The future of contract law: Three conversations at the Cape
| Citation | 2021 Acta Juridica 3 |
| Published date | 23 August 2021 |
| Author | Brownsword, R. |
| Date | 23 August 2021 |
| Pages | 3-36 |
| DOI | https://doi.org/10.47348/ACTA/2021/a1 |
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https://doi.org/10.47348/ACTA/2021/a1
The future of contract law:
Three conversations at the Cape
ROGE R BROW NSWORD*
This contr ibution considers the future of the Engli sh law of contract
in the form of th ree conversations that are aler t to the disr uptive
impact of tech nologies on both the content of legal r ules and the way
that lawyers think – and indeed on the kind of conversations t hat
lawyers have with one another. The r st conversation is concer ned
with ‘coherence’ in contract law, with the application of general
principles to novel fact situations and to new phenomena, w ith the
smoothin g of tensions within the l aw, and with the inter nal integrit y
of legal doct rine. The second conversation focuses on a tension
between, on the one hand, what may be ca lled a traditional pr ivate
law ‘coherentist’ concern for doctrin al integr ity and the pr imacy of
principle over policy and, on the other hand, a more ‘regulatory’
approach to contrac ts, especia lly to consu mer contracts, in which
policy and instrumental rationality prevail. The third conversation
focuses on the use of emerging transact ional technolog ies (such as
blockchain- supported smart contr acts and AI) that h ave the potentia l
to displace t he rules and pr inciples of contr act law. Instead of lega l
code governi ng transact ions, might we nd th at technological cod ing
does all t he work, maki ng, performing and enforcing ‘contract s’?
Each conversation suggests a dierent future for contract law.
The rst convers ation suggests that contract law will have dicult y
in livi ng up to the private law ideal of coherence; t he second suggests
that coherentism will st ruggle to survive as it is challeng ed by an
increasi ngly regu latory approach to the governance of transactions;
and the thi rd suggests that, in a world of sma rt transactional
technologies, there is a serious question mark about t he relevance of
contract law a s a body of rules that governs transactions.
I IN TRO DUCTION
It is now more than twenty years since I rst visited UCT and met
my incomparable host, Professor Dale Hutchison. The intellectual
* L LB (Univer sity of London ( LSE)); Professor of L aw at King’s Colle ge
London and at Bou rnemouth Unive rsity, Honorar y Professor at S heeld
Universit y, a nd Visiting Professo r at the City Univer sity Hong Kong.
2021 Acta Juridica 3
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4 THE FU TURE OF THE LAW OF CONTR ACT
https://doi.org/10.47348/ACTA/2021/a1
focus for the visit was to exchange notes on the principle of good
faith in contracts. At that time, there were signs that at least some
Englis h judges – followi ng the example of both the civil ian and, to
an extent, the other common-law jurisd ictions – might be willing
to adopt this principle; and, in South Africa, there was also some
movement as support for the principle seemed to be transfer ring
from the civilian to the common-law side.1
While the landscape of contract law was undergoing some
change, our conversations about good faith took place against
the stunning backcloth of the Cape – for example, on memorable
excursions to the winelands, around the Cape Peninsula, and
to Hermanus. There was much to discuss and, in due course,
we independently published our reections on good faith in a
comparative law collection.2
During the several visits that I subsequently made to UCT,
Dale and I talked about other topical issues in contract law,
especial ly concerning the reform of the principle of privity of
contract (our discussions this time resulting in a co-authored essay
on the new English statutory provisions for a change of mind by
the contractor s).3 However, we also talked about some of the issues
that had recently taken my interest in the application of the law
to a raft of emerg ing technologies. Although these conversations
tended to be dominated by questions relating to developments in
genetics and biotechnolog y, they also took place in the shadow of
emerging information and communication technologies (at which
point, e-commerce was more of a possibilit y than an actualit y).
1 S ee the reaction t o Bank of Lisbon an d South Africa L td v De Ornela s 1988
(3) SA 580 (A) 607 in Sa sn (Pty) Ltd v Be ukes 1989 (1) SA 1 (A) 7H–9G; and,
for a valuable upd ate and overv iew, see A Hutchison ‘Goo d faith in cont ract:
A uniquely Sou th Afric an perspect ive’ (2019) 1 Journal of Commonwealth Law
(available at h ttps://www.journalofc ommonwealth law.org/article/7441-good -
faith-in-contract-a-uniquely-south-african-perspective).
2 R B rownsword ‘Positive, nega tive, neutral: The rece ption of good faith in
Engli sh contract law’ in R Brown sword, N Hird & G Howel ls (eds) Good Faith
in Contract: Con cept and Context (1999) 13; and D Hut chison ‘Good f aith in the
South Af rican law of cont ract’ in R Brow nsword, N Hi rd & G Howells (eds)
Good Faith in Cont ract: Concept and C ontext (1999) 213.
3 R B rownsword & D Hutch ison ‘Priv ity of contra ct: Beyond promi ssory
principle a nd protective pr agmat ism’ in P Kinca id (ed) Privity: Pr ivate Justice or
Public Regul ation (2001) 126.
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THE FU TURE OF CONTR ACT LAW 5
https://doi.org/10.47348/ACTA/2021/a1
If we were to revisit our conversat ions, I suspect that they
would now be shaped much more strongly by an awareness of
the disruptive impact of technologies on both the content of legal
rules and the way that we think as lawyers – indeed on the kind of
conversations that we l awyers have with one a nother. Accordingly,
in this contribution, I wil l sketch three follow-up conversations
that we might now have, each speaking to the direction of travel,
and the future, of English contract law.
The rst conversation is concerned with ‘coherence’ in
contract law, with the application of general principles to novel
fact situations and to new phenomena, with the smoothing of
tensions within the law, and with the inter nal integrity of legal
doctrine. In retrospect, the agenda for our conversations about
good faith in contracts was t ypically ‘coherentist’ in nature.
Today, although the continuing resistance to a general pr inciple
of good faith reects a concern to preserve the coherence of the
commercial law of contract, this is now part of a more general
debate about the coherence of a ‘contextual ’ approach to disputes
between commercial contractors.
The second conversation focuses on a tension between, on the
one hand, what I am calling a traditiona l private law ‘coherentist’
concern for doctrinal integrity and the pr imacy of principle over
policy and, on the other hand, a more ‘regulatory’ approach
to contracts, especially to consumer contracts, in which policy
and instr umental rationality prevail. While the statutor y reform
of the principle of priv ity of contracts was an opportunity for a
more regulatory approach to contracts that were connected or
‘networked’, the Law Commission and the legislature eschewed
such an approach in favour of a coherentist correction to the law.
More generally, though, we might now wonder what the futu re of
contract law might be if we were to engage w ith it in a regulatory
way. Which policies mig ht the law of contract be thought to serve?
The third conversation focuses on the use of emerging
transactional technologies (such as blockchain-supported smart
contracts and AI) that have the potential to displace the rules
and principles of contract law. Instead of legal code governing
transactions, might we nd that technologica l coding does a ll the
work, making, performing and en forcing ‘contracts’?
Each conversation suggests a dierent future for contract
law. The rst conversation suggests that contract law will have
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