In view of articles 1709 and 1710 in conjunction with articles 1134 and 1135 Code civil:
Given that when a contract envisages the formation of further contracts the fact that the price contained in those further contracts is not fixed in the initial contract does not affect the validity of the latter, in the absence of specific legal texts to the contrary, though any abuse in the fixing of the price may give rise to rescission or damages;

Given that the decision under attack (Rennes, 13 February 1991) found that on 5 July 1981 Sumaco entered into a contract of hire and maintenance with CAT (Compagnie Atlantique de Téléphone) regarding the installation of a telephone system by the latter, payment being indexed, with a clause that any modifications requested by the administration or the customer would be charged to the latter at the then current price; that when CAT declared that it was terminating the contract for non-payment of the instalments and claimed payment of the sum specified in the contract, Sumaco sought to have the contract held void for lack of a determinable price;

Given that the court below held the contract void on the ground that the customer was obliged to resort to CAT for any modifications of the installation, that some such modifications were inevitable and that their price was not fixed but depended exclusively on the discretion of CAT, as did the price of any necessary additions;

Given that in so deciding the court below violated the texts cited above;

For these reasons QUASHES the decision of the Court of Appeal of Rennes of
13 February 1991 and remands the case to the Court of Appeal of Rouen.

Subsequent Developments

This note on subsequent developments reflects the legal situation as of October 2004.

Assemblee pleniere 1 December 1995 (3 judgments): cf Henri Capitant, Francois Terre, Yves Lequette, "Les grands arrets de la jurisprudence civile" (Leading judgments in civil case law) (Dalloz, 2000, pp 42 to 58): These judgments make "the question of determination of the price no longer a condition for validity of the contract, but a simple modality of its performance", redefining on this occasion the role of the judge. Until then, a contract with an indeterminate price was a nullity. From now on rescission or indemnification will correct abuse in the fixing of the price. The earlier case law, considering that determination of the price was an essential element of the contract, encountered numerous practical difficulties, in particular when it was not possible to determine this price beforehand. The correctives introduced by case law in respect of certain types of contract not having been sufficient, a reversal was necessary, hence these judgments given by the Assemblee pleniere, redefining the very idea of a contract.

Translation by Mr Raymond Youngs