Justice in Contracts

Abstract

The mission of justice for contracts seems to be solely one of gatekeeping. As long as the justice of the bargaining stage is secured and the parties’ agreement complies with a proper floor of legitimacy, contract law, on this conventional approach, must simply follow the parties’ preferences. Doctrines that govern contractual performance and breach by appealing to justice considerations are thus portrayed as either confused or misguided. The justice rhetoric either covers for other, notably economic, considerations or undermines contract law’s liberal underpinnings.

Against this common wisdom, this Article develops a theory of contractual justice, which is implicit in this significant body of doctrines. Contractual justice is a species of relational justice, and is thus informed by the most fundamental normative underpinnings of private law in a liberal polity, namely, the maxim of reciprocal respect for self-determination and substantive equality. Focusing on the justice of on-going contractual relationships, modern contract law properly solidifies a cooperative conception of contract performance, which targets a contract-specific form of relational injustice associated with the heightened interpersonal vulnerability to which sequential contractual performance gives rise.

The task of this Article is threefold. It articulates and defends the normative commitment to contractual justice that is implicit in contract law’s rules of the game, epitomized by the duty of good faith and fair dealing. It further explains and justifies the legal form of these rules, being normative defaults, rather than either majoritarian defaults or mandatory rules. And finally, it demonstrates how the refinement of both their substance (relational justice) and their form (normative defaults) can help direct the future development of these complex and currently somewhat disoriented set of doctrines and, more broadly, reclaim the central place of justice in the law of contract of a liberal legal order.