The Principles of European Contract Law and the concept of the
"Creeping Codification" of law
KLAUS PETER BERGER*
Abstract: The Principles of European Contract Law, along with other private initiatives
such as the UNIDROIT Principles of International Commercial Contracts,
pose new problems for legal theory. What is the status of such principles and how
can they be used? Berger examines these issues from the perspective of "creeping
codification" of transnational law ­ the idea that slowly and gradually by reference
to such principles a uniform private law will emerge. The modern European situation
re-enacts the debate between the Thibauts and the Savignys in 19th century
Germany: the debate between those who propose early codification and those who
seek to develop a political harmony between the law and its subjects. "Creeping codification"
reflects the viewpoint of the Savignys. Principles and restatements may be
used by national and supranational law makers (legislators and courts), referred to
by the parties to an agreement, and built into legal education. This is a process which
is already beginning to occur. The existence of specific, written principles rather
than open-ended "general principles" of transnational law greatly facilitates the possibility
of recognition and use. Because of their private origins, one of the tasks for
the promoters of such principles is to ensure that they are well marketed, so that they
can obtain maximum use. The "soft law" nature of such rules nevertheless renders
them sufficiently flexible that they can easily be modified to suit new conditions and
thus better reflect their environment.
Zusammenfassung: Die Grundsätze des Europäischen Vertragsrechts ­ wie andere
private Initiativen wie zum Beispiel die UNIDROIT Prinzipien für internationale
Handelsverträge ­ schaffen neue Problemstellungen für die Rechtstheorie. Welches
ist der Status dieser Grundsätze und wie können sie angewendet werden? Berger
untersucht diese Fragestellung vom Standpunkt der "schleichenden Kodifizierung"
des transnationalen Rechts ­ der Idee, daß sich langsam und allmählich durch
Bezugnahme auf solche Grundsätze ein einheitliches Privatrecht herausbilden wird.
Die derzeitige Lage in Europa stellt die Neuauflage des Streits zwischen den
Anhängern von Thibaut und Savigny im 19. Jahrhundert in Deutschland dar: Der
Streit zwischen denjenigen, die eine frühzeitige Kodifizierung vorschlagen, und
denjenigen, die die Entwicklung einer politischen Eintracht zwischen dem Recht
21
* Professor, Center for Transnational Law (CENTRAL), Münster University, Germany
European Review of Private Law 1:21-34, 2001.
 Kluwer Law International. Printed in the Netherlands.
und seinen Subjekten anstreben. "Schleichende Kodifizierung" spiegelt den
Standpunkt der Anhänger von Savigny wieder. Prinzipien und Neuformulierungen
mögen von den nationalen und supranationalen Gesetzgebern (Gesetzgebern im
engeren Sinne und Gerichten) angewendet, von den Parteien zu einer Vereinbarung
herangezogen und in die rechtliche Ausbildung aufgenommen werden. Dies ist ein
Prozeß, der bereits begonnen hat. Die Existenz von eher spezifischen, niedergelegten
Prinzipien im Gegensatz zu offenen "allgemeinen Grundsätzen" von
transnationalem Recht fördert in hohem Maße die Möglichkeit der Anerkennung
und der Anwendung. Aufgrund ihres privaten Ursprungs ist eine der Aufgaben für
Förderer solcher Grundsätze, sicherzustellen, daß die Grundsätze gut vermarktet
werden, um eine größtmögliche Anwendung zu erreichen. Der "soft law" Charakter
solcher Regelungen gibt diesen gleichwohl genügend Flexibilität, damit sie zur
Anpassung an neue Bedingungen leicht modifiziert werden und sie auf diese Weise
ihre Umgebung besser reflektieren können.
Introduction
The publication of Part I and II of the Principles of European Contract Law (PECL)
in December 1999 mark the beginning of a new era in the development of a truly
transnational contract law. Like their counterpart, the UNIDROIT Principles of
International Commercial Contracts (UPICC) published by the International Institute
for the Unification of Private Law in Rome in 1994, the PECL stand for an informal
development of the law from below. The Restatements of european and international
contract law reflect a new phenomenon, the "Creeping Codification" of transnational
law. It revives the famous dispute between Thibaut and Savigny about the right way
to codify the law. At the same time, the PECL as well as the UPICC bring new
momentum to legal teaching and legal methodology. The UPICC reflect the creation
of a growing body of transnational commercial law, a new law merchant while the
PECL may serve as the basis for a methodological ius commune europaeum, an
indispensible prerequisite for the creation of uniform substantive rules of european
contract law. Ultimately, they may pave the way for a European Civil Code.
On December 16, 1999 the new version of the Principles of European Contract
Law (PECL) Part I and II1 was presented at a conference organised by the Molengraaff
Institute for Private Law in Utrecht. Since the drafting of a genuine European Civil
Code is still a distant possibility2, this presentation represents a milestone in the development
of a modern ius commune europaeum, a genuine European contract law.
