SSRN Articles

• Florian Möslein, Legal Innovation in European Contract Law: Within and Beyond the (Draft) Common Frame of Reference
  

Abstract:

The Europeanization of contract law has continuously developed over the past 25 years. It is now at a defining stage, with the Draft Common Frame of Reference (DCFR) recently being published. This article is not primarily concerned with the substance of this instrument, but with the process of legal innovation it might trigger. The hypothesis is that the adoption of such a rulebook will have a significant impact on the future development of European contract law. Yet the nature and likely effects of such impact are difficult to predict, given that functions, elements and purposes of the new instrument still need to be identified and defined. In any event, the DCFR will modify the pattern of future legal change in European contract law. The crucial question is: Will it provide a dynamic framework for legal innovation?

• Rafael Arenas García, Precontractual Liability in the Rome II Regulation
  

Abstract:

Article 12 of the Rome II Regulation governs the non-contractual obligations arising out of dealings prior to the conclusion of a contract and establishes that the law applicable to these obligations shall be the law that applies to the contract. Where it is not possible to determine such law, the second paragraph of article 12 specifies the general connecting factors of Rome II Regulation. Moreover, it is possible to choose the law applicable in culpa in contrahendo issues. These solutions are nonetheless not problem-free. It seems not quite appropriate that the law applicable to a future contract may govern the specific obligation not to breach negotiations from a given point in time and that parties cannot rely on the law of the country in which any of them have their habitual residence in order to uphold the possibility of breaching negotiations without being held liable. It is neither appropriate that the law applicable to a future contract might govern the liability arising from negotiations which take place in the setting of a concluded agreement.

• Paloma De Barrón Arniches, Comments on the Service Contract in the Common Frame of Reference Abstract:

The recent publication of the draft Common Frame of Reference invites analysis of some of the distinguishing features of the European service contracts designed by the Study Group on European Civil Code. It contains important innovations in comparison with the traditional approach supported by Spanish scholarship and the case law of the Supreme Court. This work aims to expose some of the solutions introduced by the new European contract law, and to contribute to the debate on a necessary modernization of the Spanish civil regulation of the service contracts

Recent Judgments

Shin-Etsu Chemical Co.Ltd. v. Vindhya Telelinks Ltd. & Ors
CIVIL APPEAL NO. 4998 of 2007 decided by R. V. Raveendran & Markandey Katju, JJ. on March 27, 2009

• Facts: Vindhya Telelinks Ltd. (Vindhya) and Optic Fibre Goa Ltd (Optic) on the one hand and Shin-Etsu (Shin) one the other entered into a long sale and purchase agreement. Vindhya and Optic filed a civil suit before the Civil Judge, Class-I, Rewa, Madhya Pradesh for a declaration that the said Agreement was null and void and also for the relief of permanent injunction restraining Shin from from relying upon/invoking/giving effect to any term of the said agreement. Birla Ericsson Optical Ltd. (Birla) and Optic on the one hand and Shin-Etsu (Shin) one the other entered into a long sale and purchase agreement. Birla and and Optic filed a civil suit for similar reliefs. Shin filed an application before the civil court for dismissal of the said civil suit under Order VII Rule 11 of the Code of Civil Procedure and Sections 5 & 8 of the Arbitration and Conciliation Act, 1996 (Act). The said provision reads as follows:

• 11. Rejection of plaint— The plaint shall be rejected in the following cases:—

(a) where it does not disclose a cause of action;
(b) where the relief claimed is undervalued, and the plaintiff, on being required by the Court to correct the valuation within a time to be fixed by the Court, fails to do so;
(c) where the relief claimed is properly valued, but the plaint is returned upon paper insufficiently stamped, and the plaintiff, on being required by the Court to supply the requisite stamp-paper within a time to be fixed by the Court, fails to do so;
(d) where the suit appears from the statement in the plaint to be barred by any law :
Provided that the time fixed by the Court for the correction of the valuation or supplying of the requisite stamp-paper shall not be extended unless the Court, for reasons to be recorded, is satisfied that the plaintiff was prevented by any cause of an exceptional nature form correcting the valuation or supplying the requisite stamp-paper , as the case may be, within the time fixed by the Court and that refusal to extend such time would cause grave injustice to the plaintiff.

• 5. Extent of judicial intervention. -Notwithstanding anything contained in any other law for the time being in force, in matter governed by this Part, no judicial authority shall intervene except where so provided in this Part.
  

• 8. Power to refer parties to arbitration where there is an arbitration agreement.

(1) A judicial authority before which an action is brought in a matter, which is the subject of an arbitration agreement, shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration.
(2) The application referred to in sub-section (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof.
(3) Notwithstanding that an application has been made under sub-section (1) and that the issue is pending before the judicial authority, an arbitration may be commenced or continued and an arbitral award made.

