The 

history of contract law 

  

 1 Ancient Period
 2 Middle ages Period
o England in the Middle Ages
o European trade
 3 Industrial revolution
o Continental Europe
o United Kingdom
 4 Twentieth century
 5 Globalisation

Ancient law

"If a man fails to fulfill an agreed contract - unless he had contracted to

do something forbidden by law or decree, or gave his consent under some
iniquitous pressure, or was involuntarily prevented from fulfilling his contract
because ofsome unlooked-for accident - an action for such an unfulfilled
agreement should be brought in the tribal courts, if the parties have not previously
been able to reconcile their differences before arbitrators (their neighbors, that is)."
Plato, The Laws, Book 11, §23, Contracts.
English contract law's history was heavily influenced by Ancient Greek and
Roman thought. In The Laws, Plato devoted little attention to forms of agreement,
but recognized the same basic categories for cancelling agreements as exist
today. Roman law identified discrete categories of contractual transaction, each
with its own requirements, which needed to be fulfilled in order for promises to be
enforced. The general kind, stipulatio, required various words to be used to
generate an obligation, or in a contractus litteris it could be written down. There
were four categories of consensual agreement,[1] and four kinds of contract creating
property rights, such as a pledge (pignus) or a secured loan (mutuum). More than
appeared from the general rules in Ancient Greece, Roman law represented an
early division between specific kinds of contract, depending on the transaction's
nature.
Middle Ages Period
England in the Middle Ages

Main article: History of English contract law

During the middle ages, the English court system was minimal and so a number of
methods for restricting access to judicial hearings. In the local and manorial courts,
according to the first treatise by Ranulf de Glanville, Treatise on the laws and
customs of the English Kingdom in 1188, if people disputed the payment of a debt
they, and witnesses, would attend court and swear oaths (called a wager of
law). They risked perjury if they lost the case, and so this was strong
encouragement to resolve disputes elsewhere. The royal courts accepted claims,
without a wager of law, if "trespass on the case" was alleged. A jury would be
called, but to access the royal courts, which were fixed by the Magna Carta 1215 to
meet in London, some breach of the King's peace had to be alleged. But gradually,
the courts allowed claims where there had been no such trouble, no tort vi et armis,
even though it was still necessary to inventively plead this. For instance, in 1317
one Simon de Rattlesdene alleged he was sold a tun of wine that was contaminated
with salt water, "with force and arms, namely with swords and bows and
arrows".The Court of Chancery and the King's Bench started to allow claims
without the fictitious allegation of force and arms from around 1350. Otherwise, a
breach of covenant required production of proof of an agreement from a seal.
However, in The Humber Ferryman’s case[ a claim was allowed, without any
documentary evidence, against a ferryman who dropped a horse overboard that he
was contracted to carry across the River Humber. Despite this liberalisation, in the
1200s a threshold of 40 shillings for dispute value had been created. Though its
importance tapered away with gradual inflation, it foreclosed court access to most
people. Moreover, freedom to contract was firmly suppressed among the peasantry.
After the Black Death, the Statute of Labourers 1351prevented any increase in
workers' wages, fuelling among other things the Peasants' Revolt of 1381.
With the courts' hostility to restraints on trade, the doctrine of consideration was
forming, that to enforce any obligation something of value needed to be
conveyed. Some courts remained sceptical that damages might be awarded purely
for a broken agreement (that was not a sealed covenant).[8] Other disputes allowed
a remedy, notably in Shepton v Dogge[ where a defendant had agreed in London,
where the City courts' custom was to allow claims without covenants under seal, to
sell 28 acres of land in Hoxton. Although the house itself was outside London at
the time, in Middlesex, a remedy was awarded for deceit, but essentially based on a
failure to convey the land. The resolution of these restrictions came shortly after
1585, when a new Court of Exchequer Chamber was established to hear common
law appeals. In 1602, in Slade v Morley, a grain merchant named Slade claimed
that Morley had agreed to buy wheat and rye for £16, but had backed out. Actions
for debt were in the jurisdiction of the Court of Common Pleas, but it had required
that there needed to be both (1) proof of a debt, and (2) a subsequent promise to
repay the debt, so that a finding of deceit (for non-payment) could be made against
a defendant. But if a claimant wanted to simply demand payment of the contractual
debt (rather than a subsequent promise to pay) he could have to risk a wager of
law. The judges of the Court of the King's Bench was prepared to allow
"assumpsit" actions (for obligations being assumed) simply from proof of the
original agreement. With a majority in the Exchquer Chamber, after six years Lord
Popham CJ held that "every contract importeth in itself an Assumpsit".[13]Around
the same time the Common Pleas indicated a different limit for contract
enforcement in Bret v JS,[  that "natural affection of itself is not a
sufficient consideration to ground an assumpsit" and there had to be some
"express quid pro quo". Now that wager of law, and sealed covenants were
essentially unnecessary, the Statute of Frauds 1677 codified the contract types that
were thought should require some form.
European trade

