liable if he has signalled his intention to deliver the money provided he has no reason for refusing to deliver it.78

Case 1(b) is more complex. If a child marries, his or her parents are under an obligation to give the child a dowry (Ausstattung).79 The size of the dowry depends on the financial situation of the parents. In Case 1(b), Clara has a claim for a dowry against her father. Gaston’s promise therefore could be interpreted as a settlement or an acknowledgment80 of Clara’s claim. As neither a settlement nor an acknowledgment is a contract of donation, the form requirement would not apply. Gaston’s promise could constitute a settlement or acknowledgment, however, only if it was preceded by a dispute between Clara and Gaston about the proper amount of the dowry. If there was no such dispute, the promise constitutes a gift to the extent that the amount of money promised exceeds the dowry owed to Clara.

germany

In Case 1(a), Gaston is not bound because a promise to make a gift in the future is valid only if it is recorded in a notarial document (§ 518 of the Civil Code81). Otherwise the promise is void (§ 125(1)82). This is the only way to make the promise binding. Therefore, Gaston’s estate is not liable either.

Even if the promisee incurred expenses, the promise is not binding. The promisee cannot recover these expenses because the purpose of the form is to protect the promisor from making over-hasty promises. And if he would be liable for damages, his decision would no longer really be free. The result would be different only if Gaston had deceived Catherine by telling her that no form was required. Then Catherine would have a

78For a liability to arise, the signals must have been taken seriously by the other party, and that party must have acted on the basis of these signals and thereby incurred the expenses.

79See § 1220 of the Civil Code with respect to a daughter and § 1231 with respect to a son. In general, see Koziol and Welser, Grundriß 257.

80A party who makes a settlement (Vergleich) accepts a compromise between his claims and those of the other party; in contrast, a party who makes an acknowledgment (Anerkenntnis) accepts the other party’s claims completely.

81‘(1) A contract which includes the promise to make a gift requires that this promise is recorded by a notary. This rule is also applicable if the gift is an acknowledgment of indebtedness (§§ 780, 781). (2) The lack of this form is immaterial if the promise is fulfilled.’

82‘A promise (Rechtsgeschäft) which does not meet the formal requirement imposed by the law is void.’

44 the enforceabilit y of promises

defence which would prevent Gaston from asserting the formal requirement. If this were the case, the promise would be enforceable. Gaston could also be liable for damages (culpa in contrahendo83) if the promise was void because of Gaston’s negligence and if his responsibility for meeting the formal requirements were greater than Catherine’s because of his superior knowledge.

In Case 1(b), what somebody gives to his child because the child is about to marry is not a gift in a legal sense as long as the sum is appropriate to the financial circumstances of the parents (§ 1624(1) of the Civil Code84). Therefore § 518 is not applicable and the promise is binding without respect to any form.

Gaston’s estate is also liable for his promise.

In Case 1(c), the question is whether the promise concerns a gift and therefore whether § 518 of the Civil Code applies. There is no general exception for charitable gifts.

Nevertheless, for there to be a gift, it is necessary that the donee be enriched even after performing a duty connected to the gift.85 In our case, the United Nations Children’s Emergency Fund has to give all the money to famine victims and therefore this requirement is not met. But if a sum of money is given to a legal entity (as distinguished from a natural person), it does not matter if all the money has to be spent for one of the original purposes of the entity. Otherwise it would be virtually impossible to make a gift to a juristic person.86 Because the Children’s Fund (or at least the

83If a promise is not legally binding, it is still possible that the promisor is liable for the damages the promisee has incurred because he has put his trust in the validity of the promise (culpa in contrahendo). But there is no claim for damages if this would be contrary to the purpose of a requirement that there be a formality or if the promisee has to bear the risk of the validity. Also, the promisor is liable only if he did not meet the relevant standard of care.

