legal scholars. They have claimed, first, that characterizing the promisor’s obligation as an obligation ‘to do’ something is very dubious. Second, even if this classification were correct, it would not follow that breach of such an obligation only gives rise to a claim for damages. The only reason it does is that art. 1142 has been interpreted restrictively by case law (see Case 7). Finally, the approach of the case law ignores the fact that the promisor has definitively consented to sell, and thereby confuses a mere offer, which may be revoked, with a promise which is binding as a contract.

belgium

In Cases 13(a), 13(b), and 13(c), the agreements are options to buy (promesse de vente, option d’achat).8 In the first two cases, the agreement is unilateral in the civil law sense: it imposes an obligation only upon Simon,9 an obligation to sell which is held open for a set period of time. The third case is not clear. It could be a unilateral agreement. In that event, the fact that Realty can withdraw depending on its own judgment does not raise any particular difficulty since the unilateral promise to sell, by its very nature, obligates only the prospective seller and not the prospective buyer. Article 1174 of the Civil Code, which deals with purely potestative conditions, is therefore not applicable to it.10 The clause allowing Realty to withdraw would then merely restate its right not to exercise the option if it does not choose to do so. Alternatively, the agreement could be bilateral: Simon undertakes to sell and Realty undertakes to buy upon completion of the study. In this case, the fact that Realty can withdraw depending on its own judgment might be a purely potestative condition, that is, a condition that allows one party to determine whether a contract is binding. If so, the

8See arts. 1589 f. of the Civil Code and see De Page, Traité élémentaire, vol. IV, nos. 240 f.; P. Harmel, Répertoire notarial. La vente, vol. VII, Part 1, Théorie générale de la vente (1985), nos.

70 f.

9See Case 1, for the description of the three types of promises to be distinguished in Belgian law: the mere offer, the unilateral promise (where only one of the parties obligates him or herself), and the bilateral promise (where the two parties undertake an obligation). The court will hold that its own decision shall have the same effect as the notarial formality when the effectiveness of the contract as to third parties depends on

its formalization, as, for instance, when real estate is sold.

10Let us recall that art. 1174 of the Civil Code, which invalidates obligation subject to a purely potestative condition, clearly states that the rule applies only when the condition is purely potestative for the party who undertakes the obligation. It speaks of a potestative condition by the party committing him or herself. See Cass., 13 Oct. 1984, Pas., 1984, I, 151. A contrario, a purely potestative condition in favour of the party who is owed the obligation is valid. Trib. comm. Bruxelles, 8 June 1966, JCB, 1966, 248 and see Van Ommeslaghe, Droit des obligations, 762.

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contract is void under art. 1174 of the Civil Code. But it is also possible that the court would apply art. 1157 which says that when a clause is susceptible of two possible interpretations (in this case, that the agreement is unilateral or that it is bilateral), one should favour the interpretation that enables the clause to have some effect rather than no effect.11 In this case, the fact that the parties used the words ‘promise’ and ‘option to withdraw’ might lead the court to interpret the parties’ language as an expression of their intent to have entered into an option contract, that is, a unilateral agreement to sell.

If the market price had risen sufficiently, there might be a right to relief for lésion. Such relief is given when the seller of real estate receives a price less than seven-twelfths of the market price (see arts. 1675 f.). The sale is then rescinded unless the buyer pays the difference between contract and market price. In an option contract, whether there has been a sufficiently great deviation between contract and market price is determined as of the time the option is exercised, not the time when the option contract was entered into.12

It does not matter whether Realty decides to buy the land for resale rather than for a building unless Simon manages to prove that the purchase of the site for a new building only was part of the essence of the contract and the reason (applying the doctrine of cause) that it was entered into.13

the netherlands

The promise is binding in all three situations. Simon has made an irrevocable offer, and Realty’s acceptance is sufficient to conclude a contract. Art. 6:219 of the Civil Code provides:

11See Van Ommeslaghe, Droit des obligations, pp. 220–1. According to the case law, the judge should prefer the interpretation that would uphold the validity of a clause. The Cour de cassation observed that, nevertheless, a judge is not obligated by art. 1157 of the Civil Code to choose an interpretation that will sustain a right or an obligation (Cass., 25 Sept. 1981, Pas., I, 158).

12See H. De Page in Meinertzhagen-Limpens, Traité élémentaire, vol. IV, nos. 396 f. (on rescission for lésion of the seven-twelfths in a contract for the sale of real estate generally), and, in particular, no. 406 (lésion of seven-twelfths in option contracts).

13See P. Van Ommeslaghe, ‘Observations sur la théorie de la cause dans la jurisprudence et dans la doctrine moderne’, note under Cass., 13 Nov. 1969, RCJB, 1970, 328 f.; P. A. Foriers, ‘Observations sur la caducité des contrats par suite de la disparition de leur objet ou de leur causel’, note under Cass., 28 Nov. 1980, RCJB, 1987, 74; X. Dieux, ‘Les chaînes et les groupes de contrat en droit belge’, in X. Dieux, Les obligations en droit belge et en droit français: convergences et divergences (1993), no. 5.

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unforeseeable change of circumstances (art. 6:258 of the Civil Code in connection with art. 6:216).

The phrase ‘sole and absolute’ judgment in itself does not exclude the applicability of the principle of good faith. The parties are not allowed to exclude the application of the provisions of art. 6:2 as such. However, such a clause will naturally have an influence on determining what good faith requires in the particular case.

It should be mentioned here that good faith (redelijkheid en billijkheid) in Dutch law is an objective standard. Subjective good faith (‘I thought my conduct was right’) is not an excuse for failing to meet this standard. Moreover, not any subjective bad faith violates this standard. Therefore, Realty would not necessarily violate good faith if it announced it was satisfied with the economic prospects for its new building when, in fact, it was dissatisfied, and merely wanted to take advantage of the increase in the market price to resell the land. Nor would it necessarily violate good faith in the reverse case in which the market value of the land falls if it decided to locate its building elsewhere where land is cheaper, and announced it was dissatisfied with the economic prospects of the location merely to escape its contract. Realty’s subjective bad faith would not be decisive. What matters is the objective unfairness of its conduct. Since, as noted earlier, the motive of the buyer is irrelevant in principle, it is not in itself contrary to good faith to declare oneself satisfied when one really is not and vice versa, even assuming such conduct is subjectively dishonest.

spain

This is a case of an enforceable unilateral promise. The parties have entered into an option contract. Spanish courts will enforce such a contract whether it was entered into in exchange for money or not.17 A person who gives an option on his property and then sells it to another must pay damages.

All contracts of a value above 1,500 pesetas are required to be in writing for purposes of proof (art. 1280 of the Civil Code), but if they are not it does not mean that they do not exist.18 They can still be proven by means of other types of evidence such as witnesses (art. 1248 of the Civil Code).19 An option on real property must be recorded in the Property Registry to affect the rights of third parties (art. 14 of Reglamento Hipotecario).20 After

19Puig Brutau, Fundamentos de derecho civil, vol. II-1, 163.

20Castán Tobeñas, Derecho civil, vol. III, 543.