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PROMISE: THE NEGLECTED OBLIGATION IN EUROPEAN PRIVATE LAW

Published online by Cambridge University Press:  14 May 2010

Martin A Hogg
Martin A Hogg
Affiliation:
Dr Martin A Hogg, The School of Law, University of Edinburgh. Email: [email protected].
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Abstract

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Type
Shorter Articles, Comments and Notes
Information
International & Comparative Law Quarterly , Volume 59 , Issue 2 , April 2010 , pp. 461 - 479
Copyright
Copyright © 2010 British Institute of International and Comparative Law

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References

1 Aristotle equates truth-telling with promising: see Nicomachean Ethics iv, vii, 1127a–1127b.

2 There is an abundance of references to promise keeping in both the Old and New Testament, as well as references to the related (though not equivalent) practice of oath-making. There is frequent citation of scriptural references to promises by the Natural Law School in their writings.

3 Of primary importance are certain passages in both the Decretum (including D.23 c.6, C.22 q.2 c.14, and C.22, q.5, c.12) and the Decretals (including Sext 2.2.3, Sext 2.11.2, and Gregor IX, 1.35.1, 1.35.3) enjoining adherence to promises and founding ecclesiastical jurisdiction in promissory cases.

4 See especially the writings of the late Scholastics Leonard Lessius, Luis de Molina, Thomas Cajetan, and Franciscus Connanus.

5 See D Hume, A Treatise of Human Nature (Printed for John Noon, London 1739–1740) III,ii,5.

6 The replacement of promise by contract as the central obligation can probably be traced to the scheme of Samuel Pufendorf, of the Northern Natural Law School: see the treatment of both contract and promise in his Elementorum Jurisprudentiae Universalis (at I,xii) and his more famous De Iure Naturae et Gentium (III,iv f).

7 See PS Atiyah, Promises, Morals and Law (Clarendon Press, Oxford 1981), passim, and Essays on Contract (Clarendon Press, Oxford 1986) especially ch 2.

8 The distinction between unilaterality and bilaterality, both as describing the nature of the juridical act as well as the number of parties upon whom duties are imposed, is widely recognised in civilian systems, as well as in mixed systems such as South Africa and Louisiana. See, for instance, the Louisiana Civil Code, which has provisions relating to juridical acts (art 28) as well as to defining types of contract, including unilateral contracts (art 1907), bilateral contracts (art 1908), onerous contracts (art 1909) and gratuitous contracts (art 1910).

9 For the history of rise of the action of assumpsit, including its transformation from promissory to contractual nature, see D Ibbetson, A Historical Introduction to the Law of Obligations (OUP, Oxford 2001) ch 7.

10 See further W D H Sellar, ‘Promise’ in K Reid & R Zimmermann (eds), A History of Private Law in Scotland (OUP, Oxford 2000) vol 2, ch 10.

11 Requirements of Writing (Scotland) Act 1995, s1(2)(a)(ii).

12 See §145 BGB, together with §148 (concerning time limits).

13 This is my own translation of von Kübel's original German text, which reads: ‘Das einseitige Versprechen als Grund der Verpflichtung zum Worthalten (Vertragsantrag)’ (von Kübel, in Werner Schubert (ed), Die Vorlagen der Redaktoren für die erste Kommission zur Ausarbeitung des Entwurfs eines Bürgerlichen Gesetzbuchs, Recht der Schuldverhältnisse, (De Gruyter, Berlin 1980) vol 3, s 1145 f).

14 See the decision of the California Supreme Court in Drennan v Star Paving Company 333 P 2d 757 (Cal 1958).

15 II-4:202(1).

16 II-4:202(3)(b).

17 At least offer as conceived generally in English and Scots Law.

18 §145 BGB.

19 See Lord Diplock in Sudbrook Trading Estate Ltd v Eggleton [1983] 1 AC 444 (HL), 477A-B.

20 For a case of an option conceived of as a firm offer see Hamilton v Lochrane (1899) 1 F 478 (CSIH).

21 Requirements of Writing Act (Scotland) 1995, s 1(2)(a)(i).

22 Stone v Macdonald 1979 SC 363 (CSOH).

23 Though there is passing reference in IX.-1.103 to the option of a lessee to buy leased goods at the expiry of the lease, though without indicating how the nature of such an option is conceived.

