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Promising options, dead ends and the reform of Australian contract law

Published online by Cambridge University Press:  02 January 2018

Martin Doris*
Affiliation:
Chinese University of Hong Kong
*
Martin Doris, Chinese University of Hong Kong, Faculty of Law, 6/F Lee Shau Kee Building, Sha Tin, New Territories, Hong Kong, Hong Kong NT. Email: m.doris@cuhk.edu.hk

Abstract

The Australian government has launched a consultation on the possible reform of domestic contract law. The Attorney-General's Department is currently seeking stakeholder views on the need to reduce inconsistencies and/or remove outdated rules, and on ways to improve legal certainty generally both for businesses and consumers alike. Its current discussion paper, though open-ended as regards next steps, appears to be talking the language of simplification and coherence that has resonated particularly in the EU for well over a decade. Yet, the ongoing, high-profile project aimed at delivering a more coherent and uniform contract law for Europe's internal market has to date proved controversial, and recent concrete initiatives have generated much adverse commentary, particularly from law-and-economics scholars. The European experience therefore offers a series of signposts but equally a number of hazard markers for the Attorney-General's Department. Indeed, many of the broad assumptions underlying developments in the EU rest on weak foundations. The European institutions have further followed a number of dead ends in the pursuit of ‘coherence’ that ought reasonably to be avoided. This paper explores potential risks underlying the current Australian reform process and offers a number of suggestions on a possible way forward.

Type
Research Article
Copyright
Copyright © Society of Legal Scholars 2014

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Footnotes

*

The author would like to thank Luke Nottage, Greg Tolhurst, Barbara McDonald and members of the CAPLUS centre at Sydney Law School for helpful comments on an earlier draft. The usual disclaimer applies.

References

Notes

1. ‘Improving Australia's Law and Justice Framework – a discussion paper to explore the scope for reforming Australian contract law’, 22 March 2012. Currently available at http://www.ag.gov.au/Consultationsreformsandreviews/Pages/Review-of-Australian-Contract-Law.aspx

2. Ibid, at para 3.6.

3. Ibid.

4. The impact of equitable principles is referenced in the discussion paper as a general concern. The Attorney-General's Department also observes that ‘the interrelationship between common law rules, equitable doctrines and statute means that it is difficult to draw boundary lines around contract law’; above n 2, at para 3.4.

5. See the Introductory comment on ‘Challenges for Australian contracting’; above n 2, at section 3.

6. See, however, Schmid, C etal Tenancy Law and Procedure in the EU (Florence: Electronic Publications of the EUI European Private Law Forum). Currently available at http://www.eui.eu/DepartmentsAndCentres/Law/ResearchAndTeaching/ResearchThemes/ProjectTenancyLaw.aspx Google Scholar

7. Moreover, in addition to the general legal complexity involved, aggrieved parties in certain cases have no option but to seek to resolve disputes before the courts. See eg http://www.lawfoundation.net.au/report/older/FCC649FB42881BD6CA257081001ED439.html

8. The Competition and Consumer Council has to date played a key role in advertising the rights of consumers and highlighting in particular the contractual remedies available to consumers. See eg http://www.accc.gov.au/content/index.phtml/tag/ConsumerRightsAndShopping/

9. See generally, Doris, M, Dispute Avoidance and European Contract Law (Groningen: Europa Law Publishing, 2008).Google Scholar

