ABSTRACT
Common law judges in all jurisdictions have struggled to achieve a workable balance between providing appropriate consumer protection to signatories of standard form contracts while still retaining adequate respect for the sanctity of contract. The British judge, Steyn LJ, in his struggles with the competing implications legal formalism and legal functionalism would have for a beleaguered consumer enmeshed in a standard form contract, observed that:
Although these comments arose in relation to a banking dispute, it is perhaps in the insurance industry’s use of contracts of adhesion that this ‘battle front’ appears most clearly defined and active.3 Given the gross disparity in bargaining power often found in such contracts and the degree of complexity that exists as to the nature and effect of policy terms and exclusions, it is perhaps not surprising that a number of mechanisms and processes have been developed, or are emerging, that aim to reconcile parties’ expectations with the language employed in these contracts. It is the purpose of this article to examine the means currently available to judges in this respect and, based on this analysis, to determine whether a significantly greater scope of contract (re)construction is likely to become the norm in most common law jurisdictions in the coming decades.
