court would find that mere acceptance by the bailee of the chattel would amount to consideration giving rise to an enforceable promise. Where Barbara’s promise to Albert was not enforceable in contract she could still be liable to Albert in tort.63 In tort, the object of damages is to compensate the plaintiff by restoring him to the position which he would have held if the tort was not committed, whereas in contract, an Irish court takes into account loss of expectations and loss of profit as well. In this regard, the fact that Albert has taken a job that requires him to have a car but does not pay enough for him to rent one would matter in assessing the amount of damages, if any, Albert would receive where it could be established that Barbara was liable to Albert, be it in tort or contract.

That Albert took the job would also be relevant where Albert sought to raise promissory estoppel to defeat a claim instituted by Barbara. This could be a factor which could show the intention or otherwise of Barbara to be contractually bound and furthermore which would show detriment on the part of Albert.64

Summaries

France: If the car has been delivered, a contract of loan for use is formed but Barbara can reclaim the car before the date agreed if she has an ‘urgent and unforeseeable need’ for it, although a court will also take hardship to Albert into account. This right is an exception to the general principle that relief will not be given for changed and unforeseen circumstances. If the car has not been delivered, the arrangement is a promise to enter into a loan for use, which is also binding but not subject to this exception, and so Barbara will not have the right to reclaim the car before the time fixed.

Belgium: If the car has been delivered, a contract of loan for use is formed but Barbara can reclaim the car before the date agreed if she has a ‘compelling and unforeseeable need’ for it. This right is an exception to the general principle that relief will not be given for changed and unforeseen circumstances. If the car has not been delivered, the arrangement is a promise to enter into a loan for use, which is also binding, but not subject to this exception. Barbara may still be able to reclaim the car under the doctrine of force majeure which Belgian courts have applied when performance has become difficult even though it is still possible.

63See Case 5. See also Palmer, Bailment, ch. 8; Treitel, Contract, ch. 3.

64See Case 1 on the issue of promissory estoppel.

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The Netherlands: If the car has been delivered, a contract of loan for use is formed. The parties must also have intended to enter into a legally binding contract, which they probably did, although some authors believe their intention to do so does not matter if delivery has been made. If such a contract has been formed, Barbara may still reclaim the car before the date agreed if she has an ‘unexpected compelling reason’. If the car has not been delivered, the arrangement is a promise to enter into a loan for use which should also be binding, although the matter is not clear.

Spain: Although the Civil Code provides that a contract of loan for use is formed on delivery, most scholars believe it can be formed by consent as well, and so the parties have entered into such a contract whether or not the car has been delivered. Barbara can reclaim the car if she has an ‘urgent’ need for it (the text of the Code does not require it to be unforeseeable).

Portugal: Although the Civil Code provides that a contract of loan for use is formed on delivery, most scholars believe it can be formed by consent as well, and so the parties have entered into such a contract whether or not the car has been delivered. Barbara can reclaim the car because she has a ‘fair reason’ for doing so.

Italy: If the car has been delivered, a contract of loan for use is formed but Barbara can reclaim the car before the date agreed if she has an ‘urgent and unforeseen need’ for it. If the car has not been delivered, Barbara can reclaim the car because no contract has been formed. Her promise lacks a causa unless it served her economic interests. Moreover, she may not have intended to bind herself legally. Some scholars might draw an analogy to pre-contractual liability, but the analogy is not a good one given the special nature of the contract to be entered into.

Austria: If the car has been delivered, and the parties so intended, the contract is a loan for use, and Barbara cannot reclaim the car, even if she needs it urgently herself. If it has not been delivered, and the parties so intended, the contract is a promise to enter into a loan for use, and Barbara can reclaim it if circumstances have changed sufficiently. She can also do so if the parties intended the transaction to be a loan terminable at will (Prekarium).

Germany: Whether or not the car has been delivered, the contract is a loan for use as long as the parties intended to be legally bound, as seems likely. If so, Barbara can reclaim the car if she needs it because of ‘unforeseen circumstances’. While a court will take Albert’s interests into account, it will consider them to be less important than Barbara’s because the contract is gratuitous.

