Introduction
The reform of the Belgian law of contracts, contained in Book 5 of the new Civil Code, entered into force on 1 January 2023. More than is generally the case in Belgium, the reform of the law of contracts and obligations was deeply rooted in comparative law, and it particularly warrants discussion for this reason. Indeed, for the drafting of each provision, inspiration was systematically drawn from French law, as well as Dutch and German law, the Principles of European Contract Law (PECL), the Draft Common Frame of Reference (DCFR), the Unidroit Principles of International Commercial Contracts (PICC), and the Convention on Contracts for the International Sale of Goods (CISG).Footnote 1
As it would be difficult to summarise the whole reform of the contract law in a few pages, this article focuses on the new Belgian provisions on the interpretation and characterisation of contracts. The choice to concentrate on these issues is not incidental. They occupy a classic and central place in contract law and, as such, provide an interesting vantage point from which to assess the broader ambitions of the Belgian reform. They make it possible, first, to test the legislator’s oft-repeated claim that the reform is intended to bring about an evolution rather than a revolution of the law of contracts. Second, and more fundamentally, they bring to the fore the enduring tension between a subjective approach centred on the parties’ actual intention and an objective approach grounded in their legitimate expectations or those of a reasonable observer. This tension, while conceptually structuring, is often resolved in practice through nuanced and hybrid judicial reasoning. It permeates a significant part of contract law and finds subtly different expressions across legal systems, making interpretation and characterisation especially revealing areas for both doctrinal and comparative analysis.
In respect of interpretation, this article argues that the Belgian reform deliberately reaffirms a traditional and subjective approach to contractual interpretation, even as a shift towards objective or mixed approaches can be seen elsewhere in Europe. The Belgian reform also introduces explicit rules on characterisation and mixed contracts, and those innovative rules set Belgium apart from neighbouring systems and international instruments. Taken together, these points suggest that the Belgian reform is best understood as evolution grounded in tradition.
The article proceeds as follows: it first provides contextual background on the Belgian reform of the law of contracts and an overview of the new rules (Section II), before turning to comparative observations on the interpretation (Section III) and characterisation of contracts (Section IV). On the question of interpretation of contracts, the primary point of comparison will be French law, as the French reform predates the Belgian reform by only a few years and clearly influenced the Belgian legislator in the drafting of most provisions. Any remaining differences are therefore all the more significant. With regard to the characterisation of contracts, however, French law contains no explicit provision directly addressing this issue. The comparative analysis will accordingly be extended to Dutch and German law, both of which also informed the Belgian reform.
The analysis will take as its primary point of reference the black letter rules as adopted by the Belgian legislator. Although these provisions have given rise to some criticism and remain the subject of debate among certain—though by no means all—Belgian legal scholars, and while reference will be made to these dissenting views where relevant, the legislator has nevertheless articulated a clear and deliberate normative position. It is this position that will serve as the premise for the comparative inquiry conducted in this article.
II. The context of the reform
Since the reform is still relatively unknown outside Belgium, some contextual background is warranted. The old Belgian Civil Code was promulgated under the authority of Napoléon in 1804, when the Belgian territories were still under French sovereignty. Despite several attempts, it was not repealed for more than two centuries, and the provisions pertaining to contract law were barely amended during this time, though their meaning was significantly altered under the constant influence of case law.Footnote 2
Fast-forward to 2016, when then minister of justice Koen Geens, who also happened to be an academic, initiated a vast programme of legislative reforms.Footnote 3 These reforms were aimed at modernising the legal framework to ensure greater legal certainty and accessibility and to better reflect contemporary societal needs. To this end, he set up several commissions, one of which was tasked with the reform of the law of contracts and obligations discussed in the present article.Footnote 4 This commission prepared, from 2017 to 2021, four successive versions of a draft Book 5 of the new Civil Code, which, after being submitted to a public consultation and to the opinion of the Council of State, was finally enacted as a statute on 28 April 2022.Footnote 5
The primary objective of the reform proposed by the commission was to enhance the accessibility of civil law by expressly codifying within the statutory text a multitude of rules that had been developed over the past two centuries by legal scholarship and case law on the basis of the outdated wording of the old Civil Code. Complementarily, the reform also sought to strengthen legal certainty, notably by resolving certain long-standing controversies, and, where feasible, to introduce simplifications, for instance through the harmonisation of the rules governing restitution following the nullity or termination of contracts. Targeted modernisations were likewise introduced, generally inspired by comparative law, the most emblematic of which is undoubtedly the recognition of the change of circumstances. Finally, the reform aimed at improving the internal coherence between the various books of the new Civil Code and at enhancing the attractiveness of Belgian law on the so-called market for laws.Footnote 6
