Oxford University Comparative Law Forum
Codification of Private Law in Scotland: Observations
by a Civil Lawyer
(2007) Oxford U Comparative L Forum 1 at ouclf.iuscomp.org | How to cite this article
This article discusses, by reference to Scotland, the problems
of codifying a mixed system of private law, presenting an outline of
some parts in a draft civil code. A civil code must resolve divergence
between Civil Law and Common Law concepts. Such divergence is
demonstrated here by reference to the conceptual conflict between the
Scots (Civil) law of error and the English (Common) Law of
misrepresentation. The article outlines how codified provisions in this
area might be drafted. It discusses the German, French, Swiss and
Austrian rules (the last being remarkably similar to Scots law), and
offers possible Common Law and Civil Law-style codifications of the
Scots law of error. As Scots statutes follow the Common Law drafting
style, it is argued that they are unsuitable for comprehensive
codification. A code in a Civilian style, on the other hand, requires
the adoption of Civilian statutory interpretation, but as this is
inconsistent with Scots legal culture, the final question raised is
whether codification of Scots private law is desirable at all.
Table of contents
A. Introduction: The Austrian General Civil Code as
an Example of an "Old" Civil Code.
Discussion of the codification of Scots private law in a civil code
appears to have gained a more prominent role after devolution in 1999.
At the Scottish Universities Law Faculties' Conference in 2002,
Professor Eric Clive presented a codification project and outlined the
structure of a future code.1
This article reflects on codification from the perspective of an author
from a Civil Law background whose initial training and practical
experience in private law was on the basis of a civil code.
The civil code in question, the General Civil Code of Austria or
ABGB (Allgemeines Bürgerliches Gesetzbuch), is itself of
interest for Scots lawyers, for it was promulgated as early as 1811,2 about the
time when the flow of the Civil Law tradition and scholarship between
Scotland and Continental Europe was finally interrupted in the wake of
the Napoleonic wars.3
As a result of the century-old common basis of the ius commune (Gemeines
Recht) rooted in Roman law, certain features of Scots law can also
be found in the Austrian civil code (ABGB), which retained them in a
less modified way than more modern codifications. The ABGB is still in
force, albeit heavily amended over the decades. The ABGB is undoubtedly
old-fashioned beside the German BGB, the Swiss ZGB and OR, the Italian Codice
Civile, or the new Dutch Civil Code. To a large extent it is an old
code, in the spirit of Natural Law and abstract reason as the principal
sources of law,4
and essentially reflecting the usus modernus5 of the Habsburg
countries as shaped by the age of reason in the eighteenth century.6 In
contrast with the older Prussian Code (ALR) of 1794, it has not taken
over the conglomerate of the partly outdated and conflicting casuistic
doctrines of the usus modernus.7 As a late product of the Austrian
Enlightenment, it is short (1,502 sections),8 relatively precisely
and clearly structured.10
It uses a language not too remote from that of the (educated) people of
its era, and contains provisions which were generally born out of
common sense rather than excessively erudite scholarship - features
that equipped it with a surprising versatility and adaptability,11
essential hallmarks of a successful codification.
The example of the ABGB is also a reminder that one should approach
the task of codification prudently. Once a code is enacted, it normally
remains, even under most extraordinary circumstances, and grows old
with dignity, but without necessarily becoming a better law. Following
its promulgation, the ABGB was in force in most parts of the Austrian
Empire, and, after 1867, of the Austrian-Hungarian Empire, though not
in Hungary apart from a brief period from 1852. After the First World
War it remained in force in Austria, and also in what was then
Czechoslovakia, despite the obvious tensions between Austria and the
"secessionist"/successor state. In addition, it also stayed in force in
the former Austrian parts of Poland (Galicia, Cracow), after Poland
came into existence again in 1918 until a new civil code was enacted
for the whole of Poland.12
The ABGB even remained in force for the former Austria after its
annexation by Nazi Germany in 1938, although, curiously, as from 1
April 1940 the "Land Austria" (the national-socialist bureaucratic
term) ceased to exist completely as an administrative entity under
public law within the Third Reich.13 Since the Second World War, the ABGB
has continued in force in Austria until the present day. It still has
substantial shortcomings, in spite of numerous fundamental amendments
over the centuries14
and supplementary legislation in a large number of separate statutes.
For every Austrian private lawyer it is, nevertheless, the "bible" (and
appears to become more biblical and mysterious in some old-fashioned
parts); it enjoys some ironic affection among Austrian lawyers; it
stands pluckily beside the other codes; and it is a source of
bewilderment especially for German lawyers (something Austrians tend to
appreciate) with its slightly archaic brevity and directness, its
generally down-to-earth provisions, and its perhaps idiosyncratic
organisation following the scheme of the Institutes of Gaius: personae
- res - actiones.15
The writer is not aware of any serious project to replace it by a more
Scotland's mixed system combining Civil Law and Common Law
on the other hand, is viewed by some commentators as a model for
harmonising legislation in Europe,18 or even as a "picture of what will
be ... the law of the civilised nations".19 If that is indeed so, this
particular characteristic should probably also be preserved in a future
Scottish code. However, the assertion of mixedness in relation to legal
systems is often questionable. For example, it has been argued,
probably with some exaggeration, that the Civil Code of Quebec is in
reality the result of a reinforcement of Franco-Canadian at the expense
of Anglo-Saxon legal culture,20 driven essentially by political
forces, and so it represents Civil Law with a few minor Common Law
The notion of Scots law as a mixed system has also been qualified22 and
and the idea that a mixed system must be qualitatively superior because
of its foundation on a critical choice of the best elements of both the
Civilian and the Common Law traditions has been dismissed as a myth.24
Adopting a property law analogy, is Scottish private law "mixed" in
the sense of commixtion/confusion, or of specification? Put
differently, is Scots law a conglomerate of fragments and parts of
Civil Law or Common Law which are, in themselves, relatively
pure and do not necessarily influence each other much, or is Scots law
the result of a true mixture of Civil Law and Common Law, a new
matter composed of these two ingredients?25 A conclusive answer can probably
only be given in relation to individual, narrowly defined, areas, but
the writer tends to the conglomerate version. One gains support for
this view by examining statute law - which a civil code would also be.
Scots statutes, both Acts of the UK Parliament for Scotland and Acts of
the Scottish Parliament,26
are unadulterated Common Law creations in respect of their drafting
style, level of abstraction, and regulatory detail, and, due to their
nature, they are arguably not appropriate as a basis for a successful
Brevity and flexibility are essential for a codification and these are
achieved by using the right level of abstraction when creating
statutory provisions. This problem, as well as the whole complex debate
of advantages and disadvantages of codification, can be more
satisfactorily discussed if a concrete example is taken as a starting
point. The example in the present case will be the Scottish law of
B. Drafting Provisions on Error
The draft of new provisions on error is likely to go though the
following steps: (1) restatement of the existing law of error in
Scotland in an analytical and succinct way; (2) identification of areas
which may be improved in a new draft - effectively an amendment of the
existing law; (3) examination of the provisions on error or mistake in
other jurisdictions and, if possible, identification of existing
foreign provisions which appear to come close to the envisaged Scots
rules, so that the foreign rules may serve as an inspirational model
for the draft (although such a model should be used with due caution);
(4) analysis of the implications of the draft provision on error for
the remainder of the private law system, especially its legal
consequences, in order to achieve consistency and to create and
preserve the civil code as a uniform body of law: that involves the
issues of reduction of a contract, restoration of property transferred
under the void (annulled) contract, but also, indirectly, the principal
criteria of contract formation; and (5) draft of the provisions on
(1) Account of the Scots law of error in outline28
The law of error29
attempts to resolve the conflict arising from the discrepancy between
intention (volition) of a party to a contract and his or her
declaration or expression (signum volendi)30 on the one hand, and,
on the other, the principle that the other party can rely on the
A party may not always be bound by a contract if he or she has
contracted under error because the party's error vitiates true
contractual consensus. Consensus in idem must be tested
objectively. Error can be defined as a misconception, or a wrong or
incorrect belief about a matter of fact or a matter of law.32
The following forms and situations of error can be distinguished:
(a) Quality of error
If the error is uninduced,33 a contract can be reduced only if
the error is an error in substantialibus, that is, going to the
fundamental nature or root of the contract. It is difficult to define
the exact meaning and ambit of the "substantials": one may use Bell's
classification of error in substantialibus as being an error
regarding the subject-matter of the contract, the contracting person
(if personal identity is essential), the price, the quality of the
thing engaged for, and the nature of the contract.34 This list reflects
the basic types of error in Roman law,35 but it is not exhaustive, nor does
it refer to any potential differences between unilateral and common
error, so that this analysis is of limited assistance.36
Where error is induced by innocent misrepresentation the error must
be material or, it is sometimes said, "essential", an ambiguous term.37 The
notion of misrepresentation is an import from English law and
theoretically distinct from that of error.38 Within the realm of
misrepresentation, "material" or "essential" error can be defined as an
error that does not need to go to the root of the contract but must be
sufficiently important to have induced a reasonable person to enter
into the contract.39
Thus the misrepresentation must have induced (caused) the error ("but
As a result, the English "innocent misrepresentation" and the Scots
"essential error" appear to have become interchangeable.41 "Essential error" (error
under classical Scots law and "essential error" under modern Scots law
after the import of innocent misrepresentation from English law (error
as a result of an operative misrepresentation in the meaning of English
denote two different concepts. It has therefore been recommended that
the term should not be used in the context of innocent
(i) Error in transaction, error in motive
An uninduced error is operative only if it is an error in
transaction (in negotio). If the error was induced by the other
party's misrepresentation, the error has effect, independent of whether
it is an error in motive (in causa), or an error in transaction.45 The
distinction derives from the German legal family (where an error in
motive is operative in exceptional circumstances only46) but has found its
way into Scots law.47
If the error is in respect of circumstances outside the actual
transaction, it is an error in motive; otherwise it is an error in
transaction. In the case of an error in transaction the question is what
transaction a party wants to agree to (intention formed correctly, but
expressed with an error), while in case of an error in motive the
question is why the party wants to agree to a certain
transaction (intention formed because of an error, but expressed
The distinction is sometimes difficult to make in practice and not
entirely satisfactory because in psychological terms both cases may
often be identical.49
(ii) Relevance of error in law?
