COMPARATIVE PRIVATE LAW FORMATION University of Oslo Prof. Giuditta Cordero Moss

Case I – Written Amendment Installation contract between constructor and sub-contractor Contractual price turns out to be insufficient (no margin of profit for sub-contractor) Sub-contractor proposes increase of price and constructor agrees Written amendment agreement Constructor finds another sub-contractor and revokes amendment Was the amendment binding?

Case I- Was the amendment binding? English law: Amendment is not enforceable Others: Amendment is binding and enforceable

Case II- Irrevocable offer Tender for construction Contractor makes a bid Bid based on local sub-contractors’ prices Contractor is awarded the contract

The subcontractors’ offer ”This offer is binding on the offeror and cannot be revoked before 30 days have elapsed from the date hereof” Subcontractor revokes the offer before the term (but after the the contract was awarded)

Case II- Was the offer binding? English law: The offer was not enforceable Others: The offer was binding and enforceable

Case III-Modified Acceptance Seller and Buyer agree on the phone on quality, volume, price, delivery place, and agree to send written confirmation Seller sends confirmation specifying that transport to be made on ship at seller’s discretion Buyer sends acceptance, but requests ship of certain nationality Seller does not reply At moment of shipment, seller says that the contract was not concluded

Case III – Was the contract concluded? Norwegian, Italian, English law: No German law, CISG, UNIDROIT, PECL: Yes

Case IV – Battle of the Forms Seller and Buyer agree on the phone on quality, volume and price Seller sends offer on pre-printed general sale conditions. Conditions contain limitation of liability for delays Buyer sends acceptance on pre-printed general purchase conditions. Conditions contain no limitation of liability except for force majeure At time of delivery shortage of goods prevents timely delivery

Case IV- Was contract binding, is liability limited? Norwegian, Italian, English law, CISG: No contract If performance was started: contract is binding, no limitation of liability (”last shot”) German law, UNIDROIT, PECL: Contract is binding Neither of the liability clauses is applicable (”knock out”)

Case V- Break-off of negotiations Negotiations between car producer (”Carp”) and component producer (”Comp”) for joint production Plant identified, neg. teams discuss technical design, allocation of personel, funding, profit-split Result of negotiations to be recorded in MoU by each team; MoUs to be transformed into contract From the start Carp negotiates in parallel with other comp (”Comp 2”). Towards the end of the negotiations Carp breaks off with Comp and enteres into contract with Comp 2

Case V- Is Carp responsible for break-off? Norwegian, German, Italian law, UNIDROIT, PECL: Comp is entitled to reimbursement of damages English law, CISG: No liability

Common Features Contract is concluded by exchange of conforming offer and acceptance. Acceptance can be tacit.

Norwegian Law Act on Formation of Contracts §§ 1-9 Exchange No form requirements Offer is binding Acceptance must conform – otherwise: counter-offer Mirror image rule (unless awareness of misunderstanding) Last shot rule Progressive creation of consent (formal contract not necessary) Duty of loyalty in negotiations

German Law §§ 145 ff BGB Exchange No form requirements Offer is binding Acceptance must conform, otherwise counter-offer Mirror image rule but, if parties have interest, only modified part is deemed counter-offer §155) Battle of the forms: if contract is deemed concluded, knock- out (§154) No contract until all points agreed upon (§154.1) Formal contract necessary if parties referred to it (§154.2) Culpa in contrahendo (§311.2, 241.2

Italian Law Art cc Agreement, causa (art. 1343: legal), object, form (only for certain contracts) Exchange Offer revokable unless firm (1329) Acceptance must conform, otherwise counter- offer Mirror image rule Good faith in negotiations (1337)

English Law Exchange Consideration Offer is revocable even if firm Acceptance must conform, otherwise counter-offer Mirror image No duty of loyalty or good faith

CISG Exchange (art. 23) No form, no causa, no consideration Amendment is valid by mer agreement (29.1) Offer revocable unless firm (16) Conforming acceptance, otherwise counter-offer (19.1) Minor modifications acceptable (19.2), but: most modifications are material (19.3) No specific rule on general conditions: mirror image + last shot (last shot directly only if minor modifications) No pre-contractual liability

UNIDROIT Principles Exchange (3.2) No form, no causa, no consideration Offer revocable unless firm (2.4) Mirror image + last shot Directly last shot if immaterial modifications (2.11) Battle of the forms: knock-out (2.22) Negotiations must be in good faith( 2.15)

PECL Mere agreement (2:101(1)) Revocable offer, unless firm (2:202) Last shot if immaterial modifications (2:208) Battle of the forms: knock-out (2:209) Negotiations in good faith (2:301)

Main differences Consideration Mirror image vs. Knock-out Pre-contractual liability