22
1 O. Lando & H. Beale (eds), Principles of European Contract Law, Parts I and II, Kluwer Law
International, Den Haag 1999, p4 et seq.
2 Inspite of two Resolutions of the European Parliament, see Resolution of 26.5.1989 (Doc A2-
157/89, OJ 1989 C 158/89, 400) and Resolution of 6.5.1994 (Doc A3-329/94, OJ 1994 C 205/94, 518).
The idea to draft a Restatement of European contract law dates back to the early
sixties3. Inspite of this long lasting discussion, the emergence of Restatements of
European or international4 contract law raises a variety of new legal issues hitherto
unknown to traditional legal doctrine outside the USA. The PECĽs quality as "soft
law", their character as a "Restatement" which is not known in traditional European
legal doctrine, provokes the question as to their precise legal effect and their impact
on the development of European contract law. This article discusses these issues in
the context of what has been termed "the Creeping Codification"5 of transnational
law.
A. The concept of the "Creeping Codification" of Transnational Law
I. The meaning of the concept
The Oxford Dictionary explains that one possible meaning of "to creep" is "to
develop slowly and steadily...in the hope of advancement".6 This linguistic approach
reveals two important qualities of the concept of the Creeping Codification of the
law.
I.1. Towards a revised understanding of the codification process: the informal
creation of law
First, we are dealing with an informal codification process that develops outside the
EU institutions and the domestic legislatures of the Member Countries. Creeping
Codification stands for a reversal of the traditional legal process, i.e. for the
advancement of the law from below, not through the formal means of the traditional
codification process but through the "private" endeavours of academics and legal
practice, sometimes under the umbrella of an international institution such as
UNIDROIT. Restatements of contract law as well as other projects for the informal
23
3 See VAN HECKE, De Conflictu Legum, Sijthoff, Leyden 1962, p198 et seq.
4 See for the UNIDROIT Principles of International Commercial Contracts, M.J. BONELL, An
International Restatement of Contract Law, Transnational Juris Publications, Inc., Ivington, NY, 2nd ed
1997, p105 et seq.
5 Cf. K.P. BERGER, Internationale Wirtschaftsschiedsgerichtsbarkeit, de Gruyter, Berlin 1992, p374,
n. 196; K.P. BERGER, International Economic Arbitration, Kluwer, Deventer 1993, p543; K.P. BERGER,
Formalisierte oder "Schleichende" Kodifizierung des Transnationalen Wirtschaftsrechts, de Gruyter,
Berlin, 1996, p191 et seq; K.P. BERGER, JZ 1998, 369, 374; K.P. BERGER, The Creeping Codification of
the Lex Mercatoria, Kluwer Law International, Den Haag, 1999, p210 et seq; K.P. BERGER, in CENTRAL
(ed), Transnational Law in Commercial Legal Practice, Quadis Publ., Münster, 1999, pp121, 124 et seq;
O. LANDO, in Centre for the Advanced Study of European and Comparative Law (ed), The Harmonization
of European Contract Law through a Restatement of Principles, 1997, 1, 20.
6 Illustrated Oxford Dictionary, Olms Zürich, Hombrechtikon, 1998, p195.
codification of European and international contract and business law7 play a prominent
role in this context. At the same time, the determination of their legal quality
requires a rethinking of the traditional theory of legal sources. What is the legal relevance
and quality of a set of legal rules and principles which are less than a code
of domestic law or a convention of public international law but more than just a collection
of certain legal rules contained in a law review article? Is the answer to this
question depending upon the acceptance and use of the PECL over a certain period
of time, similar to the opinio iuris-requirement of customary law? We will come
back to these questions below.
I.2.The "Law in Action"-approach to the codification process
Secondly, the notion of the Creeping Codification of the law implies a gradual development
over time rather than a "big bang" of a new Code. The Creeping Codification
is not only informal, it is also a slow and steady process. It is never finished and
always in the process of advancement towards more workable and practical rules.8
This particular quality of the Creeping Codification results from the special character
of this area of law. Much more than any other area of law, contract law is living
law, developing at an enormous pace and requiring a flexible and readily adaptable
regulatory framework. This particular quality of modern civil law resembles the
"ongoingness" and "vitality" of the former ius commune.9 It would be a mistake to
capture this law in the tight meshes of a traditional codification. A European Civil
Code, just as any other formal codification, would necessarily introduce a static element
into this process. Legal certainty would be achieved at the price of inflexibility.
Restatements and other forms of informal codification of contract law leave enough
room for the adaptation of the law to new developments and for the creation of new
transnational concepts and methods while maintaining an acceptable level of legal
uncertainty. Also, these informal instruments could be adapted to the ever changing
conditions of real life in a much faster and much more efficient way than any formal
codification. The current preparation of a second edition of the UNIDROIT
Principles10 as well as the relatively quick development from the first to the present
version of the Lando Principles provide impressive proof of this proposition.
