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3 - The Fault Principle as the Chameleon of Contract Law: A Market Function Approach

Published online by Cambridge University Press:  10 November 2010

Omri Ben-Shahar
Affiliation:
University of Chicago
Ariel Porat
Affiliation:
Tel-Aviv University
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Summary

This chapter begins with a comparative law survey showing that not all legal systems opt exclusively for fault liability or strict liability in contract law, but often adopt a more nuanced approach. This approach includes intermediate solutions such as reversing the burden of proof, using a market (“objective”) standard of care, distinguishing between different types of contracts, and providing a “second chance” for breaching parties. Taking this starting point seriously and arguing that it is highly unlikely that all legal systems err, this chapter argues that the core question is how and when each liability regime should prevail or how and when the regimes should be combined. When asking how best to combine the regimes, the simple answer is that market expectation, and specifically the ability to compare offers, should be the core criterion.

Introduction

When Ernst Rabel came to the United States, some seventy-five years ago, he brought with him his conception of comparative law as a discovery device for all countries, and sought to develop this international discussion into more concrete results, namely, into a unification of sales law as the core of contract law. Moreover, when Rabel later wrote his treatise on (comparative) sales law – which became highly influential for the Hague Uniform Sales Law of 1964 and subsequently the Vienna Convention on the International Sale of Goods of 1980 (CISG) – one of the central questions where his new surroundings heavily influenced him was fault.

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Publisher: Cambridge University Press
Print publication year: 2010

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