A Uniform European Law of Contracts: Why and How?

8 Colum. J. Eur. L. 487 (2002)

Friedrich Blase. Revised from an address given at the annual Ph.D. Award Ceremony of the Westfälische Wilhelms-Universität Münster on November 2, 2001.

“Sexy” is not the word one usually uses to describe a legal topic. But in the past two years the general public and relevant professional circles considered sexy anything that involved communication, e-commerce and the New Economy. This madness even entered the esteemed realm of I egal research. T raining programs at universities had to focus on telecommunication if they were to stand a chance with potential students. Whoever turned to governments or foundations for support on a research project was best advised to place it on the Internet and call it an interactive teaching tool. The basics, traditions and t he known were out of bounds! To think about contract law, and then only in a. European context, would not have caught the attention of any of the service-worshipping puritans in this globalized and interconnected world.

How grateful I am that this apparent revolution, this proclaimed paradigm shift, proved to be not much more than the irregular heartbeat of a giant! Otherwise the topic of my essay would be as exciting as cold coffee. Instead, I now have the chance either to actively rock you to sleep or, much preferred, to excite you about a fundamental matter: the unification process of European contract law.

What is European contract law? The range of contract law extends from the simple wine auction case, which is renown among German first-year law students, to the complex network of contracts drafted in relation to the construction and operation of a nuclear power plant. The unification process is divided into two parts. The first concerns those legal issues common to all contracts: contract formation scenarios, grounds for invalidity, performance of duties, defects in performance and their remedies, such as avoidance and damages. The second part of the unification process concerns the special questions of particular contract types, such as the particularities of a simple sales contract or the special issues of financing, operating, supplying, and maintaining a nuclear power plant.

The term “European” does not refer to all of Europe, but only to the European Union with its current fifteen Member States. Since October 1999, however, the EU has been negotiating membership with Cyprus, the Czech Republic, Estonia, Hungary, Poland, Bulgaria, Lithuania, Malta, Romania and the Slovak Republic. So if we were to include t hese potential new members, we would b e talking a bout a European Union that covers almost all states between Finland and Gibraltar as well as Ireland and Lithuania (with the notable exception of Switzerland). The term “European” therefore seems justified.

Is the idea of the unification of European contract law just a fashion trend? The answer, of course, which I will argue through a good and deep look into history, is “No!”

Accompany me first to the beginning of the last millennium. In Renaissance Europe academic education awakens to the rediscovery of Roman law. In the universities of Bologna, Salamanca, Oxford, Prague and Cologne, academics investigate the Corpus Iuris, a collection of Emperor Justinian’s laws, as well as the decretals of Popes. Latin, the common language, is the catalyst for an exchange of ideas that spans across the entire continent. This includes the British Isles, in part because in 1066 William the Conqueror brought, along with his soldiers, the Catholic church and its laws to England. On the basis of the Roman and Canon law, a pan-continental law is established, the so called ius commune. It does not apply exclusively, but rather in conjunction with local law. Pluralism of legal sources was thus daily business. The students of medieval times would probably laugh at our distress over EU-law, federal law, state law and local law!

During the Age of Enlightenment, the law is modernized. For the first time, general legal principles common to all contracts, such as the standards of good faith and fair dealing, are developed. But already the Westphalian Peace Treaty of 1648, which ends a 30-year pan-continental war, indicates the beginning of the concept of the national state. The rise of national laws that follows-the French Civil Code in 1805, the Common Civil Code of the Austro-Hungarian Empire in 1811 and, later, the German Civil Code in 1900-marks the end of the ius commune and the beginning of an age that Rudolph von Ihering contemptuously referred to as “the era of state jurisprudence.”

Only the foundation of the European Community in the second half of the last century managed to halt the drifting apart of the national contract laws and to establish among them fragile cords of connection. At the end of the 1970s, after a limited attempt t o align t he contract Iaw o f t he E C countries, t he C ommission o n European Contract Law was founded by Danish law professor Ole Lando. The Commission included legal scholars from all Member States of the European Union, who diligently undertook the task of drafting a set of general rules of European contract law.