Dorota Leczykiewicz, ‘Contract and Regulation: Private Regulation, Compliance and Reviewability of Contracts’

Abstract:
This chapter examines the relation between private regulation, effectuated through contract, and the desirability of compliance with such regulation, from the perspective of the fundamental precepts of contract law. Its purpose is to determine what intellectual advantages can be gained by looking at the question of contractual performance as that of regulatory compliance. It is argued that much can be gained by adopting a regulatory approach to contractual performance in the case of contracts which have broader regulatory effects. In particular, given resistance to public regulatory interference into contractual content, it may be valuable to reformulate questions of state regulation of contracts as questions of state control of private regulation. The regulatory approach also invites us to elucidate the strategic choices which states need to take vis-à-vis the enforcement of private regulatory regimes, such as those concerning the availability of legal enforcement to those regimes. Moreover, the regulatory approach creates a space within which desirability of private regulation through contract can be raised as an independent line of inquiry because the issue is not predetermined by the traditional contract law approach focusing on freedom of contract and its binding (ie legally enforceable) character. The chapter argues, however, that despite its limitations, it is contract law which offers a much more promising start to the question of grounds of judicial review of contracts producing regulatory effects. This claim is based on the fact that contract law already possesses a developed normative framework, consisting of such values as voluntariness, reciprocity and freedom from domination, as sources of review standards. An uncertain place of more socially oriented grounds of review, such as community welfare, distributive justice or positive freedom obviously leaves traditional contract law open to challenge as a source of private regulation’s review standards. The chapter argues that these deficiencies should be addressed within the contract law theory which, unlike the regulatory approach, guarantees that the freedom to choose one’s individual goals and the ability to bargain remain relevant considerations.

Leczykiewicz, Dorota, Contract and Regulation: Private Regulation, Compliance and Reviewability of Contracts (October 27, 2016) in R Brownsword, R van Gestel and H-W Micklitz (eds), Research Handbook on Contract and Regulation (Edward Elgar 2017 forthcoming); Oxford Legal Studies Research Paper No 57/2016.

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