Analyzing chris willett’s the functions of transparency in regulating contract terms :  uk and australian approaches
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Analyzing chris willett’s the functions of transparency in regulating contract terms : uk and australian approaches

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Unfair Terms Contract

Unfair Terms Contract

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Analyzing chris willett’s the functions of transparency in regulating contract terms :  uk and australian approaches Analyzing chris willett’s the functions of transparency in regulating contract terms : uk and australian approaches Document Transcript

  • Analyzing Chris Willett’s “The Functions of Transparency in Regulating Contract Terms - UK and Australian Approaches” Question 1: What is the purpose of comparative legal research? Why does the author undertake such research in this article? Answer 1: The importance of comparative law in the ever increasing globally linked world cannot be ignored or denied. The essence of comparative law is to compare the law of one country to that of another to understand the differences and try to draw a conclusion there from1 . Generally, the author tries to juxtapose the law of one country to that of another or the researcher may even compare the law of several jurisdictions, such as common law and civil law countries. The essence of comparison of law from several different countries is to find out the similarities and differences2 . The author of such work generally tries to assess such data with a particular purpose of establishing the differences or similarity in development of law in different jurisdictions. Comparative legal research is also undertaken to search for universal principles of law that transcend culture and provide a meeting point of law3 . Sometimes, comparative legal research also serves the purpose of solving important public policy questions regarding consumer law, anti-trust law or intellectual property law. It also helps in shaping new law and providing legislators and the judiciary with an overview of the development of law in foreign countries4 . Overall, comparative legal research tries to find answers to the differences and similarities between the legal developments in different countries. The author undertakes comparative legal research in this article because he tries to understand the uncertainty in both the UK and Australian approaches to unfair contract terms 1 Edward Eberle, ‘The Method and Role of Comparative Law’ (2009) 8 (3) Washington University Global Studies Law Review 452. 2 Ibid 452. 3 Ibid 453. 4 Ibid 456.
  • and the scope of transparency to legitimize such unfair terms in UK and Australia5 . The author compares the development of consumer law in UK and Australia as well as in the European Union (EU) and Germany to establish that there is still uncertainty about whether transparency can legitimize unfair terms of consumer contracts. The author questions the legal tension between the ethics of informed freedom of choice that needs to be provided to the consumers and the “irreducible substantive rights” of consumers when it comes to trader- consumer relationship6 . Thus, the author tries to imply that the legislators of the two jurisdictions, UK and Australia should make it clear whether transparency is capable of legitimizing unfair terms. Further, the author argues that voluntarily used terms must be transparent to allow post contractual justice so that consumers can easily assert and bargain their rights after entering into the contract. Lastly, the authors undertake this research to assert the importance of transparency in consumer legal rights and compares UK and Australia law to conclude that the UK “misleading omissions” concept provides better transparency compared to the “misleading practice” concept used in Australia7 . Question 2: Explain the ‘presumption of similarity’ and the ‘presumption of difference’. Where do you think the author might stand in this methodological debate? Answer 2: Comparative law serves a functionality which aims at discovering the unity of thought and similarities between different jurisdictions8 . Methodology of legal research varies from one scholar to another and there are certain differences in their assumptions and presumptions. The presumption of difference was enumerated by Pierre Legrand and according to him legal research must always set out with the presumption that there is no similarity between the 5 Chris Willett, ‘The Functions of Transparency in Regulating Contract Terms: UK and Australian Approaches’ (2011) 60 (2) International and Comparative Law Quarterly 384. 6 Chris Willett, ‘The Functions of Transparency in Regulating Contract Terms: UK and Australian Approaches’ (2011) 60 (2) International and Comparative Law Quarterly 384. 7 Ibid 385. 8 Antonios Platsas, ‘The Functional and Dysfunctional in the Comparative Method of Law: Some Critical Remarks’ (2008) 12 (3) Electronic Journal of Comparative Law 11.
