The Old and the New Limits to Freedom of Contract in Europe

ERCL 2/2006 The Old and the New Limits to Freedom of Contract in Europe
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problem of violation of individual fundamental rights. 22 It is rather the clash
of incompatible legal spheres or rationales, more precisely, the case of corruption
of the solidarity-based family sphere by the logic of contract law and the
underlying dynamics of the market. 23 Any concern for fairness in contract
law is banned from this perspective: it is just not an interpretive issue here.
On the contrary, the analysis concentrates on legal and social aspects different
from those concerning the contractual relation between the bank and the
consumer as unequal bargaining partners. The focus here shifts to the ‘impossibility’
of a guarantor, who is at the same time supposed to be bound to the
debtor by ties of familial solidarity and to be led to the rational choice by the
typical individualism of a market actor. The evidence of such impossibility
requires more rigorous boundaries to freedom of contract in order to preserve
non-market-like social realms from the corruptive influence of the
market rationale. In Teubner’s view, such boundaries find their constitutional
foundation in those principles of the Grundgesetz that construe social institutions
like the family, art, 24 education, etc, upon values other than the rationality
and the individualism of the market. As to our discourse on freedom
of contract, this amounts to assigning to constitutional principles or constitutional
rights 25 – the role of defining impenetrable areas of market inalienability
by removing specific rights or entitlements from the individual’s ability to
dispose of them freely by contract. Therefore, although Teubner’s interpretation
of the bonus mores clause explicitly rejects paternalist motives, for the
simple reason that it does not focus on the individual/State relationship, it
ultimately fits in the general scheme of this first model.
2. The Social Model
According to classical liberal thought freedom of contract is a basic condition
for fulfilling the wellbeing of society and justice. 26 Therefore limits to freedom
of contract, as already seen in the paternalistic model, are theoretically
conceived as exceptions, although they are in fact valuable tools for enacting
state policies and goals.
At the beginning of the 19 th century another strand of socio-philosophical
and legal thought produced an alternative vision, according to which freedom
22 Ibid, 390.
23 Ibid, 392.
24 See also C. Beat Graber / G. Teubner, ‘Art and Money: Constitutional Rights in the
Private Sphere’ (1998) 18 Oxford Journal of Legal Studies 61.
25 Beat Graber / Teubner, n 24 above.
26 Grimm, n 1 above, 1232.