Civil Law and Common Law: Comparison and Contrast

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Civil Law and Common Law: Comparison and Contrast

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Civil Law and Common Law: Comparison and Contrast

  1. 1. CLE Seminar for In-House Counsel October 11, 2013 Washington, DC Not So Civil and Uncommon Law Randy Bregman Partner Dentons US LLP randy.bregman@dentons.com +1 202 408 9164 Marian Hagler Partner Dentons US LLP marian.hagler@dentons.com +1 202 408 9135
  2. 2. Common Law - Civil Law - why does it matter? • Different legal traditions • Different approaches to law • Different mentality among lawyers Is the difference a bright line and fully determinative? • Not fully. There are differences between and among civil law jurisdictions and common law jurisdictions. See France, Germany, Russia See US and UK • Local law matters of course and local custom and tradition. • Systems are blending somewhat into hybrids. E.g., Russia uses court opinions to interpret laws; US uses statutory contracts - home sales, insurance. French courts are ruling on estoppel principles and equity consideration. October 11, 2013 Dentons US LLP 2
  3. 3. What are the key differences? • In short, civil law is based on legislation; common law is based on court decisions. COMMON LAW versus CIVIL LAW SYSTEMS System Features Common Law Systems Civil Law Systems Major Source of Law Custom & Practice, Court Decisions Legislative Statutes & Codes Yes (Strong) No (Weak) Judicial role in law-making Active & Creative Passive and Technical • (construing and applying the law; no court creation) Role of Legal Scholarship Secondary and Peripheral Can be important in some jurisdictions Reliance on precedent Judicial Review of Statutes & Executive Actions October 11, 2013 Dentons US LLP Yes 3
  4. 4. What are the key differences? COMMON LAW versus CIVIL LAW SYSTEMS Major Decision Stage Trial Investigation & Examination Trial Format - Criminal Accusatorial/confrontational Inquisitorial/collaborative Extensive discovery Discovery limited especially by data privacy laws Extensive & fundamental Modest & restrictive Inductive Deductive Trial Emphasis on: Procedural Correctness Factual Certainty Evidentiary Rules Formal and restrictive (exclusionary rule) None (all evidence considered) Primary Secondary Trial Process - Civil Use of Argument & Debate Style of Legal Reasoning Role of lawyers during trial October 11, 2013 Dentons US LLP 4
  5. 5. What are the key differences? COMMON LAW versus CIVIL LAW SYSTEMS Functions of lawyers Judge’s role during trial Selection of judges Status of Judges Advise and inform Referee/umpire Director/examiner Political appointment from practicing lawyers or elections Merit advancement from judicial specialists (with the exception of some specialized courts) Political VIPs Appellate review focus Dentons US LLP Mid-level civil servants (with the same exceptions are previously) English Language October 11, 2013 Debate and oppose Local languages Procedural Procedural & substantive 5
  6. 6. Historical Origins - The Importance of the English Channel • In some ways, difference in law is analogous to difference in analytic method - inductive from UK, deductive from Continental Europe. • Civil law - Continental Europe based law on rediscovered Justinian (Roman) codes - maybe due to unifying role of church in Rome at least until the Reformation. Now basis of legal systems in Continental Europe, including Eastern Europe and former Soviet Union, China, Japan, most of Africa and Latin America, Louisiana and Quebec. Divided into two French (Napoleonic) and German Codes • Common law - based in England - Initiated by Henry II after Norman Conquest to unite local Saxon laws and customs with Normal law into a “common law” throughout England, strengthened by Magna Carta when barons attempted to set up strong judicial courts independent from the King. Now basis of legal system in UK and former British colonies including US and Canada. October 11, 2013 Dentons US LLP 6
  7. 7. How do these differences manifest themselves in day-to-day legal practice? • Marian will discuss contract and corporate law differences and issues; I will then discuss trial practice. • In general, common-law practitioners are accustomed to more flexibility and more initiative by lawyers. Civil-law practitioners will be limited by statutes and codes. • Contracts drafted in the common law environment are not based on Code and Statute; each one can be crafted more easily to fit the transaction instead of the Code. Contracts in civil law environment need to qualify for the one of the many standards set by statutes or codes, and will be drafted to supplement or reverse the standard rules. • In litigation, attorneys more active, can almost always find an argument or case to support a position, less dependent on judges whom, in civil law contracts are bound to apply the statutory rules (the attorneys role is to demonstrate that the statutory rules should or should not apply). October 11, 2013 Dentons US LLP 7
  8. 8. Contracts
  9. 9. Choice of law in Contracts • Civil: Swiss, French, Dutch • Common: New York or English • International: lex mercatoria (UNIDROIT Principles, PECL, CISG) October 11, 2013 Dentons US LLP 9