Greece: If the car has been delivered, a contract of loan for use has certainly been formed. If it has not been delivered, such a contract may not have been formed, and if not, the arrangement is a promise to enter into a loan for use, which is binding. Barbara can reclaim the car if she has an ‘urgent’ and ‘unforeseeable’ need for it. She must exercise this right in good faith, and while Albert’s need will be taken into account, in principle, her need will prevail over his.

Scotland: Since the promise is gratuitous, it is unenforceable (unless in writing) unless Barbara knew and acquiesced in Albert’s reliance on it, and Albert relied materially and was materially harmed as a result.

England: If the car has not been delivered, the promise is unenforceable because it lacks consideration. If it has been delivered, the parties may not have intended to be legally bound. If the car has been delivered, the arrangement is one of bailment, and more specifically, of commodatum or gratuitous loan. It is not clear whether a promise to lend for a fixed term auxiliary to such a relationship is enforceable.

Ireland: If the car has not been delivered, the promise is unenforceable because it lacks consideration. If it has been delivered, the arrangement is a gratuitous bailment. It is not clear whether a promise to lend for a fixed term auxiliary to such a relationship is enforceable, but a court might find a detriment to the bailee, and hence consideration, in a promise to take care of the car.

Barbara might be liable in tort. As before, in Irish law, it is possible to recover in tort for pure economic loss, for nonfeasance as well as for misfeasance, and for breach of a duty arising out of a relationship voluntarily entered into.

Preliminary comparisons

The significance of delivery: In two civil law countries (Spain and Germany), and possibly in a third (Greece), a contract of loan for use is formed whether or not the car is delivered. In the rest, except for Scotland, such a contract is formed only if the car is delivered; otherwise, the arrangement is a promise to enter into a loan for use (France, Belgium, the Netherlands, Portugal, Italy, Austria, and possibly Greece). In Italy, possibly in the Netherlands, and conceivably in Spain and Portugal (where the majority opinion is to the contrary), the distinction matters because such a promise would not be binding. In France and Belgium, it matters because Barbara can reclaim her car if circumstances have changed only if the contract is a loan for use. In Austria, it matters because Barbara can

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reclaim her car for this reason only if the contract is not a loan for use (see below). Delivery may matter in England and Ireland because without delivery, such a promise is unenforceable for lack of consideration; after delivery, the arrangement is a gratuitous bailment and the promise may be enforceable although it is not clear. In Scotland, the promise is unenforceable (absent a writing or reliance) whether or not the car is delivered. The significance of reliance: In Scotland, the promise is enforceable if Barbara knew and acquiesced in Albert’s reliance on it, and Albert relied materially and was materially harmed as a result.

Tort: In Ireland, Albert may recover in tort since it is possible to recover for pure economic loss, for nonfeasance as well as for misfeasance, and for breach of a duty arising out of a relationship entered into voluntarily.

Intention to be legally bound: Some reporters mentioned that for the promise to be binding, the parties must have intended to be legally bound, but most of them took it for granted that the parties wanted to create legal relations of some sort.

The effect of changed circumstances: The Civil Codes of France, Belgium, the Netherlands, Italy, Austria, Germany, and Greece all provide that, in a loan for use, the lender who has a grave and unforeseen need for the object loaned can reclaim before the time agreed. The Spanish Code has a similar provision that speaks of the gravity of the need but not its unforeseeability. The Portuguese Code allows the lender to reclaim the object if he has a ‘fair reason’. The Austrian Code provides that the lender cannot reclaim it. Nevertheless, Austria recognizes a general principle of relief for changed and unforeseen circumstances while France and Belgium do not. Thus the effect of these provisions is that in Austria, Barbara can reclaim the car if circumstances have changed only if the car has not been delivered and so no contract of loan for use has been formed; in France and Belgium, she can do so only if it has been delivered and such a contract formed. In Belgium, however, Barbara may be able to claim force majeure since Belgian courts have given relief when performance has become more difficult even though it is not impossible.