Charles James Fox as the biblical serpent tempting John Bull away from monarchy in this James Gillray satire of the Jacobin movement

Freedom of contract is a natural law concept that individuals should be free to bargain over the terms of their own contracts without government interference. Regulations, subsidies, and taxes are all comonly seen as infringements. It is the underpining of the theory of laissez-faire economics, and justifies it as a benefit to society. Natural law or the law of nature (Latin lex naturalis) is a law whose content is set by nature, and that therefore has validity everywhere. ... Laissez-faire is short for laissez faire, laissez passer, a French phrase meaning to let things alone, let them pass. First used by the eighteenth century Physiocrats as an injunction against government interference with trade, it is now used as a synonym for strict free market economics. ...

Henry James Sumner Maine proposed that social structures evolve from roles derived from status to those based on contractual freedom. A status system establishes obligations and relationships by birth, whereas a contract presumes that the individuals are free and equal. Modern Libertarianism such as that advanced by Robert Nozick sees freedom of contract as the expression of the independent decisions of separate individuals pursuing their own interests in a "minimal state". Sir Henry James Sumner Maine (August 15, 1822 - February 3, 1888) was a English comparative jurist and historian, son of Dr James Maine, of Kelso, Roxburghshire. ... In English-speaking countries, libertarianism usually refers to a political philosophy maintaining that every person is the absolute owner of their own life and should be free to do whatever they wish with their person or property, as long as they respect the liberty of others. ... Robert Nozick (November 16, 1938 – January 23, 2002) was an American philosopher and Pellegrino University Professor at Harvard University. ...

Historical background and Common Law

The idea as put forward by theorists such as Adam Smith and Thomas Hobbes is for an individual to use society as a tool for acquiring property and happiness. They opposed artificial restraint on the free-will of the individual to pursue his own self interests. Individualists see the state as a means to an end. Adam Smith (baptized June 5, 1723 O.S. / June 16 N.S. – July 17, 1790) was a Scottish moral philosopher and a pioneering political economist. ... Hobbes redirects here. ... Individualism is a term used to describe a moral, political, or social outlook that stresses human independence and the importance of individual self-reliance and liberty. ...

Freedom of Contract as we know it today stemmed from the Enlightenment ideals of John Locke. Lock's Two Treatises of Government argued against the divine right of kings as the supreme authority. Society, Locke reasoned, functioned best when freely determined social contracts governed human behavior. This was the only way to preserve life, liberty, and property. He determined these to be "natural" rights. Look up Enlightenment in Wiktionary, the free dictionary. ... This article is about John Locke, the English philosopher. ... The Two Treatises of Government (or Two Treatises of Government: In the Former, The False Principles and Foundation of Sir Robert Filmer, And His Followers, are Detected and Overthrown. ...

Liberty of Contract in America

In America, fundamental rights have special significance under the 14th Amendment to the Constitution. The Supreme Court has at times cited the due process and equal protection clauses of that amendment in defense of certain implied rights. It has claimed that some rights are so fundamental, that any law restricting such a right must serve both a compelling state purpose, and be narrowly tailored to that compelling purpose. In United States law, adopted from English law, due process (more fully due process of law) is the principle that the government must normally respect all of a persons legal rights instead of just some or most of those legal rights when the government deprives a person of life... The Equal Protection Clause is a part of the Fourteenth Amendment to the United States Constitution, providing that no state shall make or enforce any law which shall. ...

The theory was a fundamental part of American legal docrine until the Great Depression when it fell out of favor. Liberty of Contract was portrayed in the press as being "pro-business" and "anti-labor". After the Supreme Court used it to strike down several pieces of New Deal legislation, President Roosevelt tried to pack the court to alter their decisions. The Great Depression was a worldwide economic downturn which started in October of 1929 and lasted through most of the 1930s. ... The Supreme Court Building, Washington, D.C. The Supreme Court Building, Washington, D.C., (large image) The Supreme Court of the United States, located in Washington, D.C., is the highest court (see supreme court) in the United States; that is, it has ultimate judicial authority within the United States... Wikiquote has a collection of quotations related to: New Deal For other uses of New Deal and The New Deal, see New Deal (disambiguation). ... Franklin Delano Roosevelt (January 30, 1882–April 12, 1945), 32nd President of the United States, the longest-serving holder of the office and the only man to be elected President more than twice, was one of the central figures of 20th century history. ...

Lochner v. New York

Main article: Lochner v. New York

Joseph Lochner at work in 1905

In 1902 a New York baker named Joseph Lochner was fined for violating a state law limiting the number of hours his employees could work. He sued the state on the grounds that he was denied his right to "due process". Lochner claimed that he had the right to freely contract with his employees and that the state had unfairly interfered with that right. Holding New Yorks regulation of the working hours of bakers was not a justifiable restriction of the right to contract freely under the 14th Amendments guarantee of liberty. ... Image File history File links No higher resolution available. ... Image File history File links No higher resolution available. ... 1905 (MCMV) was a common year starting on Sunday (link will display the full calendar). ... 1902 (MCMII) was a common year starting on Wednesday (see link for calendar). ... NY redirects here. ...

