Business Contracts

Acknowledging the shortcomings of the Civil Code, the rules of which on non-performance of a contract were fragmented and incomplete, the reform of contract law has brought together all the provisions relating to non-performance in a single section, divided into subsections devoted respectively to the various sanctions for non-performance, and presented as a preliminary to Article 1217.  In the event of contractual non-performance, new Article 1217 of the Civil Code, resulting from Ordinance No 2016-131 of 10 February 2016, provides the creditor with options giving the latter a choice between different sanctions. The text thus authorizes “the party towards whom the undertaking has not been performed, or has been performed imperfectly” to “refuse to perform or suspend performance of his own obligation; pursue specific performance of the obligation; obtain a reduction in the price; bring about the rescission of the contract; claim reparation for the consequences of non-performance”. The last paragraph governs the relationship between those different sanctions, which, where they “are not incompatible, may be combined”, and points out that “damages may always be added to them”. While these different hypotheses tend to maintain the existence of the contract, others can lead to its extinction, putting a definitive end, for the future, to the rights and obligations arising from the contract. This is the case when the contract comes to an end, or when, more radically, the contract no longer serves any purpose, due to invalidity, rescission or through the death of the contractor.

318. Review of contract for services