Preface Abbreviations Table of cases Table of legislation vii xxi xxix liii PART ONE Introduction 1 CHAPTER 1 THE EXTENT AND ROLE OF EUROPEAN CONTRACT LAW 3 1.1 European contract law 3 1.1.A Introduction 3 1.1.B Binding rules of European contract law 3 1.1.C Soft law 4 1.2 EU s current plans concerning European contract law 7 1.2.A Introduction 7 1.2.B Common frame of reference (CFR) 11 1.2.C The process of creating the common frame of reference 18 1.2.D The draft common frame of reference (DCFR) 22 1.2.E The optional instrument 25 1.2.F Europeanisation of contract law, a controversial enterprise 28 1.3 Constitutional issues of contract law 30 1.3.A Introduction 30 1.3.B The Four freedoms and contract law; ex post assessment 30 1.3.C Ex ante assessment of the free movement of goods 34 1.3.D Horizontal effect of the free movements 36 1.4 Private international law issues 36 CHAPTER 2 NOTIONS OF CONTRACT 39 2.1 Definitions of contract 39 2.1.A Agreements and unilateral juridical acts 40 2.1.B Gratuitous promises 43 2.2 Basic elements 44 2.2.A Agreement 45 2.2.B Intention to create legal relations 57 2.3 Synallagmatic or unilateral, onerous or gratuitous? 58 2.4 Contract and undertaking by unilateral promise 62 2.5 Binding nature of contractual obligations 64 2.5.A What it means to be bound by a contract 64 2.5.B Foundations of the binding force of contract 66 xi
2.5.C Historical background 70 2.5.D The theory of reliance 72 2.6 Conclusion 76 CHAPTER 3 THE PLACE, SOURCES AND SCOPE OF CONTRACT 77 3.1 The place and sources of contract law 77 3.1.A French Law 77 3.1.B German Law 80 3.1.C English law 83 3.2 The scope of contract 86 3.2.A Contract and property 86 3.2.B Contract and tort (or delict) 94 3.2.C Contract and restitution (quasi-contract, unjust enrichment) 121 3.2.D The scope of contract: concluding remarks 134 3.3 Contract and national constitutional law 136 CHAPTER 4 CATEGORIES OF CONTRACT 139 4.1 Consumer contracts 140 4.1.A The definition of consumer 142 4.1.B The place of consumer law 155 4.2 Business to Business and Commercial contracts 157 4.2.A English law 157 4.3 Private contracts 159 4.4 Administrative contracts 160 4.4.A French law: the administrative contract 160 4.4.B Administrative contracts in German law 163 4.4.C Administrative contracts under Dutch law 167 CHAPTER 5 ADDITIONAL REQUIREMENTS: CAUSE, CONSIDERATION AND FORM 169 5.1 The doctrine of cause 170 5.1.A General 170 5.1.B The classic applications of the cause 174 5.1.C New trends in French case law 179 5.1.D A Future for cause? A vivid debate in the French reform of contract 187 5.2 Consideration (and reliance) 189 5.2.A In General 190 5.3 German law and Dutch law: neither cause nor consideration 214 5.4 Form 215 5.4.A German law: moderate formalism, freedom as to proof 217 xii
5.4.B 5.4.C English law: limited formalism; rule of almost unrestricted production of evidence 225 French law: a certain formalism, means of proof legally circumscribed 232 PART TWO FORMATION 239 CHAPTER 6 OFFER AND ACCEPTANCE 241 6.1 Introductory note 241 6.2 Offer 242 6.2.A Distinction between preliminary dealings and offers to enter contract 242 6.2.B Revocability of an offer 263 6.2.C Lapse of offer 278 6.3 Acceptance 285 6.3.A Form of acceptance 285 6.3.B A requirement of communication? 292 6.3.C Acceptance that deviates from the offer 301 6.4 Rights of withdrawal 314 CHAPTER 7 SUFFICIENCY OF AGREEMENT 319 CHAPTER 8 INTENTION TO CREATE LEGAL RELATIONS 335 8.1 Informal arrangements 335 8.2 Agreement in honour, gentlemen s agreements 346 8.3 Letters of patronage or of comfort 351 8.4 Agreement in principle (accord de principe) 358 8.5 Conclusion 370 CHAPTER 9 PRE-CONTRACTUAL NEGOTIATIONS 371 9.1 Introduction 371 9.2 A general duty of pre-contractual good faith 372 9.3 Conduct contrary to pre-contractual good faith 376 9.3.A No intention to conclude a contract 376 9.3.B Parallel negotiations 378 9.3.C Breaking off negotiations 380 9.3.D Knowingly entering an invalid contract 418 9.3.E Duty of confidentiality 425 xiii
