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Contract: Rules and Theory of Contract Law

Freedom of contract and consumer protection

  • 3 things to know
  • Components 2 and 3

Overview

Tension between freedom of contract and consumer protection, contract of adhesion and argument that consumer protection strengthens rather than weakens markets.

What you need to know

Answer each one before you reveal it.

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Numbers

Which body enforces consumer protection law in the public interest?

Key term

Why does consumer protection legislation limit freedom of contract?

Numbers

Which Act is the main source of consumer contract rights today?

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    Why does consumer protection legislation limit freedom of contract?

    Model answer

    A consumer rarely has the power to negotiate the terms of a standard agreement. Legislation therefore fixes minimum rights that a trader cannot bargain away.

  2. 2

    Which Act is the main source of consumer contract rights today?

    Model answer

    The Consumer Rights Act 2015 is the main source of consumer contract rights. The Consumer Rights Act 2015 came into force on 1 October 2015.

  3. 3

    How is a consumer defined for the purposes of consumer protection legislation?

    Model answer

    A consumer is an individual acting wholly or mainly outside a trade, business, craft or profession. A trader acts for purposes relating to that trade or business.

  4. 4

    Why can a trader not exclude the statutory rights of a consumer?

    Model answer

    Excluding the statutory rights would let a trader restore the very imbalance the legislation removes. The Consumer Rights Act 2015 makes such an exclusion of no effect.

  5. 5

    Explain the tension between freedom of contract and consumer protection.

    Model answer

    Freedom of contract assumes two informed parties bargaining as equals. Consumer protection assumes an information gap and a difference in bargaining power.

  6. 6

    Give one argument that consumer protection has gone too far.

    Model answer

    Compliance costs are passed on to shoppers in higher prices, on this argument. Consumers are also treated as unable to look after their own interests.

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Parliamentary and European Law Making
Delegated Legislation
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A Public Bill changes the general law.
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