Final Report Summary - LEGAL CULTURES (Differences in European Legal Cultures: A Study on Dispute Agreements As a Form of Private Regulation)
Project title : Differences in European legal cultures : a study on agreements as a form of private regulation
The project has enabled to uncover the potential of contract clauses as a European lingua communis. As such contract clauses are a tool useful to decipher differences in European legal cultures, if not foster a European legal culture.
The acquis is but a fragmentary and quite arbitrary set of rules. It must be recognised that there is considerable political momentum behind the task of transforming the legal framework surrounding contractual relations and giving it a new ambition. Are we getting there? Is the optional instrument the evidence that a European contractual culture has a emerged so that a piece of regulation may successfully, of course not embody such culture, but reflect it? Are there sufficient reasons to believe in the birth of a contractual Europe endowed with a shared discourse?
In the spirit of Gramsci, the optimism of the will has to be challenged with the pessimism of the intellect. In effect, in spite of the existence of a trophy draft piece of legislation, that is the proposal for a regulation on a common European Sales Law (COM (2011) 635 final), the culmination of two decades of preparatory work, barriers to a so called European contractual culture remain obvious. Ironically enough, they crystallise in particular and linguistic difficulties. These difficulties have existed since discussions on the harmonisation of contract law in Europe began: they relate to what we speak of and how and why we speak of it. More precisely, these longstanding barriers relate to the concept of 'contract' what are we speaking about? - and the legitimacy of a discourse on harmonisation of contract law who speaks ? These obstacles are really symptoms of a deep malaise. They must be taken seriously. And all the more so because they can be overcome as my project has demonstrated.
It is widely accepted that the establishment of a common language, a lingua communis, is an indispensible first step in the formation of any culture. Our point is that as far as legal culture is concerned, contract terms would be the fit common language.
How should we approach the process of elaborating segments of the common contractual language? Clauses form the basic vocabulary of the drafter of contracts once essential elements have been defined. This is true, wherever in Europe the drafter may find himself. Without dwelling on the enforceability of the different stipulations here or elsewhere, we can classified this common raw material.
In spite of their apparent diversity, it is possible to rationalise our approach by distinguishing families of clauses. This method consists of identifying families of clauses that exercise the same function because, consequently, they create risks of the same nature and therefore call for legal safeguards of the same sort.
In other words, to classify the alphabet of contractual clauses, we need to draw a distinction between the agreed performance and the contractual relationship. Some clauses relate to what is bargained for; others relate to the relationship between the parties. In other words, some define the bargain, others, define the relationship either over time or in the event of a dispute. This bottom-top approach leads us to the conclusion that there are three functions of contractual clauses and, therefore, an equal number of clause-types in written contracts.
First type: bargain clauses. These define undertakings and the remedies expected in case of violation (for example, interpretation, force majeure, entire agreement clauses, etc). Second type: power clauses. These allocate a unilateral power to modify the contract to one of the parties (such as termination, unilateral price determination, veto clauses, etc). Third type: dispute clauses. These define methods of dispute resolution (for instance arbitration, jurisdiction clauses, etc).
This systematic approach by function and type is not only a presentation tool. Each classification implies differences in terms of legal regime as each category necessarily follows specific rules. Following a rational line of reasoning, we draw the following implications, at an abstract level. Bargain clauses shall only be enforceable if the bargain they provide for is licit, if it is not in breach of social values, self-contradictory or inconsistent. Power clauses shall effectively be relied upon on the condition that the power they grant is neither misused nor exercised with disloyalty. Dispute clauses have to abide by procedural requirements.
This is an ordered but empty framework. It enables us to decipher the abstract standards that, without a doubt, build a common European contractual culture. We need however to fill in the gap by fleshing out these standards. Such could be the role scholars. Thanks to the proposed framework, comparative law discussions will be more focused and harmonisation will come from the bottom up.
To summarise, the proposed method relied first upon a dogmatic approach in order to extract the theoretical demands that must be met in order for clauses to be enforced. The cipher we used in this phase to decode these demands is rational in nature. And what do all European legal cultures have with certainty in common? It must be the centrality of the ratio. The ratio is a source of foreseeability, which is indispensable to justice, hence to every legal culture, even though it is not necessarily its sole component. According the 'gift of reason' a central role in determining what is just and fair transcends the classically defined idealist and positivist schools of thought, as well as common law and civil law. Logically as each contractual clause potentially gives rise to certain risks, therefore a solution that does not avoid these risks cannot be considered just.