• The Civil Judge, Class-I, Rewa, Madhya Pradesh (trial court) dismissed the Civil Suit. A revision petition filed before the Madhya Pradesh High Court also met the same fate. A Civil Appeal was then filed before the Supreme Court, which, on 7.12.2005 set aside the decisions of the trial court and of the MPHC, and ordered the trial court to consider the “matters afresh treating the applications filed by the appellant herein (under Order 7 Rule 11 CPC read with sections 5 and 8 of the Act) as applications under Section 45 of the Act and dispose them in terms of the decision in Aksh Optifibre Ltd.” Section 45 of the Act reads:

45. Power of judicial authority to refer parties to arbitration.
Notwithstanding anything contained in Part I or in the Code of Civil Procedure, 1908 (5 of 1908) a judicial authority, when seized of an action in a matter in respect of which the parties have made an agreement referred to in section 44, shall, at the request of one of the parties or any person claiming through or under him, refer the parties to arbitration, unless it finds that the said agreement is null and void, inoperative or incapable of being performed.

• Re-consideration by the Trial Court and thereafter: On remand, the Trial Court held that the application filed on the basis of S 45 was inoperative, the parties cannot be referred to arbitration “and the matter should be proceeded with and decided on merits by the court.” On appeal, the IV Additional District Judge, Rewa, allowed the appeals, and remitted the matters to the Trial Court with a direction to consider the applications of the appellant under section 45 of the Act, in accordance with the procedure and principles laid down in Para 111 of the decision in Shin Etsu. Against the order of the IV Additional District Judge, Rewa, Shin filed an appeal under Article 136 of the Constitution before the Supreme Court contending that: the IV Additional District Judge, Rewa should not have remanded the matter back to the trial court as it had not found that the arbitration agreement was null, void, inoperative or incapable of being performed. Rather, it should have merely allowed the appeal. It was contended by the Respondents that a petition under Article 136 was not, and the High Court was the appropriate forum to seek remedy. Against, this Shin contends that the matter has been pending for two years and the matter should not be sent back to the High Court.

Decision of the Supreme Court:

• ·The SC framed two issues:

Whether the appellants can directly approach this Court under Article 136 of the Constitution, against the orders of the District Court, without approaching the High Court?
Even if the answer to the first question is in the negative, whether leave having been granted by this Court, these appeals should be considered and decided on merits?

The SC Held:

• Section 50 of the Act which reads as follows saves the right to appeal to the Supreme Court, from the bar against second appeals.

50. Appealable orders : 1) An appeal shall lie from the order refusing to--
(a) refer the parties to arbitration under section 45;
(b) enforce a foreign award under section 48,
to the Court authorized by law to hear appeals from such order.
(2) No second appeal shall lie from an order passed in appeal under this section, but nothing in this section shall affect or take away any right to appeal to the Supreme Court.

• The SC has, under Article 136, the power to grant leave to appeal in suitable cases. This power, according to the court, but had to be used sparingly.

• An appeal by special leave to Supreme Court cannot therefore be considered as an appeal as of right or as an appeal in pursuance of a right to appeal to the Supreme Court.

• An appeal cannot lie from the court of first appeal to the Supreme Court (under Article 136) as mentioned in Section 50 as efficacious alternative remedy of revision to the High Court is available under Section 115 of the Code of Civil Procedure.

Section 115 provides:
115. Revision—
(1) The High Court may call for the record of an case which has been decided by any Court subordinate to such High Court and in which no appeal lies thereto, and if such subordinate Court appears—
(a) to have exercised a jurisdiction not vested in it by law, or
(b) to have failed to exercise a jurisdiction so vested, or
(c) to have acted in the exercise of its jurisdiction illegally or with material irregularity,
the High Court may make such order in the case as it thinks fit :
Provided that the High Court shall no, under this section, vary or reverse any order made, or any order deciding an issue, in the course of a suit or other proceeding, except where—
(a) the order, if it had been made in favour of the party applying for revision, would have finally disposed of the suit or other proceedings, or
(b) the order, if allowed to stand, would occasion a failure of justice or cause irreparable injury to the party against whom it was made.
(2) The High Court shall not, under this section, vary or reverse any decree or order against which an appeal lies either to the High Court or to any Court subordinate thereto.
Explanation.—In this section, the expression "any case which has been decided" includes any order made, or any order deciding an issue in the course of a suit or other proceeding.

• ·In Punjab Agro Industries Corporation Ltd. v Kewal Singh Dhillon – 2008 (11) SCALE 616, it was held by the Supreme Court that Article 136 is not intended to permit direct access to this Court where other equally efficacious remedy is available and the question involved is not of any public importance; and that this Court will not ordinarily exercise its jurisdiction under Article 136, unless the appellant has exhausted all other remedies open to him.

• Once leave for appeal is granted, the court continues to have discretionary power, including the power to “refuse to go into merits, or even if it goes into merits, to merely declare the law and refuse to interfere if interests of justice and/or facts of the case do not call for interference”. The extent of such discretionary power extends to “even revoke the leave already granted.”

• In spite of the fact that the matter has been pending before this Court for more than two years and relegation to alternative remedy will further delay the consideration of the issue. Supreme Court has been consistently following the practice of not entertaining appeals directly from the orders of district courts or court subordinate thereto, if an alternative remedy by way of appeal or revision was available before the High Court.

