V.

Interpretation of Contracts

A. Common intention
- seek literal meaning rather than literal meaning of words (art 1425)
B. Development of Contract (history)
- Historical nature, circumstances (art 1426), ie. Look at previous contracts
C. Clauses (ie. Condition, stipulation)
1. must reflect other clauses (art 1427)
2. must have effect rather than no effect (art.1428)
3. external clauses are binding if agreed(art 1435) : they are not in the
contract
- except: consumer and adhesive contracts need explanation(they must
prove that they did offer explanation of external clause)
4. illegible clause (art 1426) (cannot be read)
5. abusive (art 1437) (clause that is excessive )
6. Nullified clauses (art 1438) ( the contract can still be valid even though
some clauses are nullified)

D. Words

- Multiple meaning words must conform to subject matter of contract( art

1429)

E. In case of Doubt / Adhesive or Consumer Ct

- In favour of adhering party (art 1432) ie. in case of doubt, the judge will
accept in favour of those who accepted and agreed to the conditions,
F. Incidental
- recognize non expressed associated obligations (art 1434) (ex. You’re
hired to mow the lawn, you have to make sure that you don’t harm the
property in any way)

VI. Obligations

A. Principles (art 1458)

- must honour obligations
- failure results in damages (moral and material)
B. performance (art 1590 + 1591)
1. force
2. cancel or reduce own obligations
3. perform only equal to other’s performance
(ex. if you hire someone to fix your house, and they only do part of the
work, you can reduce amount that you were supposed to give them)
C. Retention of property
- Hold on to other’s property until payment as related to that property (art
1592)
(you can retain property until they pay you)
 - can hold retention and revendication rights against anybody even if
property not in control (art 1593) (ex. You’re keeping the car until
payment because owner didn’t pay you for the work. In the meantime,
you go next door and get the car washed. The owner of carwash cie
decides to call the owner of car because they’re friends, you have the right
to revendicate car back from car wash owner so that he doesn’t give it to
his friend)
D. Default
1. When
i. By contract, stipulating deadline defaults (art 1594, par1)
ii. By extrajudicial demand
o in writing giving time to perform (art 1595)
o failure of warning (art 1596)
(ie. If somebody is put in default without being warned, he has
some time to rectify the situation)
iii. By operation of law (art 1597)
2. Who (art 1599), who is put in default?
- placing one debtor in default places all debtors in default (par.1)
- one creditor’s default affects all creditors (par. 2)_
3. Execute obligations
- demand specific performance (art 1601)
- creditor may perform obligation at debtor’s expense (art 1602)
- remove works at debtor’s expense (art 1603)
- (ex. You live in an appt, there are cockroaches there…logically owner has
to make sure that there are none. But owner has done nothing, you can
hire an exterminator, go to the Regie and have the expenses deducted
from your rent)
4. End contract
i. creditor can end except if minor failure (art 1604)
ii. No judicial proceedings if by law or warning (art 1605)
E. Damages
1. Immediate and Direct (art 1607)
- bodily, moral or material
2. assessing damages (art 1611)
- compensate loss sustained
- deprived profit
3. Future damages

- certain and can assess (art 1611 par 2)

- 3 year reserve for bodily damages (art 1615)

4. Punitive damages (art 1621)

5. Penal clause (i.e. penalty built into the contract)

- penalty for failure to complete but only one or the either unless for delay
charges (art 1622)
 - no need to prove injury (art. 1623)

PETER v. FIASCHE

Case facts:

- Plaintiff buys from defendant restaurant called Chez Gino Smokey’s

- Deposits $100,000 + $100,000 after purchase (ie. after closing date)
- Restaurant showing losses, saw 1990 statement
- Plaintiff claims defendant said hides real sales (i.e, under the table)
- Plaintiff said was told two books and registers
- Plaintiff was assured of no tax debt to government (ie. Peter was told that
they don’t owe anything to govt)
- After purchase, sales did not add up
- Want to annul contract due to error by fraud

Court decision:

- can’t argue error based on fraud (p.99, 100) (ie. Peter wanted to argue
fraud but he knew what the numbers were before buying, so the
defendant didn’t fraud you because he showed you the statements)
- can argue illicit contract due to cause under art. 1411 + restitution under
art 1422 (p102-103) (ie. because Peter was buying a resto that was
hiding sales –defrauding the gov- the contract is null and void. You go
back to how it was before purchase. Peter gets money back and Fiasche
get his resto back)

GIROUX v. MALIK

Case facts:

- Malik sells property to Giroux

- Giroux discovers land unusable to build home
- Malik claims declared problem, French not good (Malik says that there’s a
problem because he doesn’t know how to speak French)
- Had tried selling twice before (Giroux discovers that malik had tried to
sell it twice before)

Court’s decision:

- Good faith is presumed, bad faith proven (p.90)

- Court found Malik knew of problem
- Did not reveal to buyer or agent thus fraud (art 1401)
- Giroux would not have bought
CARREFOUR LANGELIER v. CINEPLEX

Case facts:

- Carrefour signs Cineplex as new tenant (1991)

- Cineplex assigns lease to Guzzo with agreement (p 106)
- 1998, Carrefour finds out Guzzo took down Cineplex sign and the latter
two cancelled booking agreement, without permission. (they also
discovered that guzzo and Cineplex stopped working together to agree on
which movie to play)
- Carrefour sues for equipment and to force Cineplex sign
- Guzzo argued contracted out of fear of being shut out by Cineplex (p 108)
- Guzzo argue essential intent of agreement was being satisfied (p.109)

Court’s decision:

- No fear since existed for 13 years and aid $300k with a purpose freely
(p109) (court says that you can’t argue fear because this arrangement has
been done in the past between Guzzo and Cineplex. Besides, you
wouldn’t’ do business with them if you feared them)
- Maintaining essential intent doesn’t take away Carrefour’s rights to
demand specific performance under art 1590.
- Specific performance is not a reparation but obligation to contract
conditions
- No need to establish present or future prejudice, just breach of contract
(p111) (ie. you violated contract, too bad for you)

TRM Copy v. Copiscope

Case facts

- TRM copy provided copiers to stores

- Stores signed non-competition clause
- Copiscope, similar business, pursued stores to switch arguing clause
illegal (they say that the clause is abusive)
- TRM sued and got temporary injunction against Copiscope

Court decision

- Appeal court found non-competition clause illegal because unreasonable

restrictions imposed on stores (p.119)
- Found it to be a ct of adhesion which must be read in favour of agreeing
party (p.120)
- Therefore temporary injunction request does not pass three steps test
(p.118) : serious, irreparable damages, balance
- So injunction is null!
SUBJECT 6: CIVIL LIABILITY

(held liable for damages that you might cause somebody, as a result of the contract ,
and that you have to pay for)

(Ex. You hire people to build a deck, they didn’t do it properly and somebody got
hurt: you can sue for the contract and for the physical damages caused to you
because deck fell and if your friend got hurt also, he can sue under 1457)

I. Introduction – art 1458 v. 1457

A. Art 1458
- contractual responsibility
B. Art 1457
- civil responsibility or extra-contractual responsibility
C. Fault?
- Carelessness
- Recklessness
- Negligence (ex. Letting your friends go on the balcony although you know
that it’s dangerous)
- Intentional
II. Personal liability
1. Endowed with reason
- Minors:
o Must be over 7yrs old to know right from wrong