Contract law in the United States has evolved and has been influenced by a number of sources, including common law principles, statutory law, and the Uniform Commercial Code (UCC).
There have been significant changes to contract law in the United States along with the rest of the world, to cater towards the increasing use of technology in the formation and execution of contracts, the increasing recognition of alternative dispute resolution methods, and consumer protection.
Let’s delve into some of these changes that have happened over the years:
- One significant change has been the increasing use of technology in the formation and execution of contracts. For example, the Uniform Electronic Transactions Act (UETA) and the Electronic Signatures in Global and National Commerce Act (ESIGN) have established rules for the use of electronic signatures and other electronic means of creating and transmitting contracts. These laws have made it easier for parties to enter into contracts remotely, without the need for in-person meetings or the exchange of physical documents.
- The increasing recognition of alternative dispute resolution methods, such as mediation and arbitration, as an alternative to traditional litigation in court. Many contracts now include provisions expressly specifying that disputes will solely be resolved through one of these methods, rather than through the court system.
- United States has been the increasingly recognising and enforcing the “clickwrap” and “browsewrap” agreements. These types of contracts are formed when a user clicks a button or takes some other action to indicate their acceptance of the terms of a contract, or when a user simply browses a website and is deemed to have accepted the terms by virtue of their use of the site. These types of contracts have become increasingly common in the digital age, and courts have generally upheld their validity as long as the terms of the contract are communicated to the user.
- The increasing use of standardised contracts, such as form contracts and boilerplate clauses is another significant change. These are contracts that are prepared in advance by one party and offered to the other party on a “take it or leave it” basis, with little or no opportunity for negotiation. While these types of contracts have long been a common feature of business transactions, they have come under scrutiny in recent years due to concerns about their fairness and the potential for one-sidedness.
- The adoption of the Uniform Commercial Code (UCC), which is a comprehensive set of rules that governs contracts for the sale of goods, by United States is another significant milestone. The UCC was first proposed in the 1940s and was eventually adopted in some form by all 50 states. The UCC has had a major impact on contract law in the United States and has been influential in other countries as well.
It is difficult to identify any specific change to contract law in the United States that has had universally detrimental effects, as the impact of any change will depend on the particular circumstances of each case. However, some changes to contract law may have had negative consequences for certain parties in certain situations. For example, the increasing use of standardized contracts and boilerplate clauses may have had negative consequences for consumers, as these contracts often favour the interests of the party that drafted the contract and may not take into account the specific needs or concerns of the other party. This can lead to one-sided or unfair terms that are unfavourable to the consumer.
Similarly, the increasing recognition and enforcement of “clickwrap” and “browsewrap” agreements may have had negative consequences for some parties, particularly if the terms of the contract are not clearly communicated or if the party agreeing to the contract does not have a full understanding of their rights and obligations under the contract.
Overall, it is important for parties to carefully review and understand the terms of any contract that they enter into, and to seek legal advice if they have any concerns about the fairness or enforceability of the contract. If you blindly put a provision in a contract, without even understanding its enforceability and adherence to the law, it may not be worth any more than the paper it’s written on.
– Written by Kanika Meena.
