Economic hardship in Principles of European Contract Law PECL
... 1 Introduction The Principles of European Contract Law are a set of directive rules provided by the Commission on European Contract Law. The principles basically are intended to facilitate the cross-border business within Europe and proper functioning of the Single European Market by a broad unitary approach to the governing law and regulations. The principles are a general contract law infrastructure to be applied to all different kinds of contracts. PECL can provide a basis for harmonisation between different national law systems. It not only can provide a starting point for unification in branches of private law for any future European legislation but also it can be regarded as a model for member states who want to harmonise their contact law. It can serve as a model for judicial and legislature development of contract law. Likewise the Principles can be chosen by contracting parties to govern their contractual relationship. ... In the field of changed circumstances and economic hardship, in which most of the national systems failed to provide a satisfactory rule, PECL has provided an appropriate way to deal with the problem. It would not be exaggerate if one says that the matter of changed circumstances and economic hardship is an area of contract law in which the PECL has the most divergence from national laws and offered a more satisfactory rule than that offered by national legal systems. Bearing in mind that even CISG has not provided a satisfactory rule regarding the problem of changed circumstances, PECL can be regarded as a model for possible amendment to CISG in this field. ... 2 Impossibility under PECL Article 8:108 of PECL deals with the problem of impossibility. There is a similarity in the wording of the corresponding PECL provisions to Article 79 CISG. However, the Comment A to the PECL 8:108 differentiates in the scope of the two regimes. ... Even an economic change must be like physical impossibility in preventing the performance of the contract. This differentiation seems reasonable only if one presumes that even such an economic impediment, which is like physical impossibility in preventing the performance of the contract, would be considered not under Article 8:108 but under Article 6: 111 of PECL. This presumption is not accurate because such an economic impediment cannot merely regarded as a situation of hardship when it prevent performance and has made the contract nearly impossible. Another difference between these two regimes is that under CISG a temporary impediment would not amount to a permanent discharge of the contract but under PECL 8:108(2) the aggrieved party is given the right to terminate the contract if the delay is itself fundamental. ... 3 Economic hardship under Article 6:111 of PECL The Principles deal with the issue of change of circumstances and economic hardship in a quite thorough way, providing not only a basic statement of and the operational parameters of the concept but also the mechanism for the adaptation or termination of the contract by the court.