When examining the text, Parliament stressed that the legislative proposal under consideration did not purport to bring about a revolution, nor did it alter the core foundations of the Civil Code. Rather, it constituted an exercise in recodification, integrating the case law of the Court of Cassation (Belgium’s highest civil court) while preserving the underlying principles, within a thoroughly renewed Civil Code. While some observers had taken the view that the recodification did not go far enough, Mr Geens, for his part, considered that a fair and balanced compromise had been achieved.Footnote 7
It is interesting to note that the reform of the Belgian Civil Code did not stop—nor did it even begin—with the adoption of Book 5. Indeed, the law of tort, contained in Book 6 of the new Civil Code, was prepared by a separate commission and entered into force on 1 January 2025. Other aspects of the civil law reform have also been completed to date. Book 1, containing general provisions which are closely connected to the law of contract (such as the concepts of juridical act, public policy, good faith, abuse of right, and willful misconduct), entered into force on 1 January 2023. Books 2.3 and 4, pertaining respectively to couples’ patrimonial relationships, inheritance, gifts and wills, entered into force on 1 July 2022. Book 3, containing the law of goods, entered into force on 1 September 2021. Book 8, the first book of the new Civil Code to have been adopted, containing the law of evidence, entered into force on 1 November 2020. Most recently, Book 9.1, pertaining to personal suretyships, entered into force on 1 January 2026. Finally, some texts are currently in discussion in Parliament (such as Book 7 on the law of special contracts, including sale, lease, and service contracts) or are still being drafted (such as Book 10 on the law of time limitation, the second part of Book 9 on real suretyships, and the first two parts of Book 2 on family law).
III. The interpretation of contracts
A. The new Belgian provisions
Although there is no official English translation of the new Belgian Civil Code,Footnote 8 the provisions pertaining to the interpretation of contracts can be translated as follows:
Art. 5.64. Primacy of real intention
In contracts, the common intention of the contracting parties must be sought, rather than focusing on the literal meaning of the terms.
However, where the contract is evidenced in writing, no interpretation of the contract may be given which is manifestly incompatible with the meaning of the written contract, taking into account the elements intrinsic to it and the circumstances in which it was drawn up and performed.
Art. 5.65. Search for the real intention
To ascertain the common intention of the parties, the following guidelines, in particular, shall be taken into account:
1° when a clause is susceptible to two meanings, it should be understood in the sense in which it can have some effect, rather than in the sense in which it could produce none;
2° terms susceptible to two meanings must be taken in the sense that is most appropriate to the subject matter of the contract;
3° what is ambiguous is interpreted by what is customary in the region and sector concerned and in accordance with the usual relations between the parties;
4° all the clauses of the contracts are interpreted in light of each other, giving each one the meaning that results from the entire act;
5° however general the terms in which a contract is drafted, it only includes the subjects on which the parties appear to have intended to contract;
6° when a case is mentioned in a contract for the explanation of the obligation, it is not deemed to have been intended thereby to restrict the extent that the obligation receives by law to the unmentioned cases;
7° the performance given to the contract before a dispute arises between the parties is taken into consideration to interpret the contract.
Art. 5.66. Interpretation in case of doubt
When there is doubt concerning the common intention of the parties, the following rules apply, without prejudice to the rules specific to special contracts:
1° the standard-form contract is interpreted against the party who drafted it;
2° the exemption from liability clause is interpreted against the debtor of the obligation;
3° in all other cases, the clause is interpreted against the beneficiary of this clause.
The contract with a consumer is interpreted in accordance with Article VI.37 of the Code of Economic Law.
B. Overview of the Belgian rules: the survival of the traditional subjective approach
Generally speaking, interpreting a contract aims to determine its meaning. Under Belgian law, the concept is broad and includes the process of filling contractual gaps with implied terms,Footnote 9 although the principle of good faith also plays an important role in the latter scenario.Footnote 10 Indeed, ‘comparative lawyers have long known that the common law-style implication of terms and the civilian-style supplementary interpretation are functional equivalents’ and that ‘there is no clear dividing line between interpretation and implication’.Footnote 11 This contribution will, however, focus on the rules pertaining to interpretation sensu stricto.