  • legal outcomes of different jurisdictions9 . Presumption of difference goes to the root of legal knowledge of any particular country and states that there can be no similarity in such knowledge due to the different culture, historical background and development of law in such two different countries. According to Legrand, comparative legal research should set out with a presumption of difference instead of a presumption of similarity. He argues that comparison of two different elements and legal systems must logically imply difference and deny sameness10 . Presumption of difference always sets out legal research with the thought that two opposing legal systems can have no similarities. Difference is at the root of the legal system because development of law has occurred under different circumstances in the two countries. However, Legrand’s treatise is in stark comparison to the seminal work of K Zweigert and H Kotz “An Introduction to Comparative Law”11 , in which they have proposed the thesis idea praesumptio similitudinis, which implies that there is a presumption of similarity of practical legal results amongst different legal systems12 . According to the “presumption of similarity”, although jurisdictions, legal methods, approaches may vary in domestic laws of different countries, but inherently the practical results are broadly similar13 . Modern legal scholars and researchers believe in the idea of “presumption of similarity” because in the age of globalization and convergence, legal systems of different countries bear more resemblance to each other than to their own history14 . Present day legal researchers have negated the theory of Legrand and adopted the idea of Zweigert and Kotz because they believe that the end result of legal research is to look for similarities in the legal purposes of two different jurisdictions15 . The presumption of similarity sets out that although there might be cultural, political, religious and economic or even legal differences in two different countries but the purpose of law cannot be held to be much different in two different jurisdictions. The methodology of the author of the present article is that of presumption of similarity. The author sets out to find whether transparency has a legitimizing effect on unfair terms of a consumer contract. To this effect the author tries to understand the development of consumer law in UK and Australian jurisdictions and alterations in unfair terms. However, in the 9 Geoffrey Samuel, Law of Obligations and Legal Remedies (2nd edn Cavendish Publishing 2001) 538. 10 Ibid 538. 11 K Zweigert and H Kötz, An Introduction to Comparative Law (3rd edn Oxford University Press, Oxford 1998) 12 Ibid 40. 13 Ibid 40. 14 Antonios Platsas, ‘The Functional and Dysfunctional in the Comparative Method of Law: Some Critical Remarks’ (2008) 12 (3) Electronic Journal of Comparative Law 12. 15 Ibid 12.
  • introduction of the article itself, the author sets the tone that he presumes that the law in UK and Australia is confusing when it comes to whether transparency is capable of legitimizing unfair terms. Thus, the author looks to start his comparative legal research on a set hypothesis and presumption of similarity and later concludes that his hypothesis is true on analysis of the legal developments in UK and Australia. Question 3: Evaluate the author’s choice of jurisdictions to be compared. Answer 3: In the present research article, the author compares the unfair terms in consumer contracts and the role of transparency in legitimizing such unfair terms. The main purpose of this research work is not just to elaborate that transparency has failed to legitimize unfair terms but also to establish that the role of transparency in legitimizing unfair terms has been much clouded by judicial interpretation, legislations and legal developments in UK and Australia. The author compares the development of law in two common law jurisdictions in the context of EU level regulation with references to civil law approaches. However, the development of consumer law and interpretation of unfair terms has been very confusing in UK and Australia. Through this comparative legal research, the author tries to set out the need for certain changes in public policy and consumer law so that the legislators of the corresponding countries would alter the law accordingly. Further, the author also compares the development of law in the European Union and its impact on the development of law in UK. Lastly, the author also compares consumer law and law relating to unfair terms in the civil law country Germany, to remark that at least the German law explicitly states that transparency is not necessarily a legitimizing factor since unreasonable disadvantage may be caused to the consumer in substance, irrespective of transparency16 . This form of clarity is required in the UK and Australian law. The author’s choice of countries for comparative legal research is limited to common law countries and very few civil approaches. This is one major drawback for this research work because it sets out with a basic premise about how transparency is important but fails to expand the comparison of consumer law and unfair terminology in 16 Chris Willett, ‘The Functions of Transparency in Regulating Contract Terms: UK and Australian Approaches’ (2011) 60 (2) International and Comparative Law Quarterly 365.