Normally only an error in fact is relevant. Some cases went even so
far as to exclude errors in law from having any effect whatsoever, at
least when the contract in question was not in discharge of legal
Other cases were less strict. If the error in law could be interpreted
as a case of an error in essentialibus,51 (in other words if
the error in law was considered as an error in the subject-matter of
the transaction) then reduction of the contract was allowed.52 It now
seems clear that if the error was as to the legal consequences of the
transaction, the contract is not reducible, unless the error was
induced by misrepresentation of the other party.53 Reluctance to accept
error in law as a ground for reduction can be traced back to Roman law.54
(b) Unilateral error not induced by the other party
A unilateral error that was not induced by the misrepresentation of
the other party is a ground for reduction only if the error is in
substantialibus and an error in transaction.55 Examples are errors
in relation to the personal identity, if essential, of the party
undertaking the obligation56 (error in persona), or to the
nature (error in negotio) or object (error in corpore) of
In the German legal family error in expression is often regarded as
a sub-category of error in transaction,57 and this view does not appear to
conflict with Scots law.58
Errors in expression59
are defects in the declaration of the party's intention, such as a slip
of the tongue or the pen, or the incorrect quoting of a price.60 The
incorrect quoting of a price should be distinguished from the quoting
of an incorrect price. In the former case, the intention concerning a
certain price has been communicated with an error: in the latter, it
has not, but the price calculation itself was made wrongly. As a rule,
the other party can rely on what the representor states. In other
words, the representor is bound by his or her statement and cannot
escape from a bad bargain.61 Thus there is no reduction on the
ground of error if the price calculation is disadvantageous to one
even when the other party is aware of this (right expression of a
wrongly calculated price). However, if the other party knows from the
prior negotiations which price the first party is actually prepared to
accept, and the first party then mistakenly quotes another (typically
lower) price, he or she can seek reduction (error in pretio -
wrong expression of the price this party is prepared to agree on).63 In such
a situation the particular price64 has become part of the contractual
Usually such a situation (not confined to erroneous prices only) is
referred to as "taking advantage of the other party's error", 66 which
is, it is submitted, a somewhat ambiguous label.67
An uninduced unilateral error as to the nature of a contract (and
its legal effects) which has been committed to writing can virtually
never be annulled,68
and there no longer seem to be exceptions to this rule.69
The so-called falsa demonstration is not an error in
expression ("falsa demonstratio non nocet"70): the parties use (in
agreement) a description of the subject-matter of the contract which an
outsider would consider as incorrect, but the parties do not err in
respect of the subject matter itself.71
Error in transaction (in the wider sense) can overlap with cases of,
or be an example of, a breach of a contractual term or the
nonpurification of an implied condition, as for example when the
subject matter of the contract is not in existence at the formation
stage or its actual quality deviates fundamentally from the stipulated
The stronger emphasis on contractual terms or suspensive/resolutive
conditions is a typical feature of non-codified (Common Law) systems
where the parties cannot rely on an existing set of rules of ius
as are found in a code. This is one reason why the law of error has
only limited relevance in practice.74 Similarly, in English law, many
mistake cases can be interpreted as breaches of a contractual term (for
example, quality of the subject-matter), or as cases of frustration,
and it has sometimes been suggested that there is in fact no law of
mistake in English law.75
Although Civilian academic discussion tends to deal with these areas
more separately, in the doctrine and case-law of Civil Law systems
there is an awareness of potentially competing claims arising from
facts which could be construed as cases of error, initial impossibility
to perform, or breach of (implied) contractual conditions (with
different remedies or legal effects). 76
Some authors are of the view that the successful reduction of a
contract for error renders the contract void: until then, it is valid,
though voidable, and has all the legal effects of a sound contract.77
Judicial opinion is less clear:78 in some cases contracts under error
are regarded as void in certain circumstances,79 which would be the
logically consistent consequence of retrospective legal recognition of
absence of consent, hence no contract, due to the error in
substantialibus. This leads to further questions, in particular
whether or not ownership can validly pass under a contract under error,
and, if so, up to which point. In this context it is also important
whether there was an error regarding contemplation of transfer of
These matters would have to be decided in the course of a codification.
(c) Error induced by misrepresentation of the other party
This area of the law of error developed under the influence of, and
follows largely, English law on misrepresentation. If a material81 error
in motive or a material error in transaction, which does not need to go
to the root of the contract (there is no requirement of error in
substantialibus) has been induced by an operative
misrepresentation, the misrepresentee is entitled to seek reduction of
the contract on the ground of his or her error. A misrepresentation is
operative if the misrepresentor or his or her agent has made a false
of existing (or past) fact83 to the other party prior to the
conclusion of the contract and the misrepresentation has actually
induced the misrepresentee to contract with the misrepresentor.84 The
misrepresentation does not have to be the sole cause for the
misrepresentee to conclude the contract but a causal link is necessary.85
When the misrepresentation is innocent, the misrepresentee can seek
reduction of the contract86
and restitution of the price, but only if restitutio in integrum
This includes the return of the subject-matter in the same state as
before the formation of the contract. Otherwise (typically, where a
third party has acquired an unassailable title to the subject-matter)
reduction is barred.88
Before reduction the contract is voidable, in other words, valid,
unless the error is in substantialibus,89 in which case the
contract is arguably void, although there is no clear authority on this
When the misrepresentation is negligent or fraudulent, delictual
damages can be claimed in addition to reduction. 91
(d) Error by both parties
It is useful to distinguish between common error, whereby both
parties are under the same misapprehension, and mutual error, whereby
the parties are at cross-purposes92 (although the terminology is not
used consistently in this way).
Common error is a real situation of error because there is apparent
consent between the parties, but true consent is defective,
while in the case of mutual error even apparent consent is absent.
Mutual error prevents the emergence of a consensus in idem and
there is therefore dissensus.93 On objective criteria, offer and
acceptance do not match and no contract has been concluded. Strictly
speaking, dissensus is never a case of error,94 because the contract
does not even come into existence ab initio, in contrast to being
If there is a common error, the courts seem to judge this situation
according to the rules of induced/uninduced error, although their
analysis is not always clear, partly because of the obscure meaning of
the term "mutual".95
(2) Areas for potential improvement
The Scottish law of error is perhaps an example of "commixition" of the
Civil and the Common Laws, rather than "specification", and it also
appears to represent confusion - in the ordinary meaning of the word.96 The law
of error (or mistake) is notoriously difficult and controversial in all
and a mixed system does not necessarily provide a better result merely
by mixing the ingredients from different legal families.
A codification of Scots law may attempt to resolve the conflict
between the concepts of (innocent) misrepresentation and error: these
concepts are, nevertheless, irreconcilable because the Scots law of
error is a component of the law of contract and deals with defects in
the contractual formation process, while the English law of
misrepresentation is conceptually still a part of tort law, although it
frequently appears in the context of the conclusion of contracts. The
claim for negligent misrepresentation can appear alongside contractual
but the assessment of damages for misrepresentation is based on a tort.99
Misrepresentation in English law comprises the tort of deceit,100
statutory liability for negligent and innocent misrepresentation under
the Misrepresentation Act 1967,101 and the common law tort of
negligent misrepresentation as in Hedley Byrne v Heller.102 What
is common to all of them is that they do not deal with (flawed)
consensus in the formation of the contract but with a
(mis)representation, and in order to establish liability they are
therefore concerned with the act and state of mind of the injuring
party. The law of error, however, looks primarily at the state of mind
of the injured party (from the point of view of tort law), in other
words whether there is a discrepancy between intention and declaration
(statement or act) which vitiates the party's true consent. Thus in the
(classical) Scots law of error the focus is on the erring party, while
in the English law of misrepresentation the focus is on the other
party. This is also the reason why the term "essential error" under
modern Scots law in the context of innocent misrepresentation is in
what is relevant is not whether one party is in error, but whether the
other party makes a false statement of existing fact which induces the
first party to contract. In a code this conceptual divergence can
probably only be overcome, for example, by following the Civilian
system of error with consistency, and by incorporating the advantageous
elements of the otherwise abandoned Common Law system of
misrepresentation by emulating its legal consequences within, rather
than in addition to, the conceptual framework of the Civilian system.
