THEORETICAL APPROACH ON STATE INTERFERENCE IN LIMITING THE FREEDOM OF CONTRACT (WITH REFERENCE TO ENGLISH LEGAL SYSTEM)

The topic is the theoretical approach to the state interference in limiting the freedom of contract in English law This paper tries to identify and discuss the key issues that arise in the design and application of state interference in limiting the freedom of contract. One of the main aims is to understand the basic principles of the state role and the reasons for interference in economy and, in particular, in contract.State intervention limits the scope of private law area and the public law elements gets dominant with this action to find of exact line between both areas of law is a crucial issue. In this paper theoretical analysis is carried out to examine the topic. This subject is given in three sections. In the first section a general view is briefly given about the reasons for the state interference in market. The second section discusses the legal measures that state takes to achieve the aims and in the third section the rationale underlying the stat interference in limiting the freedom of contract in contract law is examined. It has been found that the prevention of exploitation, which can remedy unfairness or inequalities, and to achieve distributional goal are the main aims of state interference. And all measures like some theoretical foundation of judicial interpretation and statutory interventions into private contract are designed to ensure substantive fairness in transactions. The recommendation is that in every contradiction among different interests and in order to design a clear line between private and public areas it should be given main role to the underlying policy of obligations. The underlying policy of the state interference justifies the limits on freedom of contract.