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The American Restatements of the law have become a major textual authority of the American common law. Today, large parts of the law have been restated, and the Restatements are taken by the participants to the legal discourse as a valid expression of the law. This chapter shows that the American restatement approach has also influenced the developments of transnational restatements of the law. The International Institute for the Unification of Private Law (UNIDROIT) has largely applied the terminology and formal style of the American Restatements for its Principles of International Commercial Contracts; and a similar approach was taken, on the European level, by the Lando Commission on European Contract Law. Today, the Restatements' formal style is used by the Study Group on a European Civil Code and by the Acquis Group, the main non-legislative actors in the current political process of unifying European private law.

More than by any other component of the reform process, the face of the German Civil Code (BGB) has been changed by the incorporation of a number of special statutes aiming at the protection of consumers. The draftsmen of the new law have thus made an effort to streamline, or harmonise, general contract law and consumer contract law. While it had been on the initial reform agenda of 1978, it had no longer been part of the brief of the Commission charged with the reform of Germany's law of obligations. The incorporation into the BGB of the special legislation concerning consumer protection was not required by any fiat on the European level. The issue is very much on the agenda mapped out by the action plan for a more coherent European contract law and it also still has to be considered by the draftsmen of the Principles of European Contract Law who, while providing a blueprint for general contract law, have so far failed to take account of the acquis communautaire in the field of consumer contracts.

Experts in contract law from different Member States have drafted two volumes of Principles of European Contract Law, which are based on ‘rules’ contained in the contract laws of the EU Member States. But contrary to the (unformulated) principles referred to in Article 288(2) EC, they are worded in very precise terms, and structured and numbered in the same way as articles are in a ‘civil code’. This chapter argues that the aforementioned Principles of European Law are rules, not principles. Moreover, taken together they form a fully fledged European Code of Contract Law — or, more appropriate, it would seem, a European Contract Law Act.

Chapter 4 details the beginnings of the debate about European contract law, showing that discussion as to the approximation of private law in Europe began even before the founding of the European Communities in the 1950s. The contract law debate has since then evolved particularly through the following three interlocking elements: first, the work of certain academic projects (the Commission on European Contract Law, the Study Group on a European Civil Code, and the Network of Excellence); secondly, the European Parliament’s early resolutions; and thirdly, the European Council’s Tampere Conclusions, with primary focus placed on exploring their impact on the constitutional assessment of European contract law.

So long as contracts are observed according to their terms there is little call for the law to intervene. Problems arise when a party fails to perform. This situation is known in both Scottish and South African law as ‘breach of contract’ although the term ‘non-performance’ is preferred by the Principles of European Contract Law. This chapter considers how the main problems thrown up by breach of contract have been solved in the two jurisdictions. In neither jurisdiction has the legislature provided much assistance. In both there has been a certain mixing of civil law and English law influences, combined, most importantly, with continuing attempts to make and keep the law functional and just. The solutions devised by the judges are compared with the quasi-legislative solutions of the Principles of European Contract Law.

The European Commission was able to publish a Communication regarding European contract law in July 2001 that presented four alternatives for taking on Community policy. Such options involve the following: 1) letting the market forces act on contract law; 2) advocating contract principles that are non-binding; 3) improving legislation, specifically consumer law; and 4) implementing binding and comprehensive legislation at the Community level. While a majority opposed the fourth option, the majority supported the third option while private stakeholders moved that the second option be imposed. As the Council emphasized the need for improving the then present acquis communautaire, the Commission released a new Communication in 2003 that advocated a common frame of reference and also presented two proposals — promoting the drafting of standard contract terms for the EU and the drafting of an optional code.

This book explores the interactions between a European contract law instrument and national legal systems, using English law and German law as examples. This introductory chapter sets out the background to the enquiry and the methodology employed. The first part gives an overview of the ‘European contract law initiative’, which has resulted in various drafts for a European contract law regime, culminating in the two instruments: the European Commission's Proposal for a Regulation on a Common European Sales Law of October 2011 and one of its precursors, the 2009 Draft Common Frame of Reference. The second part describes the Anglo-German research project which led to the present book.

Several questions arise that concern the scope of available competence that is covered by European private law. While it is specified in Article 5(1) EC that the EC functions only within the bounds that are set by the founding Treaties, there is no legislative competence that addresses the issues in the particular field of private law. The constitutional landscape is said to be enriched in practice by the competence given by the EC Treaty to impose harmonization. However, certain issues have to be addressed that would not just assess legislative practices imposed in the past, but contemplate what may be adopted in the future of European contract law as well. This chapter attempts to examine the constitutional aspects of European private law, while drawing attention specifically to patterns of legislative harmonization.

Before the revision of Germany's law of obligations it had been, for a long time, a standard complaint that the rules concerning breach of contract were far too complex. Moreover, they were taken to be deficient in several important respects. They were based on a classification of various types of breach, that is, impossibility of performance, delay of performance, and defective performance, rather than structured according to the various remedies available. Central to the understanding of the system, so it was said, was a highly artificial concept of impossibility of pandectist vintage. Moreover, the German Civil Code was thought to be characterised by an axiomatic adherence to the outdated fault principle. This chapter discusses the development of German law and remedies for non-performance from the vantage point of the broader European debate that has led to the formulation of the Principles of European Contract Law.

The Principles of European Contract Law constitute the most advanced, and internationally most widely noted, project on the way towards a harmonisation of contract law in Europe. These Principles are designed to facilitate cross-border trade within Europe by making available a set of neutral rules, detached from the peculiarities of any national legal system, to which parties can subject their transactions. In a longer-term perspective, the Principles can be seen to provide a conceptual and systematic infrastructure for community legislation concerning contract law; at the same time, they can even be taken to constitute a first step on the way towards a European Civil Code. By intellectually relating the national laws and the Principles to each other, legal scholarship can create an awareness of the Principles as a model for legislative reform and as a guideline for judicial interpretation of the law. The present chapter on prescription law in Germany has been written in this spirit. Special prescription rules of very considerable practical significance are contained in sections 438, 634 a of the German Civil Code. They relate to claims arising from liability for non-conformity under contracts of sale or contracts for work.

This chapter examines the issue of threats and excessive benefits or unfair advantage under European contract law. It evaluates the proposition that many of the solutions found by the draftsmen of the Principles of European Contract Law (PECL) have been anticipated in the mixed systems of South Africa and/or Scotland, and analyses the laws of contract of these systems from a comparative perspective. The chapter argues that mixed systems and PECL could benefit from reconsidering their refusal to assist weak parties by making use of presumptions of impropriety.

This chapter explores the law of agency in relation to European contract law. It explains that agency is often considered to be more properly part of commercial rather than contract law and evaluates the extent of English influence which has operated on contract law in Scotland and South Africa. The chapter discusses the innovations in English law contained within the Principles of European Contract Law (PECL), and how useful those might be for Scots and South African lawyers. It argues that the PECL framework for indirect representation and apparent authority is likely to be acceptable to Scots and South African lawyers, and that it is clear that the Common Law has been highly influential in the modelling of the PECL provisions.