This may also serve to remove the terminological uncertainty of the
expressions "substantial", "essential" and "material" error. An example
of a foreign legal provision providing a solution broadly along these
lines is shown below.
(3) The law of error in other jurisdictions104
In Germany, the law of error is regulated under § 119 of the
A party can rescind a contract106 because of an error in transaction
if either (a) it is an error in expression (Erklärungsirrtum),
or (b) the expression, tested objectively, does not correspond to the
meaning the party believed it would have (error as to content, Inhaltsirrtum).
Thus a reasonable representee understands the representation in a way
which differs from what the representor had imagined. Had the
representor known of the true situation, he or she would not have
An error in motive is only relevant if the error relates to the
quality of the person or the thing and this is a "characteristic
regarded in business as essential" (§ 119 (2) BGB). In the
interpretation of the German courts, matters are "regarded in business
as essential" if they relate directly to the thing itself (in a wide
sense, also assets etc),108 or to those qualities of the
person which are relevant to contractual performance. The newly enacted
§ 313 (2) BGB follows existing case-law in recognising common
error in motive.
Provisions on error are contained in Arts 1109 and 1110 of the
French Code civil.109 Error is relevant where it relates
to the very substance of the thing (la substance même de la
chose, Art 1110) which, in the interpretation of the courts,
includes qualities of the thing which go to its substance (qualités
substantielles de la chose).110 An error is only relevant if it
has been the determining motive for the party to enter into the
contract (motif principal ou determinant), that is, if the party
would otherwise not have contracted at all. Reduction (action en
nullité ou en rescission, Art 1304) is only available if the
error was excusable. 111
If a party could have ascertained the accurate state of affairs but
failed to do so, the error is inexcusable.
The Swiss error provisions are Arts 23 and 24 of the Swiss Law of
Obligations (Obligationenrecht, OR).112 In Swiss law, a party can rescind
only for substantial error. The law provides a non-exclusive list of
instances of substantial error but, in a manner typical of the drafting
style of the Swiss civil code, it is within the judge's discretion to
determine what constitutes a substantial or an insubstantial error.113 The
first three categories in Art 24 describe the usual categories of error
in negotio, error in corpore and in persona, and error in
The last category (Art 24(1)(4)) classifies an otherwise irrelevant
error in motive (Art 24(2)) as substantial if the party's error
concerns a certain set of facts which the party has (subjectively)
considered as the basis of the contract, and which the party is also
(objectively) entitled to hold as such, in accordance with good faith
and normal commercial practice (error as to the basis of the contract,
fundamental error, Grundlagenirrtum). Thus the error must have
had a causal connection with the formation of the contract and both
parties must have had a common idea about its contractual basis which
was, on an objective view, an inevitable pre-requisite for entering
into the contract.114
An important application of the error regarding the basis of the
contract is the error as to the substantial quality of a thing (error in
The Austrian law of error is contained in § 871 of the ABGB.115
Under this provision, only errors in transaction regarding the main
object of the contract or a substantial quality thereof are relevant,
and reduction is not permitted when there has been error in motive
(§ 901). The party who was in error can rescind if the error was
substantial, and either (a) the error was induced by the other party;
(b) the other party ought to have noticed the error in the given
circumstances; or (c) the error was resolved in good time. This "theory
of reliance" (Vertrauenstheorie) in the Austrian ABGB can be
traced back to the draftsman of the ABGB, Zeiller, and even more so to
his predecessor and teacher, Martini.116 It contrasts with the theory of
intention or will (Willenstheorie) by Grotius, Pufendorf and Christian
"Inducement" means that the other party has caused the error, and
it is irrelevant whether this was done negligently or innocently.118
"Ought to have noticed" means that the other party has been negligent
in failing to notice the representor's error. The error is "resolved in
good time" if the other party has not yet acted in reliance on the
contract. This rule represents an application of the res integra
doctrine of the ius commune119: if the other party has already
incurred expenses or disposed of property under the contract (for
example, sold it to a third party), restitutio in integrum is
no longer available and the contract cannot be reduced on that ground.120
Common error has also been recognised as a ground for rescission in the
case-law and in legal doctrine.
The Austrian error rule has been praised as "most original,
attractive and satisfactory."121 Whether or not one shares this
opinion, the Austrian § 871 ABGB contrasts with the provisions of
other jurisdictions in that it considers the intention and acts not
only of the erring party but also of the other party. This brings the
rule closer to Scots law, although, of course, it is not a
misrepresentation section in the sense of the Common Law.
(4) Implications of the error provisions for the rest of the code
As error concerns a defect in the formation of the contract, the
consequences of a successful reduction of the contract under Scots law
must be considered, including the restoration of property (in the
widest sense) previously transferred. This is one of the most essential
parts when devising the plan of a code. It could even be argued that a
draftsperson has to have regard to the general underlying principles of
transfer and re-transfer of property from the very beginning, as they
pervade a code, even before formation and performance of contract are
considered in detail. In some respects, the law of unjustified
enrichment (restoration of property) is the mirror of the law of
contract (transfer of property), not just its appendix. The planning of
an unjustified enrichment system immediately prompts decisions as to
the existence and extent of constructive trusts under a future code.122
Surprising though it may seem, a really consistent logical framework is
achieved primarily by a comprehensive underlying system of unjustified
enrichment and restitution, the "chassis" of a civil code.
A decision must therefore be made at an early stage whether the
(derivative) acquisition of property in Scots law is to be causal, or
If ownership can only pass on the basis of an underlying reason
recognised by the law (iusta causa traditionis), most commonly a
contract capable of transferring ownership (e.g. a sale, but not a loan
for use, commodatum), the system is causal.124 Where the
conveyance is in itself sufficient to transfer ownership, irrespective
of the validity of any underlying contract, the system is abstract,125
which is the present Scottish system,126 although the authorities are not
entirely clear in this respect.127
Whether the system of transfer of ownership is causal or abstract
determines legal solutions particularly in relation to double sales of
and to the invalidation of contracts. Taking error as an example,
first, it has to be determined whether the error renders a contract
void or merely voidable, and, if the latter applies, what the true
effect of a reduction of the contract should be: does it render the
contract void retrospectively, ab initio (or "ex tunc"),
in the sense that it is deemed never to have been concluded? Or does
the contract cease to have legal effect as from the successful
reduction, but remain valid in respect of the time period before ("ex
nunc")? The latter approach probably conflicts with the concept of
error as destroying the contractual consent. If the effect of reduction
is the retroactive annulment of the contract, in a causal system the
transferor can reclaim property passed under the reduced contract (for
example by rei vindicatio, condictio sine causa129 or a similar
remedy). This is because the transferee never acquired ownership, due
to the deemed absence of iusta causa traditionis as the result
of the reduction. This is irrespective of whether or not the party has
(also) erred in relation to the intention to transfer ownership. Where
the basis of transfer is abstract, error can only vitiate transfer of
ownership if the error is about the intention to transfer ownership,
for the validity of the underlying legal relationship is irrelevant.130 This
is of obvious importance for the legal position of third parties to
whom the transferee may have passed on the property in the meantime,
and ownership of it, as the case may be.131 In an abstract system, redress is
effected in such cases by way of unjustified enrichment, and that might
tilt a decision in favour of a causal system, to avoid undue expansion
of the law of unjustified enrichment.132
(5) Draft provisions on the Scottish law of error
The suggested provisions are founded on three premises: (a) the issue
of terminology and its conceptual aspects cannot be considered without
large parts of a draft code in existence; (b) the current principles of
Scots law of error are to remain generally unaltered; and (c) the
problem of reduction of contracts, including its implications for the
restoration of property transferred under these contracts, is dealt
The following exemplifies the Common Law approach. An extreme
example is given in outline for demonstration purposes without any
suggestion that a possible future Scottish civil code would necessarily
adopt such a style. The example is inspired by the South Australian
Misrepresentation Act 1972,133 and the Contract Law Regulation
1961 of Bahrain.134
Both are, or contain, misrepresentation provisions.
In this Chapter the following words and expressions are used in the
following senses, unless a contrary intention appears from the context:
(1) "Error" means, under an objective assessment, a misapprehension as
to a matter of fact or a matter of law relevant to the contract;
(2) "Substantial error" means an error but for which the party would
have declined to contract and which relates to the fundamental nature
of the contract. An error as to the fundamental nature of the contract
includes an error regarding the subject-matter of the contract; the
identity of the other contracting party, if made essential to the
contract; the price, if made essential to the contract; the quality of
the thing engaged for; the nature of the contract entered into;
(3) "Material error" means an error, though not substantial, which is
sufficiently important to induce a reasonable person to enter into a
(4) "Misrepresentation" means and includes:
(a) the assertion of that which is not true, by a person who believes
it to be true;
(b) a false statement which is a breach of a duty of care owed to the
person to whom the statement is made and which, without an intent to
deceive, gains an advantage to the person committing it (negligent
(c) a false statement made knowingly or without belief in its truth or
recklessly whether it be true or false (fraudulent misrepresentation);
(d) a false statement made without deception and without being in
breach of a duty of care to the person to whom the statement was made
- Reduction for error and misrepresentation
Where a person has entered into a contract
(a) under error, or
or both, that person shall be entitled to reduce the contract and, in
addition to the reduction, to claim damages, as the case may be,
subject to the provisions under this Chapter of the Act.
