- Research Handbooks in International Law series
Edited by Geraint Howells, Iain Ramsay, Thomas Wihelmsson and David Kraft
7. Unfair terms and standard form contracts Thomas Wilhelmsson and Chris Willett 1. Fairness of contracts – posing the problem One of the core problems both in general contract law and in particular in consumer contract law is how law should react to contract terms that appear as one-sided, unbalanced or unfair – many attributes have been used in this discourse. To what extent should unfair clauses be recognised as binding and should the law interfere against use of such clauses in other ways? Or should one assume that contracts almost per definitionem should be regarded as balanced, as they are based on the will of the parties? The issue of how to guarantee or promote fairness of contracts is often described in terms of dichotomies like freedom of contract versus fairness or freedom versus paternalism. However, this can oversimplify the issue. For example, to regard procedural fairness rules as opposite to freedom of contract can be misleading. Rules, to be described below, that require the party using standard terms to let the other party acquaint itself with them and even to ‘flag’ particularly onerous terms, can equally well be understood as devices to make sure that the decision-making of the party receiving the terms is sufficiently informed and ‘free’ (although these rules, as well as those regulating the substance of the terms, may be viewed as a rejection of a particular form of freedom, that is, a libertarian form of freedom that emphasises self-reliant, self-interested freedom). The term ‘paternalism’ in a...
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