24
7 Cf. eg the List of Principles, Rules and Standards of the Lex Mercatoria developed by the Center
for Transnational Law (CENTRAL) at Münster-University; K.P. BERGER, in CENTRAL (ed),
Transnational Law in Commercial Legal Practice, supra n. 5, p146 et seq.
8 K.P BERGER, The Creeping Codification, supra n. 5, p218 et seq.
9 See R. ZIMMERMANN, Col.J.Europ.L. (Columbia Journal of European Law) 1994/95, 63, 84 et seq.
10 See M.J. BONELL, in CENTRAL (ed), Transnational Law in Commercial Legal Practice, pp7, 41
et seq.
II. The "Thibauts" versus the "Savignys"
The contrast between traditional positivistic ideas of codification and progressive
approaches to the development of the law as reflected in the recent emergence of
Restatements of contract law reminds us of the famous dispute between Savigny and
Thibaut about the codification of German private law in the 19th century. In fact, Ole
Lando and Reinhard Zimmermann have repeatedly turned back the clock of legal history
and have compared the current discussion about the codification of European private
law with the dispute betweenThibaut and Savigny.11 In their view, those who advocate
the drafting of a European Civil Code belong to the "Thibauts", while those who
favour the informal, Creeping Codification of private law may be called the "Savignys".
Thibaut advocated the drafting of a German Civil Code. He was, however, far
from favouring the impossible venture of a "complete" code covering every conceivable
fact pattern. Instead, he combined a sound drafting approach with comparative
legal thinking, thus revealing himself as a true comparatist. Thibaut emphasised this
important comparative dimension of his quest for the codification of German private
law in one of his several "Additions" to his famous pamphlet of 181412 published in
the same year. In the seventh Addition we find the statement that:
"Our [German] understanding of legal history should comprise the laws of
all ancient and modern people in order to be truly pragmatic. Ten learned lectures
on the laws of the Persians and the Chinese would instil more legal
understanding in our law students than one hundred on the terrible mistakes
of the law of succession from Augustus to Justinian....one should give us a
simple code drafted in clear language and in conformity with the spirit of our
people. In this case our governments could demand without any injustice that
every young law student who takes his law exam must study carefully the
Greek speakers and his Cicero. Our law faculties will then have the pleasure
that their law candidates, just as their counterparts in Oxford, will greet their
leaders with odes in Latin and Greek".13
Thibauťs positivistic approach to the unification of German private law and, most
important, to the codification of law in general, was strongly opposed by Savigny, a
proponent of the "historical school of jurisprudence".14 For him, law was necessarily
"natural" in character. In his view, the core of every legal system is customary
law (in a non-technical sense) developing through "the inherent and silent powers of
25
11 See O. LANDO, ERPL 1997, 525; R. ZIMMERMANN, Col.J.Europ.L. 1994/95, 81: "In a way, ..., it is
Savigny versus Thibaut all over again.".
12 A. THIBAUT, Ueber die Nothwendigkeit eines allgemeinen bürgerlichen Rechts für Deutschland,
Mohr und Zimmer, Heidelberg 1814.
13 A. THIBAUT, in J. Stern (ed), Thibaut und Savigny, Wissenschaftliche Buchgesellschaft, Darmstadt
1959, p170 (emphasis added).
14 F. VON SAVIGNY, Vom Beruf unserer Zeit für Gesetzgebung und Rechtswissenschaft, Mohr,
Heidelberg 1814.
the people and not by the arbitrariness of a lawmaker".15 According to Savigny, "law
grows with the people, is shaped by the people and disappears and dies away just as
the people lose their identity".16 For Savigny this inherent relationship between the
people and the law is the "political element", its academic treatment and development
the "technical element" of law.17 In his eyes, "this living customary law is the
true source of progress of society".18
These quotations reveal that there is a natural link between Thibauťs and
Savigny's dispute over the organic or positivistic nature and development of domestic
German law in the 19th century and the current discussion on the "right" way to
codify European and international contract law.
III. The goals of the creeping codification of the law
The ultimate aim of the Creeping Codification of the law is the advancement of the
creation of uniform private law through new and progressive means of "codification".
These new forms have developed out of practical necessity. Some form of
black letter law is needed for every type of law to make it workable in legal practice.19
The ultimate goal of this technique is therefore similar to that of the formal
ways of creating uniform law. It is intended to reduce transaction costs, to create a
level playing field for parties to cross-boarder contractual transactions, to overcome
the uncertainties of the "jump in the dark"20 of private international law and to serve
as an important integrative force for the creation of a Single European Market.