(b) after an operative misrepresentation has been made to him;
- Contract terms
If the error or the misrepresentation relates to a fact which
subsequently has become a term of the contract, the party shall be
entitled to claim breach of contract instead of reduction of the
A person who has entered into a contract under an error shall not be
entitled to reduce the contract if the error is not a substantial
error, and if:
(1) the error relates to the nature and the legal effects of a contract
which has been reduced in writing; or
(2) the error does not relate to the contract as such but only to the
person's motive to enter into the contract; or
(3) the error is an error as to law.
(1) Where a person has entered into a contract after an operative
misrepresentation has been made to him which has caused the person to
contract under a material error, the person shall be entitled to reduce
(2) The misrepresentation is operative if:
(a) the misrepresentation has been made to the person by the other
party to the contract or by a person acting for, or on behalf of, the
other party to the contract; and
(3) Where the party making the operative misrepresentation is not at
fault, the person to whom the misrepresentation has been made shall
only be entitled to reduce the contract if, following reduction, he is
able to restore the positions he and the other party were in before the
(b) the misrepresentation is an incorrect statement of fact; and
(c) the misrepresentation is a statement or positive misleading conduct
made before the contract has been concluded; and
(d) the misrepresentation has been the reason, or one reason, for
entering into the contract, which has to be proved by the person
seeking to reduce the contract because of the misrepresentation.
(4) Where the party has made the operative misrepresentation
fraudulently or negligently, the person to whom the misrepresentation
has been made shall be entitled to damages in delict in addition to the
reduction of the contract.
- Common error Where both parties to a contract are under a
common error as to a matter of fact which is substantial to the
contract, the contract is void.
[Remedies as to error and misrepresentation] ...
The following is an example of the Civil Law approach. Again, this
is an extreme example, inspired by the provisions from the Civil Law
Section 1: Error
(1) A party, who contracts under a substantial error, or under a
material error induced by a statement of the other party, can reduce
(2) An error is substantial if it relates to the elements which form
the basis of the contract and without which the erring party would not
have contracted. There is no reduction for a substantial error if it is
the result of an error in the motivation to contract.
(3) An error induced by a statement of the other party is material if
it is deemed to be a sufficiently important reason to have induced a
reasonable person to enter into the contract. If a material error has
been induced without fault by a statement of the other party, and the
erring party is unable to restore both parties to their positions
before the contract, the contract is not reduced. If the other party
has induced the material error fraudulently or negligently, the erring
party is entitled to damages in addition to reduction [in accordance
with section ...].
C. Implications of Codifying the Existing Law
The example above from the law of error shows that it is unquestionably
possible to codify Scots private law, but one has to reckon with
significant changes as a result, perhaps less in Scots law as
such, but certainly in Scottish legal culture. In this context, a
"code" is understood as a comprehensive and coherent body of rules in a
certain field of the law, with a consistent intellectual framework and
terminology which form the backbone of its elements, legal concepts and
areas of regulation. For present purposes, codification does not mean a
restatement by "consolidation" or "statutorisation"135 of existing laws,
whether statutes or case-law, without incorporating them in a
comprehensive and logical legislative framework:136 that can be
achieved in good textbooks.
The drafting of a statutory rule is the grouping and abstraction of
sets of facts for which certain legal consequences (sanctions) are
considered necessary. The higher the level of abstraction, the more
types of facts are covered by the rule and its sanction. Conversely,
the application or implementation of the rule puts the abstract
principles back into concrete terms ("re-concretisation") in relation
to a real set of facts in order to subject them to the sanction of the
rule. High-level abstraction is generally typical of Civil Law
countries, low-level abstraction of Common Law systems. In Common Law
countries, low-level abstraction is traditionally found in the rationes
decidendi of court decisions, which contain general rules that are
applicable beyond the special case at issue. Often such a set of rules
appears in the shape of a "test". Examples in private law are the
"nervous shock" cases within the delict or tort of negligence.137 This
casuistic style of rule-making emanating from an individual case is
then reflected or imitated in the statutory law of Common Law
If the level of abstraction is too low, the test is only applicable
to the facts of the present case and a few more cases with very similar
facts. A code which tries to cover all these potential cases without
attempting a higher level of abstraction becomes extremely extensive,
structurally confused, unwieldy to apply and eventually unusable. It
also resembles more a book of rigid compliance rules (with the need to
amend them after a short period of time), rather than a framework of
elastic and adaptable principles. One example of a "code" which shares
many of these questionable qualities is the Companies Act 1985.138 The
main reason why this statute works at all is that it actually regulates
only a small part of private and commercial law. The higher the level
of abstraction, the more cases can be covered, and the rule enjoys more
general application without ageing too quickly.
If the level of abstraction is too high, the rule becomes vague and
its application criteria unclear. In order to ascertain these, the rule
has to be restated in more concrete terms by way of supplementary
"lower-level" abstractions, normally court decisions that apply this
rule and that are given a particularly high importance through
subsequent affirming court decisions, and through legal doctrine
(academic writing). A good example is the French law of delict which
has been regulated in only five general articles of the Code civil
(Arts 1382-1386). It was left to French jurisprudence to ascertain and
develop the concrete application of these articles.139 This approach of
filling the empty metal structure with walls (to use a building
metaphor) entails certain dangers: case-law and academic doctrine may
develop unsystematically and in a potentially conflicting way, which
defeats the purposes of a code.
If a workable code is to be produced, the right level of
abstraction, and a significantly higher one than in most current
British statutes, must be chosen to ensure economy in drafting. This
can be achieved when short statements of principle are used rather than
extensive casuistic rules attempting to freeze fragments of existing
case-law. The example above from the law of error shows that the Common
Law version is unsuitable for much more than a single isolated statute
(which is, however, acceptable in a Common Law environment). If
Scotland decides in favour of a code, possible starting points for a
drafting technique which endorses statements of principle can be found
in the Sale of Goods Act 1979 (1893) and the Bills of Exchange Act 1882.140
Although the Sale of Goods Act clearly has some of the features of a
Civilian statute, it has been criticised as being incompatible with
This is true in respect of the content of certain provisions142 but
not of their form, provided a more Civilian drafting style is sought.143
Thus the paramount rule of drafting is: the code and its sections
must be not only short,144
but also truly concise: lex moneat, nec doceat. All the
codification projects which have come up with unwieldy results have
failed: for example, the Prussian Corpus Iuris Fridericiani
(1751) which was, significantly, merely a comprehensive restatement of
the ius commune; and the Austrian Codex Theresianus
which Maria Theresa herself rejected as too voluminous.146 This rule may be
difficult to follow, for lawyers are trained to have an eye for detail
and to be as comprehensive as possible. Indeed current codifications
have not always resisted the temptation to over-regulate and to obscure
the framework of the code as whole. A nice little example of a
redundant provision is §118 of the German BGB, which deals with
the legal relevance of jocular statements ("Scherzerklärung",
notably in the German code): such representations, as one might guess
with little intellectual effort, do not lead to contractual relations.
Generally, however, terseness of the rules prevails over
completeness in civil codes. This affects the interpretation of
codified statutory law. Traditionally, a Common Law statute acts as a
sword stabbing into the body of the common law to excise and rectify
certain unwanted case-law developments. A Civil Law statute, especially
if it is a code, is a skeleton around which the flesh of the case-law
and doctrine can grow. In practice the difference is blurred, but it is
mirrored in the interpretation rules. The construction rules of Common
Law statutes, and their qualifications, are well known and need not be
In Civil Law countries, the rules of construction allow for more
interpretative flexibility (and here I follow the model of the German
The canon of statutory construction comprises, in this order, the
literal (or grammatical) interpretation, the systematic (or
systematic-logical) interpretation, the historical interpretation, and
the objective-teleological interpretation.149 The literal
(grammatical) interpretation is based on the meaning of the words
according to their general (and sometimes more specialist) use and the
grammatical structure in which they are embodied. The
systematic-logical interpretation relies on a codified structure of the
statutory law: in which context, in view of surrounding norms or the
same chapter or the whole code, can the norm in question be found?
Material considerations prevail over formal ones. 150 A historical
interpretation tries to ascertain the legislator's intention by
consulting the travaux préparatoires. If these
construction methods are unsuccessful, the objective-teleological
interpretation is used, which tries to explore the purpose of the rule (ratio
legis), and foreign legal systems may be considered in this
There are additional methods, separate from the interpretation rules,
when an unintended gap in the law as a whole (echte
Gesetzeslücke) has been detected. These comprise the use of
arguments per analogiam, arguments e contrario, a minori ad maius
and a maiori ad minus, and as a last resort, of general ("natural"152)
principles of the law.153
Even from this very short and incomplete account one can see that
the continental laws can be, and often have to be, interpreted much
more flexibly to apply general principles to concrete facts. A
codification in a Civilian sense is likely to require Scottish judges
and academics to adopt a more Civilian interpretation style. This may
be one of the biggest stumbling blocks, although there is some
familiarity with the continental type of construction because of
European Union legislation,154 and it is also true that Scottish
judges are increasingly familiar with interpreting statutes which
regulate given areas comprehensively.