  10. 10. Setting the Stage • Civil v Common? Partially…. • Effects of Globalization • No Big Difference at Extremes • Evolution of Contracts and Influence of Anglo-American Law Firms • Anglo-American Style More Conducive to multi-jurisdictional deal • Emerging Markets and “Certainty” Issues • Conflicts Generated by Language October 11, 2013 Dentons US LLP 10
  11. 11. Making Offers • Common: Offers revocable before acceptance • Civil: Offers not revocable, except . . . October 11, 2013 Dentons US LLP 11
  12. 12. Good Faith and Fair Dealing • England: No implied covenant • New York: Is the obligee exercising his right abusively/ in bad faith? • Civil: Is the effect fair/ just? • Sliding Civil Law Scale Between Interpretative Tool and Operative Guideline: Italy - Germany - Norway Abusive October 11, 2013 Fair Dentons US LLP 12
  13. 13. Choosing Your Words • “reasonable efforts….” • "best efforts…" October 11, 2013 Dentons US LLP 13
  14. 14. Courts and Litigation
  15. 15. Litigation - Role of Courts • The key difference between the role of the courts in civil law and common law jurisdictions is the importance of the court decision. • In civil jurisdictions, court decisions never have force of law; (i) the judge may only rule in relation to existing statutory provisions, (ii) judges are not bound by previous court decisions and court decisions are valid only for case at hand. October 11, 2013 Dentons US LLP 15
  16. 16. Litigation - Role of Courts • A classic example of the limited power of civil court judges to create the law is the well-know “Arret Perruche”, rendered by the French Supreme Court on March 26, 1996 and November 17, 2000 that ruled for the right to the child born with a severe handicap undiagnosed by the medical team to be indemnified for the harm suffered by him from being born. Following these judicial rulings, a law known as “Anti-Perruche” was issued on December 3, 2001, restated in March 4, 2002 “loi Kouchner” and now incorporated in article L.114-5 of the social security code which rules that the provides that “no one may claim compensation for the harm resulting solely from being born”. • In common law jurisdictions, court decisions are precedent, principle of Stare decisis. A lower court must follow precedent of a higher court; decisions have force of law. October 11, 2013 Dentons US LLP 16
  17. 17. Litigation - Nature of Trial • In common law proceedings, a trial is an adversarial battle between two (or more) parties represented by active lawyers. • Trial is usually a single, continuous hearing lasting for a relatively short period of time. • In civil law proceedings, the trial process is more of an investigation into the facts led by a judge on the basis of the elements provided to him by each of the Parties in what is known to be the “pleading file”. • It is often a sporadic process spread over a number of discontinuous sessions ending up in a final oral hearing where each attorney will be provided generally from 10 to 30 minutes to present its main arguments and/or outline of the main evidence with the help of the “pleading file”, a copy of which is remitted to the judge during the hearing. October 11, 2013 Dentons US LLP 17
  18. 18. Role of Judge • In common law he or she is neutral referee in adversarial process. The fact-finding is usually left to a jury of peers, especially in the US. • Judge is not familiar with the facts before the trial and usually does not intervene in fact-finding EXCEPT to interpret and enforce very strict rules of evidence. In fact, there is considerable case on those Rules. • In civil law the civil or commercial judge plays an active role in fact finding though limited to the documents and evidence remitted by each party. Except in criminal cases, he or she cannot introduce facts, can look for facts nor can he go to the parties’ houses to interview them. Except during criminal investigation, he or she will not examine witnesses even for those witnesses that have provided for testimonials. All fact finding will be limited to the documents and elements freely and discretionarily provided by each party only to serve the Party’s position or to oppose the other Party’s position. October 11, 2013 Dentons US LLP 18
  19. 19. Role of Judge • Accordingly, rules of evidence are much more flexible; the judge is not a referee between two battling lawyers. • Very Important to Note: In common law jurisdictions judges are usually accomplished prestigious lawyers appointed after review by peers or elected. • In civil law, they are professional bureaucrats, often younger and without status and prestige, except in specialized courts (such as labor or commercial courts) where they are elected. October 11, 2013 Dentons US LLP 19
  20. 20. Scope of Discovery Major difference in practice: • In common law - virtually unlimited - fishing expeditions. • In civil law there is no discovery process available; each party is supposed to provide its evidence spontaneously during the trial; if investigation is required to request the reduction of evidence, the request shall be detailed, limited, proportional and in direct relation to the case; very restricted as judge controls the investigation part. Also, limited by local data privacy laws which are becoming more restricted. October 11, 2013 Dentons US LLP 20
