All entries for Wednesday 03 February 2010
February 03, 2010
Cause and consideration
Whereas all system requires agreement and intention to create legal relations in order to create a contract, English and French law each impose additional requirements: consideration and cause. Consideration consists in the requirement of a counterpart in exchange of the promise. Cause in a synallagmatic contract is the prospect of the counter-performance to by the other party (objective cause) There is also the individual motive that prompted another party to commit himself (subjective cause) both traditions inspired article 1131. But their definitions seem to overlap. The difference is that French lawyers have to distinguish cause and object whereas consideration is undefined. Consideration is made to prevent bare promise and cause controls freedom of contract.
Both notions are subject to changes in their countries. Three groups (Catala, Terré and the Chancellerie) decided to reform the notion of cause through the reform of the French code civil. At the same time, the notion of consideration is subject to various interpretations in Courts because its inconvenience to subsequent amendments to contracts. The concepts may need to evolve if they still want to protect the parties at the conclusion of a contract.
German law recognizes neither consideration nor cause. It attaches a great importance to the act abstracted from its underlying cause. The doctrine of unjust enrichment restores balance in the contract.
Even if each legal system has different requirement, the aim remain to find a balance between the parties.
Pierre-Patrice TIFI MAMBI