Merchants trading within the Hanseatic Leagueconducted their affairs according to

the lex mercatoria, whose principles were received into the English law of
contract.
Increasingly, English contract law was affected by its trading relations with
northern Europe, particularly since the Magna Carta 1215 guaranteed merchants
"safe and secure" exit and entry to England "for buying and selling by the ancient
rights and customs, quit from all evil tolls". In 1266 King Henry III had granted the
Hanseatic League a charter to trade in England. The "Easterlings" who came to
trade brought goods and money that the English came to call "Sterling",[17] and
standard rules for commerce that formed a Lex Mercatoria, the laws of the
merchants. Merchant custom was most influential in the coastal trading ports
likeLondon, Boston, Hull and King's Lynn.
In the 1500s, litigation sharply increased, although the causes are unclear and it
may have been due to a centralization of lawsuits in the King's Bench and
Common Pleas. The Chief Justices received a large portion of their income from
fees paid by litigants, mostly in civil disputes.
Over the late 17th and 18th centuries Sir John Holt, and then Lord
Mansfield actively incorporated the principles of international trade law and
custom into English common law as they saw it: principles of commercial
certainty, good faith, fair dealing, and the enforceability of seriously intended
promises. As Lord Mansfield held, "Mercantile law is not the law of a particular
country but the law of all nations", but also that "the law of merchants and the law
of the land is the same".

Industrial revolution
Continental Europe

 Code Napoleon 1810
 German Civil Code 1900
United Kingdom
Over the industrial revolution, English courts became more and more wedded to
the concept of "freedom of contract". It was partly a sign of progress, as the
vestiges of feudal and mercantile restrictions on workers and businesses were
lifted, a move of people from "status to contract". On the other hand, a preference
for laissez faire thought concealed the inequality of bargaining power in contracts
of employment, consumer, and tenancy. At the centre, captured in nursery rhymes
like Robert Browning's Pied Piper of Hamelin in 1842 was the fabled notion that if
people had promised something "let us keep our promise". But then, as if
everybody had the same degree of free will, a generalised law of contract
purported to cover every form of agreement was expounded. Courts were
suspicious of interfering in agreements, whoever the parties were, so that
in Printing and Numerical Registering Co v Sampson Sir George Jessel
MR proclaimed that "contracts when entered into freely and voluntarily shall be
held sacred and shall be enforced by Courts of justice." The Judicature Act
1875 merged the Courts of Chancery and common law, with equitable principles
(such as estoppel, undue influence, rescission for misrepresentation and fiduciary
duties or disclosure requirements in some transactions) always taking precedence.
But the essential principles of English contract law remained stable and familiar, as
an offer for certain terms, mirrored by an acceptance, supported by consideration,
and free from duress, undue influence or misrepresentation, would generally be
enforceable. The rules were exported across the British Empire, as for example in
the Indian Contract Act 1872.
Further requirements of fairness in exchanges between unequal parties, or general
obligations of good faith and disclosure were unwarranted because was said that
liabilities "are not to be forced upon people behind their backs".Parliament's
statutes, outside general codifications of commercial law like the Sale of Goods
Act 1893, left people to the harsh "freedom of contract" of the market until the
property qualifications for Parliament were reduced, and the electoral vote finally
became democratic.

Twentieth century

Unidroit, based in Rome and established in 1926 under the League of Nations to

unify private law, maintains the influential Principles of International Commercial
Contracts of2004. A similar effort is thePrinciples of European Contract
Law of2002.
Over the 20th century, legislation and changes' in court attitudes effected a wide-
ranging reform of 19th century contract law. First, specific types of non-
commercial contract were given special protection where "freedom of contract"
appeared far more on the side of large businesses. Consumer contracts came to be
regarded as "contracts of adhesion" where there was no real negotiation and most
people were given "take it or leave it" terms. The courts began by requiring
entirely clear information before onerous clauses could be
enforced, the Misrepresentation Act 1967 switched the burden of proof onto
business to show misleading statements were not negligent, and the Unfair
Contract Terms Act 1977 created the jurisdiction to scrap contract terms that were
"unreasonable" considering the bargaining power of the parties. Collective
bargaining and growing number of employment rights carried the employment
contract into an autonomous field of labour law where workers had rights, like a
minimum wage, fairness in dismissal, the right to join a union and take collective
action, and these could not be given up in a contract with an employer. Private
housing was subject to basic terms, such as the right to repairs, and restrictions on
unfair rent increases, though many protection was abolished during the 1980s. This
reduced the scope of the general law of contract, and meant that most contracts
individual people made in their ordinary lives were shielded from the power of
corporations to impose whatever terms they chose in selling goods and services, at
work, and in people's home. Nevertheless, classical contract law remained at the
foundation of specific contracts, unless particular rights were given by the courts or
Parliament.
Globalisation

Internationally, the UK had joined the European Union, which aimed to harmonise

significant parts of consumer and employment law across member states.
Moreover, with increasing openness of markets commercial contracts were
receiving ideas from abroad. Both the Principles of European Contract Law,
the UNIDROIT Principles of International Commercial Contracts, and the practice
of international commercial arbitration was reshaping thinking about English
contract principles with the rest of the globalising economy.