There is, however, an important genetic difference between the traditional means of
unification and the concept of the Creeping Codification of contract law. While the former
has to fight with the sovereign prerogatives and traditional disinterest of domestic
lawmakers for international matters,21 the latter is intended to overcome the severe disadvantages
of the formalised unification process:22 the reluctance of domestic legislature
to foster the unification of private law and to give up traditional legal concepts, the
dependence of the success of such projects on the current political attitudes in the jurisdictions
concerned, the risk that the time factor may cause such projects to be overtaken
by the developments of reality and the NIMBY("not in my backyard")-argument23
which very often stands in the way towards a widespread creation of uniform law.
26
15 F. VON SAVIGNY, id, p15.
16 F. VON SAVIGNY, id, p11.
17 F. VON SAVIGNY, id, p12.
18 F. VON SAVIGNY, id, p132.
19 See for arguments against the workability of the lex mercatoria concept in legal practice O.
SANDROCK, American Review of International Arbitration 1992, 30, 50 et seq; M.J. MUSTILL, Arbitration
International 1988, 86, 114 et seq.
20 L. RAAPE, Internationales Privatrecht, Vahlen, Berlin, 5th ed 1961, p90.
21 Especially in the field of contract law which is not politically attractive to say the least.
22 See P. STEPHAN, VJIL (Virginia Journal of International Law) 1999, 743, 752 et seq.
23 See R.M. GOODE, ULR (Uniform Law Review) 1991, 54, 60 et seq.
IV. Unity through Multiplicity?
Doing away with traditional "positivistic" approaches towards the creation of
uniform law and favouring the concept of informal "creeping" codification, of the
"soft-law" character of uniform European contract law, however, involves a new
problem, the one of "unity through multiplicity".24 The notion of "private lawmaking"
opens the door for as many projects as there are persons or academic
institutions interested in the codification of European and transnational private law.
The Restatement projects of UNIDROIT and the Lando-Commission as well as the
CENTRAL List of Principles, Rules and Standards of the Lex Mercatoria25 present
excellent examples of this problem.26 In the modern world of privately-made
uniform law "a market for the product" UNIDROIT or Lando-Principles is
said to exist, the development of a "widely diversified marketing strategy"
is required for the success of the PECL27 and the private or semi-private nature of
these and other initiatives provokes the interesting issue of a "claim for copyright of
the law".28
Behind these phenomena we find vital questions: How do the various projects fit
together?29 How do we deal with the problem of the battle of projects? To which set
of rules should the arbitrator or judge refer in a concrete case? If one takes the concept
of Creeping Codification seriously, these are in deed tough questions. On the
other hand, the problems in this area should not be overestimated. What we are facing
today with the multiplicity of projects is the emergence of a European and truly
global legal culture which is developing outside the constraints of the domestic or
EU-lawmaking process.30 This informal process is shaped by the emergence of the
Single European Market and the Global Market Place. Thus, the results which these
projects achieve for the resolution of the manifold problems of contract law are not
so different. In fact, these different vehicles are more often than not mutually supportive
and supplementary of each other.31 The problem is rather one of determining
the authoritative value of each of these projects and their relationship vis a vis
each other in case of conflict. In fact, it is at this juncture that final word has not yet
been said. We are faced with the question as to the dogmatic and methodological
basis of the emerging doctrine of transnational law.32
27
24 A. ROSETT, Am.J.Comp.L. (American Journal of Comparative Law) 1998, 347, 348.
25 See supra n. 5.
26 See F. BLASE, Vindabona Journal 1999, 3, 6 et seq.
27 F. BLASE, id, 8, 13.
28 See A. ROSETT, Am.J.Comp.L. pp18, 358.
29 See O. SANDROCK, JZ 1996, 1, 8.
30 A. ROSETT, Am.J.Comp.L. pp18, 349.
31 F. BLASE, supra n. 26, 6; A. ROSETT, Am.J.Comp.L. pp18, 353.
32 See infra B.II.2.
V. Creeping codification and consumer protection
When discussing the phenomenon of the Creeping Codification of law at the occasion
of the presentation of the Lando-Principles, an important caveat must be made.
The concept of the Creeping Codification was initially developed in the context of
the transnationalisation of international business law, the creation of a new lex mercatoria.33
This new lex mercatoria is based not only on the principles of the free will
of the parties but also on the self-responsibility of international businessmen. In the
absence of any need to ensure consumer protection, international trade and commerce
constitutes an ideal climate for the free development of contractual structures.34
The presumption of the professional competence of international businessmen
resulting from this special scenario has developed into a rule of transnational
law and is used constantly by international arbitral tribunals to justify the distribution
of risks within international commercial contracts.35
The PECL have a wider ambit. They intend to cover the whole field of contract
law, business as well as consumer contracts. Within the EU, however, this problem
is alleviated by the many initiatives of the EU Commission with respect to consumer
protection. They have created an amalgam of mandatory law which ensures distributive
justice in contractual relationships and takes precedence over the PECL
according to their Art. 1:103 (2).
