Australia Consults on the Law of Contract

The Australian Attorney General has recently published a discussion document “to explore the scope for reforming Australian contract law”.

The document asks for comments on whether and how contract law impairs economic activity within Australia and separately for international economic activity. Australia’s contract law is basically the English Sale of Goods Act and common law, of course with legislative changes and the contributions of Australian courts. Australia is a member state of the Convention on the International Sale of Goods.

The consultation document starts off well, in my view, with this statement: “Our legal system is a form of infrastructure which is as indispensible to economic growth as transport or energy networks.” This is a message I have been promoting in Canada since the early days of the Uniform Law Conference’s Commercial Law Strategy.

The ULCC found, however, that there was no appetite in Canada to update the Sale of Goods Act, despite its 19th century origins. The Uniform Sale of Goods Act was adopted in about 1980 (largely influenced by a study by the Ontario Law Reform Commission), but no jurisdiction has enacted it. The reason seems to be that everyone is aware of the shortcomings of the Act and simply drafts around them. Perhaps if the Australians get some good advice, it can spill over to Canada. The Ontario Law Reform Commission did make proposals on the law of contracts in 1987, and a few of them have been adopted, but not systematically.

Here are the actual questions being asked (from the document p iii – details in the main text):

1. What are the main problems experienced by users of Australian contract law?
Which drivers of reform are the most important for contract law?
Are there any other drivers of reform that should be considered?

2. What costs, difficulties, inefficiencies or lost opportunities do businesses experience as a result of the domestic operation of Australian contract law?

3. How can Australian contract law better meet the emerging needs of the digital economy? In what circumstances should online terms and conditions be given effect?

4. To what extent do businesses experience costs, difficulties, inefficiencies or lost opportunities as a result of differences between Australian and foreign contract law?

5. What are the costs and benefits of internationalising Australian contract law?

6. Which reform options (restatement, simplification or substantial reform of contract law) would be preferable? What benefits and costs would result from each?

7. How should any reform of contract law be implemented?

8. What next steps should be conducted? Who should be involved?

The Australian government is looking for responses by 20 July 2012.

What would you say to similar questions posed for common law Canada (or for Quebec, for that matter)?

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