The Limits of Voluntariness in Contract
39 Pages Posted: 26 Sep 2005 Last revised: 3 Aug 2012
Contractual obligations are routinely characterised in the contract literature as voluntary or voluntarily assumed. This article examines the major challenges to the voluntaristic conception of contract. An obligation can be regarded as voluntary only if it is meaningfully understood, and the decision to assume it is intentional and substantially unconstrained. Many contractual obligations arise from standard form terms, which are commonly unread, frequently misunderstood, and routinely unavoidable due to the lack of available alternatives. In some circumstances, the obligations and curtailments of rights arising from unread standard form terms can be regarded as voluntary, but in others they cannot. In exceptional cases, the objective approaches to formation and interpretation result in parties becoming subject to obligations that they cannot be said to have voluntarily assumed. The objective approach to the incorporation of terms, particularly unsigned terms, leaves even greater scope for parties to become subject to obligations that cannot be said to have been voluntarily assumed. Obligations routinely arise from the default rules of contract law, which appear not to be well understood, even in the commercial context, and are often difficult to avoid. Recent claims that these obligations inhere in the agreement itself have not been made out. Contractual obligations and curtailments of rights are routinely fashioned by one contracting party in the ignorance of the other, or by the state in the ignorance of both, and are often practically unavoidable for one or both parties.
Keywords: contract, voluntary, obligation, standard form term, rights
JEL Classification: K1, K12, K00
Suggested Citation: Suggested Citation