24 II-1:103(2): ‘A valid unilateral undertaking is binding on the person giving it if it is intended to be legally binding without acceptance.’

25 NJW 2002, 363.

26 In fact, in a similar case from 2005, the BGH expressed the view that the seller had made the offer, and the buyer the acceptance when it submitted the highest bid: BGH JZ 2005, 464; NJW 2005, 53.

27 [1986] AC 207 (HL).

28 The facts of Harvela were not quite the same as the example, as in Harvela what invalidated the seemingly higher bid was not its late submission but the fact that it was a referential bid, something which the House of Lords held was not permitted under the bidding process envisaged by the seller.

29 This is an unusual analysis of a contract bidding process, as usually those bidding for a contract are seen as making offers, with the party inviting the bids then accepting (or not) one of them. But in such a normal case, the party inviting bids has the discretion which, if any, to choose to accept, a discretion which had been excluded in Harvela.

30 See the speech of Lord Diplock [1986] AC 207, 224.

31 The analysis of transformation from unilateral to bilateral contract is identical to that said to apply in options contracts, the judge providing this analysis in Harvela being the same Lord Diplock who gave judgment in the options case of Sudbrook Trading (n 19).

32 The previously uncodified doctrine of culpa in contrahendo now finds a place in the BGB, in §311(2).

33 [1990] 1 WLR 1195 (CA), [1990] 3 All ER 25.

34 In the Blackpool case the undertaking which the defendant had breached was in fact an implied undertaking, rather than an express one, a feature which might have caused difficulties for the Scots promissory analysis, given that it has traditionally been the position in Scots law that promises are construed strictly. It would thus be unusual in Scotland to imply a promise of one nature from an express promise of a different nature made by the promisor.

35 For service contracts see §§611–630, for work contracts §§631–651, and for contracts to transact business §675. For a recent judgment demonstrating that an offer of reward to a specific person is also unlikely to be viewed as a donation, but rather as consideration for the offeree's efforts in trying to bring about the desired state of affairs, see BGH judgment of 28 May 2009—Xa ZR 9/08 (LG Potsdam).

36 Which, according to §145, cannot be revoked unless power to do so has been reserved by the offeror.

37 Carlill v Carbolic Small Ball Co [1893] 1 QB 256 (CA).

38 There is no English case clearly setting out this view, though it would seem to follow from the general principles applicable to acceptances. For an Australian case adopting this view, see R v Clarke (1927) 40 CLR 227 (High Court of Australia); to similar effect, see the South African case of Bloom v American Swiss Watch Co (1915) AD 100 (Appellate Division).

39 No decision of the courts definitively sets out this view, though the comments of Denning LJ in Errington v Errington [1952] 1 KB 290 (CA), 295, support it. For a discussion of the issues, see E Peel, The Law of Contract (London: Sweet & Maxwell, 2007) 41–43.

40 See Requirements of Writing (Scotland) Act 1995, s1(2)(a)(ii).

41 Hunter v General Accident Corp 1909 SC 344 (CSIH), affd 1909 SC (HL Sc) 30; Hunter v Hunter (1904) 7 F 136 (CSIH).

42 The term is encountered in Scots law, and derives etymologically from Roman law's acceptilatio, which was an oral form of the dissolution of an orally constituted obligation.

43 The topic of implied renunciation brings in issues of promissory estoppel or personal bar which are not the main focus of the present discussion, though promissory estoppel will be mentioned in passing in the discussion of English law.

44 It has been argued that it is possible to conceive of rare cases where release of a debtor from an obligation may make the debtor worse off overall, so that he will wish to be able to refuse the ‘benefit’ of such a release, though it is hard to imagine what the facts of such cases might be. More conceivably, a debtor may have a moral reason for not wishing to be released from his debts, that being that he holds it consistent with honesty and good faith that he discharges in full all duties he has contracted.