10. Lando, O and Beale, H (eds) Principles of European Contract Law, Parts I and II (London: Kluwer, 1999)Google Scholar and Lando, O etal Principles of European Contract Law, Part III (London: Kluwer, 2003).Google Scholar Parts I and II of the PECL provide annotated rules on a range of general contract law issues, including the formation, interpretation and performance of contracts, and remedies for non-performance. The later Part III was published in 2003, and similarly to the DCFR, covers broader issues such as assignment, plurality of debtors and creditors, set-off, prescription and so forth. The twin volumes UNIDROIT Principles of International Commercial Contracts (1994, 2010) were prepared under the auspices of the International Institute for the Unification of Private Law in Rome. For a recent discussion of the limited impact of the UPICC in the UK in particular, see Lake, SAn empirical study of the Unidroit Principles – international and British responses’ (2011) 16(3) Unif L Rev 669.CrossRefGoogle Scholar Lake highlights a strong opposition among members of the Bar in London towards the UPICC, and cites one commercial barrister who observed that it would be ‘an important professional fault to advise a party to use the [UNIDROIT Principles]’, at 689. Of course, Australian contract law has already departed from the English law in a number of substantive areas and there may be a strategic, economic advantage to be gained from aligning the domestic law with that slowly emerging in the EU. Indeed, Justice Douglas would appear to believe that Australian contract law has already arrived at something of a crossroads, still heavily influenced by the English law but increasingly taking note of wider developments in Brussels; see Douglas, JEngland as a source of Australian law: for how long?’ (2012) 86 ALJ 333.Google Scholar

11. Above n 2, at para 4.14.

12. See eg ‘London leads the world in commercial law cases’ The Guardian, 2 January 2012. Figures suggest that nine in every ten commercial disputes resolved in London have an international link. As Gregory notes, ‘English law has a lengthy provenance. It contains guidance on most conceivable areas and is based on the fundamental principle of freedom of contract, which is attractive to parties from jurisdictions that take a more interventionist and paternalistic approach. The English common law has been exported throughout the world and parties therefore tend to be familiar with its underlying principles.’ See https://www.lawgazette.co.uk/features/hopes-cement-international-disputes-uk. Moreover, a previous Gap Gemini report, published in 2001, estimated that annual invisible earnings for legal services in the City of London amounted to £800 million. See http://ec.europa.eu/consumers/cons_int/safe_shop/fair_bus_pract/cont_law/comments/4.14.pdf. In the context of the current reform process, it would doubtless be advantageous to conduct a similar study in order to determine the current economic return of the Australian legal services sector.

13. For a useful discussion of path-dependency in relation to the UN Convention on Contracts for the International Sale of Goods (CISG) 1980, see Spagnolo, LGreen eggs and ham: the Cisg, path dependence and the behavioural economics of lawyers' choice of law in international sales contracts’ (2010) 6 J Private Intl L 417.CrossRefGoogle Scholar

14. See G Dent ‘Easy does it’, brw.com, April–May 2012.

15. Galanter, MContract in court, or almost everything you may or may not want to know about contract litigation’ (2001) 3 Wisc L Rev 577.Google Scholar

16. It will clearly remain an uphill struggle for domestic courts and the arbitration community to compete with leading Asian ‘hubs’ for commercial dispute resolution, such as Singapore and Hong Kong. Yet internationally Australia also currently lags behind other jurisdictions when it comes to exploring the potential use of online dispute resolution (ODR) in both commercial and consumer markets. The gap is particularly apparent when we compare domestic developments to those taking shape in the EU in favour of consumers. A number of jurisdictions, most notably the Netherlands and Belgium, have developed sophisticated consumer ODR platforms. Belmed.be is one notable public–private partnership involving the Belgian government. It assists consumers and small traders in resolving domestic disputes in the energy, travel, financial services and building sectors, and in tackling cross-border disputes. The European Commission has further proposed a Regulation on online dispute regulation, which aims to provide a single EU-wide ODR platform for the resolution of cross-border disputes. The current draft Regulation is currently available at http://ec.europa.eu/consumers/redress_cons/docs/odr_regulation_en.pdf. The proposal aims to ensure that European consumers will be able to resolve low-value disputes online within 30 days.