• The Court found no special and exceptional circumstance that warrants direct interference with an order of a district court bypassing the remedy available before the High Court and hence dismissed the appeal.

Review Article

EC’s order on the hate speech issue – A summary

Part II of Legal implications of hate speech in the milieu of elections. See Part I here.

EC suo motu took note of the reported incidences of hate speech and issued notice to Varun to explain his actions of violation of clause 1 and 3 of the Item No.1, which specifies General Conduct, of the MCC. The notice also required Varun to explain the charges of (1) attempting to promote enmity and hatred among different class of citizens on the ground of religion, (2) outraging the religious feeling of a particular community, and (3) promoting hatred and ill-will between two classes of citizens provoking a section of the citizens to indulge in violence. Notice was also issued to BJP to explain its actions.

The party in its reply took a safe stance of disassociating itself from the actions of Varun, though later actions of the party are contrary. But then we are not surprised about the actions of the BJP as we are so familiar with the diabolic actions of political parties and their unprincipled stands for gains, aren’t we?

Varun vied the contents of the notice and explained his position denying all the allegations. He contended that the CDs were doctored and what happened is a trial by media. As per the EC, Varun neither accepted nor rejected the contents of the speech, which became a crucial basis of the order of the Commission.

The Commission could not find any merit in the explanation of Varun. EC came down hard on the content of the speech and observed that expressions of this nature are pernicious as also contemptuous of the Constitutional ideals of secularism and democracy. The Commission co-opted the views of the SC of India in cases where such rhetoric has been the issue. (Ziauddin Burhanuddin Bukhari v Brijmohan Ramdass Mehra AIR 1975 SC, Abdul Hussain Mir Vs. Shamsul Huda AIR 1975 SC 1612 and Ramesh Yeshwant Prabhoo Vs.Prabhakar Kashinath Kunte and Others (1996) 1 SCC 130)

Being conscious of the limitations of the powers and the present position of law the Commission advised the party not to field Varun as a candidate. EC condemned the actions of Varun and censured him. Commission had already taken initiative to register criminal cases under IPC and R.P Act. The Commission directed the UP government to investigate and proceed in these matters with swiftness and alacrity. In the light of explanation tendered by BJP the Commission expressed its expectation that the party will not nominate Varun as its candidate.

(To be continued)

Election Law

Right to get registered as a voter

The Hindu of today carry a news - First time and legal - about the National Law School of India University, Bangalore (NLSIU) students successfully registering themselves as voters. Kudos to all who worked for it.

Thought, this could be an occasion to educate ourselves about the legal processes of registering as a voter. The right to be registered as a voter flows from Article 326 of the Constitution of India. This right is extended to every citizen of India who is not less than 18 years of age and not otherwise disqualified by any law made by the legislatures in this aspect. The disqualifications are non- residence, unsoundness of mind, for committing crime,corrupt or illegal practices.

There exists plenty of literature, both academic and case laws, which has debated the nature of the right to vote. The three competing categories to pigeon hole this right are; fundamental right, constitutional right or statutory right. The judiciary in India seems to have put an end to the debate by holding that the right to vote is a creature of the statute and hence a statutory right. Despite this the other line of argument is alive that democracy is basic feature of the Constitution and the right to democratic governance make the right to vote an inevitable fundamental right. The constitutional prescription of 'adult suffrage' in Art. 326 makes it at least a constitutional right if not a fundamental right for some ohters.

The right to register as a voter, qualifications and disqualifications thereof and the process of registering oneself as a voter is scattered in two different but related laws, besides the Constitution . The Representation of People Act, 1950 (R.P Act)and The Registration of Electoral Rules, 1960 are those relevant laws. Part III of the R.P Act contains the provisions about the qualifications and disqualifications to register oneself as a voter. Section 19 of the R.P Act prescribes the conditions for registration. Age and residency are the two criteria to be considered.

The aspect of 'ordinary residency' is the one which has always been contested, especially in the case of students who live for a long duration in hostels or otherwise in places other than their permanent residence. Section 20 of the Act explains ordinary residence and seems to suggest that it is your stay in a place for a considerable period that matters. This section provides for the scope of registration in specific instances of persons in service, elected representatives etc. What one need to be reminded of here is that a person is prohibited to have his/her name registered in more than one constituency or more than once in a constituency. (Sections 17 and 18)

Part I of the Registration of Electors Rules 1960 (Rules), details the process of getting oneself registered as a voter. A person desirous of registering oneself as voter is to submit an application in Form 6 (attached to the Rules) to the designated Electoral Registration Officer. In case the person is already registered as a voter elsewhere that can be deleted therefrom for which the application is to be submitted in Form No. 8A. The decision of the Electoral Registration Officer is appealable ( Rule 27) to the Chief Electoral Officer within 15 days from the date of the order appealed against.

It is heartening to know that the students of NLSIU have taken the initiative to get themselves registered as voters. Casting vote is an important element of active participation in the political process of the country. This becomes special against the background of the fear expressed by many about the apathy of the young educated towards politics and political processes.