The first principle of interpretation contained in the old Belgian Civil Code of 1804 was that contracts must be interpreted in accordance with the common intention of the contracting parties even if this intention does not correspond to the literal meaning of the words used.Footnote 12 Admittedly, some legal scholars had tried to advocate a more objective approach centred—even when the parties’ subjective intention can be ascertained—on the ordinary meaning of the words used by a party and their normal understanding by the other party.Footnote 13 Alternatively, some authors have argued that an objective approach should at least be employed on a subsidiary basis where the parties’ subjective intention cannot be determined.Footnote 14 The Court of Cassation has, however, remained faithful to a theory of interpretation primarily based on the parties’ subjective intention. For instance, even when the lower court upholds the literal meaning of the contract, the Court of Cassation insists that this does not imply by itself that the lower court has not sought what the parties’ common intention was.Footnote 15 Conversely, a lower court does not violate the binding character of a contract when it sets aside its literal meaning and prefers to it the meaning resulting from the parties’ common intention.Footnote 16 Finally, the Court of Cassation refuses to interpret itself a contract because this would require it to ascertain the parties’ intention, which—being a factual question—would exceed its constitutional powers.Footnote 17 This being said, some judgments of the Court of Cassation nevertheless hint at the possibility of interpreting the contract on the basis of the principle of good faith.Footnote 18
The new Belgian Civil Code has retained the principle already applicable to the interpretation of contracts under the old Code,Footnote 19 though this choice has been regretted by some legal scholars.Footnote 20 The approach thus remains a subjective one, as the court needs, in the event of a dispute, to attempt to reconstruct the parties’ frame of mind at the time of the contract’s conclusion.Footnote 21 As regards the principle of good faith, it is recognised as having a dual function: supplementing the contract through implied terms and preventing the abuse of rights.Footnote 22 On the other hand, no interpretative role is expressly attributed to this principle by the new Civil Code.
The main change brought by the reform is the addition of a provision clarifying the courts’ power to uphold an interpretation incompatible with the wording of a written contract (Art 5.64 Alinea 2). This resolves a long-standing difficulty in the case law. To exercise (limited) control over the interpretation upheld by lower courts without ruling itself on the facts of the case, which it is forbidden to do,Footnote 23 the Court of Cassation had developed the concept of ‘violation of the faith due to a document’ (violation de la foi due à l’acte), which relies on the idea that an interpretation of a written document which is radically incompatible with the wording used in that document violates its evidentiary value.Footnote 24 This theory is the functional equivalent of the French concept of dénaturation.Footnote 25 However, that theory sat uneasily with the text of the (old) Civil Code, which states that the interpretation of the contract must be based on the common intention of the parties irrespective of the wording used.Footnote 26 The new Civil Code resolves this tension by confirming the power of lower courts to adopt an interpretation that departs from the literal meaning, provided this interpretation is not ‘manifestly incompatible’ with the text of the contract, taking into account all its clauses as well as the circumstances in which it was drafted and performed.Footnote 27 The parties’ behaviour both before and after the formation of the contract is thereby recognised as relevant to ascertaining their common intention.Footnote 28 This new legal provision thus confirms that a clause can never be considered as clear and unambiguous in isolation but must always be read in its context.Footnote 29
In any case, ascertaining the parties’ common intention therefore remains at the heart of contractual interpretation under the new Belgian law. To help the court in this difficult endeavour, two additional tools are available to it.
First, a series of traditional principles of interpretation are codified to help ascertain the common intention of the parties,Footnote 30 for example that each clause of the contract is presumed to have some added value rather than being meaningless (effet utile),Footnote 31 that the words used must be read in light of the subject matter of the contract,Footnote 32 or that regard must be had to usage.Footnote 33 Most of these principles were already mentioned in the old Civil Code.Footnote 34 They were slightly redrafted in the new Code, notably to specify that the relevant usage comprises not only the usage in use within the country but also the usage of the relevant region or trade sector as well as the habitual relations between the parties,Footnote 35 and that regard must be had to the manner in which the contract was performed before the dispute arose between the parties.Footnote 36 Moreover, the provision now clarifies that these principles of interpretation enjoy the status of ‘guidelines’: while their character of legal rules cannot be denied, they are only recommendations addressed to the court and therefore devoid of any binding effect, since they may very well lead to differing interpretations in a given case.Footnote 37
Second, subsidiary rules apply if the court entertains doubt regarding the common intention of the parties.Footnote 38 Under the old Civil Code, the contract had to be interpreted, in case of doubt, against the creditor and in favour of the debtor.Footnote 39 This principle remains under the new Civil Code, but in a slightly redrafted form: in case of doubt, the contract is interpreted against the beneficiary of the clause,Footnote 40 which is generally the creditor, but may be the debtor in cases such as those involving clauses limiting the debtor’s liability.Footnote 41 A special rule is also included for standard-form contracts, that is, contracts which have not been individually negotiated within the meaning of the EU Directive on unfair terms.Footnote 42 The application of the rules applicable to consumer contracts is also reserved.Footnote 43 Overall, the traditional subjective approach to contractual interpretation has thus been preserved by the Belgian reform.