17. J smits ‘The future of European contract law: on diversity and the temptation of elegance’, available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=803144

18. Above n 10, at 63–108.

19. See, respectively, Bar, C and Von Clive, E, Principles, Definitions and Model Rules of Private Law, Draft Common Frame of Reference (DCFR), Vols I–IV (Oxford: Oxford University Press/Sellier, 2010)Google Scholar and the ‘Proposal for a Regulation of the European Parliament and of the Council on a Common European Sales Law’, Com (2011) 635 final, Brussels, 11 October 2011 (hereinafter DCFR and CESL). The Proposal consists of three main parts: a Regulation, Annex I to the Regulation containing the contract law rules (the CESL) and Annex II containing a Standard Information Notice. Despite the title of the draft Regulation, Article 3 CESL indicates that it aims to cover not only sales contracts but also contracts for the supply of digital content and contracts for the supply of related services. The author is not aware of any comparative analysis of the draft CESL and comparable Australian (consumer) contract laws. Such a study would nonetheless be constructive in the context of the current reform agenda. Importantly, the Principles of European Contract Law form the bedrock of the DCFR, while the UNIDROIT Principles and the UN Sales Convention further served as templates for the content of both the DCFR and CESL. Vogenauer appears to view the DCFR in a negative light for having added unnecessarily to the existing international legal landscape which is in many respects already littered with soft law instruments; see Vogenauer, SCommon frame of reference and Unidroit Principles of International Commercial Contracts: coexistence, competition or overkill of soft law?’ (2010) 6(2) Eur Rev Contract L 143.Google Scholar

20. See ‘Communication from the Commission to the Council and the European Parliament on European contract law’, Com (2001) 398 final, 11 July 2001.

21. The Commission is firmly persuaded that consumers are losing out as a result of legal fragmentation and that consumers seeking to take advantage of better deals in other Member States are often refused sale or delivery by traders, see V Reding ‘The optional Common European Sales Law – seizing the opportunity’ (European contract law conference, Warsaw, November 2011) (noting too that only 7% of online shoppers purchase cross-border). For additional data on impediments experienced by some EU consumers when seeking to access consumer goods and services that are available in other Member States, see ‘Consumer protection in the internal market’, Special Eurobarometer Survey 298, 2008. From the reliable data gathered, the survey suggests that one in ten cross-border shoppers have experienced difficulties because they reside ‘in a different jurisdiction from where the purchase took place’, at p 8. The study is less clear, however, on the types of problems encountered.

22. ‘Communication from the Commission to the Council and the European Parliament on to the action plan on a more coherent European contract law’, Com (2003) 68 final, 12 February 2003.

23. For an earlier discussion of various difficulties encountered by civil law systems as a result of EC secondary legislation in the field of private law, see Roth, WhTransposing “pointillist” Ec guidelines into systematic national codes – problems and consequences’ (2002) 10 Eur Rev Private L 761.CrossRefGoogle Scholar

24. See R Madelin ‘European contract law: the way forward’ (December 2004), available at http://ec.europa.eu/consumers/cons_int/safe_shop/fair_bus_pract/cont_law/speaking_note_madelin_en.pdf (noting that the CFR would serve as a ‘toolkit’ and would, in particular, contribute to the goal of improving regulation and the simplification of EU legislation).

25. The umbrella ‘Network of Excellence’, or ‘Joint Network on European Private Law (coPECL)’, was founded in 2005 under the EU's Sixth Framework Programme in order to deliver the Common Frame of Reference on European Law ‘in the form of definitions, general concepts and legal rules’ with supplementary comments and ‘evaluative analysis’. For further details, see http://www.copecl.org/

26. Eidenmüller, H etal ‘The common frame of reference for European private law – policy choices and codification problems’ (2008) 28(4) Oxford J Legal Stud 659, at 707.CrossRefGoogle Scholar The authors consider the DCFR to be lacking in clear core aims and values, and that the ‘abundance of general provisions and open-ended legal concepts’ would herald a ‘massive expansion of uncontrolled judicial power,’ at 707. They further note that the balance of the DCFR is out of sync with reasonable commercial expectations and emphasise the fact that ‘the responsibility for the content of a contract is shifted from the parties towards the law and the judiciary’, at 707. They warn that if implemented it would result in ‘unbounded liability’ and the authors raise a ‘floodgates’ argument that they consider to be fully justified, at 686.

