The CISG and the Presumption of Enforceability: Unintended Contractual Liability in International Business Dealings

Abstract

This Article addresses the issue of unintended contractual liability that might be created by the use of informal "comfort letters" in international transactions. It first examines the presumption of enforceability placed on certain types of business correspondence by different foreign legal systems. It concludes that civil law systems are more likely to impose contractual liability for comfort instruments than the Anglo-American legal system, but that there are no per se rules of enforceability. The Article then examines the recently ratified Convention on Contracts for the International Sale of Goods (CISG) as a possible international resolution of these different approaches to the question of comfort letter enforceability. Grounded in a range of contract law systems, the CISG recognizes general principles of contract law as well as new contractual informalities. The CISG thus presents courts with a range of considerations that can be applied to the issue of comfort letter enforceability. While courts have yet to rule on comfort letter enforceability under the CISG, the Article suggests that American business people should familiarize themselves with the principles of the CISG to avoid potential unintended liability.