ABSTRACT
This paper examines the role of contract law in tackling inequality unveiled by the COVID-19 pandemic, with a focus on China, where courts seem to have made the most drastic moves. Whether contract law has any role to play in addressing economic inequality is the focal point of a long-lasting debate among contract law scholars. The orthodox view of contract law contends that contract law is expected to guarantee freedom of contract, individual autonomy and efficiency rather than bearing extra burdens of pursuing distributive justice; for the latter, tax law and fiscal policies are more effective and legitimate tools. In comparison, recent literature has pointed out the trend of contract law heterodoxy in developing countries. This heterodox approach to contract law moves beyond the conventional doctrines relating to the validity and enforceability of contracts of contracts, such as frustration, duress and misrepresentation, to correct injustice on additional grounds. Courts in countries such as Brazil, Colombia, and South Africa have been willing alter or void unfair contract terms in order to protect weaker parties on grounds of distributive justice. Against this backdrop, I find that neither orthodox nor heterodox approaches can explain Chinese courts’ drastic approach to dealing with inequality. Chinese courts have gone further to espouse what I term ‘ultra-heterodoxy’ to denote the greater latitude they enjoy in deciding cases that impact inequality.
Chen, Weitseng, Contracts, Inequality and the State: Contract Law Ultra-heterodoxy in China (May 28, 2024) in Kevin Davis and Mariana Pargendler (eds), Legal Heterodoxy in the Global South (CUP, forthcoming).
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