European Contract Law presents

1
European Contract Lawpresents

• Contract or Property?

2
What is a debt?
Definition
A debt is a sum due under contract or otherwise
(Dawson v. Great Northern City Ry 1905)

• Usually a sum of money
• A contractual right
• Various forms e.g. mortgages, rights to
  (not)perform, usage rights and in this case the
  example of the promissory note

3
What is a promissory note?

• English Law A promissory note is an
  unconditional promise in writing made by one
  person to another signed by the maker, engaging
  to pay, on demand or at a fixed or determinable
  future time, a sum certain in money, to, or to
  the order of, a specified person or to bearer.
  (Bills of Exchange Act 1882)
• German Law Schuldschein (952 BGB)
• French Law Reconaissance de dette (Art. 1326
  Code Civil)

Nature 1) A debt owed by the debtor to the
creditor/bearer 2) A debt owed in physical
form 3) Needs to be signed by the debtor, not by
creditor
4
What is property?
For a right to be proprietary, it needs to be

• To bind the purchaser and the debtor
  automatically
• Assignable (!)

Assignment (English law) known as
Abtretung/Zession (German law) and Cession
(French law)
5
What is the principle of assignment?

• English law An assignment is a transaction
  whereby a right is transferred by its owner,
  called the assignor, to another person, called
  the assignee, as a result of which the assignee
  becomes entitled to sue the person liable, called
  the debtor (Ius commune casebook Contract
  Law,p.935 Beale, Hartkamp, Kotz, Tallon
  2002)
• Law of Property Act 1925 No consideration or
  notice necessary
• German law A claim or debt may, by agreement or
  between the creditor and another, be transferred
  by the former to the latter (assignment), Upon
  the conclusion of such an agreement, the new
  creditor takes the place of the former creditor
  (398 BGB)
• French law 1) The assignee is not treated as
  acquiring the debt as against third parties until
  the debtor has been notified. 2) However,
  acceptance of the assignment by the debtor in a
  notarial act also vests the debt in the assignee.
  (Art. 1690 C.Civil)

6
Conlusion Contract or Property?

• Debts can be in certain cases be considered as
  property while simultaneously being contractual
  rights.

Bibliography Property Law, Roger J. Smith
2009 The law of Contract, Edwin Peel 2007
Ansons Law of Contract, J. Beatson 2002
Contract Law, Ewan McKendrick 2009 Ius commune
casebook Contract Law, H.Beale, A.Hartkamp, H.
Kotz, D. Tallon 2002 www.legifrance.gouv.fr
BGB