In this report I consider the preliminary draft not so much from the point of view of its usefulness to various branches of legal practice, including business life and the courts, but in particular with respect to the tenability of the theoretical standpoints that are implicit in it. It is my view that a seemingly useful body of rules, however precisely formulated and however little room for interpretation it leaves, will prove deficient in practice, in terms for instance of the predictability of the outcome of its application, unless it rests upon a sound – and not a sand – foundation.