B. The principles of contract law and the phenomenon of the creeping codification
of law
The relationship between the Creeping Codification of law and the Restatements of
contract law can be seen on at least three different levels of the legal process.
I. The `Promotional Task' principles
First, these projects make transnational contract law easily accessible, thereby curing
one of the major defects of the current doctrine of transnational law.36 At the
28
33 See K.P. BERGER, The Creeping Codification of the Lex Mercatoria, p216 et seq.
34 See F. KAHN, in BONELL & BONELLI (eds), Contratti Commerciali Internazionali E Principi
UNIDROIT, Giuffré, Milano 1997, 41, 42.
35 See, eg ICC Award No. 1990, Clunet 1974, 897; No. 1512, Clunet 1974, 905; No. 2291, Clunet
1976, 989; No. 2438, Clunet 1976, 969 with note Y. DERAINS, id, 971; No. 3130, Clunet 1981, 932; No.
3380, Clunet 1981, 927; No. 5364, Clunet 1991, 1059; cf. generally K.P. BERGER, The Creeping
Codification of the Lex Mercatoria, p236.
36 See B. SELDEN, Ann.Surv.Inťl.&Comp.L. (Annual Survey of International and Comparative Law)
1995, 111, 119: "...those partial listings [of principles and rules of the lex mercatoria] were not found in
the normal places to which judges and arbitrators (and lawyers) turn. The occasional law review article
is no substitute for a code or, in common law jurisdictions, line of judicial opinions.".
same time, they perform a promotional task that cannot be overestimated. A major
deficit of the informal codification of the law is the lack of easily accessible information
about these projects through official gazettes or a collection of statutes.
Recent studies show that knowledge of these projects among state court judges is
almost non-existent.37 The widespread discussion about their viability, their legal
nature and the options for their practical application create a certain degree of consciousness
and awareness in domestic courts and lawmakers that common principles
and rules of European contract law do exist.38 The discussion is no longer centred
around an invisible, and for this reason sometimes heavily criticised abstract notion
of transnationalism. For the first time, the transnationalisation of law can be linked
to a tangible set of black letter law. This new "visibility" of transnational law, in turn,
creates an increasing degree of "transnational mindset" in practitioners and lawmakers.
Savigny has alluded to the necessity of this development in that he urged
that the common knowledge of the law "should not be stored in some dusty tomes
or left to be shaped by individual academics. Rather, it should become the common
knowledge of all lawyers who want to work with sincereness and an open mind for
their profession".39
II. New directions for legal teaching and legal methodology
Based on this new awareness of legal practice and the academia, the informal codification
of European law will have a considerable influence on the new shape and
direction of domestic law and domestic legal theory. This applies both to legal teaching
and legal methodology.
II.1. Teaching
Legal teaching plays an important role in creating a spirit of comparative and international
legal thinking among young lawyers as a basic prerequisite for the unification
of law.40 Roscoe Pound has emphasised this significance of comparative law in
connection with the formative era of a "world law".41 The PECL as well as other
instruments resulting from the informal codification process are an important comparative
teaching tool in that they provide a standard point of reference to make stu-
29
37 See for a disappointing inquiry among American judges in Florida concerning their knowledge of
the UNIDROIT Principles, A.I. ROSETT, Am.J.Comp.L. 1998, 361; CENTRAL at Münster-University,
Germany has conducted a worldwide survey on the knowledge and use of the lex mercatoria in 1999
which has generated more positive data, see K.P. Berger, H. Dubberstein, S.M. Lehmann & V. Petzold
(eds), The Practice of Transnational Law, 2000.
38 See R. ZIMMERMANN, JZ 1995, 477, 491.
39 F. VON SAVIGNY, supra n. 13, 125.
40 See J. GORDLEY, Am.J.Comp.L. 1995, 555 et seq; A. FLESSNER, 56 RabelsZ 1992, 243, 250 et seq;
H. KÖTZ, (Revue de droit internationale et de droit comparé) 1999, 753, 766 et seq.
41 R. POUND, Am.J.Comp.L. 1952, 1, 8 et seq.
dents aware of the European and transnational dimension of their profession. The
substantial comparative efforts of the drafters enable students to see the whole kaleidoscope
"of useful ideas and experiences of other legal systems"42 in a single
instrument of uniform law. The PECL may thus serve as the focal point for the
teaching of civil law at a "European Law School". In fact, various German textbooks
already refer to the UNIDROIT and Lando Principles.43 The PECL should also provide
an ideal background for a European Moot Court Competition in the area of private
and commercial law.44
II.2. The development of a methodological Ius Commune Europaeum
a. The gradual convergence of civil and common law methodology
As to the application of the law in legal practice, Basil Markesinis, Ernst A. Kramer
and others have hinted at the beginning development of a genuine comparative
methodology in Europe, a methodological "ius commune europaeum".45 The significance
of an internationalisation of legal methodology has long since been underestimated.
