You may have heard that under English laws, individuals and companies have “freedom to contract“. But what on earth does that mean?
Freedom to contract has two aspects:
- you can choose whether you want to enter into a contract, and with which persons (party freedom, or freedom to contract);
- you can choose the terms of that contract ie the obligations you and the other individual/company are going to promise to carry out (term freedom, or freedom of contract terms).
What This Means in Practice
First, you can enter into bad, unwise and unfair bargains and no-one can stop you (provided it is legal).
Second, no court can change the contract to make it better. The courts have always been clear that it is not their job to make a bad contract better. It is their job to act as an ‘umpire’ to enforce the rules you have agreed to apply to the project you are involved in. It has no role in making your contract fair.*
Once you have made your contractual bed then you have to lie in it.
* A slight anomaly is the court’s role in deciding whether specific contract provisions can be relied on (and enforced) under the Unfair Contract Terms Act 1977 and the Unfair Terms in Consumer Contracts Regulations 1999.