Alba F. Fondrieschi

Relational Contracts and Repeated Deals in Japan and Europe

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Abstract

In contracts, change and stability are usually regarded as conflicting patterns, with the result that systems tend to favour one aspect to the detriment of the other. The classical and neo-classical contract model - both in civil law and common law systems - have always leant towards stability, by attributing a central role to the promise, defined as a binding declaration of will. Over the years this model has frequently been questioned, especially by theoreticians of the so called «relational contract», a more flexible and change-oriented model that is common in Far-Eastern legal systems such as the Japanese one. This paper maintains that the real differences between the Western neo-classical model and the Japanese relational model lie in the greater attention which the latter pays to the stability of long-term commercial relationships, by providing for duties which prevent the unreasonable interruption in repeated deals or the refusal of the renewal in long-term contracts. Despite the undeniable differences between these two models, over the decades some European legal systems - through legislation or judicial decisions - have shown an ever increasing interest in protecting long-term relationships by acknowledging similar duties, although their scope is usually still confined to competition law. Nevertheless, one should ask whether these duties can play a more relevant role in the near future in the law of contract and contribute to changing the traditional notion of contract in Western legal systems.

Keywords

  • Relational Contract
  • Discrete Contract
  • Long-Term Agreement
  • Repeated Deals
  • Abuse of Economic Dependence

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