However, there is no viable and workable uniform private law without a sufficient
methodological basis. This development has to start within the respective
domestic jurisdictions instead of on some vague and distant transnational plane
detached from the solid foundations of domestic law. Again, we are facing a slow
and invisible "creeping" process, this time, however, not on the plane of substantive
law but on the plane of legal theory. This process of methodological convergence
shows effects in the area of statutory interpretation, where English courts tend to
adopt the "purposive" Continental approach of interpretation and of the changed
understanding of civil lawyers of the phenomenon of "judge made law", i.e., the
growing amount of genuine case law.46
30
42 See for this goal of the use of comparative law in legal teaching M. RHEINSTEIN, Einführung in die
Rechtsvergleichung, Beck, München, 2nd ed, p191.
43 See eg I. SCHWENZER & M. MÜLLER-CHEN, Rechtvergleichung, Mohr, Tübingen, p29; H. KÖTZ,
Europäisches Vertragsrecht, Vol. I, Mohr, Tübingen 1998, p35.
44 See the proposal of F. BLASE, supra n. 26, p14; see also K.P. BERGER, in K.H. BÖCKSTIEGEL (ed),
New Perspectives of Air Law, Space Law, and International Business Law for the Next Century,
Heymann, Köln 1996, pp309, 319; F. BLASE, in K.P. BERGER (ed), Understanding Transnational
Commercial Arbitration, 2001 (forthcoming).
45 See generally E.A. KRAMER, in W.R. Schluep et al (eds), Recht, Staat und Politik am Ende des zweiten
Jahrtausends, Haupt, Bern 1993, pp729, 736; E.A. KRAMER, in C.J. Meier-Schatz (ed), Die Zukunft
des Rechts, Helbing & Lichtenhahn, Basel und Frankfurt am Main 1999, pp71, 74 et seq; B. MARKESINIS,
The Gradual Convergence. Foreign Ideas, Foreign Influences and English Law on the Eve of the 21st
Century, Clarendon Press, Oxford 1994; cf. also K.P. BERGER, Auf dem Weg zu einem europäischen
Gemeinrecht der Methode, ZEuP (Zeitschrift für Europäisches Privatrecht) 2001 p4.
46 E.A. KRAMER, id, p75 et seq; see also LORD GOFF OF CHIEVELEY, The Wilberforce Lecture 1997,
International and Comparative Law Quarterly 1997, 745, 747 et seq; B. MARKESINIS, Cambridge L.J.
2000, 294 et seq; K.P. BERGER, ZEuP 2001, 4ff.
b. Towards an "Internationally Useful" construction of domestic law
In this context, the PECL perform a very important task for the further internationalisation
and Europeanisation of legal methodology. They open the door for a
new era of dynamic statutory interpretation, i.e. an interpretation of domestic law in
the light of the Lando Principles. This "internationally useful construction" of
domestic law47 emphasises the increased significance of comparative law in legal
practice.48
It has been used in a recent ICC arbitral award. The sole arbitrator construed the
provisions on force majeure of the applicable sixth book of the Dutch Civil Code in
the light of the UNIDROIT Principles.49 He was entitled to take this comparative
approach to statutory interpretation because he found support for his view in Dutch
legal literature.50 Since the UNIDROIT Principles have been considered by the
Dutch lawmaker in the preparation of the new Civil Code, the judge or arbitrator
shall be entitled to use them as a sort of filter in international cases. The domestic
law is viewed and analysed against the background of the Principles. The rule or
principle of Dutch law is applied to the individual case only if it is in conformity
with the UNIDROIT Principles. The comparative efforts employed by the Dutch
lawmakers in the drafting process51 justify the comparative approach in the practical
application of the law in legal practice. This ensures that Dutch contract law is
applied in a sensible and interest-oriented manner in international transactions.52
It is not by coincidence that this approach was first developed in the context of
Dutch private law. The new Dutch Civil Code is certainly the most "cosmopolitan"53
enactment in Western Europe. Also, the concept is by no means new. It is known
from choice of law clauses in large infrastructure projects or contracts for the
exploitation of natural resources. In these contracts, the parties sometimes provide
that the law of country X may be applied to the contract if this law is in conformity
with general principles of law or with the lex mercatoria.54
31
47 See for this concept K.P. BERGER, The Creeping Codification, supra n. 5, p183 et seq; K.P.
BERGER, Festschrift Sandrock, Verlag Recht und Wirtschaft, Heidelberg 2000, p49 et seq; E.A. KRAMER,
in C.J. Meier-Schatz (ed), supra n. 45, p82, n. 52.
48 See LORD GOFF OF CHIEVELEY, supra n. 46, 748: "Comparative law may have been the hobby of
yesterday, but it is destined to become the science of tomorrow.".
