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Edinburgh Private Law Blog Posts

What evidence can be taken into account in interpreting a contract? Prohibiting reference to pre-contractual negotiations and the effect of an entire agreement clause

by Ms Lorna Richardson, Senior Lecturer in Commercial Law

Scots law, like English law, generally prohibits the use of pre-contractual negotiations when interpreting a contract. This is in contrast to the position in many civilian systems where such negotiations are taken into account in determining what a contract means. The DCFR also permits reference to pre-contractual negotiations, as part of the circumstances in which the contract was entered into, when interpreting a contract (Art II-8:102(1)). The exclusion of such evidence in Scots law is not however absolute and it can be referred to in certain circumstances, for instance, to show that a fact was known to both parties at the time of contract formation, such fact forming part of the “factual matrix” against which the words of the contract must be considered.

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Compensating unpaid domestic care in the testamentary context II: Possible approaches and potential objections

by Professor Alexandra Braun, Lord President Reid Chair of Law

In a previous blog entry, I examined whether current Scots law allows unpaid domestic carers to bring a claim against the estate of the person whom they have cared for. We saw that in Scotland, unpaid carers who are not in a contractual relationship with the care-recipient and who have not been provided for in the care-recipient’s will, only have a limited set of possible options and that the value of informal care is not currently recognised by way of a specific entitlement against the estate of the care-recipient. What is the situation elsewhere?

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Compensating unpaid domestic care in the testamentary context: An opportunity for Scots law

by Professor Alexandra Braun, Lord President Reid Chair of Law

According to the Scotland’s Carers research report published in 2015, and the latest update release of April 2022, approximately 700,000 people provide unpaid care and the value of such unpaid care in Scotland is estimated at over £36 billion a year. For comparison, in 2019 the NHS Scotland budget was £13.4 billion. Often such unpaid care is provided by family members, frequently but not always women,[1] and in some cases neighbours and friends. The assumption seems to be that domestic care services are intended to be gratuitous and are thus provided for free. Indeed, domestic care services are sometimes described as ‘labours of love’. But while domestic care services might well be motivated partly by love and affection or a sense of duty, this does not necessarily mean that they should not be compensated, especially since such services can be of significant economic and personal benefit to the care-recipient. My question then is can domestic unpaid care services be compensated on death of the care-recipient through a claim against their estate?

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Formation of Contract in Scots Law: Applying the Governing Principles

by Laura Macgregor, Professor of Scots Law, University of Edinburgh.

Many types of contracts do not require to be entered into in writing in Scots law (see Requirements of Writing (Scotland) Act 1995, s1). Where this is the case, it can be difficult to identify whether the parties have reached binding consensus or something short of that. It is possible for parties to reach consensus on all essential terms, and yet agree that they will not be contractually bound until such time as a written contract is signed (Karoulias SA v The Drambuie Liqueur Company Ltd 2005 SLT 813). In Supaseal Glass Ltd v Inverclyde Windows Manufacturing Ltd ([2022] CSOH 49), a recent case decided in the Outer House of the Court of Session, Lord Braid provides a useful summary of the governing principles of formation of contract in Scots law. His objective analysis nicely illustrates Lord President Dunedin’s famous statement that “[c]ommercial contracts cannot be arranged by what people think in their inmost minds. Commercial contracts are made according to what people say” (Muirhead and Turnbull v Dickson (1905) 7F 686 at 694).

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Nation-Building, Capital Markets and Meaning of le Franc Or

by David Fox, Professor of Common Law, University of Edinburgh*

The Case of the Serbian Loans issued in France (1929) 56 J. Dr. Int’l 977 was one the earliest and most influential of the inter-war cases on the interpretation of gold clauses in long-term bond contracts.  As a decision of the Permanent Court of International Justice in the Hague, its reasoning influenced decisions in the French, English and United States courts.  It established that a payment clause stipulating for payment of gold coin would be interpreted as creating an obligation to pay legal tender money corresponding to the gold value of the money owed by the issuer of the bond.

Now that all world currencies have broken their link with gold, that point of law is unlikely ever to arise again.  But the case has an enduring significance beyond the superseded point it stands for.  The sparse legal record offers a glimpse into important historical events of the early twentieth century, and the way they impinged on the financial arrangements of the governments and investors of the time.  We see financial deals being done by an emerging nation state and the imperial Great Powers of the era.  Less comfortably, we see an example of the inevitable link between finance and war in a time when notions of “ethical investment” were still a century away from being articulated.

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