Culpa in contrahendo can also result in a claim for damages if one party terminates the negotiations for a contract without any reason and the first party has had expenses because it relied on the other party and expected the contract to be concluded. BGHZ 76 (1980), 343 (349). Nevertheless, this doctrine has to be applied very carefully because before a contract is really concluded, the parties are not bound, and they are naturally free to decide whether or not to agree. Therefore, damages can only be awarded if the trust was exceptionally great or if the conduct of the party terminating negotiations was particularly egregious.

84Summary of the provision: What parents give to their child because of a marriage or because the child wants to start an independent life is only a gift in respect of the sum which is not appropriate to the financial situation of the parents.

85RGZ 62 (1906), 386; RGZ 105 (1923), 305.

86RGZ 70 (1909), 15 (17); RGZ 71 (1909), 140 (142, 143); RGZ 105 (1923), 305 (308). See also Dawson, Gifts and Promises, 170–3.

United Nations) has its own legal personality and has famine relief as a purpose, § 518 of the Civil Code is applicable in our case and the promise is therefore void.

In Case 1(d), a normal tip is not a gift because it is very similar to remuneration. This doctrine is not undisputed but it is sound because of the close connection between the tip and the service performed by the waitress.87 Were this a normal tip, the promise would be binding because § 518 of the Civil Code is not applicable. But a large sum of money cannot be regarded as a real tip. It has to be regarded as a gift and consequently § 518 is applicable, and the promise cannot be enforced.

greece

Gaston has promised a donation. Donation is a unilateral contract in the civil law sense: only one party assumes an obligation.88 It is regulated by arts. 496 to 512 of the Greek Civil Code. The donor’s promise, the donee’s acceptance, and the delivery of the object promised may be simultaneous (an immediately executed donation) or the promise may be made and accepted prior to the delivery (promissory donation).89

According to art. 498(1) of the Civil Code, a donation or a promise of donation is valid if, and only if, a notarial document has been drawn up. This form is necessary for such an obligation to exist regardless of the kind and value of the donation, and if it is absent, the donation90 is void. According to art. 180 of the Civil Code, an ‘act which is void is deemed not to have been done’. Therefore, a promise of donation is deemed to have been made, and the donee can ask for the thing promised to be delivered to him, only if a notarial document has been drawn up.91 The requirement of art. 498(1) is deemed to be a matter of public order and the court can examine it ex officio.92 The invalidity of the donation is complete and the donor, his heirs, his creditors, and anyone who has a legal interest in it can invoke it.93

An exception to this rule is created by art. 498(2) of the Civil Code which concerns movables. In the case of movables, when no notarial document

87H. Kollhosser in K. Rebmann and F. J. Saecker, Münchener Kommentar zum Bürgerlichen Gesetzbuch, 3rd edn (1995) § 516 no. 19; O. Mühl in W. Siebert, Soergel Kommentar zum Bürgerlichen Gesetzbuch, 12th edn (1997) § 516 no. 18.

88Acceptance by the donee is also required by art. 496 of the Civil Code.

89Deligiannis and Kornilakis, Law of Obligations, Special Part, vol. I, 32.

92Kafkas, Law of Obligations, vol. I, art. 498 CC, pp. 17–21.

93I. Karakostas in Georgiadis and Stathopoulos, Civil Code, vol. III, art. 498, no. 8.

46 the enforceabilit y of promises

exists, fulfilment of the donation (namely delivery of the thing to the donee) validates the donation. After delivery, the donor cannot recover what he has given. This is the donation manuelle of art. 242 of the Swiss Code of Obligations.94 The legislator’s intention in requiring a formality is to protect the donor from hasty decisions because he may not be aware of the consequences when a simple promise is made. This rationale explains why an exception is made when movables are delivered. The donor is more aware because he experiences the alienation of the gift in a perceptible manner.95 Therefore, in our case, Gaston is not obliged to keep his promise (namely to deliver the money to the donees), and in case he dies his estate will not be liable, unless a notarial document has been drawn up.

