Hardship in German Codified Private Law: In Comparative Perspective to English, French and International Contract Law
European Review of Private Law (ERPL), Vol. 15, pp. 483-513, 2007
34 Pages Posted: 12 Dec 2008 Last revised: 12 Jan 2010
Date Written: 2007
This article analyzes the German, English and French law if and how contracts can be terminated or amended in response to unforeseen events. In addition, it describes the solutions in the UN Convention on Contracts for the International Sale of Goods (CISG), the Principles of European Contract Law (PECL) and the UNIDROIT Principles on International Commercial Contracts. The starting point of this article is German law with its doctrine of Stoerung der Geschaeftsgrundlage established by the courts in the 1920's and recently codified in paragraph 313 BGB. The new provision requires a fundamental change in circumstances upon which a contract was based and that it is unreasonable to hold the party bound to its (unchanged) duty. The article then stresses some parallels to the English frustration law, though English Courts have no power to revise the contract, whereas this is the primary remedy in German law. Taking French law into account, which still rejects the concept of imprevision, English law is thus placed between the Germanic and Romanic legal solutions. French law only knows force majeure which officially results in tout ou rien, though there is some trend towards accepting an "obligation de renegociation". While article 79 (1) CISG is not dealing with the change of fundamental circumstances or the adjustment of contracts, article 6:111 PECL and articles 6.2.1 to 6.2.3 UNIDROIT Principles provide for this. The fact that they do not just allow for a termination of the contract, but also its juridical adaptation to restore the equilibrium is a trend that should be welcomed from the perspective of European and international contract law.
Keywords: hardship, Stoerung der Geschaeftsgrundlage, imprevision, PECL and UNIDROIT Principles
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