A civil code should provide solutions for common and frequent
problems, as well as flexible principles or yardsticks for less usual
ones, which are then to be solved by practitioners and academics guided
by the existing rules in the code. Deliberate gaps in the law that are
to be filled by judicial decisions are vital for a successful
codification. The Swiss Civil Code shows awareness of that and orders
in Art 1 (2) that in the absence of statutory or customary law the
court is to decide in the same way as it would do if it were a
In this respect, a code may also counteract the current movement to
over-regulate, a spirit of our time which is in stark contrast with the
motto of the Enlightenment, as expressed by Kant, to have the courage
to use one's own reason.156
D. Is a Codification Desirable at All: For
Scotland? Or for Europe?
The arguments for and counter-arguments against a civil code are well
known, and it is interesting that they have changed little over the
so there is no need to reproduce them here.158
As demonstrated above, the use of comparative law within a
codification project is certainly useful. Comparative law (partly in
connection with legal history) is able to separate, highlight and
compare different methods with which functionally similar solutions to
various problems are obtained. It can draw upon concrete legal rules
from culturally diverse jurisdictions to distil general and abstract
principles for legal solutions to similar social and economic problems.
But comparative law should not be used to prove any superiority of one
legal system over another, or to prepare the introduction of foreign
legal concepts into a new code without prior critical evaluation.159
One may take the view that a codification of Scots private law is no
longer necessary because there will soon be unification of European
private law. While it is probably not possible to make an unqualified
decision for or against a civil code in a particular single
jurisdiction, there is, in my opinion, very much to be said against a
civil code for the whole of Europe (assuming for the sake of argument
that this is feasible at all160). While it may appear obvious that
a comparative lawyer should object to legal unification, on the grounds
that he or she would be rendered superfluous, this argument should not
be dismissed lightly. It is the variety of human cultures and their
differences which have enriched other cultures, not their uniformity.
Law is one expression of human culture. The imposition of legal
uniformity across the nations is a forceful act and inevitably a
process of legal imperialism,161 despite the argument that some
areas within the existing laws share many similarities.162 It is not too
surprising that the basic principles of contract law do not differ that
much in various European countries.163 Obviously, the very essence of a
contract is an agreement between the parties. If the concept of
contract is to work at all, it needs as a prerequisite an implicit
agreement that the conceptual foundations of contract formation and
performance are broadly similar everywhere.164 The whole picture
changes if legal relations are not based on consent, as with regard to
delict and property.165
One of the major arguments for unification is expediency and legal
Following this argument through to its logical conclusion, one should
perhaps promote the unification of Scots and English laws first. There
is no need to wait for a unified European private law.
The idea of codification itself can run counter to national
character and culture. This may be the reason why a Civilian style
codification of laws will never be successful in England, and a Common
Law style codification (consolidation) will not be advantageous for
either a Civil Law or Common Law trained lawyer.167 The legal
mentalité of the English, or their epistemological framework, is
different from that found on the Continent - and both have the right to
exist alongside one another. The French, for example, strive to
eliminate any factual detail to establish a general idea or concept:
the source of legal knowledge is the order, not the facts, and the
emphasis is on universals. For the English the persuasiveness of a
narrative must depend on the way in which it makes it possible for
others to replicate an empirical demonstration on which it reports.
Thus in the Common Law world, any construction of an ordered account of
the law rests on the disorder of fragmented and dispersed facts.168 In
addition, the English are ill-at-ease with systems of rigid and formal
rules, and a code could represent exactly that for them.169 A code is an
intellectual construct; it rests on principles, and not on precedents -
on ideas and abstractions and not on past experience, at least not from
the immediate past. But for the English, pragmatism triumphs over
Scotland, however, could be a borderline case. The stronger
propensity in Scotland for abstractions and systematisation may make it
more inclined to the abstract concepts and ideas which form the
substrata of a code.171
However, much will depend on how such a code is drafted.172
E. Conclusion: Who Would Support the Enactment of a
Scottish Civil Code?
The legal profession in Scotland does not wholeheartedly support a
codification project. Indeed the judiciary is vehemently opposed to it:173
[The judges] were of the view not only that
codification would not contribute anything of value and would therefore
be a waste of time and money, but that it would be positively harmful.
They considered that it would hamper rather than promote the steady
development of Scots law and, in particular, would tend to freeze it
into some form determined, not by judges in the light of concrete
practical problems, but by a small number of persons not immediately
exposed to the realities of practice.
Although the writer does not share the view expressed above, he has
some sympathy for it, albeit perhaps for different reasons. The judges'
major concerns are obviously based on the assumption that a code would
be drafted according to the traditional style of Common Law statutes,
and in this respect the concerns are not unfounded. The objections to a
Common Law style of drafting for codification purposes have been raised
above. In Britain, both north and south of the Border, a change of the
drafting style is unlikely to happen.174 A comprehensive ("codifying")
Common Law statute adhering to the conventional drafting style is
always an unsatisfying compromise. It kills ("freezes") the creativity
of case-law in the regulated area, and that is, from a historical
viewpoint, the very purpose of an Act of Parliament: to react
remedially and to correct the common law. It then tries to distil rules
from decided cases, which naturally focus on the facts in question and
do not normally state broader principles. The statute, which may also
incorporate existing partial codifications, thus usually consists of an
aggregate (or patchwork) of detailed and casuistic rules established by
Such a statute is not a flexible framework but potentially a
straitjacket. For a judge, the application of such a statute, without
the discretion he or she would otherwise have in the field of the
common law, and without the freedom of statutory interpretation of the
continental judge, is obviously a joyless exercise in the sense of
Montesquieu's statement that le juge est la bouche de la loi176
(although that statement was never true of the Civil Law systems). The
real problem for codification of Scots private law (apart from
is whether Scottish legal culture is prepared fundamentally to change
its approach to statutory interpretation:178 the actual
drafting is then a secondary matter.
Codification along Civilian lines would undoubtedly change statutory
interpretation. It is much less clear whether it would influence
substantially the principle of stare decisis and the style and
function of rationes decidendi.179 It is arguable that the less
detailed the code provisions, the less affected are the competence and
discretion of the courts, given that the courts already deal with
numerous detailed statutes which, in theory at least, do not permit as
much freedom of interpretation as a Civilian statute. A code will not
reverse the ranking of sources of law,180 because Acts of Parliament have
always ranked highest. It is not necessary, and presumably not
beneficial, to replace all existing common law by the provisions of the
The code would need to prevail only where they clearly conflict.
Case-law, whether pre-existing, or post-dating the enactment of the
code, can close gaps in the legislation. A Civilian style code would
not necessarily restrict the judges' power:182 it may change its
style and concrete content in given cases, but not its ambit or
quality. Thus it should not be impossible to gain support for a
codification project from the judiciary.
The last important point, although unfortunately neglected by
lawyers, is that a code should have some aesthetic quality. A musical
comparison can be made in that a layperson may not recognise a
brilliant instrumentation but will immediately notice a mediocre one.
It is not surprising that Blackstone took a very keen interest in
architecture, which can itself be seen as solidified music if one
follows the Ancient Greek myth of Amphion. A law which is painful to
read is unlikely to be obeyed and enforced properly, and people will
not be drawn to the study and practice of the law if they have to
surround themselves with gruesome texts. The French novelist Stendhal
is said to have taken the Code Civil as a model for his own style183 -
even lawyers are not advised to do this with UK statutes. Inextricably
linked with the importance of elegance and harmonic proportion is the
fundamental necessity not to regulate too much in too detailed a
manner. A codification should never strive for total completeness and
extreme precision. Humans are never perfect: if their law were, it
would be inhuman.
Lecturer in Law, University of Leicester; Mag iur et phil, Dr iur
(Vienna), LLM (London). The article first appeared in 2004 Edinburgh
Law Review 28-56 and is reproduced with kind permission of Edinburgh
University Press. The author is grateful to Professor Eric Clive and to
Professor George Gretton, both University of Edinburgh, for their
numerous valuable comments on an earlier draft. Errors are the
Clive, Project for a draft Scottish civil code. Paper for the
Minister for Justice (25 March 2002). The author is grateful to
Professor Clive for providing a copy of an updated (July 2002) version
of this paper. On the issue of codification see also E Clive, "A
Scottish Civil Code", in H L MacQueen (ed), Scots Law into the
21st Century. Essays in Honour of W A Wilson (1996) 82; E Clive,
"Current codification projects in Scotland" (2000) 4 EdinLR 341.
For a brief history of its codification see K Zweigert and H Kötz,
An Introduction to Comparative Law, 3rd edn (tr T Weir) (1998)
(henceforth Zweigert and Kötz, Introduction) 157; H
Schlosser, Grundzüge der Neueren Privatrechtsgeschichte
(1979) 67; F Wieacker, A History of Private Law in Europe (tr
T Weir) (1995) (henceforth Wieacker, History) 266; H Baltl, Österreichische
Rechtsgeschichte, 3rd edn (1977) 209. On Franz v Zeiller
(1751-1828), the draftsman of the final drafts of what was to become
the ABGB, see Th Mayer-Maly, "Zeiller, das ABGB und wir", in W Selb and
H Hofmeister (eds), Forschungsband Franz von Zeiller (1980)
W Cairns, "Historical Introduction", in K G C Reid and R Zimmermann
(eds), A History of Private Law in Scotland (2000)
(henceforth Reid and Zimmermann, History), vol 1, 176; D M
Walker, The Scottish Legal System, 8th edn (2001) (henceforth
Walker, Scottish Legal System) 163, 180.