In 1905 the Supreme Court used the "due process" clause in the 14th Amendment to declare unconstitutional the New York state statute imposing a limit on hours of work. In Lochner v. New York, Justice Peckham wrote for the majority: "Under that provision no state shall deprive any person of life, liberty, or property without due process of law. The right to purchase or to sell labor is part of the liberty protected by this amendment..." 1905 (MCMV) was a common year starting on Sunday (link will display the full calendar). ... Federal courts Supreme Court Chief Justice Associate Justices Elections Presidential elections Midterm elections Political Parties Democratic Republican Third parties State & Local government Governors Legislatures State Courts Counties, Cities, and Towns Other countries Politics Portal      The Supreme Court of the United States (SCOTUS) is the highest judicial body in the United... In United States law, adopted from English law, due process (more fully due process of law) is the principle that the government must normally respect all of a persons legal rights instead of just some or most of those legal rights when the government deprives a person of life... The Fourteenth Amendment may refer to the: Fourteenth Amendment to the United States Constitution - contains the due process and equal protection clauses. ... NY redirects here. ... Holding New Yorks regulation of the working hours of bakers was not a justifiable restriction of the right to contract freely under the 14th Amendments guarantee of liberty. ...

Writing for the minority, Justice "Oliver Wendall Holmes" accused the majority of basing it's decision on laissez-faire ideology. He believed that they were making law based on economics rather than interpreting the constitution. Neither did he believe that "Liberty of Contract" existed or was intended in the constitution. Laissez-faire is short for laissez faire, laissez passer, a French phrase meaning to let things alone, let them pass. First used by the eighteenth century Physiocrats as an injunction against government interference with trade, it is now used as a synonym for strict free market economics. ...

By 1937 politics forced the court to reverse its view in the case West Coast Hotel Co. v. Parrish. In that case the court upheld a State of Washington Law setting a minimum wage. Year 1937 (MCMXXXVII) was a common year starting on Friday (link will take you to calendar). ... Holding Washingtons minimum wage law for women was a valid regulation of the right to contract freely because of the states special interest in protecting their health and ability to support themselves. ... State nickname: The Evergreen State Other U.S. States Capital Olympia Largest city Seattle Governor Christine Gregoire (D) Official languages None Area 184,824 km² (18th)  - Land 172,587 km²  - Water 12,237 km² (6. ...

Tyranny of the majority

Collectivists emphasize paternalistic government over individual responsibility. Weather this stems from a distrust of human nature or a desire to force others to conform, the reasons do not matter. They tend to see themselves as divinely charged with a duty to prevent harm befalling others. The collectivists are the ones who attempt to construct poltical solutions by attacking the Freedom of Contract and refusing to recognize it as a right. Collectivism is a term used to describe any moral, political, or social outlook, that stresses human interdependence and the importance of a collective, rather than the importance of separate individuals. ...

Many see morality as the basis for distrusting an individual to make sound choices. Most cultures value honour and honesty, and rely on conscience to underpin morality. Dishonesty is generally considered wrong, particularly when one promise induces another person to take action. Equity or similar codes of fairness therefore require a person to obey the dictates of his or her conscience and so avoid causing loss to other people. Therefore, they codify the concept of wrong in tort — the law of private wrongs — which is based on the notions of personal accountability, causation, and, in modern law, negligence. Alexander Hamilton defending his honor by obliging to duel Aaron Burr. ... Look up honesty in Wiktionary, the free dictionary. ... To meet Wikipedias quality standards, this article may require cleanup. ... The Court of Chancery, London, early 19th century This article is about the concept of equity in the jurisprudence of common law countries. ... Tort is a legal term that means civil wrong, as opposed to a criminal wrong, that is recognized by law as grounds for a lawsuit. ... In law, causation is the name given to the process of testing whether defendants should be fixed with liability for the outcome to their acts and omissions that injure or cause loss to others. ... In tort law, the right to sue and recover damages from another on the basis of negligence, as opposed to numerous other tort theories discussed elsewhere, is based upon proving that the defendant failed to use ordinary care, that is,that degree of care for the protection of the person...

Both John Stuart Mill and Alexis de Tocqueville described what they called the "Tyranny of the majority". Both men were concerned with minority interests being subject to whim of the majority. They even went so far as to imply that the minority would be victims of tyranny by Ochlocracy. This is why modern consitutions contain bills of rights that limit the powers of the legislature. John Stuart Mill (20th May 1806 – 8th May 1873), a British philosopher and political economist, was an influential liberal thinker of the 19th century. ... For other uses, see Tocqueville (disambiguation) Alexis de Tocqueville Alexis-Charles-Henri Clérel de Tocqueville (Verneuil-sur-Seine, Île-de-France, July 29, 1805– Cannes, April 16, 1859) was a French political thinker and historian. ... Majoritarianism (often also called majority rule) is a political philosophy or agenda which asserts that a majority (sometimes categorized by religion, language or some other identifying factor) of the population is entitled to a certain degree of primacy in society, and has the right to make decisions that affect the... This page is about the religious concept of Tyranny. ... Ochlocracy (Greek: οχλοκρατια; Latin: ochlocratia) is government by mob or a mass of people, or the intimidation of constitutional authorities. ... This article is about the general concept of a bill of rights. ...

Literature

• Trebilcock, Michael J.:"The Limits of Freedom of Contract" (Harvard University Press) ISBN 13 978-0-674-53429-2

• Atiyah, P.S:"The Rise and Fall of Freedom of Contract" (Oxford University Press, USA; New ed; Dec 12, 1985) ISBN 13 978-0198255277

See also

• Contract
• Contract theory
• Individualism

A contract is a legally binding exchange of promises or agreement between parties. ... Contract theory comprises many different theories and various interpretations of the various body of rules and subrules that define Contract Law. ... Individualism is a term used to describe a moral, political, or social outlook that stresses human independence and the importance of individual self-reliance and liberty. ...

References