The Code prefers the basic Scots approach which requires 'any minor who is lucratus to pay for the benefit conferred upon him'.(234) Indeed, on some occasions a Scots solution regarded as 'eminently preferable', appears in the Code, such as in the case of 'joint promisors as well as joint and several promisors' under section 604 'consequences of promises of the same performance'. Current English law, where two or more promisors are jointly liable, requires action to be brought against all together. English law also regards the release of one promisor as effective on the release of the others, whether the promise is 'joint' or 'joint and several'. The Code removes the English distinction between 'joint promises' and 'joint and several promises' as the English rule is seen to be impractical particularly in contracts between businessmen.(235)
As noted earlier, in many instances the aim is to harmonise English and Scots law such as in section 106 'gradation of promises and obligations'. Here it is done 'by removing from English law the tendency to categorise obligations at the formation stage, as opposed to the stage of performance, and to distinguish between \\and \terms\
Sometimes English law is not only brought into line with Scots law, but also with methods to be found in Continental codes such as, for example, section 402 'terms, conditions and enforcement order', also to be found in German law.(237)
As to the rules on agreed damages 'greater than loss', McGregor considers German and South African laws extensively and suggests that England and Scotland should adopt a similar rule; a case, Robophone Facilities v Blank [1966] 3 All ER 128 (C.A.) at 143 already indicating that this may be the law in England.(238) This is section 445 'agreed damages greater than loss' where, when there is an agreed sum, the legitimate and rightful interests of the victim of the breach are to be taken into account in determining the extent of the loss.
McGregor often suggests useful simplification of the present English law, such as in section 515 'enforcement and restitution where one party innocent of the illegality'. Under current English law, 'a contracting party who is innocent of the illegality is sometimes and is sometimes not debarred from suing the other party who is aware of the illegality. ... All these distinctions are technical and appear to be devoid of intrinsic merit ...'(239) The Code adopts the basic rule that the innocent party is entitled to sue and then introduces qualifications. Another example to such simplification is, as already discussed above, the rule abolishing the 'postal rule' and introducing the concept of 'communication'.(240)
At times, some comfort is offered by reiterating that other common law jurisdictions have statutorily adopted a solution along similar lines to the one suggested by the Code. An example of this is the reference to New Zealand, where a solution along similar lines proposed by section 519 'enforcement of part of illegal contract', was adopted in relation to contracts containing covenants in restraint of trade.(241) At times another common law jurisdiction offers a replacement, such as when the American rule on persons mentally affected is preferred: 'Accordingly, the conventional test has been discarded in favour of the test put forward in this section, which test is in conformity
with that recently propounded by the Restatement of Contract (Second) section 18C and applied by the New York Court of Appeals in Ortelere v Teachers' Retirement Board 25 N.Y. 2nd 196, 250 N.E. 2nd 460 (1969).'(242)
Discussing 'contracts lacking free consent' (section 561), however, McGregor says: 'Current English law says that the contract is voidable, current Scots law that it is void in the case of force or fear though accepting that it is voidable - reducible in Scots terminology - in the case of undue influence; of the two the Code adopts, in effect, the English solution although discarding the terminology.'(243)
Sometimes there is clear departure from settled common law. 'It would appear to follow that the guarantor of a minor should remain liable even if the minor can plead his minority as a defence, and this result is reached in Scotland: see Stevenson v Adair (1872) 10 M. 919. The contrary English decision in Coutts v Browne-Lecky [1947] K.B. 104 is accordingly expressly departed from in the Code.'(244) Furthermore, 'the technical rule of English law that the principal whose agent makes a contract under seal does not himself contract - a rule already made inapplicable to powers of attorney by section 123 (1) of the Law of Property Act 1925 and finding no place in Scots law - is abandoned by the Code.'(245)
Privity of contract is abolished by section 641 'creation of rights in third parties'. This can be regarded as revolutionary. Here not only is English law brought into line with Scots law but the law of Scotland is also amended. The commentary states:
English law, unlike Scots law, has stubbornly clung to the general principle that ... if a person is not a party to a contract he can acquire no rights under it. ... The inconvenience of such a restrictive rule has led both to attempts to bypass it, particularly by resort to the concept of trust, and to the introduction of wide-ranging statutory exceptions. Other major legal systems have found no need for the rule. In the civil law the stipulation pour autrui is fully recognised; thus this issue marks one of the main differences between the Scottish and the English law of contract. Some systems derived from the English common law have also thrown off the English yoke here; thus in the U.S.A. the rights of third parties have been recognised since ...(246)
The commentary goes on to say that: 'Current English law is clearly out of step both with modern practice and with good sense, and in this section the Code seeks to remedy this and to bring English law into line with Scottish, while at the same time clarifying and amending the law of Scotland in certain respects.'(247)
So, in many ways, had the McGregor Code become a Contract Code for England and Scotland, it would have meant that an enormous upheaval had taken place in one of the most important areas of English private law, one which is predominantly based on common law. English law would have abandoned some of its peculiarities altogether. In some areas it would have been harmonised with Scots law deserting its own settled position. In other areas it would have been infiltrated by International Conventions and foreign jurisdictions, not only those of the U.S.A., a common law jurisdiction, or South Africa, a mixed jurisdiction, but also those of Germany and France. This,
however, is one of the 'ifs and buts' situations.(248) Not only was this Code abandoned by the Law Commission but it did not introduce any changes into English law whatsoever.