Compare §§ 7, 12, 16 ABGB.
See Wieacker, History, 159, 164 et seq.
Wieacker, History, 199 et seq, 240, 250.
Wieacker, History, 266, 268.
This brevity was, however, achieved at the expense of substantial gaps
which had to be filled by case-law and doctrine during the nineteenth
century: compare Zweigert and Kötz, Introduction, 163.
Compare Zweigert and Kötz, Introduction, 163.
The ABGB consists of three parts: 1. law of persons; 2.1. law of
property (possession, ownership, pledges, servitudes, succession); 2.2.
contracts, contracts concerning the matrimonial régime, damages;
3. common provisions (creation of debts and obligations, alteration of
rights and obligations, discharge of rights and obligations, time-bar
Compare W Ogris, Die Rechtsentwicklung in Österreich
1848-1918 (1975) 58.
The ABGB also survived in most parts of what was to become Yugoslavia.
W Brauneder and H Lachmayer, Österreichische
Verfassungsgeschichte, 3rd edn (1983) 249, 251.
The first large-scale amendments were made in the three "Partial
Amendments" in 1914, 1915, 1916 (the last one being the most important
one) under the influence of the then new German BGB. They led to a
substantial revision of the code as a whole. See Ogris, Die
Rechtsentwicklung in Österreich, note 11 above, 69.
Compare ABGB, § 14, and §§ 15 et seq
(persons); §§ 285 et seq (things); §§ 859
et seq (obligations).
Reform of the ABGB is nevertheless frequently discussed, see C
Fischer-Czermak et al (eds), Das ABGB auf dem Weg in das 3
See e.g. H L MacQueen, "Scots Law and the road to the new ius commune"
(2000) 4(4) Electronic Journal of Comparative Law (available
W D H Sellar, "Scots law: mixed from the very beginning? A tale of two
receptions" (2000) 4 EdinLR 3.
See Zweigert and Kötz Introduction, 204. Wieacker is
much more cautious, History, 394: "It is perhaps only a
question of time before the assimilation to English law becomes
complete." (That was written, however, well before devolution).
H Lévy-Ullmann, "The law of Scotland" (1925) 37 JR 370 at 390.
This enthusiasm is typical of the older generation of comparative
lawyers, and understandable in the light of the strenuous efforts to
build up a peaceful Europe after the world wars.
Including potential forced assimilation. E.g. ss 57 et seq
(change of name) of the 1994 Quebec Civil Code could be used for this
See especially P Legrand, "Against a European Civil Code" (1997) 60 MLR
44, 53 and note 54: "the 1994 Quebec civil code's insidious
marginalisation of the anglophone minority in Quebec as part of a
broader political project"; and P Legrand, "Civil Law codification in
Quebec: a case of decivilianization" (1993) Zeitschrift für
Europäisches Privatrecht 574, 583.
E Örücü, "Comparative law as a tool of construction in
Scottish courts" 2000 JR 27, 33, 36.
Some authors do not view the influence of English law as particularly
desirable, see e.g. Walker, Scottish Legal System, 196.
Others, however, stress the English law impact as very beneficial for
the development of Scots law, particularly commercial law: see e.g. A
Rodger, "The codification of commercial law in Victorian Britain",
(1992) 109 LQR 570, 572, 588.
R Evan-Jones, "Receptions of law, mixed legal systems and the myth of
the genius of Scots private law" (1998) 114 LQR 228, 232, 247-248.
See K G C Reid and R Zimmermann, "The development of legal doctrine in
a mixed system", in Reid and Zimmermann, History, vol 1, 6.
On the drafting style of the Acts of the Scottish Parliament (then to
come), see E Clive, "Law-making in Scotland: from APS to ASP" (1999) 3
Compare A E Anton, "Obstacles to codification" 1982 JR 15, 18, 21, 30,
A much more exhaustive treatment (on which this section is based) can
be found in W W McBryde, The Law of Contract in Scotland, 2nd
edn (2001) 351 et seq (henceforth McBryde, Contract);
H L MacQueen and J Thomson, Contract Law in Scotland (2000)
(henceforth MacQueen and Thomson, Contract) 154 et seq; W W
McBryde, "Error", in Reid and Zimmermann, History, vol 2, 72
et seq (henceforth McBryde, Error); D M Walker, Principles
of Scottish Private Law, vol 2, book 4 (Obligations), 4th edn
(1988) 65 et seq (henceforth Walker 2).
Error in formation of a contract only is discussed, not error in
performance, which is in the writer's view not an issue of error at
all, but of breach of contract and/or unjustified enrichment (on the
latter, see McBryde, Contract, 379: condictio indebiti).
This analysis of error in contract is the legacy of the jurists of
Natural Law, see R Zimmermann, The Law of Obligations: Roman
Foundations of the Civilian Tradition (1990) (henceforth
Zimmermann, Obligations) 587, 613.
This "reliance theory" is the product of eighteenth-century ius
commune jurists in central Europe (as opposed to the "will theory"
of Grotius and Pufendorf), and could already be found in the Bavarian Codex
Maximilianeus Bavaricus Civilis of 1765 (IV.1.25), and in the
writings of the Austrian jurist K A v Martini. See also under B (3),
Compare Walker 2, 65; McBryde, Contract, 363: "Error arises
when there is a discrepancy between reality and a party's belief."
The distinction between uninduced and induced error reflects the
present situation of Scots law under the influence of the English law
of misrepresentation. Before, there was no difference between uninduced
and induced (essential) error. Misrepresentation became relevant only
if it was fraudulent, see McBryde, Contract, 365. This
reflected the position of the usus modernus: compare
Zimmermann, Obligations 610, and as to classical Roman Law
Bell, Principles, 4th edn (1839) § 11.
Zimmermann, Obligations, 588-592.
McBryde, Contract, 353.
In the eighteenth and the early nineteenth centuries, "essential error"
was also used in relation to uninduced error and could mean substantial
(error in substantials) or material, i.e. less than substantial,
although the use was not consistent. The difficulty in identifying the
precise meaning of these terms started with inconsistent use by the
Institutional writers (Stair: "error in substantials"; Erskine: "error
in the essentials"): see McBryde, Contract, 352. See also
definition of essential error (as error in substantialibus)
in Walker 2, 68.
Accordingly, W M Gloag, The Law of Contract, 2nd edn (1929),
discusses error and misrepresentation separately, see 435, 457. See
Ritchie v Glass 1936 SLT 591. See also J Thomson,
"Error revised" 1992 SLT (News) 215.
Menzies v Menzies (1893) 20 R (HL) 108, 142 per Lord
Manners v Whitehead (1898) 1 F 171; McBryde, Contract,
360 with further case references, and 370.
Following Stair and Bell who use the term "error in substantials".
That is, a false statement of fact which induces the other party to
contract, e.g. Smith v Chadwick (1884) 9 App Cas
187; Edgington v Fitzmaurice (1885) 29 Ch D 459. In
the concept of misrepresentation, the aspect of "error" on the part of
the representee does not play a determining role.
McBryde, Contract, 372.
MacQueen and Thomson, Contract, 159.
Compare Germany: § 119 BGB; Austria: § 901 ABGB. Swiss law is
less strict: see Art 24 (1) (4) OR, in contrast with Art 24 (2) OR.
French law indirectly also recognises the distinction between error in
transaction and error in motive: see the reference to "la cause
principale de la convention" in Art 1110 Code civil and
Angus v Bryden 1992 SLT 884.
Compare A Ehrenzweig, System des österreichischen allgemeinen
Privatrechts I/1, 2nd edn (1951) 226.
See Zweigert and Kötz, Introduction, 413-414.
Munro v Strain (1874) 1 R 522, 525 per Lord Justice Clerk
This is not necessarily the same as an error in substantialibus:
see McBryde, Contract, 352, and 355, discussing Menzies v Menzies
(1893) 20 R (HL) 108, and above.
Mercer v Anstruther's Trs. (1871) 9 M 618, 628 per
Lord President Inglis, and 652 per Lord Kinloch.
McCallum v Soudan 1989 SLT 523; Royal Bank of
Scotland v Purvis 1990 SLT 262.
Zimmermann, Obligations, 604.
MacQueen and Thomson, Contract, 159.
This is a particular issue for marriage cases (now of historic
interest): see McBryde, Error, 73.
See e.g. H Koziol and R Welser, Bürgerliches Recht I,
9th edn (1992) 126 (discussing Austrian private law).
Compare analysis in MacQueen and Thomson, Contract, 163-164.
Compare Gloag, Contract, 437; Walker 2, 87.
This also includes transmission errors, see Gloag, Contract,
Steuart's Trs. v Hart (1875) 3 R 192.
This can be seen as a case of an irrelevant error in motive.
See already in Sword v Sinclair 1771 Mor 14241,
although it is doubtful whether this case was indeed one of unilateral
error: W W McBryde, "A note on Sword v Sinclair and the law of error"
1997 JR 281.
Also a calculation of the price or the basis of its calculation can
become part of the contractual substantials if the parties so agree.
MacQueen and Thomson, Contract, 163.
Angus v Bryden, 1992 SLT 884; McBryde, Contract,
360 with case references.
