Contract law are equally innervated by the principle of security ofcontract.

Hence, the elaboration of the Guiding Principles of European Contract law has beenfounded on the three pillars of freedom of contract, contractual certainty and contractualfairness. These three ideas had to be elaborated in the form of a text covering the wholeof the contractual process. In order to do this, it was imperative to proceed with acomparative analysis as well as using lessons taken from the provisions of the Principlesof European Contract Law. The principles of freedom of contract, contractual certaintyand contractual fairness can be found in all the laws of the Member States of the Euro-

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2 See Art 1.102.3 See Art 1.201 and 1.202.

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pean Union. However, their scope varies from one State to another and the search forGuiding Principles of European Contract law presupposes the identification a commonbasis of the different national laws. The study has necessarily turned towards German law,Dutch law, Swiss law,4 French law, Italian law, Spanish law and English law. Whenever ithas been possible to do so, guidelines relating to the legislation of other countries in theEuropean Union have also been given.

This study of comparative law could not limit itself to the analysis of these legisla-tions alone. In reality, the scope of the principles of freedom of contract, security ofcontract and contractual fairness must be clarified by two other supplementary sources:International law5 and European Community law, and also codifications by legal scho-lars. The codifications referred to include: the Unidroit Principles, the European Code ofContract Preliminary Draft and the Proposals for Reform of the French Law of Obliga-tions and the Law of Prescription. These different models have constituted a precioussource as they propose the regulation of the whole of contract law, in the same way as thePrinciples of European Contract law. From these completed research projects, it has beenpossible to give the principles of freedom of contract, contractual certainty and contrac-tual fairness a concrete content. Although the object of the proposed text was to come upwith general principles, it has nonetheless appeared desirable to not proceed merely byway of generalities. The texts have thus been drawn up in an effort to maximize theaccessibility and intelligibility of the rule posed.

As completed, the Guiding Principles of European Contract law are comprised ofthree sections, treating the freedom of contract (section I), contractual certainty (sectionII) and contractual fairness (section III) respectively.

We hope that the Revised Principles of European Contract Law as well as the Guid-ing Principles of European Contract Law here proposed contribute to today’s debateconcerning a European Contract Law. It seems to be necessary to go further in consti-tuting a body of homogenous rules in contractual matters on a European scale, whetherany future instrument be facultative, optional or even compulsory. We wish to thank allthe members of the working group for having contributed to analysis in this area.

Guillaume WICKER and Jean-Baptiste RACINEJanuary 2008

4 Swiss law has received attention and been integrated into the study of the European legalsystems because it is made up of different influences, in particular those of French and Germanlaw and it cannot in this day and age hide from the influences of European Law. See in thisregard V. P. ENGEL Contrats de droit suisse (Traité des contrats de la partie spéciale du Code desobligations, de la vente au contrat de société simple, articles 184 à 551 CO, ainsi que quelques contratsinnommés) Stæmpfli éditions SA, Berne, 2000, n° 6, p. 9.

5 Treated only in respect of the United Nations Convention on Contracts for the InternationalSale of Goods of 11 April 1980.