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Freedom of contract is the principle according to which individuals and groups may form contracts without government restrictions. This is opposed to government regulations such as minimum-wage laws , competition laws , economic sanctions , restrictions on price fixing , or restrictions on contracting with undocumented workers .
The Court repudiated, but did not explicitly overrule, the "freedom of contract" line of cases in West Coast Hotel v. Parrish (1937). [96] In its decision the Court stated: The Constitution does not speak of freedom of contract. It speaks of liberty and prohibits the deprivation of liberty without due process of law.
Freedom of contract and association [ edit ] Opponents argue that right-to-work laws restrict freedom of association , and limit the sorts of agreements that individuals acting collectively can make with their employer by prohibiting workers and employers from agreeing to contracts that include fair share fees.
The courts have largely abandoned the Lochner era approach (c. 1897–1937), when substantive due process was used to strike down minimum wage and labor laws to protect freedom of contract. Since then, the Supreme Court has decided that the Constitution protects numerous other freedoms, even if they are not in the text.
American jurist Arthur Nussbaum noted that Spanish theologian Francisco de Vitoria was "the first to set forth the notions (though not the terms) of freedom of commerce and freedom of the seas". [38] Vitoria made the case under principles of jus gentium. [38]
The Rise and Fall of Freedom of Contract (1979) is a legal-historical text on the changes in the concept of freedom of contract by English Professor Patrick Atiyah. It was published by the Oxford University Press, and a paperback edition was released in 1985.
The law of contracts varies from state to state; there is nationwide federal contract law in certain areas, such as contracts entered into pursuant to Federal Reclamation Law. The law governing transactions involving the sale of goods has become highly standardized nationwide through widespread adoption of the Uniform Commercial Code .
Social Contract, Masochist Contract: Aesthetics of Freedom and Submission in Rousseau. Albany: State University of New York Press. ISBN 978-1-4384-4989-0; Gierke, Otto Friedrich Von and Ernst Troeltsch. Natural Law and the Theory of Society 1500 to 1800.