C. Contrast with the modern objective approach
This traditional, subjective approach to contractual interpretation, however, contrasts with the more objective approach adopted by other legal systems as well as international instruments. The French reform, adopted in 2016 and revised in 2018, slightly before the Belgian reform, serves as a useful point of comparison.Footnote 44 At first glance, the French provisions on contractual interpretation present strong similarities with their Belgian counterparts. Indeed, the interpretation is primarily based on the parties’ common subjective intention,Footnote 45 subject to the limit of dénaturation.Footnote 46 Several guidelines are provided to the court to assist it in this task.Footnote 47 Subsidiary rules are also provided in case of doubt, in which case the contract is interpreted in favour of the debtor (or against the drafter in the case of a standard-form contract).Footnote 48 Yet a significant difference must be emphasised: where the parties’ common intention cannot be ascertained, the contract is interpreted in the sense that a reasonable person placed in the same situation would give it.Footnote 49
This move towards a more objective approach to interpretation, applicable where the parties’ subjective common intention cannot be ascertained, is expressly inspiredFootnote 50 by the PECL,Footnote 51 the DCFR,Footnote 52 and the PICC.Footnote 53 Reference can also be made to the CISG.Footnote 54 Along similar lines, and subject to certain nuances, German law also provides that—save where the contractual terms are used by both parties in a specific and atypical sense (falsa demonstratio non nocet)—a party’s declaration is, in principle, to be interpreted according to the meaning that the addressee could reasonably attribute to it.Footnote 55 Likewise, under Dutch law, interpretation turns on the meaning that the parties could reasonably ascribe to the contract and on the expectations they could reasonably have of one another.Footnote 56 Finally, English law currently favours an objective and contextual approach as expressed by Lord Hoffmann in Investors Compensation Scheme Ltd v West Bromwhich Building Society: ‘[i]nterpretation is the ascertainment of the meaning which the document would convey to a reasonable person having all the background knowledge which would reasonably have been available to the parties in the situation in which they were at the time of the contract’ (principle 1), being understood that ‘[t]he law excludes from the admissible background the previous negotiations of the parties and their declarations of subjective intent’ (principle 3).Footnote 57 Therefore, the approach adopted by English law is generally presented as being exclusively objective, since the parties’ intention is deemed to be irrelevant for contractual interpretation.Footnote 58
D. Comparative observations
Some authors have regretted that the Belgian reform retained the traditional subjective approach instead of recognising the courts’ power to interpret the contract on the basis of a reasonable person’s understanding, at least where the parties’ common intention cannot be ascertained.Footnote 59 Reciprocally, the French reform has been approved based on the idea that ‘reliance on objective considerations is not only inevitable but widespread. It should therefore not be disguised’.Footnote 60 That said, two observations can be made to contextualise the choice of the Belgian reform to uphold the traditional approach despite these objections.
1. Interpretation in case of doubt
The first observation is that, in the French reform, a hierarchy is established between subjective and objective interpretation: the former enjoys the primacy and the latter is applied only if the parties’ common intention cannot be ascertained.Footnote 61 Admittedly, this hierarchy is rather theoretical since in practice the objective approach is more commonly followed.Footnote 62 But the often-overlooked consequence of the introduction of such a hierarchy is that it necessarily affects the pre-existing hierarchy among interpretation methods.
Indeed, under Belgian and French law, in case of doubt, the contract must in principle be interpreted in favour of the debtor.Footnote 63 This principle is not a mere guideline provided to the court; it is a rule that binds the courts under Belgian law,Footnote 64 though this is discussed by some authors under French law.Footnote 65 Traditionally, doubt existed when the parties’ common intention could not be ascertained with certainty.Footnote 66 Yet, in French law, a new rung has been added to the ladder: interpreting the contract in favour of the debtor now requires determining not only that the parties’ common intention cannot be ascertained but also that even a reasonable person would entertain a doubt as to the meaning of the contract.Footnote 67
The nature of the doubt required has thus changed in character: while the content of the parties’ common intention and the possibility of ascertaining it are purely factual questions, the objective meaning given to the contract by a reasonable person is much more abstract and implies a normative determination of what must be considered reasonable. Does this latter approach even leave room for doubt?Footnote 68 As a commentator rightly points out,
contra proferentem interpretations risk remaining a dead letter if they apply only where the clause is incomprehensible to a reasonable person: not only will such occasions be few and far between, but it is hard to see how one could adopt a meaning favourable to the debtor or adhering party when no rational meaning can be gleaned from the clause.Footnote 69
At the very least, one can assume that the cases of interpretation in favour of the debtor (or against the drafter of a standard-form contract) will be much less frequent under the French reform, since a reasonable interpretation can often be found.Footnote 70 This constitutes, in my view, an argument in favour of upholding the traditional approach, especially since the Belgian reform was intended to provide greater protection for the weaker party.Footnote 71 Indeed, it appears that the contra proferentem rules of interpretation will apply more frequently under Belgian than under French law.
