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Choice Of Law In Contract Under The Rome Convention: The Approach Of The Uk Courts

Published online by Cambridge University Press:  17 January 2008

Jonathan Hill
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Abstract

The core provisions of the Rome Convention on the law applicable to contractual obligations are deceptively simple: a contract is governed by the law chosen by the parties (Article 3(1)); to the extent that the parties have not made a choice, a contract is governed by the law of the country with which it is most closely connected (Article 4(1)). However, within these provisions there are a number of problems. First, Article 3 provides that the parties’ choice may be either express or ‘demonstrated with reasonable certainty from the terms ofthecontract or the circumstances of the case’. This gives rise to potentially difficult questions about what constitutes an express choice and uncertainty as to the dividing line between, on the one hand, cases where the parties have made a choice (albeit not an expressone) and, on the other, cases where the parties have not made a choice at all. Secondly, the general principle in Article 4 is supplemented bya presumption (in paragraph 2), 1 which may, incertain circumstances, be disregarded (under paragraph 5). The operation of the presumption is problematic and the relationship between Article 4(2) andArticle 4(5) controversial.

Type
Articles
Information
International & Comparative Law Quarterly , Volume 53 , Issue 2 , April 2004 , pp. 325 - 350
Copyright
Copyright © British Institute of International and Comparative Law 2004

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References

1 While the presumption in para 2 applies to most contracts falling within the Rome Convention's scope, there are special presumptions in cases involving contracts relating to a right in immovable property or a right to use immovable property (Art 4(3)) and contracts for the carriage of goods (Art 4(4)). There are also separate provisions dealing with certain consumer contracts (Art 5) and individual contracts of employment (Art 6).Google Scholar

2 The Act applies to contracts concluded after 1 Apr 1991.Google Scholar

3 The most significant English decisions in the decade following the enactment of the 1990 Act were Bank of Baroda v Vysya Bank [1994] 2 Lloyd's Rep 87, Egon Oldendorffv Libera Corporation [1995] 2 Lloyd's Rep 64; [1996] 1 Lloydapos;s Rep 380, Credit Lyonnais v New Hampshire Insurance Co [1997] 2 Lloyd's Rep 1 and Gan Insurance Company Limited v Tai Ping Insurance Company Limited ]1999] ILPr 729. The major Scottish decision from the 1990s was William Grant & Sons International Ltd v Marie Brizard Espana SA, 1998 SC 536.Google Scholar

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