49 ICC Award No. 8486, Clunet 1998, 1047 with note Y. DERAINS, id, 1050 et seq.
50 G. KUIJER, Ars Aequi, Ars Aequi Libri, Nijmegen 1996, pp16, 19.
51 It is argued that due to this thorough comparative preparation of the Dutch Civil Code, the Dutch
lawmaker "may have found its own style, based on continental-european ius commune", K. ZWEIGERT &
H. KÖTZ, Einführung in die Rechtsvergleichung, Mohr, Tübingen, 3rd ed 1996, p101.
52 See A. ROSETT, supra n. 24, 354: "[The Principles]...supply common-sensical approaches to problems
that have long eluded common sense.".
53 U. MATTEI, "A Transaction costs approach to the European Code," ERPL 1997, 537, 539.
54 See, eg SSP (Middle East) Ltd., et al v. Arab Republic of Egypt et al, ILM 1983, 752, 771; Letco
Award, ILM 1987, 658.
The arbitrator's reference in the ICC award to domestic Dutch doctrine also
reveals the major problem of this approach. The theories on statutory construction
are always domestic doctrines. Traditionally, these doctrines have developed out of
a framework of dogmatic and constitutional ramifications. Very often, they are
linked to the question of what a domestic judge may do or may not do from a constitutional
point of view. The mere existence of a Restatement of European contract
law does not per se justify a fundamental change in these theories on statutory construction.
This is the price for the "soft law" character of the PECL. The viability of
the "internationally useful" construction of domestic law therefore always requires
a solid dogmatic groundwork in the respective European jurisdictions.
The prospects of the development of such groundwork depend on the penetration
of knowledge about the Restatements among scholars and practitioners. On the
international plane, there seems to be a growing awareness of the purpose and benefits
of the Principles.55 In Germany, the first steps have been made. German
Scholars maintain that in international contexts, the German Law on Standard
Contract Conditions (AGB-Gesetz) as well as the general contract law of the
German Civil Code and the German Commercial Code should be construed in the
light of the PECL.56 The concept shall be applicable in all those cases where the law
leaves room for flexibility, especially through the blanket clauses such as good faith
or the reference to trade practices and usages.57 Some even maintain that the
UNIDROIT Principles constitute a "binding codification" of the lex mercatoria.58
For Swiss law, Ernst A. Kramer has provided another interesting dogmatic justification
of this approach. In his view, the reference in the last sentence of the Preamble
of the UNIDROIT Principles to "national and international legislators" should be
construed in a functional manner so as to encompass domestic judges who develop
the law "like legislators" under the famous Art. 1 Sec. 2 of the Swiss Civil Code
(ZGB).59 Finally, even in purely domestic German cases reference has been made
for the construction of German Civil law to the approaches of "modern lawmakers"
such as the Lando and UNIDROIT Principles. They were invoked to support a quest
for maintaining the flexibility and adaptability of the "culpa in contrahendo" ­ doctrine60
as one of the dogmatic corner stones of German contract law. Thus, these soft
law instruments pave the ground for opening traditional German doctrine to the
32
55 See on the results of the CENTRAL Enquiry on the Use of Transnational Law in Legal Practice
among more than 2.700 practitioners worldwide, K.P. Berger, H. Dubberstein, S.M. Lehmann &
V. Petzold, The Practice of Transnational Law (forthcoming).
56 K.P. BERGER, The Creeping Codification, supra n. 5, p190; K.P. BERGER, Festschrift Sandrock,
supra n. 47; J.C. WICHARD, 60 RabelsZ 1996, 269, 300 et seq.
57 See A.S. HARTKAMP, in ICC (ed), UNIDROIT Principles of International Commercial Contracts:
A New Lex Mercatoria?, UNIDROIT, Rome 1995, pp254, 259: "Whenever a rule [of domestic law]
leaves room for interpretation, profit may be made from the [UNIDROIT] Principles.".
58 R. HAUSMANN, in C. Reithmann & C. Dageförde (eds), Internationales Vertragsrecht, Schmidt,
Köln, 5th ed 1996, No. 2435.
59 E.A. KRAMER, supra n. 47, p82.
60 H. WIEDEMANN, JZ 1998, 1176 et seq.
influence of international soft law instruments. It is only a matter of time that references
to the PECL will be found in the standard German commentaries on the
German Civil Code.
3. The principles as a codification of the Lex Mercatoria or of general principles
of law?
The third aspect of the legal process where the impact of the PECL can be felt relates
to the crucial question of whether the PECL constitute more than just soft law instruments,
whether they can be regarded as a true codification of general principles of
contract law or, in the global context, as a codification of the new lex mercatoria.
