Contract law: French law

Question 1

What is a contract under French law?

Answer 1

A Contract is an agreement by which people bind themselves to other people to give/do/not do something’.

Question 2

What conditions are needed for a valid contract? (4)

Answer 2

• Consent of the parties binding themselves.
• Their capacity to contract.
• Definite subject matter for the arrangement.
• Legitimate purpose for the binding obligation.

Question 3

What is a statement?

Answer 3

A statement is considered an offer if it is precise, definite and unequivocal. Any statement short of an offer cannot . be considered ‘an invitation to enter negotiations’.

Question 4

When does an offer lapse?

Answer 4

An offer will lapse if the fixed time for acceptance has run out, if the offerer dies or if the offeree replies with a counter offer. An offeree can sue an offerer if the offer is withdrawn before the fixed time.

Question 5

Why are tort and contract law not seen as completely different under French law?

Answer 5

They are two branches of the law of obligations. The cause of action (of what???) is considered non-contractual.

Question 6

How are acceptance, consideration and intention considered in French law?

Answer 6

No clear distinction as to whether sending or receiving letter of acceptance indicates acceptance. this is judged on a case-by-case basis. Consideration and intention to create legal relations are not considered in French law

Question 7

What is a “cause”?

Answer 7

‘Cause’ is the generalised motive behind a promise. Every contract is meant to be supported by one, however in practice this is not the case. Very few contracts are considered invalid in its absence. The function of ‘cause’ is to provide evidence of the transaction the parties had intended to enter. If their final agreement doesn’t match, the contract can be considered ‘sans cause’.

Question 8

What does Objet mean?

Answer 8

If the parties can’t agree on all the important terms of the contract, it cannot be said to exist. Like English need of certainty. If the ‘objet’ of the contract is illegal, courts will strike the whole agreement. Unlike English law, a promise made for already given goods/ services is as enforceable as an contract made for future goods/services.

Question 9

Third parties (3)

Answer 9

• One can bind only oneself/make promises on own behalf.
• Agreements can affect only the parties to them.
• One can make a promise to a 3rd party if this is the
  condition upon which something was promised to oneself

Question 10

Mistakes (8)

Answer 10

• French courts will assume a contract is valid unless a party can prove a defect in agreement.
• There is no valid agreement if consent is given by mistake or if it has been forced by duress/fraud. It is enough to prove mistake. Had a party been mistaken, they would have entered the contract.
• The contract cannot be void if a party can prove they had not expressly agreed to one of the terms of the contract.
• The thing the party was mistaken about should be the principal reason they agreed to the contract.
• Mistake should concern basic qualities of contract-object
• Mistake annuls agreement only if it relates to the very substance of the object of the agreement.
• Innocent misrepresentation/breach (contract law) or negligent misrepresentation (tort law) with be considered erreur.
• Mistakes can be compensated through damages to the non-mistaken party

Question 11

Duress (4)

Answer 11

• Violence is operative, though duress comes from a party not involved in the contract.
• Duress exists when it affects a reasonable person and to make them fear that they will be exposed to considerable and imminent risk.
• Also enough if duress is exercised on spouse or close relative of contracting party.
• Occasionally, economic duress is enough.

Question 12

Fraud (2)

Answer 12

• Fraud annuls an agreement whenever one party’s conduct makes it clear that, if the conduct had not occurred the other party would not have entered the contract. Not presumed but must be proven.
• Mere silence could constitute as fraud.

Question 13

Unfairness and illegality (3)

Answer 13

• Unfairness in a contract is not enough to justify recission.
• Inequality in exchanges are normal in contractual life.
• Lésion protects situations such as acceptance of legacy, contracts entered by minors, and sales of immovable property, from unfairness.

Question 14

1. When is a contract unlawful?
2. What is L’autonomie de la volonté?
3. What are obligations de sécurité and obligations de moyens?

Answer 14

1. If it is prohibited by statute or contrary to good practice or public policy.
2. It means that parties are free to agree whatever they like in contracts, as long as it is under public policy. Contracting parties cannot violate statutes which represent public policy and good practice.
3. French law doesn’t use the concept of implied terms. Obligations de sécurité and obligations de moyens are like conditions and warranties.

Question 15

Termination of a contract in french law

Answer 15

French law doesn’t use discharge of contract. No equivalent to idea of frustration. The french rely on an absence of ‘cause’. No compensation can be claimed if a contracting party has been prevented from giving/doing what they was obliged to, or has done something which they was prohibited from doing.

• Cause only covers cases of physical or legal impossibility. In absence of cause the other party is granted restitution.
• If there is no excuse for non-performance, the other party can refuse performance or ask for specific performance.
• If performance isn’t possible, damages are the remedy.
• If one party does something that they promised not to do, the other part can ‘destroy’ what has been done at the first party’s expense

Question 16

Consumer law:
Who is a consumer?

What rules do sellers have to follow? (3)

Answer 16

A consumer is someone who obtains goods/services for personal, not professional purposes.

All sellers are strictly liable for defects in the goods they sell, whether the buyer is a consumer or not. Consumers who buy from door-to-door salesmen have 7 days to change their minds. Deceitful advertising is prohibited. Consumer associations can take court action to defend consumer interests

Question 17

Give the facts, arguments and judgment of the ‘Cour d’Appel Versailles 7 January 1987’ case

Answer 17

Facts:
Family owned painting. Tradition lead them to believe it was by Poussin, famous French painter. Advised by an expert that it was by Carracci (worth less than a Poussin), only 1,500 francs. Sold to an art dealer for 2,200 francs as a Carracci. Museum bought it, displayed it as a Poussin. Family wanted to rescind contract due to mistake.

Arguments:
Family succeeded at first due to no meeting of minds: sought to sell a Carracci, museum sought to buy a Poussin. Court of appeal reversed decision, because mistake must be established on day of sale. Another appeal made because court hadn’t investigated whether consent of seller was affected by incorrect belief that painting could not be a Poussin. Court of appeal ruled against family. On day of sale, family had doubts as to whether painting was a Poussin. Forwarded to court of appeal of Versailles. Sale was annulled, family was refunded 2,200 francs. Later sold painting to different gallery for actual price, as it was a Poussin: 7,4 mio francs.

Justification of judgment:
Distinction must be made between mistake about incorrect financial value, and mistake of quality of ware. A mistake is only a mistake if it affects essential nature of the subject matter of a contract. In this case, it did.

Question 18

What is Erreur obstacle?

Answer 18

A mistake which prevents the existence of an agreement in the first place

Question 19

What is a recission?

Answer 19

Remedy which allows a contractual party to cancel the contract