PART THREE FRAUD, ABUSE, IMMORALITY 427 CHAPTER 10 FRAUD, MISTAKE AND MISREPRESENTATION 429 10.1 General introduction 429 10.2 Fraud 432 10.2.A Fraud as a ground for avoidance of a contract 433 10.2.B Particular issues in fraud 434 10.2.C Damages for fraud 437 10.3 Mistake 441 10.3.A Mistake in general 441 10.3.B Mistakes and misunderstandings as to the terms 445 10.3.C Mistake as to the person 467 10.3.D Mistake as to the subject matter or circumstances 469 10.4 Non-disclosure 511 10.4.A Common law 512 10.4.B France 515 10.4.C Germany 519 10.4.D The Netherlands 527 10.5 Adaptation of contracts 527 10.6 Comparative summary: mistake and the international restatements 529 10.6.A The laws 529 10.6.B Duties to disclose: why such differences? 535 CHAPTER 11 THREATS AND ABUSE OF CIRCUMSTANCES 539 11.1 Introduction 539 11.2 Threats 541 11.2.A A physical compulsion as opposed to psychological pressure 542 11.2.B The means of compulsion 543 11.2.C Threat must be illegitimate 547 11.2.D Causation 556 11.2.E Serious and imminent threat 561 11.3 Laesio enormis 564 11.4 Abuse of circumstances and excessive benefit: qualified laesio enormis 570 11.4.A General Doctrines: continental law 570 11.4.B Specific doctrines: undue influence in English law 582 11.4.C Specific doctrines: unconscionability and other rules in English law 588 11.4.D An attempt at a general doctrine in English law 591 11.4.E International restatements 594 11.4.F Causation 595 11.5 Other abuse of circumstances 596 11.6 Threats or abuse of circumstances by third persons 598 xiv
CHAPTER 12 IMMORAL AND ILLEGAL CONTRACTS 607 12.1 Introduction 607 12.2 Conflicts with principles of sexual morality and family life 612 12.3 Contracts in restraint of trade 619 12.4 Contracts which involve prohibited conduct 635 12.5 Restitution of benefits conferred under an immoral or illegal contract 646 12.6 Compensation for loss caused by a contract which violated European law 655 PART FOUR INTERPRETATION AND SUPPLEMENTATION 665 CHAPTER 13 INTERPRETATION 667 13.1 Objective and subjective interpretation 668 13.2 Ambiguous clauses 674 13.3 Unambiguous clauses : literal and contextual interpretation 678 13.4 Preliminary negotiations 689 13.4.A Recourse to preliminary negotiations for the purposes of interpretation 690 13.4.B Recourse to preliminary negotiations in order to add to, vary or contradict a written contract 695 13.5 The contra proferentem rule 702 CHAPTER 14 THE PARTIES OBLIGATIONS: SALES AND SERVICES CONTRACTS 711 14.1 Introduction 711 14.1.A Default rules 711 14.1.B Nature of the debtor s obligation 718 14.1.C Relationship to impossibility of performance 719 14.2 Obligations to achieve a result and lesser obligations 721 14.2.A French law 721 14.2.B German law 725 14.2.C English law 727 14.2.D Conclusion on the nature of the debtor s obligation 728 14.3 Obligations in typical contracts 729 14.3.A Sale: the seller s obligations as to the kind and quality of the goods 729 14.3.B Contracts of carriage 736 14.3.C Construction contracts 737 xv
CHAPTER 15 SUPPLEMENTATION AND IMPLICATION OF TERMS 743 CHAPTER 16 UNFAIR CLAUSES 757 16.1 Introduction 757 16.2 Controls under the general law 759 16.2.A Incorporation tests 759 16.2.B Mispresentation etc 765 16.2.C Nature of the breach of contract 766 16.2.D Interpretation 771 16.2.E Good faith and public policy policing substance 775 16.3 Legislative controls 779 16.3.A Germany: BGB 782 16.3.B England: the Unfair Contract Terms Act 1977 and Unfair Terms in Consumer Contracts Regulations 1999 785 16.3.B France: The loi scrivener, the Code de la consommation and the 2009 Decree 789 16.4 Key issues in unfair contract terms legislation 793 16.4.A Consumers and non-consumers 793 16.4.B Negotiated and non-negotiated terms 797 16.4.C Blacklists and grey lists 798 16.4.D Core terms 805 16.4.E Fair, reasonable, in accordance with good faith 812 16.5 Public law controls 826 16.6 Concluding remarks 828 PART FIVE REMEDIES FOR NON-PERFORMANCE 831 CHAPTER 17 THE RANGE OF REMEDIES FOR BREACH OF CONTRACT 833 CHAPTER 18 LITERAL ENFORCEMENT 839 18.1 Introduction 839 18.2 Non-monetary obligations 840 18.2.A Introductory note 840 18.2.B The basic rules 840 18.2.C Making the defendant himself perform 848 18.2.D Performance by a third party 850 18.2.E Practical examples 852 xvi