The use of a different legal form such as a trust in order for a promise to be binding is not possible under Greek law, because this legal morpheme (at least as it is defined in common law countries) is not recognized.96

Nevertheless, if certain requirements are met, Gaston may be liable because of his pre-contractual conduct for the expenses that the promisees incurred in the expectation that the promise would be kept. Article 197 of the Civil Code provides that ‘in the course of negotiations for the conclusion of a contract the parties shall be reciprocally bound to adopt the conduct which is dictated by good faith and business usages’. Article 198 of the Civil Code continues that the person who violates this obligation and causes harm to the other party through his fault is obliged to compensate that party.

The first requirement for these articles to apply is that the violation must occur ‘in the course of negotiations’. Negotiations begin from the moment when the parties interested in the conclusion of a contract begin to bargain for this purpose. They end with the conclusion of the contract or the suspension or the final failure of negotiations.97 The conclusion of an invalid contract – for example, one that does not have the form required by law – does not end the course of negotiations.98 Thus, in our case, this first requirement is met.

The second requirement is conduct contrary to the principles of good

94Kafkas, Law of Obligations, vol. I, art. 498 CC, pp. 17–21; EfAth 1650/1959 EEN 28, 70.

95Karakostas in Georgiadis and Stathopoulos, Civil Code, vol. III, art. 498 and Stathopoulos,

Contract Law 77.

96Georgiadis, General Principles, 217–18; Stathopoulos, Contract Law, 52–5.

97Stathopoulos, Contract Law, 81–6.

98G. Koumantos in ErmAK arts. 197–8 no. 44; Thessaloniki Court of Appeal 348/1980, Arm. 34 (1980) 456; AP 669/1982 NoB 31 (1983) 654; AP 1303/1984 NoB 33 (1985) 993; AP 1505/1988 EEN (1989) 740.

faith and business usage. Whether conduct is contrary to the principles is judged ad hoc taking into consideration the facts of the particular case. Normally, good faith does not demand the conclusion of the contract, since contractual freedom includes the freedom to withdraw at least before a party makes a binding offer. A party may terminate negotiations even without a reason without having acted contrary to good faith unless he is at fault for doing so, and the other party strongly believed that the contract would be concluded.99 Accordingly, Gaston is acting in bad faith if he has decided not to keep his promise (by refusing to draw up a notarial document) and does nothing to prevent the promisees, who strongly believed that the contract would eventually be concluded, from incurring expenses.

The third requirement is fault (culpa in contrahendo). The degree of fault required during negotiations is the same as that required for liability to be imposed for breaching the contract itself. So, during negotiations, the promisor could be held liable only for wilful conduct and gross negligence100 (art. 499 of the Civil Code), for that is the degree of fault required for a person to be held liable for breaching a contract to make a donation.

The fourth requirement is that the other party suffer harm because the trust shown by him has been betrayed through the other party’s fault and conduct in bad faith.

The fifth requirement is that the harm that a party suffers be causally related to the fault of the person who acted in bad faith.

All of these requirements must be proven by the party claiming damages. A party who is held liable must compensate the other party for harm suffered because of his own conduct. The compensation covers only the negative interest or damages101 suffered through reliance on the conduct of the other party102 and not the positive or expectation interest owed in the case of contractual liability. The negative interest covers not only the positive damage (expenses that a party incurs in the expectation that the contract would be concluded), but also the lost profit (e.g. rejection of

another opportunity).103

199 EfAth 1819/75 rm. 29, 131; EfAth 150/75 rm. 29, 677; Karasis in Georgiadis and Stathopoulos, Civil Code, vol. I, arts. 197–8.

100This is the leading opinion: Stathopoulos, Contract Law, 81–6; EfAth 2232/55 rm. 22, 1250, EfAth 1203/69 rm. 23, 937. However, a contrary opinion exists, which claims that the party is liable for all degrees of fault, and it is based on art. 330 CC: Koumantos in ErmAK arta. 197–8 no. 51; Deligiannis and Kornilakis, Law of Obligations, Special Part, vol. I, 47, n. 1.

101This is the compensation that restores the status quo without the contract and