[In 1567 Adam de Craponne constructed a canal in Pélissanne, whose inhabitants contributed towards the cost, and formally undertook to maintain it against a payment of three sols for every two hectares irrigated by the farmers of the commune. As time went by, this sum became derisory and out of all proportion to the cost of maintaining the canal, so the heirs of Adam de Craponne sued for an increase and the lower court granted it. The inhabitants sought review.]

The Court:

In view of art. 1134 Code civil;

Given that since this article simply repeats established principles as to contractual obligations which have always been followed, its application to the present contract is not affected by the fact that it was formed prior to the promulgation of the Code; given that the rule it enacts is general and absolute, applicable to all contracts, including those to be performed at successive periods, and that it is no part of the function of courts, however equitable it may seem to them, to modify the parties' agreements in the light of changing times and circumstances or to substitute new terms in the place of those freely accepted by the parties;

Given that in deciding otherwise and raising to 30 centimes for the period 1834 to 1874, and from then onwards to 60 centimes the sum per unit of irrigation on the basis that the original sum of three sols fixed by the contracts of 1560 and 1567 was no longer in relation to the cost of maintaining the canal de Craponne, the decision under review has manifestly violated article 1134.

For these reasons QUASHES the decision of the Court of Appeal of Aix-en-Provence.

Subsequent Developments

This note on subsequent developments reflects the legal situation as of October 2004.

Civ 6 March 1876: article 1134 applies even to contracts prior to the promulgation of the Code civil, the performance of which would extend to different eras. The courts cannot - even in the interest of equity - take into consideration the time and circumstances in order to modify these agreements, and to substitute new clauses for those which have been freely accepted by the contracting parties. Case law maintained.

Cf Yves Picod, op cit, nos 32 to 35: The traditional refusal by the Cour de cassation to accord the judge power to revise the conditions of performance of a contract in the case of disruption to the economic circumstances is a good indication of the judicial will to respect the law the parties have made for themselves. By this judgment, the Cour de cassation recalls that no considerations of equity can permit modification of a contract in case of change of circumstances. (Cf refusal to take account of inflation following on the First World War, Civ 6 June 1921). This case law has continued since, in various areas: cf Com 18 December 1979, Bull no 339 ("a court of appeal cannot, on the basis of new economic circumstances, fix the rate for a warehousing contract of indeterminate duration in terms of a "just price", when the agreement did not provide for modification of the rate of payment for deposit") or Civ 3, 30 May 1996 (unpublished, pourvoi no 9415828). Again, when the parties have signed a contract of sale (or any other contract requiring a determined or determinable price) and omitted to state the price, the judge cannot take the place of the parties in determination of this price (Civ 1, 18 July 1979, Bull no 220 and Com 29 June 1981, Bull no 298). This solution nevertheless admitted of certain deviations in statute (cf art 1152 para 2 and 1244-1 of the Code civil) and in case law. The Cour de cassation thus allows the substitution of the method of performance provided for in the contract by another method better adapted to the new circumstances (Civ 1, 8 January 1980, Bull no 15; 19 January 1988, Bull no 12), in the same way as it recognises, in order to preserve the contractual bond, that the judge has a certain power of substitution (Civ 1, 9 November 1981, Bull no 332 and Civ 3, 22 July 1987, Bull no 151). Finally, for certain authors (cf "Les grands arrets de la jurisprudence civile" (Leading judgments in civil case law), no 163), "the development of the powers of the judge in cases of determination of price, which follows from judgments given by the Assemblee pleniere on the 1 December 1995, creates a favourable context for acknowledgement of revision for imprevision (restoration of contractual equilibrium, in response to unforeseeable events). Certain recent decisions can be understood as a first step in this direction. In the famous Huard judgment (Com 3 November 1992, cf infra), the Cour de cassation approved the decision of the Paris court which considered that in the case of a change of circumstances exposing a distributor to increased competition, the supplier was obliged by the requirement of good faith to negotiate with the distributor an agreement of commercial co-operation in order to permit him to compete with his rivals".

Translation by Mr Raymond Youngs

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