7 - Interpretation

Summary

INTRODUCTION

Given the statement in the Introduction to PECL to the effect that one of the benefits offered by them “is to provide a bridge between the civil law and the common law” it is of some interest, particularly for those from so-called “mixed systems” like Scotland and South Africa, to try to detect major influences on parts of PECL. Are the PECL rules predominantly Civil Law, predominantly Common Law, or “mixed”? I will therefore consider the PECL rules on interpretation from this point of view before turning to what are for me more interesting questions – namely whether the PECL rules on interpretation are acceptable rules, and how they compare with the rules in Scottish and South African law.

THE PECL RULES: CIVIL LAW, COMMON LAW OR MIXED?

The PECL rules

The PECL rules for the interpretation of contracts are to be found in Chapter 5. The more general rules are in Articles 5:101 and 5:107 PECL. Article 5:101 provides that

1. (1) A contract is to be interpreted according to the common intention of the parties even if this differs from the literal meaning of the words.

2. If it is established that one party intended the contract to have a particular meaning, and at the time of the conclusion of the contract the other party could not have been unaware of the first party's intention, the contract is to be interpreted in the way intended by the first party.

3. (3) If an intention cannot be established according to (1) or (2), the contract is to be interpreted according to the meaning that reasonable persons of the same kind as the parties would give to it in the same circumstances.