27. Moreover, many of the same general clauses are considered to be further ‘replete with indeterminate terminology’; ibid, at 687. For an additional detailed analysis of the DCFR from a primarily common law perspective, see S Whitaker ‘The “Draft Common Frame of Reference”: an assessment’, a report prepared on behalf of the UK Ministry of Justice (London, 2009).

28. See Eidenmuller etal, above n 27, at 70.

29. Above n 27, at 675. In like measure, it should be recalled that a number of past projects of the American Law Institute and the National Conference of Commissioners on Uniform States Laws have similarly been heavily criticised for an unrestrained resort to the concept of ‘reasonableness’. This was a criticism of the stunted reforms of UCC Article 2B and the broad collapse of the Uniform Computer Information Transactions Act (UCITA).

30. For criticism of the extent to which the process has been ‘academic’ driven to the exclusion of legal practitioners, see eg The Law Society of England and Wales ‘Response to Commission Green Paper on policy options for progress towards a European Contract Law for consumers and businesses’ (January 2011) (noting that ‘[t]he Society is concerned that the group of experts convened by the European Commission is mainly comprised of academics and would welcome the direct involvement of common law practitioners in the drafting process”, at 4). The Response is currently available at http://ec.europa.eu/justice/news/consulting_public/0052/contributions/223_en.pdf

31. Indeed, the full edition of the DCFR is currently advertised as a ‘six volume opus’ on European private law and it is significant that initial dissatisfaction with the content of the DCFR resulted in a further round of review in 2010, which was carried out by a selected group of experts on behalf of the Commission. This resulted in 2011 in a Feasibility Study that produced a reduced set of 189 articles comprising ‘core contract law principles’ considered ‘fundamental to contractual relationships in the internal market’. For further details on the Feasibility Study, and the 106 responses that it generated from various stakeholders, see http://ec.europa.eu/justice/contract/expert-group/index_en.htm

32. See RA Epstein ‘Harmonization, heterogeneity and regulation: why the Common European Sales Law should be scrapped’ (European Contract Law: a Law-and-Economics Perspective conference, Chicago, April 2012), at 5.

33. See ‘Proposal for a Regulation of the European Parliament and of the Council on a Common European Sales Law’, above n 20, at 2 (of the ‘Explanatory Memorandum’). The Commission suggests that ‘the value of the trade foregone each year between Member States due to differences in contract law alone amounts to tens of billions of Euros’, at 3 (of the ‘Explanatory Memorandum’).

34. See also in this regard, http://www.law.ed.ac.uk/epln/blogentry.aspx?blogentryref=8912; and Ganuza, JJ and Gomez, FOptional law for firms and consumers: an economic analysis of opting into the Common European Sales Law’ (European Contract Law: a Law-and-Economics Perspective conference, Chicago, April 2012).Google Scholar

35. See Vogenauer, S and Weatherill, S Harmonisation of European Contract Law: Implications for European Private Laws, Business and Legal Practice (Oxford: Hart, 2006).Google Scholar

36. The study assessed consumer behaviour and attitudes in France, Spain, Germany, the UK, Italy and Poland. See Ipsos/MORI study, ‘Online consumer research’, January 2011. The study was carried out on behalf of Allen & Overy LLP and is currently available at http://ec.europa.eu/justice/news/consulting_public/0052/contributions/6_en.pdf

37. See Posner, EAThe questionable basis of the Common European Sales Law: the role of an optional instrument in jurisdictional competition’ (European Contract Law: a Law-and-Economics Perspective conference, Chicago, April 2012).Google Scholar Similarly, for an insightful analysis of consumer behaviour in relation to standard form contracts, including online contracts, see Ben-Shahar, OThe myth of the opportunity to read’ (2009) 5(1) Eur Rev Contract L 1.Google Scholar

38. Ibid. The author is not aware of any stress tests or other assessments, whether carried out on behalf of the European institutions or other bodies, designed to test whether European lawyers would currently recommend the draft CESL to their clients. The Law Society of England and Wales has previously indicated that it would oppose an ‘optional instrument’ on European contract law on the ground that the ‘need’ for such an instrument has not been demonstrated, above n 31, at 3. The submission of the Law Society further suggests that English lawyers would be reluctant to recommend an ‘optional instrument’ to clients.