2. The blurred distinction between the subjective and the objective approach
At any rate, the distinction between the subjective and the objective approaches to contractual interpretation should not be drawn too sharply. This has been recognised in Belgian contract lawFootnote 72 and even more generally outside of contract law.Footnote 73
On the one hand, the parties’ common intention is a mental state which is not immediately perceptible and may not even exist.Footnote 74 It must necessarily be reconstructed by the court based on the available evidence, namely objective facts (such as the contract’s wording, declarations made by the parties before the conclusion of the contract, or the way in which the contract was performed by them in tempore non suspecto).Footnote 75 The additional guidelines provided to interpret the contract, while being presented as tools to help the court ascertain the common intention of the parties, could alternatively be seen as factors ‘which have nothing to do with the subjective state of mind of the parties’ and are therefore in reality objective by nature.Footnote 76 Finally, to reconstruct the parties’ common intention based on the available evidence and guidelines, the court uses its own common sense so that the so-called subjective interpretation is in fact primarily a judicial interpretation.Footnote 77
On the other hand, the purportedly objective viewpoint of the reasonable person takes into account the specific circumstances in which this particular contract was concluded by these specific parties, and is thus to some extent subjectivised.Footnote 78 But, more fundamentally, the ‘reasonable person’ has no more concrete existence than the parties’ common intention. It is also ultimately a construction by the judges who, even if they must go beyond their personal assessment,Footnote 79 will inevitably be tempted to consider themselves as the reasonable person par excellence.Footnote 80
In the end, both approaches—subjective and objective—boil down to the discretionary assessment by the court of what the contract concluded by the parties ought to mean. Moreover, both approaches often lead in practice to the same outcome,Footnote 81 which may explain why the courts do not always distinguish between the subjective attempt to ascertain the parties’ common intention and the application of the (more objective) guidelines provided to help determine such common intention.Footnote 82 Viewed in this perspective, the question of the choice of the interpretation model, whether subjective or objective, is mostly theoretical.
However, this does not mean that the distinction between these two approaches to interpretation is wholly irrelevant. It can indeed have secondary consequences. For instance, ‘a consequence of the predominantly subjective approach in France is that issues of interpretation are regarded as questions of fact, whereas under the objective approach in England they are questions of law’.Footnote 83 The chosen approach is also illustrative of the legal system’s core values.Footnote 84 Accordingly, the subjective approach exclusively recognised in Belgium is in line with other rules, such as the nullity of the contract whose subject-matter cannot be ascertained without a new agreement of the parties,Footnote 85 the prohibition for the court to replace a clause which is null and void with another clause which is not based on the consent of the parties,Footnote 86 or the possibility of rectifying a contract that contains an involuntary discrepancy between the parties’ common intention and their stated intention.Footnote 87
In conclusion, although the Belgian legislator’s decision to uphold the traditional principle of interpretation based on the parties’ subjective intention may appear out of step with the more objective approach adopted in neighbouring legal systems and international instruments, its practical impact remains limited, and it appears consistent with the core principles of the Belgian Civil Code.
IV. The characterisation of contracts
A. Concept of characterisation and new Belgian provisions
The concept of qualification du contrat appears more difficult to translate into English than that of interpretation. Under Belgian and French law, the qualification immediately follows the interpretation and consists of classifying the contract within the legal category to which it belongs (such as sale, lease, service, etc.).Footnote 88 This allows determination of the rules applicable to all contracts of this category, which is usually rendered in English by the concept of ‘implied terms in law’.Footnote 89 These implied terms are generally default rules from which the parties are permitted to derogate by common agreement (règles supplétives), but some of them cannot be derogated from, at least at the moment of concluding the contract. In this regard, Belgian law distinguishes between rules aimed at protecting the weaker party (règles impératives)Footnote 90 and rules aimed at safeguarding the general interest (règles d’ordre public).Footnote 91 This distinction roughly corresponds to the French distinction between ordre public de protection and ordre public de direction.Footnote 92
To translate this concept of qualification, I have chosen the term ‘characterisation’, which is consistently used to describe the same intellectual operation, albeit in the context of conflicts of laws.Footnote 93 The term ‘classification’ could also have been chosen but appears to be generally used in a less technical sense.Footnote 94 As for the term ‘qualification’, it seems more ambiguous since it can also refer to ‘[a] modification or limitation of terms or language; esp., a restriction of terms that would otherwise be interpreted broadly’.Footnote 95
The choice of the proper translation is rendered even more complex by the fact that the concept of qualification is generally ignored in international instruments such as the PICC and PECL, and is only partially addressed in the DCFR. The reason for such omissions may be explained by the fact that, as we will see, the process of qualification appears to be the functional equivalent of other legal institutions.