18.2.F Comparative summary on basic rules and the international restatements 854 18.2.G Limitations on specific performance 855 18.3 Monetary obligations 887 CHAPTER 19 WITHHOLDING PERFORMANCE 893 19.1 Basic rules 894 19.2 The order of performance 900 19.3.A Introductory note 900 19.3.B Establishing the order of performance 900 19.3 Withholding because of defective or partial performance 902 19.4 Default can be anticipated 910 19.5 Non-performance of other contracts 912 CHAPTER 20 TERMINATION 915 20.1 Introduction 915 20.2 The meaning and nature of termination 916 20.3 Basic rules and the means of termination 920 20.4 The seriousness of the default 929 20.4.A French law 929 20.4.B English law 931 20.4.C German law 938 20.5 Termination for delay 944 20.6 Termination before performance is due 957 20.7 Agreed rights of termination 962 20.8 A last chance to perform 972 20.8.A Right to perform before due date 972 20.8.B Requirement of notice 973 20.8.C Court may give additional period for performance 975 20.9 Effects of termination 976 20.9.A The effect of termination on claims for damages for non-performance 976 20.9.B The effect on ancillary obligations 977 20.9.C Restitutionary claims 980 20.10 Loss of right to terminate 990 20.10.A Affirmation 990 20.10.B Lapse of Time 991 20.10.C Impossibility of Restitution 991 xvii
CHAPTER 21 DAMAGES 993 21.1 Introduction 993 21.2 The basic measure of damages for breach of contract 994 21.3 The requirement of notice 999 21.4 Restrictions on damages recoverable 1002 21.4.A Unforeseeable or indirect losses 1002 21.4.B The protective purpose of the norm 1011 21.4.C Losses which might have been avoided or reduced by the creditor 1015 21.4.D Contributory negligence 1020 21.4.E Non-pecuniary loss (prejudice moral) 1026 21.5 Some typical cases 1034 21.5.A A seller of goods fails to deliver 1034 21.5.B A debtor fails to carry out work correctly 1036 21.6 Plaintiff s loss or defendant s gain 1041 21.7 Agreed damages and forfeiture clauses 1051 21.7.A The validity of agreed damages clauses 1051 21.7.B Deposits and forfeiture clauses 1060 CHAPTER 22 LIABILITY AND REMEDIES FOR NON-CONFORMING GOODS 1067 22.1 Introduction 1067 22.2 Remedies 1068 22.2.A European law 1068 22.2.B English law 1069 22.2.C French law 1076 22.2.D German law 1080 22.2.E International restatements 1087 PART SIX SUPERVENING EVENTS 1091 CHAPTER 23 IMPOSSIBILITY OF PERFORMANCE 1093 23.1 Introduction to Part 6 1093 23.2 Impossibility 1094 23.3 French law 1095 23.3.A The definition of force majeure 1096 23.3.B Effects of force majeure 1101 23.4 German law 1102 23.5 English law 1106 23.5.A Frustration 1106 23.5.B Effects of frustration 1124 xviii
xix CONTENTS CHAPTER 24 HARDSHIP, IMPRÉVISION 1127 24.1 Introduction 1127 24.2 French law 1130 24.3 English law 1135 24.4 Recognition of the revising power: German law 1138 CHAPTER 25 CLAUSES DEALING WITH SUPERVENING EVENTS 1149 25.1 Introduction to hardship clauses 1149 25.2 Indexation clauses 1150 25.2.A Indexation clauses under English law 1151 25.2.B Indexation clauses under German law 1154 25.2.C Indexation clauses under French law 1158 25.3 Force majeure clauses 1163 25.4 Hardship clauses 1165 PART SEVEN THIRD PARTY CONSEQUENCES 1171 CHAPTER 26 CONTRACTS FOR THE BENEFIT OF THIRD PARTIES 1173 26.1 The general position 1173 26.2 Requirements for the conferral of a right on a third party 1181 26.2.A Agreement of the parties in general 1182 26.2.B Implied stipulations for another and contracts with protective effect for third parties 1189 26.3 Exemption clauses and other defences for the benefit of third parties 1250 26.4 Modification and revocation 1259 26.5 Defences available to the promisor 1261 26.6 Remedies available to the promisee 1262 CHAPTER 27 AGENCY 1265 27.1 The notion and the nature of agency 1265 27.2 The effects of agency 1269 27.2.A Disclosed agency 1269 27.2.B Undisclosed agency 1277 27.3 Agent acting ultra vires 1283 27.3.A Authority 1283 27.3.B Ratification 1287 27.3.C Termination of authority 1289 27.3.D Liability of agent 1290
CHAPTER 28 ASSIGNMENT 1293 28.1 Introduction 1293 28.2 Validity of assignment 1295 28.2.A Agreement 1295 28.2.B Formal requirements 1295 28.2.C Notice to the debtor 1296 28.2.D Further requirements 1303 28.3 Protection of the debtor 1315 28.3.A Notice to the debtor 1316 28.3.B Defences available to the debtor 1318 Index 1327 xx