The project has enabled to uncover the potential of contract clauses as a European lingua communis. As such contract clauses are a tool useful to decipher differences in European legal cultures, if not foster a European legal culture.
The acquis is but a fragmentary and quite arbitrary set of rules. It must be recognised that there is considerable political momentum behind the task of transforming the legal framework surrounding contractual relations and giving it a new ambition. Are we getting there? Is the optional instrument the evidence that a European contractual culture has a emerged so that a piece of regulation may successfully, of course not embody such culture, but reflect it? Are there sufficient reasons to believe in the birth of a contractual Europe endowed with a shared discourse?
In the spirit of Gramsci, the optimism of the will has to be challenged with the pessimism of the intellect. In effect, in spite of the existence of a trophy draft piece of legislation, that is the proposal for a regulation on a common European Sales Law (COM (2011) 635 final), the culmination of two decades of preparatory work, barriers to a so called European contractual culture remain obvious. Ironically enough, they crystallise in particular and linguistic difficulties. These difficulties have existed since discussions on the harmonisation of contract law in Europe began: they relate to what we speak of and how and why we speak of it. More precisely, these longstanding barriers relate to the concept of 'contract' what are we speaking about? - and the legitimacy of a discourse on harmonisation of contract law who speaks ? These obstacles are really symptoms of a deep malaise. They must be taken seriously. And all the more so because they can be overcome as my project has demonstrated.
It is widely accepted that the establishment of a common language, a lingua communis, is an indispensible first step in the formation of any culture. Our point is that as far as legal culture is concerned, contract terms would be the fit common language.
How should we approach the process of elaborating segments of the common contractual language? Clauses form the basic vocabulary of the drafter of contracts once essential elements have been defined. This is true, wherever in Europe the drafter may find himself. Without dwelling on the enforceability of the different stipulations here or elsewhere, we can classified this common raw material.
In spite of their apparent diversity, it is possible to rationalise our approach by distinguishing families of clauses. This method consists of identifying families of clauses that exercise the same function because, consequently, they create risks of the same nature and therefore call for legal safeguards of the same sort.
In other words, to classify the alphabet of contractual clauses, we need to draw a distinction between the agreed performance and the contractual relationship. Some clauses relate to what is bargained for; others relate to the relationship between the parties. In other words, some define the bargain, others, define the relationship either over time or in the event of a dispute. This bottom-top approach leads us to the conclusion that there are three functions of contractual clauses and, therefore, an equal number of clause-types in written contracts.
First type: bargain clauses. These define undertakings and the remedies expected in case of violation (for example, interpretation, force majeure, entire agreement clauses, etc). Second type: power clauses. These allocate a unilateral power to modify the contract to one of the parties (such as termination, unilateral price determination, veto clauses, etc). Third type: dispute clauses. These define methods of dispute resolution (for instance arbitration, jurisdiction clauses, etc).
This systematic approach by function and type is not only a presentation tool. Each classification implies differences in terms of legal regime as each category necessarily follows specific rules. Following a rational line of reasoning, we draw the following implications, at an abstract level. Bargain clauses shall only be enforceable if the bargain they provide for is licit, if it is not in breach of social values, self-contradictory or inconsistent. Power clauses shall effectively be relied upon on the condition that the power they grant is neither misused nor exercised with disloyalty. Dispute clauses have to abide by procedural requirements.
This is an ordered but empty framework. It enables us to decipher the abstract standards that, without a doubt, build a common European contractual culture. We need however to fill in the gap by fleshing out these standards. Such could be the role scholars. Thanks to the proposed framework, comparative law discussions will be more focused and harmonisation will come from the bottom up.
To summarise, the proposed method relied first upon a dogmatic approach in order to extract the theoretical demands that must be met in order for clauses to be enforced. The cipher we used in this phase to decode these demands is rational in nature. And what do all European legal cultures have with certainty in common? It must be the centrality of the ratio. The ratio is a source of foreseeability, which is indispensable to justice, hence to every legal culture, even though it is not necessarily its sole component. According the 'gift of reason' a central role in determining what is just and fair transcends the classically defined idealist and positivist schools of thought, as well as common law and civil law. Logically as each contractual clause potentially gives rise to certain risks, therefore a solution that does not avoid these risks cannot be considered just.