Subject to the preceding observations, I will examine first the review which the court may exercise over the characterisation chosen by the parties (Section IV.B). I will then discuss the rarely examined question of the characterisation of mixed contracts (Section IV.C).
B. Review of the characterisation of the contract by the court
The new Belgian Civil Code contains the following provision (my translation):
Art. 5.68. Recharacterisation of the contract
The characterisation given to the contract by the parties may only be disregarded where it is incompatible with the clauses of the contract or with mandatory rules or rules of public policy.
A distinction is thus made depending on whether the parties have characterised their contract at the time of conclusion. If they have failed to do so and if the category to which the contract belongs is relevant to determining the outcome of their dispute, the court is bound to determine the proper characterisation of the contract pursuant to an uncodified rule of procedural law (jura novit curia).Footnote 96 If, however, the contract has been characterised by the parties, Article 5.68 of the Belgian Civil Code provides a specific solution. Indeed, the characterisation given to the contract by the parties may only be disregarded where it is incompatible with the clauses of the contract or with mandatory rules or rules of public policy. For instance, if the parties have characterised their contract as a contract for services while it results from its stipulations that the service provider stands in a subordinate relationship to the client, the contract must in reality be characterised as an employment contract.Footnote 97 However, where the contract is open to several possible characterisations, the court is bound by the choice made by the parties. By contrast, in other legal systems such as Dutch law, characterisation is a purely objective question that is independent of the parties’ common intention.Footnote 98
The choice of the Belgian legislator to dedicate a provision of the new Civil Code to the characterisation of contracts is noteworthy. Indeed, no similar provision can be found in international instruments such as the PECL, the DCFR, or the PICC. A possible explanation for this absence is that, with the exception of the DCFR, these international instruments are confined to the general law of contracts. In the absence of distinct categories of specific contracts, the need to characterise a contract disappears, and the concept itself therefore does not require explicit treatment.
Another reason may be that the question of characterisation is often treated as being of a purely procedural nature. This is the case in French law, where slightly different rules apply. Indeed, the court is not bound by the name given by the parties to their contract. If the chosen category does not correspond to the content of their agreement (as interpreted pursuant to the rules set out earlier), the court can therefore restore the contract’s proper characterisation.Footnote 99 However, this rule is based not on the Civil Code but on Article 12 of the Code of Civil Procedure, which requires the court to settle the dispute in accordance with the applicable rules of law and to give or restore the exact characterisation of the facts and juridical acts in dispute without regard to the name that the parties may have proposed.Footnote 100
The reason why the problem of characterisation is often overlooked in international instruments may also be more profound. Indeed, it appears that the issue addressed by the characterisation of contracts under Belgian and French law is often treated in other legal systems from a different perspective. German law can be taken as an illustration of this trend.Footnote 101 Some authors consider that when the parties have improperly characterised a contract, for example by designating a sales contract as a lease, this error in designation must be rectified, even when intended by the parties, because the classification of a juridical act within one of the legal categories or ‘types’ is a purely legal question.Footnote 102 Reference is sometimes made in this respect to the maxim falsa demonstratio non nocet, that is, the principle of interpretation pursuant to which the parties’ common intention prevails over the improper wording they have chosen.Footnote 103 One must, however, observe a shift in the use of the maxim, or perhaps an extended meaning attributed to it, since it is normally applied to interpret the contract’s wording in a special sense used by the parties which derogates from its usual significance in the common speech.Footnote 104 In other words, the maxim is normally applied to the meaning of words used in the contract, not to the category chosen to designate the contract itself. Other authors seem to consider, in a more direct way, that the correction of the characterisation erroneously attributed by the parties to the contract belongs to the sphere of interpretation.Footnote 105 Finally, when the improper characterisation results in the nullity of the contract, the problem is addressed through the doctrine of conversion (Konversion). While the majority of authors acknowledge the specificity of this doctrine, some of them still see it as a mere application of the interpretation of contracts or of the partial nullity.Footnote 106
Two significant examples of Konversion can be given to illustrate its potential overlap with the characterisation of contracts. In one case, a contract purporting to transfer the right in rem of usufruct in violation of § 1059(1) of the BGB was converted into the contract foreseen in § 1059(2), that is, a contract limited to the personal obligation to grant the exercise of the usufruct.Footnote 107 In a similar way, the French Court of Cassation decided at the same period that, when a right in rem could not validly be granted (because a right of easement cannot impose a positive obligation), the clause was not to be annulled but only granted a personal right.Footnote 108 Interestingly, the solution was based not on the doctrine of Konversion, which is not generally recognised under French law, but on the power of the lower court to interpret contracts subject to the prohibition of dénaturation.
