To conclude the civil law workshop series “Maladroit: The Missteps of Private Law,” the Paul-André Crépeau Centre is pleased to welcome Alexandra Bahary-Dionne for a presentation of her workshop “The Overwhelmed Contract: The Missteps of Civil Law in the Face of Paracontractual Intermediaries.”
In summary:
Quebec civil law recognizes, in sections 1440 et seq. of the Civil Code, that a contract produces its effects between the contracting parties. It acknowledges that a contract may have certain effects with respect to third parties, and that an obligation may be subject to a transfer or modification that changes its holders or substitutes a new obligation for it. What the conceptual framework of civil law finds more difficult to grasp is the inverse scenario, namely that of intermediaries who determine the existence and terms of the contract from the outside, without being parties to it, without becoming parties to it, and without the contract or the law explicitly conferring this power upon them.
This presentation examines this phenomenon through the lens of two instruments that I refer to as “paracontractual” in the context of consumer credit: credit scoring, which is performed by external agencies that determine, even before a contract is formed, who is eligible to borrow and under what terms; and securitization, which involves a constellation of intermediaries—special-purpose vehicles, investors, rating agencies—capable of influencing lending practices without ever appearing in the contractual relationship. These mechanisms are certainly subject to legal regulation, but under different frameworks and with objectives other than the protection of the debtor’s contractual rights: privacy protection, investor protection, and financial stability.
We look forward to seeing you on Friday, May 28, from 1:00 PM to 2:30 PM, online.
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