Nevertheless, the fact that the codification of contract law was considered to be a desirable objective and appeared a priority activity for both Law Commissions from 1965 to 1973, must indicate something significant. This makes McGregor's Code important. It is also important in that it demonstrates how common law and Continental civil law concepts can live not only side by side but in fruitful interrelationship. Granted it does not read like a Continental Code and is far too long by that comparison, yet it does fulfil some of the conditions of codification, such as simplification, cohesiveness and systematisation. Anyone familiar with English and Scottish contract law must appreciate that this was a mammoth task dexterously performed. A third reason for its importance is the impact it made on some Continental lawyers who could now reapproach English contract law as a more familiar and user-friendly topic than ever before.
What is significant here is not so much the content of the Code, though in places that too is important as it indicates a movement towards civilian solutions and concepts, but the methodology and the structural approach employed. It is for this that the Code is of interest. Yet, this Code did not serve as a basis for the Principles of European Contract Law, nor was it ever referred to by the Lando Commission, although it was hailed with considerable enthusiasm by the Gandolfi project.
As to later developments, the English Law Commission and the legislator introduced some changes into contract law along the lines of the proposals of this Code soon after abandoning the project, such as in the Unfair Contract Terms Act 1977, which transformed the law in the area of exemption clauses and contracting out, by a general and far-reaching legislative enactment replacing the 'particular and spasmodic legislative interventions'.(249) Another example of this is in the Law Reform (Miscellaneous Provisions) Act 1978, section 1 which makes plain that a breach of a contract to marry cannot give rise to any legal remedy. This is similar to what was suggested by section 407 of the McGregor Code.(250) This development also makes section 433 irrelevant since actions for breach of promise of marriage were abolished by the same Act. Yet another example is related to 'improper economic advantage', which was envisaged in the Code to go beyond the law as it stood; now, this section 'is more than justified by the manner in which English law soon afterwards developed. ... a doctrine of economic duress allowing contracts to be set aside has now firmly arrived on the scene'.(251) The last example here is where McGregor remarks in a footnote to his section 641 rejecting the privity doctrine, 'indeed intimations have since come from the House of Lords, especially in Woodar Investment Development v Wimpey Construction U.K. [1980] I W.L.R. 277 (H.L.), that the time has come to reconsider and reject the privity doctrine'.(252)
However, some later developments also indicate solutions along different lines. Some of the legislation and cases underlying the Code have now been changed, either abolished by legislation or overruled by the courts, making some of the law stated in the Code unrepresentative of English law. One example of this category of developments is that, whereas previously, for a person to give as a gift an ornament sent to him which was unsolicited, constituted an agreement of sale, now, since the Unsolicited Goods and Services Act 1971, the position is different.(253) In the area
of 'substantial breach', the solution suggested by section 306 has not developed along the suggested lines starting with The Mihalis Angelos.(254) Also, the suggestion in the next section emanating from the case Harbutt's 'Plasticine' v Wayne Tank and Pump Co.(255) has not been accepted by the House of Lords in Photo Production v Securicor Transport,(256) the issue being overruled.(257) The same overruling also affects section 310 'effect of breach on provisions excluding or limiting liability', where McGregor says that the relevant sections of the Code 'may now be removed from the Code as now otiose; indeed it had ceased to represent the law'.(258) Another rule representing current English law which found its place in the Code, that damages have to be paid in pounds sterling, was overruled by Miliangos v George Frank (Textiles),(259) which accepted that both debt and damages may be awarded in foreign currencies.(260)
Some of the rules relied upon in the Code as current English law have also been superseded or abolished by the legislator. Examples of such Acts are Law Reform (Miscellaneous Provisions) Act 1970, Law Reform (Miscellaneous Provisions) Act 1989, Consumer Credit Act 1974, The Industrial Relations Act 1971, Trade Union and Labour Relations Act 1974, Sale of Goods Act 1979, Minors' Contracts Act 1987 and Mental Health Act 1983.