  • different jurisdictions. However, the author still manages to elaborate the importance of transparency of unfair terms in consumer law. The author has rightly selected UK and Australia as the point of discussion because both these countries have developed their law through judicial precedents and legislations. However, legislations and judicial interpretation of the two countries has resulted in conflicts and confusion which requires further legislation to set out clearly whether transparency has any role in legitimizing unfair terms of consumer contracts. The author’s choice of jurisdictions to compare development of consumer law is legitimate and reasonable because the UK law has been much influenced by EU law such as the UTCCD (Unfair Terms in Consumer Contracts Directive) while the Australian federal law was passed in 2010 following several suggestions and amendments to New South Wales Contracts Review Act, the Victorian Fair Trading Act and passing of various important judgments17 . The role of comparative law is to understand the development of law over time in different circumstances at different jurisdictions and the author has been able to portray the same. Further, through the comparison of legal developments in UK and Australia the author has been able to reach an important conclusion that transparency plays several other roles in helping consumers to understand terms, in furthering market discipline and in providing consumers post contractual access to justice18 . Dealing with public policy and enumerating the importance of transparency in unfair terms, the author has been able to justify selecting UK and Australia to compare the state of law in these two jurisdictions. Question 4: To what extent does this article embody prescriptive legal scholarship, or is it merely descriptive? Justify your answer and evaluate the approach adopted. Answer 4: This article embodies prescriptive legal scholarship because it does not merely describe how the consumer law is and what is the difference in unfair terms interpretation in UK and Australian law, but it also prescribes how the law should be and why transparency of unfair terms is important for the development of consumer law. Understanding legal scholarship is 17 Chris Willett, ‘The Functions of Transparency in Regulating Contract Terms: UK and Australian Approaches’ (2011) 60 (2) International and Comparative Law Quarterly 356. 18 Ibid 357.
  • important for evaluating the importance of any legal research work. The present article sets out with the development of law in interpreting unfair terms in consumer contracts in UK. The author’s approach towards the legal research has been appropriate since he tries to describe how consumer contracts in UK used to be interpreted in the light of the unfairness test which supported the idea that transparency cannot legitimize substantive unfair terms. However, by introduction of the good faith doctrine, the role of transparency in legitimizing unfair terms in UK seemed to have been established, which again was shrouded in confusion when the good faith doctrine was tossed for the test of significant imbalance to the detriment of the consumer19 . Similarly, in Australia too, the law relating to transparency could legitimize substantively unfair terms before the Victorian Fair Trading Act, 1999 was passed. Once this legislation came into force, the role of transparency in legitimizing unfair terms became nil20 . However, ever since the introduction of federal law in Australia, a small degree of uncertainty in the role of transparency in legitimizing unfair terms in consumer contracts has once again surfaced in Australia21 . This article can be referred to as prescriptive legal research because the author does not simply engage in comparative law for the sake of theoretical pursuits but he also tries to bring forth the importance of transparency in consumer law and seeks legislative changes. The author seeks a policy change and argues that voluntarily used terms should be transparent since it furthers market discipline and consumer’s access to post contractual justice22 . The author suggests that the UK and Australian legislators should improve the unfair terms law by referring to the previous model of the contract law in the State of Victoria and the current approach towards transparency taken by the European Union’s Draft Common Frame of Reference (DCFR)23 . This legal article has the audience of legal scholars, jurists, advocates as well as legislators so this article represents prescriptive legal scholarship. Further, the author’s approach towards the subject has been to compare the development of consumer law and unfair terms in two separate jurisdictions as well as civil law jurisdictions. Thus, the entire research work and the approach of the author can be said to be justified and reasonable because the author has been able to point out that transparency of unfair terms is important while at the same time suggesting that any form of confusion in interpreting unfair terms should be legislatively rectified in UK and Australia. 19 Chris Willett, ‘The Functions of Transparency in Regulating Contract Terms: UK and Australian Approaches’ (2011) 60 (2) International and Comparative Law Quarterly 366. 20 Ibid 357. 21 Ibid 357. 22 Ibid 357. 23 Ibid 357.
  • Bibliography Eberle, E, ‘The Method and Role of Comparative Law’ (2009) 8 (3) Washington University Global Studies Law Review 452 Platsas, A, ‘The Functional and Dysfunctional in the Comparative Method of Law: Some Critical Remarks’ (2008) 12 (3) Electronic Journal of Comparative Law 11 Samuel, G, Law of Obligations and Legal Remedies (Cavendish Publishing 2001) Willett, C, ‘The Functions of Transparency in Regulating Contract Terms: UK and Australian Approaches’ (2011) 60 (2) International and Comparative Law Quarterly 355 Zweigert, K and Kötz, H, An Introduction to Comparative Law (Oxford University Press 1998)