  21. 21. Thank you Marian Hagler Partner Dentons US LLP Marian.Hagler@Dentons.com Randy Bregman Partner Dentons US LLP Randy.Bregman@Dentons.com © 2013 Dentons Dentons is an international legal practice providing client services worldwide through its member firms and affiliates. This publication is not designed to provide legal or other advice and you should not take, or refrain from taking, action based on its content. Please see dentons.com for Legal Notices. October 11, 2013 Dentons US LLP 21
  22. 22. Marian Hagler Partner Marian Hagler is a member of Dentons' Corporate practice. Her practice focuses on complex international energy sector mergers and acquisitions (M&A) and includes projects in the Middle East, Latin America, Africa, Russia and Central Asia. Experience • Led negotiations for China Investment Corporation to invest US$300 million in a 50–50 joint venture with a Russian oil and gas company. • Led engagement for MOL Plc in relation to its proposed US$1 billion acquisition of Kazakhstan oil and gas assets held by Oman Oil Company, including strategic advice, due diligence, and preparation and negotiation of transaction documents. • Led engagement for KMG E&P in relation to its US$900 million acquisition from CITIC Group of a 50 percent interest in the Canadian holding company (formerly Nations Energy) owning and operating the Karazhanbasmunai field, including due diligence, strategic advice and negotiation of transaction documents. • Advised an independent in negotiating a PSC with Equatorial Guinea and related joint venture and financing agreements. • Led engagement for GeoPark in the sale of 10 percent of its business in Chile to LG International, the first upstream Korean investment in Chile. • Led engagement for a private developer of a crude oil rail loading facility in North Dakota. October 11, 2013 Dentons US LLP Contact information Washington, DC D +1 202 408 9135 marian.hagler@dentons.com Areas of focus Practices Compliance Corporate Corporate Governance Mergers and Acquisitions Industry Sectors Energy Energy Transactions Mining Oil and Gas Upstream Regions Africa Desk in Washington, DC Russia Desk in Washington, DC 22
  23. 23. Marian Hagler Partner Experience • Advised an international oil company with respect to the potential acquisition of an interest in the Caspian Pipeline Consortium (CPC). • Advised a US company in connection with its investment and acquisition of a controlling interest in a Pakistan company constructing a power plant and desalination facility. • Advised an international development company sponsored by the African Union in the development of a US$2 billion subsea cable around Africa. • Advised on structuring and prepared documentation for the establishment by a United Arab Emirates bank of a US$2 billion global energy fund. Prior and Present Employment Prior to joining Dentons, Marian was of counsel at Baker & McKenzie LLP and a partner at Coudert Brothers LLP. Marian was founder and managing partner of Coudert’s St. Petersburg office. From 1999 to 2001, she was an attorney advisor in the Office of General Counsel–International Affairs of the United States Department of the Treasury, where she was responsible for a variety of matters involving international public finance, the World Bank, the European Bank for Reconstruction and Development and other multilateral development banks, and international anti-money laundering controls. October 11, 2013 Dentons US LLP Education Georgetown University, School of Foreign Service, 1990, MS, cum laude Georgetown University Law Center, 1990, JD, cum laude University of California at Berkeley, 1984, AB, magna cum laude Admissions & Qualifications District of Columbia 23
  24. 24. Randy Bregman Partner Randy Bregman is a partner in Dentons' Public Policy and Regulation practice. Randy has focused his practice on the CIS for over 20 years and has significant experience in corporate and trade matters. He advises Russian and Western clients in a diverse range of industries, including banking and finance, oil, steel, pharmaceuticals, telecommunications and consumer goods. He has also supervised litigation and administrative disputes in Russia. Randy advises corporations and investors on issues related to compliance with anti-bribery laws and practices. Activities and Affiliations Memberships Member, Cosmos Club, Washington, DC Qualified, District of Columbia and the US Court of Appeals for the District of Columbia Circuit, 1985 Member, Board of Directors, US Russia Business Council Contact information Washington, DC D +1 202 408 9164 randy.bregman@dentons.com Areas of focus Practices Corporate Public Policy and Regulation Education Georgetown University Law Center, 1985, JD Yale University, 1969, M.A. Columbia University, 1968, BA Admissions & Qualifications District of Columbia US Court of Appeals for the District of Columbia Circuit Member, Board of Trustees, Eurasia Foundation October 11, 2013 Dentons US LLP 24

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