In the second case, a commercial company (offene Handelsgesellschaft) which did not have any commercial objective was converted into a civil company (bürgerlichrechtliche Gesellschaft).Footnote 109 A parallel can be drawn with a similar Belgian judgment which, through the doctrine of characterisation, transformed a public limited company (société anonyme) which did not have any commercial objective into a non-profit organisation (association sans but lucratif).Footnote 110
The Belgian legislator was well aware that Konversion and characterisation can, to a certain extent, be considered functional equivalents. Indeed, the explanatory memorandum notes that ‘it has not seemed necessary to devote a provision to the conversion of invalid acts, as this can already be achieved through Article 5.68 relating to the recharacterisation of the contract’.Footnote 111 The Belgian legislator thereby took a position in an ongoing scholarly debate. In a well-known paper published in the 1960s, Professor Jan Ronse had advocated the recognition of the doctrine of Konversion under Belgian law, drawing inspiration from its counterparts in Dutch and German law.Footnote 112 A parallel can also be drawn between Konversion and partial nullity,Footnote 113 which is well recognised under the new Civil Code.Footnote 114 Other authors, however, were sceptical that the doctrine of Konversion could be recognised as such under Belgian law.Footnote 115 The reason lies in the fact that the doctrine of Konversion is based on what the parties would reasonably have agreed had they been aware of the nullity of their contract.Footnote 116 Such a hypothetical intention is difficult to reconcile with the premises of Belgian contract law, which, as we have seen, remains deeply rooted in a subjective conception of contractual intention.Footnote 117
An illustration of this can be found in a judgment of the Court of Cassation of 23 March 2006.Footnote 118 Under Belgian law, indexation clauses are subject to strict restrictions under the Act of 30 March 1976, on pain of absolute nullity. In a case where these provisions had not been complied with, the court of appeal sought to avoid annulling the contract by observing that, at a later stage of the works, the parties had agreed on a new indexation clause that complied with the 1976 Act, and that this new indexation clause should also replace the unlawful clause for the earlier phase of the works. This decision was, however, quashed by the Court of Cassation on the ground that a clause which is null and void cannot be replaced by another clause that is not supported by the parties’ consent.
Generalising from this solution, the Belgian legislator appears justified in having refused to recognise the institution of Konversion as such. It appears more consistent with the Belgian tradition to rely instead on the institution of characterisation, which, unlike Konversion, is based on the parties’ common and actual intention rather than on the hypothetical intention of a reasonable person placed in the same circumstances.
In conclusion, the question of the proper characterisation of the contract is probably not ripe for a common international solution as, depending on the foundations and particularities of each legal order, it can also be addressed from very different angles such as procedural law, interpretation, partial nullity, and Konversion.
C. Characterisation of mixed contracts
A ‘mixed contract’ can be defined under Belgian law as a contract which includes several transactions, each falling into a different legal category. The typical example is the sale of a machine coupled with a maintenance contract for the same machine. This approach differs from Article 6:215 of the Dutch Civil Code, where a ‘mixed contract’ is understood as a contract which, as a whole, falls simultaneously into different legal categories without being susceptible to being split into different transactions.Footnote 119
The new Belgian Civil Code provides in respect of mixed contracts (my translation):
Art. 5.67. Characterisation of mixed contracts
Where a contract contains clauses that fall under different categories of contracts, each clause is subject to the rules that apply to the category to which it belongs.
However, where a contract contains, as an accessory, clauses falling under a category other than that to which the contract principally belongs, the entire contract is subject, with the required adaptations, to the rules applicable to it in principal order, unless by their nature the accessory clauses concerned require their own regulations.
This article applies unless the parties decide otherwise and subject to any relevant mandatory or public policy rules.
More than the precise content of this provision, which leaves wide discretion to the courts, its importance lies in the fact that the characterisation of mixed contracts is expressly addressed. Indeed, as the DCFR notes, ‘[t]here are few legislative provisions on this topic’.Footnote 120 In particular, there is no equivalent provision in the French or German civil codes, nor in the PECL or the PICC. The Belgian text is therefore directly inspired by Article II.—1:107 of the DCFR and, to a lesser extent, by Article 6:215 of the Dutch Civil Code.Footnote 121 Article 3(2) of the CISG, which takes into account ‘the preponderant part of the obligations of the party who furnishes the goods’, is also based on a similar rationale to the one underpinning Article 5.67(2) of the Belgian Code.
