Page - 95 - in Austrian Law Journal, Volume 1/2019

ALJ 2019 EU Consumer Contract Law Directives and Ownership 95 connect this conflict with other conflicts where the concept of ownership could be used. The insolvency conflict concerning the item that the buyer bought should be dealt with on its own merits. With a functional approach the category of problems like this is seen as an issue of priority. This category of problems, or category of conflicts, is called ‘the buyer’s protection from the seller’s general creditors’, and ownership is (ideally) not a part of how the problem is perceived. The real problem, a functionalist would think, is the conflict of interests between the seller’s creditors and the buyer. What the creditors want is to use the property in question to get a higher dividend in the bankruptcy proceedings. The buyer is one kind of creditor, and the difference is simply the buyer wanting the property as such. Since both sides cannot have what they want, the issue of priority must become a question of whether there are reasons for giving priority to a buyer at some point in time during a sales relationship. When contemplating this issue, a thorough functionalist effort would be to identify that the buyers who have not yet paid any part of the price seldom suffer from not being given priority. In those cases, the other creditors normally prefer the bankruptcy estate to proceed with the sales contract. Since the creditors want the estate to sell all property of the debtor, it is very practical to already have a buyer who is obliged to fulfil an existing contract and pay the agreed price. The real problem can therefore be narrowed down to an issue of priority for buyers who paid something in advance.38 There is a similarity between those buyers and the seller’s general creditors in that they all trusted the seller by giving him or her credit. The real problem can thus be formulated as whether a creditor, who is a buyer and therefore has a main claim for the delivery of specific goods and alternatively a claim to get compensation for an unfulfilled contract, should be given priority over the other creditors of the seller.39 Since the functional approach is a way of thinking, the real issue needs to be dealt with by the legislator, as well as by practicing lawyers in every-day legal practice. When there are established rules that fit the case at hand, the process can be narrowed down by using the legal template for the specific type of problem. When it comes to a case where an unclear issue of law appears, the application of the functional approach includes a constructive problem solving method, as we will explain in the following chapter. B. How a Functional Approach Can be Applied The previous section tried to explain fundamental features of the functional approach and illustrated this way of legal reasoning by means of two examples from the original ambit of this 38 And, also, to buyers who were lucky to enter into the contract at a time when the market prices for the property in question were lower than the prices are at the time of bankruptcy. We simplify and leave these cases out. We also do not deal with ‘actio Pauliana’ issues where the buyer got a low price and the contract therefore should be questioned by insolvency legislation. 39 We should point out that we describe a rather developed functional view on this issue here. If we look at what has been argued in, for example, Swedish legal argumentation, the issue has not been perceived like this. See our criticism of a particular underdeveloped view in Jens Andreasson, Wolfgang Faber, Shubhashis Gangopadhyay, Claes Martinson and Stefan Sjögren, Prioritet för köpare – en fråga om tradition eller princip?, 100 SVENSK JURISTTIDNING 709 (2015). For a policy-oriented debate of this issue see also Comments C(c) to Article VIII.–2:101 DCFR, in PRINCIPLES, DEFINITIONS AND MODEL RULES OF EUROPEAN PRIVATE LAW – DRAFT COMMON FRAME OF REFERENCE (DCFR), FULL EDITION, VOLUME V 4396–4404 (Christian von Bar and Eric Clive eds., 2009). Compare also Håstad, supra note 33, at 735–736, who assumes that every buyer and seller would always agree to give the buyer priority.