E.g. "taking advantage" can also contain aspects of fraud: see Steuart's
Trs v Hart (1875) 3 R 192. Also, securing a good bargain
means contracting at the expense of the other side, which the law does
not normally prevent.
Stewart v Kennedy (1890) 17 R (HL) 25, 29 per Lord
Watson; McCallum v Soudan 1989 SLT 523; Royal
Bank of Scotland v Purvis 1990 SLT 262.
J Thomson, "Error revised" 1992 SLT (News) 215, 217.
On the perceived common error in nomine, see Zimmermann, Obligations,
E.g. the parties agree on the sale of a clarinet which, however, they
refer to as a "flute".
MacQueen and Thomson, Contract 160, 162.
I.e. the parties can chose to adopt these provisions for their
agreement or stipulate different rules.
Compare J Thomson, "Error revised" 1992 SLT (News) 215. The other
reason is arguably the somewhat confused state of the present Scots law
J C Smith, "Contracts – mistake, frustration and implied terms" (1994)
111 LQR 400, 408 et passim; C J Slade, "The myth of mistake
in the English law of contract" (1954) 70 LQR 385.
This complicated subject goes beyond the scope of this article. For
Swiss law, e.g., see A Koller in T Guhl, Das schweizerische
Obligationenrecht, 9th edn (2000) 140 et seq.
MacQueen and Thomson, Contract, 158.
See McBryde, Contract, 376.
This would correspond with Stair's view: "Those who err in the
substantials of what is done, contract not" (Institutions,
Reid, Property, para 617. Indirectly this touches upon the
question whether a derivative acquisition of property is abstract or
causal in Scots law: in the former case property can also pass under a
void contract if the error does not encompass contemplation of transfer
For the explanation of "material" error see text to note 39 above.
Silence does not suffice except in cases of contracts uberrimae
fidei, fiduciary relationships etc.
Thus trade puffs and statements of opinion or of future intention do
For more details see e.g. MacQueen and Thomson, Contract
165-167; Walker 2, 75 et seq.
Edgington v Fitzmaurice (1885) 29 Ch D 459.
Where the misrepresentation is made in relation to a statement that is
also a term of the contract, the misrepresentee can sue for breach of
contract instead of seeking reduction: see Lees v Todd
(1882) 9 R 807.
Western Bank v Addie (1867) 5 M (HL) 80.
Boyd & Forrest v Glasgow and S W Ry Co., 1915 SC
McBryde, Contract, 374, 379.
McBryde, Contract, 378.
More details in McBryde, Contract, 374-375.
Compare Walker 2, 70.
E.g. in Mathieson Gee (Ayrshire) Ltd. v Quigley
1952 SC (HL) 38.
Compare McBryde, Contract, 363; R Black in The Laws of
Scotland: Stair Memorial Encyclopaedia, vol 15 (1996), para 692.
McBryde, Contract, 363. Walker 2, 70, cites mostly English
McBryde, Error, 72: "After 500 years of development the law
is in material parts uncertain and conflicting."
Zweigert and Kötz, Introduction, 411.
Esso Petroleum Co Ltd v Mardon  QB 801.
That does not only apply to liability under Hedley Byrne v Heller
 AC 465, but also to damages for negligent misstatement under the
Misrepresentation Act 1967, s 2 (1): Royscott Trust Ltd v Rogerson
 3 All ER 294.
Derry v Peek (1889) 14 App Cas 337.
The claim under s 2 (1) is linked to the making of a contract, but
still tortious in nature.
Hedley Byrne & Co Ltd v Heller & Partners Ltd
 AC 465.
McBryde, Contract, 372.
A short account in the English language can be found in Zweigert and
Kötz, Introduction, 410-419.
See Appendix under "Germany".
The more abstract German concept of declaration of intention or will (Willenserklärung)
is disregarded for present purposes.
W Däubler, BGB Kompakt (2002) 248.
BGHZ 70, 48.
See Appendix under "France".
See e.g. Cass Civ 1re, 28.6.1988, D.1989.450.
Cass Soc, 3.7.1990, Bull Civ, V, No 329.
See Appendix under "Switzerland".
Compare T Koller in T Guhl et al, Das schweizerische
Obligationenrecht, 9th edn (2000) 138.
BGE 113, II, 25, 28.
See Appendix under "Austria".
Karl Anton v Martini (1726-1800) in his Positiones de iure
naturali (1762, 2nd edn 1780), especially in § 451.
See G Wesener, "Zeillers Lehre ‘von den Verträgen
überhaupt'", in W Selb and H Hofmeister (eds), Forschungsband
Franz von Zeiller (1980) 258-259.
OGH in SZ 46/84.
On this issue briefly, L Winkel, "Die Irrtumslehre", in R Feenstra and
R Zimmermann (eds), Das römisch-holländische Recht,
Fortschritte des Zivilrechts im 17 und 18 Jahrhundert (1992), 225,
H Koziol and R Welser, Bürgerliches Recht I, 9th edn
Zweigert and Kötz, Introduction, 414.
On constructive trusts in Scots law see G Gretton, "Constructive
Trusts", parts I and II, (1997) 1 EdinLR 281 and 408, especially at
284, 288, 291 (relationship with unjustified enrichment).
This theory of abstract delivery goes back to F C v Savigny, System
des heutigen römischen Rechts (1840-49) vol 3, 312-313,
(indirectly also) vol 4, 244-246, and can especially be found in
Savigny, Das Obligationenrecht als Theil des heutigen
Römischen Rechts, vol 2 (1853) 254-261, in particular at 257
and note (m): see now § 929 BGB. See also Reid, Property,
para 608; D L Carey Miller, "Systems of property: Grotius and Stair",
in D L Carey Miller and D W Meyers (eds), Comparative and
Historical Essays in Scots Law. A Tribute to Professor Sir Thomas Smith
QC (1992) 13, 28.
E.g. in Austria, Switzerland, The Netherlands.
E.g. in Germany.
At least outside the realm of the Sale of Goods Act 1979: compare s 17.
Reid, Property, para. 609; Carey Miller, "Systems of
Property", note 123 above.
See, with regard to land, S Wortley, "Double sales and the offside
trap: some thoughts on the rule penalising private knowledge of a prior
right" 2002 JR 291, 312.
As in Austria, § 877 ABGB.
Reid, Property, para 609, 617. See the discussion of error in
this context already in Savigny, System des heutigen
römischen Rechts, note 123 above, vol 3, 360 and note (e).
This is also directly relevant to the insolvency laws.
As it is in Germany. Compare the brevity of §§ 812-822 BGB on
unjustified enrichment with the vast literature and the bulky
commentaries on them.
South Australian Misrepresentation Act 1972 (no. 46 of 1972).
Regulation for Bahrain (under a British Order in Council), passed 25
February 1961, based on the Indian Contract Act 1872, published in W M
Ballantyne, Commercial Law in the Arab Middle East (1986)
279. Sections 15, 20, 21, and 23-25 are especially relevant. Unlike
most other countries of the Arab Middle East, Bahrain has a codified
Common Law contract and tort law, but is influenced by the Civilian
(French) jurisprudence of the surrounding states, such as Egypt and
Kuwait, see Ballantyne, 4-6, 56.
Consolidation could perhaps be defined as a private arrangement of the
legal material, e.g. by academics and publishers, while statutorisation
involves a legislative act. There is no consistent terminology, nor
does the present author attempt one. See in respect of the French codification
compilation or codification à droit constant, B
Fauvarque-Cosson, "Modern developments in French codification" (2000) 4
EdinLR 350, 353.
Compare discussion of the terminology in W Dale (ed), British and
French statutory drafting. The Proceedings of the Franco-British
Conference of 7 and 8 April 1986 (1987) 44, 72.
E.g. Alcock v Chief Constable of South Yorkshire
 1 AC 310.
See also critical comment in P L Davies, Gower's Principles of
Modern Company Law, 6th edn (1997) 62.
B Fauvarque-Cosson, "Modern developments in French codification" (2000)
4 EdinLR 350, 352; Zweigert and Kötz, Introduction, 615.
Dale, British and French statutory drafting, note 136 above,
65. Good examples of concise provisions (as regards the form, not
always the content) are ss 29, 31 of the Bills of Exchange Act and ss
16, 17, 20 (but not s 18) of the Sale of Goods Act.
D M Walker, A Legal History of Scotland, vol 6 (2001) 872.
For example, the distinction between contract and conveyance in
relation to transfer of ownership, (which is made by Scots law) is
unclear, s 18, rule 1, and there is effectively a causal theory of
transfer, unlike classical Scots law, ss 1 and 17. See also Reid, Property,
paras 606, 610.
A G Chloros, "Principle, reason and policy in the development of
European law" (1968) 17 ICLQ 849, 862-863, advocates a Civilian
drafting style (together with Civilian statutory interpretation) even
for the English law (of contract).
See, e.g., Montesquieu, De l'esprit des lois, livre XXIX, ch
On the Austrian "Compilationscommission", which started its work in
1753, see P H von Harrasowsky, Geschichte der Codification des
österreichischen Civilrechtes (1868) 38, 60 et seq,
Wieacker, History, 261, 267; H Schlosser, Grundzüge
der Neueren Privatrechtsgeschichte (1979) 54, 67.