The regime of mixed contracts under the new Belgian Code can be summarised as follows. The general rule, expressed in Article 5.67(1), is that each transaction included in the contract is governed by its own rules (distributive approach).Footnote 122
Thus, for example, if a unilateral promise to sell is included in a lease agreement, each transaction remains in principle subject to its own rules. This solution is favoured for reasons of legal certainty because it allows the judge, when the parties have not clearly expressed their intentions, to revert to the legal regime applicable to the various operations that make up the mixed contract.Footnote 123
Another justification is that ‘[i]t will often be a mere matter of chance whether there is one contract or two. This suggests that the practical results should preferably not differ depending on whether the parties conclude one contract or two’.Footnote 124
An exception is immediately made in Article 5.67(2), which significantly reduces the practical implication of the general rule: if one part of the contract can be considered predominant, the other, ancillary parts are ‘absorbed’ by the predominant part and governed by the rules applicable to the latter. ‘Thus, for example, if a contract for the sale of a standard kitchen includes a service for its installation and this installation is completely incidental in the intention of the parties (particularly with regard to the respective value of the kitchen furniture and the service), then the contract is considered as a sale in its entirety.’Footnote 125 This absorption by the dominant part of the contract calls for two nuances.
First, the ancillary parts of the contract are governed by the rules applicable to the dominant part ‘with the required adaptations’. ‘Thus, if, in the aforementioned example, the installation has a hidden defect, the rules on the guarantee against hidden defects in the sale, normally applicable only to defects affecting the good, will have to be applied by analogy to the hidden defects of the installation.’Footnote 126
Second, the rules applicable to the dominant part of the contract also apply to its ancillary parts ‘unless by their nature the accessory clauses concerned require their own regulations’.
Thus, for example, the clause on applicable law, the clause on choice of forum or the arbitration clause, although of an ancillary nature, cannot be absorbed by the legal category to which the main contract belongs (sale, lease, etc.) because they produce their own effects which could not be subject to the rules applicable to the main contract without distorting these rules.Footnote 127
Finally, pursuant to Article 5.67(3), ‘[t]his article applies unless the parties decide otherwise and subject to any relevant mandatory or public policy rules’.
Thus, if it appears that the parties clearly intended to conclude a sui generis transaction that is not directly related to any contract regulated by law, they remain free to do so, even if the transaction concluded borrows certain features from regulated contracts. However, this freedom is limited by mandatory or public policy rules, which cannot be circumvented in this way.Footnote 128
This being said, the relevant mandatory or public policy rules will need to be interpreted carefully to determine whether they apply to the mixed contract or whether, because of its specificity, it falls outside of their scope.
V. Conclusion
The interpretation and characterisation of contracts in the Belgian reform of contract law manifest clear adherence to traditional principles, notably the subjective approach to interpretation. By reaffirming that the primary objective of contractual interpretation is ascertaining the contracting parties’ common intention, the new Belgian Civil Code distinguishes itself from recent international trends exemplified by French law as well as international legal instruments which increasingly adopt an objective or mixed approach.
The decision to preserve the subjective approach illustrates the Belgian legislature’s intention to maintain robust protection of contractual autonomy, privileging the parties’ genuine intent over the understanding of a theoretically constructed ‘reasonable person’. The addition of interpretative guidelines and subsidiary rules, designed to facilitate judicial determinations in ambiguous cases, further refines this traditional framework. Nevertheless, as comparative analysis reveals, subjective and objective approaches to interpretation are not rigidly distinct in practical judicial reasoning. Courts inevitably blend subjective reconstruction with objective normative standards, demonstrating judicial discretion that transcends these doctrinal concepts. Consequently, the distinction remains significant primarily for its secondary legal implications—such as the status of interpretation as a matter of fact or law—and for reflecting underlying legal system values concerning contractual freedom and judicial intervention.
In characterising contracts, Belgium’s explicit regulation through Article 5.68 and the innovative handling of mixed contracts in Article 5.67 represent notable clarifications compared to other civil codes and international instruments, which typically overlook characterisation or treat it only implicitly through procedural or interpretative techniques. The Belgian legislator’s explicit codification seeks to clarify the courts’ role and to respect the parties’ characterisation, subject to compliance with mandatory provisions and public policy.
Taken together, these provisions reflect a reform that is both rooted in tradition and open to evolution. Whether or not one agrees with the choices made by the Belgian legislator, the Belgian reform of contract law constitutes a new topic worthy of academic investigation by comparative lawyers.
Competing interests
The author declares none.