39. See Action Plan, above n 23, at 22. ‘Orgalime’ issues guidelines and develops general conditions and model rules for traders operating in the mechanical and electrical engineering sector; see http://www.orgalime.org

40. Bernstein, LAn (un)common frame of reference: an American perspective on the jurisprudence of the Cesl’ (European Contract Law: a Law-and-Economics Perspective conference, Chicago, April 2012)Google Scholar (Bernstein notes that the CESL provides that, in addition to the written terms, any ‘usage which the traders have agreed should be applicable’ as well as any ‘usage which would be considered generally applicable by traders in the same situation as the parties’ [see Art. 67 CESL]. In addition, courts interpreting the CESL would be required to consider practices that ‘grossly deviate’ from ‘good commercial practice’. Given the sweeping nature of these provisions, Bernstein argues that comparable provisions in the UN Sales Convention are preferable to the draft CESL.) There are four specific references to ‘good commercial practice’ in CESL (in relation to precontractual disclosure, fraud and unfair terms between traders and unfair terms related to late payment). The concept itself is not defined.

41. Australian consumer law rules are now principally to be found within the Competition and Consumer Law Act 2010.

42. In the late 1960s, there was a degree of Australian academic interest in the design of an Asian contract law – see eg Allan, D Asian Contract Law (Carlton, Victoria: Melbourne University Press, 1969) and more recently a number of scholars, particularly in Japan, Taiwan and Singapore have been promoting the Principles of Asian Contract Law (PACL), and have adopted the PECL as a key inspiration and model.Google Scholar

43. Di Matteo, LCisg and the presumption of enforceability: unintended contractual liability in international business dealings’ (1997) Yale J Int'l L 111.Google Scholar

44. Admittedly, ‘full-blown’ disputes in this area are comparatively uncommon; however, the mere risk that a party may be found liable for having negotiated in bad faith, for instance, may create a chilling effect on parties and/or a difficult dynamic in cross-border contractual negotiations generally. It may also encourage parties to commit more time to failing negotiations than they would otherwise domestically.

45. [1992] 2 A.C. 126.

46. See Scottish Coal v Danish Forestry [2009] CSOH 171.

47. Charles Shaker v Vistajet Group Holding SA [2012] EWHC 1329 (Comm), 2012 WL 1684837. The dispute arose out of a letter of intent for the purchase of an aircraft. It was reiterated that an obligation to exercise reasonable endeavours is unenforceable in law. Teare J emphasised that the courts cannot police such an obligation and relying on the view expressed by LJ Potter in Phillips Petroleum v Enron Europe [1997] CLC 329, at 343, stressed that courts are ‘unable to draw a line between what is to be regarded as reasonable or unreasonable in an area where the parties may legitimately have differing views or interests’, at pt. 11. The court further reinforced that an obligation to negotiate in good faith is ‘inherently inconsistent with the position of a negotiating party’, at pt. 7. In Charles Shaker, the court found in favour of the claimant who had argued that ‘just as the obligation to exercise good faith and reasonable endeavours […] is unenforceable, so the alleged condition precedent […] is unenforceable’. The decision follows earlier cases that have outlined a very clear judicial standpoint on precontractual negotiations. See, for instance, including Multiplex Constructions UK Limited v Cleveland Bridge UK Limited [2006] EWHK 1341, at paras 633–639 and Barbudev v Eurocom Cable Management Bulgaria EOOD [2012] EWCA Civ 548.