See R Cross et al, Statutory Interpretation, 2nd edn (1987)
47; Walker, Scottish Legal System, 413; N Walker, "The
crumbling pillars of statutory interpretation", in H L MacQueen (ed), Scots
Law into the 21st Century. Essays in Honour of W.A. Wilson (1996)
On statutory interpretation in France, which is largely similar, see
e.g. M Troper et al, "Statutory interpretation in France", in D N
MacCormick and R S Summers (eds), Interpreting Statutes. A
Comparative Study (1991) 171.
F Bydlinski, Juristische Methodenlehre und Rechtsbegriff, 2nd
edn (1991) 437. See also K Larenz, Methodenlehre der
Rechtswissenschaft, 4th edn (1979) 307.
Bydlinski, note 149 above, 444.
Bydlinski, note 149 above, 461.
That is the term used in § 7 of the Austrian ABGB.
Bydlinski, note 149 above, 472 et seq.
Walker, Scottish Legal System, 412; J A Holland and J S Webb,
Learning Legal Rules, 3rd edn (1997) 184, 215.
Art 1(2) ZGB: "Kann dem Gesetz keine Vorschrift entnommen werden, so
soll das Gericht nach Gewohnheitsrecht und, wo auch ein solches fehlt,
nach der Regel entscheiden, die es als Gesetzgeber aufstellen
würde." One feels reminded of Kant's categorical imperative.
Kant, Was ist Aufklärung? in Berlinische Monatsschrift
(1784), reprint 1973, vol 4, 481.
One of the well-known codification debates in history was in early
nineteenth-century Germany between A F J Thibaut, Über die
Nothwendigkeit eines allgemeinen bürgerlichen Rechtes für
Deutschland (1814), who promoted codification, and F C v Savigny, Vom
Beruf unserer Zeit für Gesetzgebung und Rechtswissenschaft
(1814, reprint 1892), who strongly opposed codification (see especially
at 13 et seq, 29 et seq, 59 et seq
(against the then new ABGB), 94 et seq).
In favour of codification in Scotland: e.g. Clive, "A Scottish Civil
Code", note 1 above; Clive, "Current Codification Projects in
Scotland", note 1 above; Walker, Scottish Legal System, 585,
but see important qualifications at 588; and on a more cautious note H
L MacQueen, Scots Law and the Road to the New Ius Commune,
(2000) 4(4) Electronic Journal of Comparative Law, (at http://www.ejcl.org/44/art44-1.html).
Against codification: e.g. A D M Forte, "If it ain't broke, don't fix
it: on not codifying commercial law", in H L MacQueen (ed), Scots
Law into the 21st Century. Essays in Honour of W.A. Wilson (1996)
92; A Rodger (Lord Rodger of Earlsferry QC), "The bells of law reform"
1993 SLT (News) 339, and note 173 below; A E Anton, Obstacles to
codification 1982 JR 15.
On the whole issue see Zweigert and Kötz, Introduction,
chs 1 and 2.
The European Union, however, promotes the unification of private law of
the Member States. See Resolutions of the European Parliament On
Action to bring into line the private law of the Member States, OJ
1989 C158/400, and On the Harmonisation of certain sectors of
private law of the Member States, OJ 1994 C205/518. See also O
Lando et al Principles of European Contract Law, parts 1 and
2 (2000), part 3 (2002) (information on Lando Commission at http://www.cbs.dk/departments/law/staff/ol/commission_on_ecl/index.html).
In addition, the Study Group on a European Civil Code conducts
comparative law research in private law of EU countries and has
produced codified principles for the "Patrimonial Law" (essentially all
private law excluding family law and succession) within European
private law (information at http://www.sgecc.net).
P Legrand, "Against a European civil code" (1997) 60 MLR 44. See also
Zweigert and Kötz, Introduction, 24-25, 28.
See e.g. K Riedl, "The work of the Lando Commission from an alternative
viewpoint" 2000 ERPL 71. For strong reservations see P Legrand,
"European Systems are not converging" (1996) 45 ICLQ 52, 61.
The Principles of European Contract Law, note 160 above, may
be a starting point for codification on a national level.
And therefore one should not be surprised to find broadly similar
contract law principles in jurisdictions even outside Europe before the
time of substantial Western influence, for example in classical Islamic
law: see J Schacht, An Introduction to Islamic Law (1964)
See concerns expressed regarding the benefit of legal unification for
the common market of the EU in H Kronke, Brauchen wir ein
europäisches Zivilgesetzbuch? (Speech at the Institut
für Rechtspolitik, University of Trier, 2002, no 11 of
Rechtspolitisches Forum), available at http://www.irp.uni-trier.de/11_Kronke.pdf.
See e.g. P Legrand, "Against a European civil code" (1997) 60 MLR 51; A
Pinna, "Drafting a civil code for Europe" Tilburg Foreign Law
Review Journal on Foreign and Comparative Law (2002) 9(4), para
A good discussion of the advantages and problems of codification from a
Common Law (English) perspective can be found in M Clarke, "Doubts from
the dark side – the case against codes" (2001) JBL 605.
Excellently explained by P Legrand, "Against a European Civil Code"
(1997) 60 MLR 44, 49-50. See also W T Murphy, "The oldest social
science? The epistemic properties of the Common Law tradition" (1991)
54 MLR 182, 192, 197, 201.
Legrand, note 168 above, 47, makes the contrast with Germany and is
carefully supported by references to social studies.
See T Weir, "The Common Law system", in R David (ed), International
Encyclopaedia of Comparative Law, vol 2, "The legal systems of the
world: their comparison and unification", ch 2, no 82, at 77.
But cf Lord Goff of Chieveley, "The future of the Common Law" (1997) 46
ICLQ 745, 752: "Let us not forget that the common law is common not
only to England, Wales and – dare I say it – to a substantial extent to
my native land, Scotland"; and at 753: "Continental lawyers love to
proclaim some great principle, and knock it into shape afterwards.
Instead, the boring British want to find out first whether, and if so,
how these great ideas are going to work in practice. This is not at all
popular with the propagators of the great ideas."
Clive, "A Scottish Civil Code", note 1 above, sees a code as a
fortification of Scottish cultural identity, although in the writer's
view this must be subject to various qualifications.
Letter of 4 June 2001 from the former Lord President of the Court of
Session, Lord Rodger of Earlsferry, to Professor Clive, quoted in
Clive, Project for a draft Scottish civil code, note 1 above,
Compare Lord Goff of Chieveley, note 171 above.
Dale, British and French statutory drafting, note 136 above,
56, 60, 67, 74. E Clive, "Law-making in Scotland: from APS to ASP"
(1999) 3 EdinLR 144, advises that legislation must be specific to avoid
litigation to resolve questions prompted by general and unclear rules.
Montesquieu, De l'esprit des lois, livre XI, ch 6.
Issues also arise with regard to the relationship between the Scottish
civil code and UK statutes.
See also Anton, "Obstacles to codification", note 27 above, 15, 19.
Real judge-made law also exists in continental European codified
systems, see Bydlinski, note 149 above, 506.
This, nevertheless, has been argued by Anton, "Obstacles to
codification", note 27 above, 19.
However, Clive tends to this approach, see Project for a draft
Scottish civil code, note 1 above, 2.
Anton's concerns in this respect are not convincing, see Anton,
"Obstacles to codification", note 27 above, 24.
Wieacker, History, 273.
§ 119 BGB:
1. A party making a declaration of intention, who was in error about
its content or did not want to make a declaration with this content at
all, can rescind the declaration if it can be assumed that he would not
have made this declaration in full knowledge of the situation and with
a sensible appreciation of the case.
2. An error as to the content of the declaration is regarded in the
same way as an error as to those characteristics of a person or thing
which are regarded in business as essential.
Art. 1109 CC:
There is no valid consent, where the consent was given only by error,
or where it was extorted under duress or induced by deception.
Art. 1110 CC:
Error is a ground for annulment of an agreement only where it relates
to the very substance of the thing which is the object of the agreement.
Error is not a ground for annulment where it relates only to the person
with whom one has the intention of contracting, unless the particular
identity of that person was the main cause of the agreement.
Art. 23 OR:
A contract is not binding on a party who has been in a substantial
error when concluding the contract.
Art. 24 OR:
1. An error is substantial in particular in the following cases:
- if the erring party wanted to conclude another contract than that
to which he has declared his consent;
- if the intention of the erring party was directed towards another
thing or, where the contract was concluded in regard to a particular
person, towards another person than he has declared;
- if the erring party has promised a performance on a considerably
larger scale or has been promised a performance in return on a
considerably smaller scale than was his intention;
- if the error concerned particular facts which the erring party,
in accordance with good faith and normal commercial practice, regarded
as a necessary foundation for the contract.
2. If an error relates only to the motive for entering into the
contract, this is not a substantial error.
3. Mere errors in calculation do not prevent the binding effect of the
contract, but are to be rectified.
§ 871 ABGB:
(1) Where one party was in error about the content of a declaration
made by him or communicated to the other party, which concerns the
principal object or an essential attribute of it to which the intention
was principally and expressly directed, then no obligation arises on
his part, if the other party induced the error, or the error ought to
have been noticed by the other party in all the circumstances, or it
was resolved in good time.
(2) An error of one party concerning circumstances about which the
other party would have had to inform him under the law in force, is
always deemed to be an error about the content of a contract and not
merely an error in the motive or ultimate purpose for contracting
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