As far as the latter one is concerned, one has to emphasise that the analytical vacuum
of the functional comparative analysis alone does not provide enough breeding
ground for the "political element" of transnational law as understood by Savigny.61
While it is true that the Preambles of both the Lando and UNIDROIT Principles provide
for their application in cases where the parties have referred to "general principles,
the lex mercatoria or the like", this reference alone cannot mean that all rules
and principles contained therein are per se part of transnational commercial law. The
Principles as a private form of transnational lawmaking cannot themselves decide
about their legal quality. Rather, qualifying certain rules or principles as part of
transnational commercial law requires acceptance by the international community
of traders ("societas mercatorum") and by international arbitral tribunals as the natural
judges of international trade and the social engineers of transnational commercial
law. Thus, as long as the viability of a principle or rule has not been tested in
commercial practice, both the UNIDROIT and Lando- Principles are "Pre"Statements62
rather than "Re" Statements of transnational commercial law. There is
a presumption that the Principles contain provisions which reflect the lex mercatoria,
but this presumption may be rebutted if the respective rule or principle is not
accepted by commercial legal practice (e.g. through general contract conditions or
standard contract forms or the like) or by international arbitrators.
The situation is different with respect to general principles of law. Since the PECL
have been drafted on the basis of the functional comparative analysis, they contain
general principles of European contract law.63 Again, this requires a closer look at the
origins, structure and wording of each individual principle. It may happen that the drafting
group did not just derive a principle through "private law analogies" from the
domestic laws of the EU Member Countries. In some instances the Group went a step
further and developed a new and better principle64 on the basis of its extensive com
33
61 See K.P. BERGER, The Creeping Codification, supra n. 5, p207 et seq.
62 See for this terminology P. KARRER, in H. Honsell, N.P. Vogt & A.K. Schnyder (eds), Internationales
Privatrecht, Helbing & Lichtenhahn, Basel und Frankfurt am Main, 1996, Art. 187, No. 71.
63 See generally R. SCHULZE, Allgemeine Rechtsgrundsätze und europäisches Privatrecht, ZEuP
1993, 442, 458 et seq.
64 See for this phenomenon of "gently pushing" W. SCHLESINGER, Legal Essays in Honour of Hessel
E. Yntema, 1961, 65, 78; W. LORENZ, JZ 1962, 269, 274.
parative re-search. This "new" rule cannot be called a general principle of European
contract law.65
Conclusion
The relationship between the concept of the Creeping Codification of law and the
Lando Principles can be expressed in four keywords: "informality", "visibility"
"multiplicity" and "transnationality". Do the Lando Principles foster the development
towards a European Civil Code? The answer must be ambiguous.
From the present perspective it appears that the creeping codification-approach
to the unification of European contract law is a more promising venture than the traditional
positivistic attitude. One should not forget Thibauťs famous miscalculation
that the drafting of a German Civil Code would not take more than "two, three or
four years".66 How much more danger is there in the calculation of a realistic drafting
period for such an ambitious and gigantic venture as a European Civil Code in
an era of "decodification"?67 Isn't this the "quest for utopia"68 described so aptly by
Professor Markesinis?
From a long term perspective, the PECL may also be seen as paving the way for
a true codification of European private law. The German Civil Code of 1900 owed
much of its maturity to the conceptual groundwork laid by the historical school of
jurisprudence and its successors, the pandectists.69 This experience shows the right
direction for today's discussion on the unification of European contract law. The
PECL and the practice gradually evolving around them provide an excellent laboratory
for the use and necessity of European statutory contract law. Codes are not born
out of nowhere but out of experience. The practice and experience based on the
PECL will show whether a truly international, comparative methodology can be
developed as an indispensable prerequisite for every codification of European or
international contract law.70 In the words of Ole Lando, "the methods advocated by
the Savignys may also be useful for the Thibauts".71
34
65 In ICC Award No. 7375 the tribunal applied the UNIDROIT Principles only "as far as they can be
considered to reflect generally accepted notions and principles"; see Mealey's International Arbitration
Report, 1996, A-1 et seq; Unif.L.Rev. 1997, 598; M.J. BONELL, in CENTRAL (ed), Transnational Law in
Commercial Legal Practice, supra n. 5, pp7, 37 et seq; A. REDFERN & M. HUNTER, Law and Practice of
International Commercial Arbitration, Sweet & Maxwell, London, 3rd ed 1999, p127.
66 A. THIBAUT, supra n. 11, p64.
67 The notion of "decodification" refers to the tendency to remove codified law (e.g. on consumer
protection) from the classical major codes into specialised laws, see N. IRTI, Ľet della decodificazione,
Giuffré, Milano 1979, p14 et seq.
68 B. MARKESINIS, "Why a code is not the best way to advance the cause of European legal unity,"
ERPL 1997, 519.
69 R. ZIMMERMANN, supra n. 9, p81.
70 See K.P. BERGER, ZEuP 2001 4 et seq.
71 O. LANDO, supra n. 11, 525; see also O. LANDO, in H.L. Wyers (ed), Europäisches Vertragsrecht,
Nomos-Verlags-Gesellschaft, Baden-Baden 1997, pp81, 101.