48. Art 2b (under CESL Art 2 on ‘Definitions’) defines ‘good faith and fair dealing’ as ‘a standard of conduct characterised by honesty, openness and consideration for the interests of the other party to the transaction or relationship in question’. Art 2(3) (The CESL Part I on Introductory Provisions) indicates that, regardless of their status, the parties may not exclude the application of good faith and fair dealing or derogate from or vary the effects of Art 2 CESL (the good faith and fair dealing provision).

49. See Macgregor, LReport on the Draft Common Frame of Reference: a report prepared for the Scottish government on the principles, definitions and model rules of European private law’ (Edinburgh, March 2009).Google Scholar Macgregor noted at that time that ‘[B]ecause there is no tradition in Scotland of providing such information, this [disclosure] standard may be difficult to apply’. It should nonetheless be stressed that Macgregor concluded her survey of the DCFR arguing that the ‘precontractual duties to negotiate in accordance with good faith and fair dealing are balanced [under the DCFR], and welcome in a B2B situation’. The report is available via http://www.scotland.gov.uk/Publications/2009/03/05095153/0

50. Ibid.

51. Litigation e-bulletin, Herbert Smith, 3 September 2010.

52. For a discussion of the law governing precontractual reliance and the impact of preliminary agreements in European and US legal practice, see M Doris ‘Bargaining and reliance in new European contract law’, available at http://www.indret.com/en/?ed=32

53. An argument recently reinforced by the Australian Newsagents' Federation Ltd in their response to the Attorney General's discussion paper. See ‘Response’, dated 20 July 2012, available via http://www.anf.net.au/

54. For the relevant legislation in New South Wales, see The Building and Construction Industry Security of Payment Act (Nsw) 1999. The application of the Act is further well explained for users online; see http://www.securityofpayment.com.au/nsw.php?hide=true

55. The recent financial collapse of the construction arm of the St Hilliers group is a useful example. The collapse stalled work on a series of public housing projects in Sydney and across New South Wales, and had a significant financial and emotional impact on many of the subcontractors involved.

56. Above n 2, at 20–21.

57. Spagnolo, LThe last outpost: automatic Cisg opt outs, misapplications and the costs of ignoring the Vienna Sales Convention for Australian lawyers’ (2009) 10(1) Melbourne J Int'l L 141.Google Scholar For a more recent overview, see Hayward, B and Perlen, PThe Cisg in Australia – the jigsaw puzzle that doesn't fit’ (2011) 15(1) Vindobona J Int'l Comm Law & Arb 119 (noting that ‘in many respects the CISG and Australian domestic law are happily married together’, at 140, but that gaps and inconsistencies between domestic sales law and the CISG endure, including as a result of specific provisions of Australian consumer laws).Google Scholar The authors further highlight an apparent disconnect between the treatment of domestic sale of goods contracts involving software and the approach of the CISG following the decision in St Albans City and District Council v International Computers Ltd [1996] 4 All ER 481. The case concerned the Sale of Goods Act 1923 (Nsw). See also Douglas, above n 10 (noting at 342 that ‘optional instruments (such as the UN Sales Convention) must overcome a great deal of legal and commercial inertia before they affect the substantive law significantly’).

58. As is correctly identified in the Attorney General Department's discussion paper at para 5.11.

59. See, inter alia, Shulman, Mr and Singh, LChina's Implementation of the Un Sales Convention through arbitral tribunals’ (2010) 48 Colum J Trans L 242;Google Scholar and cf Wu, D, ‘Cietac's practice on the Cisg’ (2005) 2 Nordic J Comm L, available at http://cisgw3.law.pace.edu/cisg/biblio/wu.html Google Scholar

60. The number of CISG disputes in Australian courts according to the UNILEX database is currently 12, which is highlighted in para 5.4 of the discussion paper. See http://www.unilex.info/dynasite.cfm?dssid=2376&dsmid=13354&x=1, which further indicates that there have been no reported decisions since 2010.

