Report on Proposals for Unfair Contracts Relief

British Columbia Law Institute Report No. 60

75 Pages Posted: 7 Oct 2011

Date Written: September 28, 2011

Abstract

The basic purpose of the law of contracts is to ensure that promises made for consideration are enforced. Achieving this basic purpose offends the conscience of society in some cases. The courts have a longstanding jurisdiction to refuse to enforce contracts that are determined to be unfair.

This report recommends reforms to the leading concepts used by contract law to tackle the problem of unfairness. These concepts are unconscionability, duress, undue influence, good faith, and misrepresentation. Over the past years, they have been considered in an increasing number of court decisions. This has led to an expansion of, and a degree of confusion about, their scope. It is now timely to rationalize and consolidate these concepts.

This report presents its recommendations in the form of draft legislation, called the Contract Fairness Act. The Contract Fairness Act clarifies vexing ambiguities in the application of unconscionability, duress, and undue influence, creates a framework to integrate those concepts, includes a definition of “good faith,” provides for a duty of good faith in the performance of contracts, and addresses concerns about remedies for misrepresentation.

Keywords: contract, unconscionability, duress, undue influence, good faith, misrepresentation, exclusion clause, unfair contract, Contract Fairness Act, remedies, consumer protection, consumer financial & debt, inequality of bargaining power, general principles of contract law

Suggested Citation

Law Institute, British Columbia, Report on Proposals for Unfair Contracts Relief (September 28, 2011). British Columbia Law Institute Report No. 60, Available at SSRN: https://ssrn.com/abstract=1940531 or http://dx.doi.org/10.2139/ssrn.1940531

British Columbia Law Institute (Contact Author)

British Columbia Law Institute (BCLI) ( email )

1822 East Mall
Vancouver, British Columbia V6T 1Y1
Canada

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