When we turn to the Scottish Law Commission, we observe that Memorandum No. 42 'Defective Consent and Consequential Matters' of June 1978 starts out by stating that:
In our First Programme of Law Reform we recommended that the law of obligations be examined by this Commission with a view to reform. ... Between 1966 and 1972 we participated in a joint venture with the [English] Law Commission for the codification of the law of contract. For reasons we have stated in our Seventh Annual Report we withdrew from that project in 1972, and work on it was later suspended by the Law Commission as regards the law in England and Wales as well, without prejudice to the possibility of codifying at some future date after the law had been clarified or reformed. Progress on our programme subject of Obligations was 'very seriously interrupted' during this period by the concentration of our resources on the joint exercise. We have recently, however, been able to turn our attention again to this area of law, and in 1977 we published a number of Memoranda containing provisional proposals for reform of certain aspects of the law relating to voluntary obligations.(261)
One of the intriguing aspects of the work of the Scottish Law Commission in this field is that among foreign experts who assisted in the work on these proposals were two Dutch scholars, Professors Feenstra and Fokkema from the Leiden University. In Memorandum No. 42, Volume I, there are frequent and extensive references to the laws of other jurisdictions such as those of the United States, England, 'most continental European systems' or 'legal systems derived from Roman Law'. Israeli Contracts (General Part) law, the then Draft Dutch Civil Code, UNIDROIT draft law, American Restatement (Second) of Contract law, Roman Law, the then Revision of Quebec Civil Code and the United States Uniform Commercial Code are referred to for help. In Volume II, sections on the comparative context include references to German, Swiss, Austrian, French, Dutch, Italian, Israeli, Quebec, American, English, New Zealand, South African and UNIDROIT laws. Also, reference is often made to 'legal systems on the European Continent', 'all modern systems participating in the civilian tradition', 'European systems', 'Continental
developments', Poitier, Grotius, Pufendorf and Barbeyrac. In the section on fraud, for example, it is stated that:
Erskine's definition of fraud as a 'machination or contrivance to deceive' we would accept as probably the most serviceable which could be devised. It reflects the same civilian tradition exemplified in French, Italian, Dutch and Spanish law. While the 'Germanic' systems stress the causing of 'error' by fraud, the systems with which Scots law has closer affinity stress the type of 'conduct causing' error (or, of course, founding delictual liability). Thus the French Code Civil refers in art. 1116, to 'manoeuvres'; the Dutch Burgerlijk Wetboek in art. 1364 to 'kunstgrepen'; and the Spanish Codigo Civil in art 1629 to 'maquinaciones insidiosas'. However, those different approaches to definition do not produce differences of result.(262)
Whereas, as regards English solutions in the Misrepresentations Act and New Zealand reactions, for example, they say: 'We have, however, fundamental difficulties regarding the whole conceptual approach to the legislation - at least as a possible model for a system such as Scots law which is not primarily \based\and which, in this branch of the law, did not develop through the interaction of Law and Equity. ... Scots law, broadly speaking, shares a conceptual framework with the civil law systems of the world.'(263)
These views clearly indicate that were English law to be brought into line with Scots law, there would be conceptual difficulties if not difficulties simply in the encounter between two systems of socio-cultural affinity but legal-cultural diversity. Add to this the fact that codification, in whatever sense, is not part of either culture within the UK, it is not difficult to understand why the McGregor Contract Code never saw the light of day at home.
5.4.3.6 Coexistence of common law and civil law in Codes
A first point to note is that when English common law coexists with a jurisdiction that is not codified, it can seep into that other. This was and is the case in Scotland and in the common law States of Australia mentioned above. Common law finds it harder to penetrate into Codes where judges tend to adhere to the wording of a Code itself when deciding cases.(264)
A second observation is that, looking at the history of codification in the common law world, we see that help was derived from Continental Codes. For example, Livington's Draft Criminal Code of 1826 for Louisiana and Macaulay's Indian Penal Code, the draft dating back to 1838, have a lot in common with Continental Codes and markedly with the French Code pénal of 1810. Cadoppi says that now 'the French flavour remains somewhat a distant hint, a sprinkle of French wine on a roast beef which is English in taste'.(265) Stephen's Draft Criminal Code for England of 1878 and Wright's Draft Criminal Code for Jamaica were also influenced, though to a lesser degree, by Continental Criminal Codes. The Louisiana Civil Code and the Louisiana Commercial Codes, both old and new, are also good examples.
Cadoppi provides insight into the Criminal Code for Malta of 1854. The first mixed Commission of English, Scottish and Maltese lawyers in this then British colony with Italian as the language of