61. Above n 2, at para 7.4. It should be noted that the Attorney-General's Department does recognise some of the limitations of opt-in rules briefly at para 7.5. The discussion paper also stresses that ‘[SMEs] and individuals may be less likely to have the legal sophistication to elect to use opt-in rules’.

62. Above n 2, at para 7.5.

63. Cafaggi, FCesl and precontractual liability: from a status to a transaction based approach?’ (European Contract Law: a Law-and-Economics Perspective conference, Chicago, April 2012), at 2.Google Scholar

64. Ibid, at 3.

65. The department raises the possibility of an ‘opt-out’ model at para 7.6 of the discussion paper (above n 2).

66. Epstein laments the ‘threadbare justifications for optional new [EU] rules [under CESL]’ and supports the view of Bar-Gill and Ben-Shahar that they are ‘truly breathtaking in their scope’ in that they cover ‘mandatory provisions and binding disclosures, in addition to mandated rules for entering and exiting contracts, and sticky pro-consumer default terms’, see Epstein, above n 33, at 7, and citing Bar-Gil, O and Ben-Shahar, ORegulatory techniques in consumer protection: a critique of the Common European Sales Law’ (European Contract Law: a Law-and-Economics Perspective conference, Chicago, April 2012).Google Scholar Cf Mak, C, ‘In defense of Cesl’ (European Contract Law: a Law-and-Economics Perspective conference, Chicago, April 2012) (who, similarly to Hesselink, emphasises the merits of a ‘legal–political’ CESL). See also the rather defensive views expressed by Eric Clive in support of the current CESL draft at http://www.law.ed.ac.uk/epln/blogentry.aspx?blogentryref=8912 (who suggests that much of the opposition to CESL by leading US law-and-economics ‘gurus’ can be explained away by these scholars' ‘free market’ stance).Google Scholar For a more in-depth analysis of Clive's views on CESL generally, see Clive, EA general perspective on the European Commission's Proposal for a Common European Sales Law’ (2012) 19(1) Maastricht J Eur & Comp L 120.Google Scholar

67. Above n 33, at 7.

68. The recent establishment in 2011 of the European Law Institute is in part the product of the ‘coherence’ initiative in EU contract law. Indeed, the case for such an institute was broadly sketched by private lawyers in response to developments in the field of EU contract law. It has been pointed out that such an institute could play an important flanking role, particularly in the absence of a supporting common EU legal culture. See eg Doris, MThe continued resonance and challenge of the ‘ius commune’ in modern European contract law’ (2006) 34(2) Int'l J Legal Info 14 (advocating a European Private Law Association. Doris promoted such an EPLA particularly as a means of encouraging the development of the Common Frame of Reference).Google Scholar

69. See ‘Consumer conditions scorecard’, 7th edn, May 2012. Available at http://ec.europa.eu/consumers/consumer_research/editions/doc/7th_edition_scoreboard_en.pdf

70. As evidenced in part by the decision in mid-2011 to exclude the financial services sector from the scope of any optional instrument on EU contract law.

71. This view is shared by Simon James, a partner at Clifford Chance, who argued back in early 2011 that for the European institutions, ‘the act of passing the law is what matters’ and not necessarily the content or quality of the instrument; see S James ‘European contract law: the politics of law’, Clifford Chance in-house publication (31 March 2011), available at http://www.cliffordchance.com/publicationviews/publications/2011/03/european_contractlawthepoliticsoflaw.html. Hesselink has been one of the few proponents of the CESL who has publicly advocated for the instrument as much for its wider political merits, as for any strong economic case in its favour. See MW Hasselink ‘The case for a Common European Sales Law in an age of rising nationalism’ (2012), available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1998174 (noting that the CESL should be considered as an instrument that boosts a sense of ‘European identity’ and enshrines ‘just rules’ for the internal market). While the argument that the CESL enhances a sense of European identity is unpersuasive, the current draft CESL, despite its many weaknesses, does currently offer a notably strong pro-consumer body of contract rules.