The draft of the American Law Institute’s Restatement of Consumer Contracts reflects the jurisdiction of the US courts on the ‘adoption’ (as the draft calls it) of standard contract terms into consumer contracts. This draft is of great value to European lawyers in understanding US developments, but it may also stimulate a reflection on the state and possible evolution of European legal systems. It turns out that in the United States, as in Europe, the law on the adoption of standard contract terms is still heavily influenced by cases from the pre-digital and paleo-digital era. This article explains the rules of the Restatement for the adoption of standard contract terms, tests their functionality, in particular using the example of websites, makes some drafting suggestions and puts forward a proposal for the further development of the law on the adoption of standard contract terms of websites. The adoption of standard contract terms governing the use of a website should not require that consumers receive a notice of the standard contract terms prior to entering that website. The requirements for the adoption of standard contract terms should be seen as mainly, if not only, having the purpose of pinpointing the wording of a contract for later reference if necessary.

June 11, 2019

Business First. A Comment on the Adoption of Standard Terms under the American Restatement of the Law Consumer Contracts from a European Union Perspective

Jacobien Rutgers

Page range: 130-147

June 11, 2019

A Modern Standard Contract Terms Law from Reasonable Assent to Enhanced Fairness Control

– A View on Digital Environments and Post-Transaction Assent –

Stefan Grundmann

Page range: 148-176

Abstract

This paper gives a birds’ eye view on the ALI Restatement on Consumer Contracts (proposal) and European, and partly also Member State, law of standard contract terms with respect to the environment where these standard contracts and assent to them appears to be particularly fleeting, namely in digital contexts. It does so, however, with a broader scope: It tries to explain why assent rules are not meaningless even in a world where most consumers and customers do not read standard contract terms, and it tries to explain how lessons could be deduced also for a meaningful and more differentiated fairness control. It argues that favouring intervention of control (ie information) intermediaries – such as consumer associations – is key and that the preservation of possibilities for negotiation should be maintained and valued. In these respects, the paper is inspired in good part by company law and capital market law dealing with parallel problems.

June 11, 2019

Core versus Non-Core Terms and Legal Controls over Consumer Contract Terms: (Bad) Lessons from Europe?

Fernando Gómez Pomar

Page range: 177-194

Abstract

Not all contract terms pose the same perils for efficient contracting and for consumer welfare. EU Law and the laws of many Member States make a distinction between core and non-core contract terms and tend to exempt the former from the ex-post substantive unfairness review to which the latter are subject to. By reviewing how the CJEU and European legal commentators have justified and construed the terms of Art. 4(2) of Directive 93/13 we may obtain a general picture of the analytical underpinnings deployed to provide useful content to that provision. The prevailing European approach is (unsurprisingly, perhaps) predominantly legalistic and uninterested in empirics. The CJEU analysis remains (unsurprisingly, perhaps) immune to the implications from the theoretical and empirical literature that economics and Law & Economics has produced in order to understand how market forces and other non-legal incentives for contract quality interact with ex post controls implemented by courts and based on broad legal standards. The ALI Restatement on Consumer Contracts may cogently make use of that input in crafting a less formalistic legal regime.

June 11, 2019

European Unfairness and American Unconscionability: A Letter From a European Lawyer to American Friends

Anne-Lise Sibony

Page range: 195-226

Abstract

The Unfair Contract Terms Directive (UCTD) and the Common Law doctrine of unconscionability in the United States both pursue the same aim: they seek to protect consumers against abuse of power by traders who are in a position to exploit the asymmetry of the contracting process. However, both sets of rules rest on different premises. In particular, they allocate trust differently between courts and markets. This accounts for deep-running differences despite apparent similarities. This contribution analyses these similarities and differences by commenting on the unconscionability doctrine as expressed in the Draft Restatement of consumer contracts from a European point of view.

June 11, 2019

Beyond Consumer Law – Small Enterprises, Independent Contractors and other Professional Weak Parties

Carlotta Rinaldo

Page range: 227-250

Abstract

The need to protect weak parties from unfair standard contract terms does not only exist in b2c relationships, as one could at first sight believe. In business contracts also, entrepreneurs and other professionals can be subservient to their counterparty. Accordingly, this may result in an asymmetrical situation posing the same problems that are usually addressed in consumer contracts. On the grounds of these introductory considerations, this paper aims at analysing the problem from a European point of view, with special attention to the Italian legal system. A variety of different solutions – depending on the single rationales of the different legal systems at issue – emerges, offering de iure condendo a good starting point for a fresh and novel pragmatic approach.

EU Legislation

June 11, 2019

European Union Legislation and Actions

Rossella Delfino

Page range: 251-255

About this journal

This Journal deals with contract law and serves as a pan-European platform for discussion and analysis. The concept of a European Contract Law is still rather recent: the phrase was first coined in the 1990s. Since the early 2000s when this journal was created, European Contract Law has come to encompass an increasingly comprehensive body of law. There were three driving forces behind this development: the EC harmonisation of laws in the area of the internal market, a generally increased interest in comparative law discussions in contract law, and the European Commission’s Communication on European Contract Law, the Commission’s Action Plan and the Common Frame of Reference process. These developments brought about a changed climate of discussion. The foundations of contract law, examined from many perspectives and in view of various national legal systems and an increasing number of disciplines, are currently being discussed in great detail in the European arena. In 10 years contract law may be the first area of European private law to be regulated in a fully fleshed out European Code.

European Contract Law comprises diverse areas of the law such as sales, standard contract terms, distribution chains, marketing practices, research and development agreements, contract law copyright aspects, financial and investment services contracts, insurance contracts and e-commerce as well as non-discrimination within and beyond labour law and more generally, important aspects of labour contracts and other symbiotic contracts.

The importance and breadth of the field and the methods and questions involved are such that ERCL has established itself as the specialised European journal in this area. Since 2004 the standard of information and discussions on this platform have been consolidated: ERCL discusses the body of law in three sections: articles, case law, and literature on EC Contract Law. This takes place mainly in book reviews and, in addition, contains short sections on the most recent EC legislation, sectoral developments, national developments and other news. The Review focuses on existing law at the EC level and all rules influencing the formation, content and execution of contracts from default rules to regulation, from marketing aspects to the content of contracts, from consumer (and also labour) law to general contract law. The Review is open to a variety of approaches and provides the opportunity to read traditional 'dogmatic' explanations of the upcoming and existing law, assessments through comparative law studies as well as economic analysis and discussions of the philosophical foundations and major structural features. The Review is and has been the site of intense discussion of proposals for codification or, more generally, systemisation and comprehensive development of contract law at the EC level. The European Contract Law Code is too realistic an option and much too important not to be thoroughly discussed as transparently as possible with as many competing ideas and approaches as possible. Several special issues have followed this process in great detail. The journal is meant to help in establishing a functional market of ideas in one of the core areas of private law and one of the most important areas of European private law. ERCL is the journal covering this large body of law and the modern solutions to the problems encountered.