45 There must necessarily be exceptions to any policy favouring such contractual symmetry: termination for breach, for instance, is clearly an asymmetric juridical act (though even here one might assert of a sort of symmetry by virtue of the presence of the other party's wrongful act of breach).

46 There are some further more specific provisions on renunciation elsewhere in the BGB, such as §533 concerning waiver of the right to revoke a donation, §658 on waiver of the right to revoke a public offer of reward, and various provisions on the waiver of inheritance rights.

47 See J Kleinschmidt, Der Verzicht im Schuldrecht (Mohr Siebeck, Tübingen, 2004). Kleinschmidt's argument has generated support from the following (among others): R Zimmermann, AcP 202 (2002), 243, 270; G Schulze, in Antwaltkommentar zum BGB (Deutscher Anwaltverlag, Bonn 2005) vol 1, §§145–147, fn 15; Hans Stoll, ZEuP 2007, 396, 398; E A Kramer, in Münchener Kommentar zum Bürgerlichen Gesetzbuch (5th edn, Beck Juristischer Verlag, Munich 2006) vol 2, Einleitung fn 55.

48 Opponents have taken the view that his argument stretches the plain meaning of the text of the BGB: see Volker Rieble, in J von Staudingers (ed), Kommentar zum Bürgerlichen Gesetzbuch (rev edn Sellier, Munich 2005) §397, fn 5.

49 For instance, Sir John Comyns, A Digest of the Laws of England (4th edn printed for A Strachan, London, 1800), notes (127) the case of Lynn v Bruce 2 H Bl 317 (CP), in which a declaration had been made by A that he had, at B's request, agreed to accept from B a composition of so much in the pound upon a certain sum of money owing by B in full satisfaction and discharge of B's debt. It was held that B's promise to pay this composition was not a good consideration to support an assumpsit against B, and that ‘upon an accord, which this is, no remedy lies’ (per Lord Chief Justice Eyre).

50 See Ibbetson (n 9) 240, and cases cited there.

51 See Foakes v Beer (1884) 9 App Cas 605 (HL), and Re Selectmove [1995] 1 WLR 474 (CA).

52 The latter interpretation would not strictly qualify as a renunciation of rights, but merely as an undertaking that the promisor was forbearing to exercise the rights either permanently or for some period of time.

53 For instance: the right of ownership over property may be renounced unilaterally, the effect being that the property affected is held to be abandoned, ownership passing to the Crown; a right to claim damages for a delict may be renounced by unilateral act.

54 A concern which looks contrived since the general recognition of third party rights in contract by virtue of the Contract (Rights of Third Parties) Act 1999.

55 In the Principles of European Contract Law, a renunciation is treated as a unilateral promise of the type allowed for in art 2:107.

56 Codice Civile art 1236, which provides that the renunciation does not take effect if the debtor states within a reasonable period of time that he does not wish to profit from the renunciation.

57 The BGB definition of donation is found in §516(1).

58 For mandate see §662 f, for loans for use see §598, and for gratuitous deposits see §690.

59 §518(1).

60 §518(2).

61 If, however, notarisation of both parties' declarations was required by another provisions, as for instance with land contracts, then that requirement would have to be met.

62 As for the irrevocable nature of offers in German law, see §145 BGB.

63 §§518(1), 780 BGB.

64 A position established early on, in Joscelin v Shelton (1557) 3 Leon 4 (KB), the earliest English judgment in which there is a reference to the concept of consideration.

65 Shadwell v Shadwell [1860] 9 CBNS 159, 142 ER, 3 LT 628 (CP).

66 The requirements for a valid deed are found in the Law of Property (Miscellaneous Provisions) Act 1989, s 1.

67 Book IV.H.

68 IV.H.-1:104.

69 PECL art 2:107.

70 PECL art 1:107.

71 II-1:103(1).

72 II-1:103(2).

73 J Dalrymple (Viscount Stair), The Institutions of the Law of Scotland (Edinburgh and Glasgow University Presses, Edinburgh and Glasgow 1981, being a reprint of the 2nd edition of 1693) I.x.4.