Balancing negotiations : a study of the effects of European consumer law on the principle of 'Pacta Sunt Servanda' in contract law with particular reference to the unfair terms directive

Abstract

This dissertation analyses the impact of Directive 93/13 on unfair terms on general principles of contract law, particularly the principles of freedom to contract and pacta sunt servanda. It argues that whilst the Directive has had a modest success in providing consumers with protection from the use of unfair terms, and that a measure of convergence of contract law across the domestic legal orders is materializing, due to its lack of clarity and generality of certain notions within it, it has left national courts and legislators alike in a state of confusion, resulting in misapplication of the Directive and potentially in a destabilisation of basic principles of contract law. Chapter One focuses on Directive 93/13, outlining its historic and political development, discussing its aims and scope of application. A detailed analysis of the test of fairness established therein ensues, followed by a brief consideration of the proposed changes to the European consumer acquis. Chapter Two discusses the implementing measures transposing the Directive in the United Kingdom, Italy and Malta. It assesses how these measures compare to the Directive and each other, considering the various problems and uncertainties arising from their divergences. Finally an assessment of the impact of the proposed reform to said measures is made. Chapter Three discusses the impact of the Directive on general principles of contract law and how this impact has affected national courts. To this extent a brief discussion of the general principle of contract law in the different jurisdictions is made, followed by an outline of the CJEU judgments on the interpretation of the Directive. Finally adjudication methods employed by national courts are considered and analysed in order to assess the practical impact of the Directive The Conclusion deals with the effects of the interaction between the Directive and general contract law principles arguing that the limitations and possible repercussions of the Directive emanate from the multiple aims sought by said Directive and the ensuing uncertainty. It argues that the Union must decide what its main aims are for harmonizing the use of unfair terms and to take the requisite steps according to those aims.