Kwon, Youngjoon, COVID‑19 and Contract Law, The Korean Journal of Civil Law, Vol. 96 (2021), pp. 223-261.
<Abstract>
The emergence of COVID-19 offers a momentum to revisit traditional framework of contract law. In the wake of difficulties in performing contractual obligations, force majeure or hardship clauses are drawing significant attention. Doctrines regarding the change of circumstances or impossibility, which seemed to have little presence in practice, are back on the stage again. Non-performance doctrines are more often highlighted. Meanwhile, emergency legislations in response to COVID-19 have us critically rethink the flexibility of the above traditional contract legal doctrines. In addition, the extent to which governments are justified to paternalistically intervine in the existing contractual relationship becomes another critical issue. Swift transition to a non face-to-face contractual environment is another byproduct of COVID-19, thereby facilitating the transformation of classical contract law that was once premised on the face-to-face internactions. In short, COVID-19 is providing considerable stimulation to the current contract law regime. Against this backdrop, I intended to make observation on the responses of the current contract law doctrines, especially in terms of risk allocation, and to find some future implications on contract law. First of all, I categorized risk allocation mechanisms into the internal allocation (meaning that such allocation is done by virtue of contract itself such as a force majeure clause) and the external allocation (meaning that such allocation is done by virtue of law such as the doctrine of change of circumstances), and further analyzed respective mechanisms. I also provided general overview on how major jurisdictions are responding to this crisis, in terms of legislative and administrative measures specifically tailored to COVID-19. Further, based on such observation and analysis, I endeavored to find implications that might facilitate current contract law to appropriately transform itself corresponding to the change of a society under the shade of COVID-19. I mentioned the need for rigidity of current contract law doctrines, focusing more on contract design ex ante, and systematic relation between contract law and community value in consideration of social costs of contract.
<Keywords>
COVID-19 , contract law , force majeure , change of circumstances , impossiblity , MAC clause , risk allocation , social costs of contract
Kwon, Youngjoon, COVID‑19 and Contract Law, The Korean Journal of Civil Law, Vol. 96 (2021), pp. 223-261.
<Abstract>
The emergence of COVID-19 offers a momentum to revisit traditional framework of contract law. In the wake of difficulties in performing contractual obligations, force majeure or hardship clauses are drawing significant attention. Doctrines regarding the change of circumstances or impossibility, which seemed to have little presence in practice, are back on the stage again. Non-performance doctrines are more often highlighted. Meanwhile, emergency legislations in response to COVID-19 have us critically rethink the flexibility of the above traditional contract legal doctrines. In addition, the extent to which governments are justified to paternalistically intervine in the existing contractual relationship becomes another critical issue. Swift transition to a non face-to-face contractual environment is another byproduct of COVID-19, thereby facilitating the transformation of classical contract law that was once premised on the face-to-face internactions. In short, COVID-19 is providing considerable stimulation to the current contract law regime. Against this backdrop, I intended to make observation on the responses of the current contract law doctrines, especially in terms of risk allocation, and to find some future implications on contract law. First of all, I categorized risk allocation mechanisms into the internal allocation (meaning that such allocation is done by virtue of contract itself such as a force majeure clause) and the external allocation (meaning that such allocation is done by virtue of law such as the doctrine of change of circumstances), and further analyzed respective mechanisms. I also provided general overview on how major jurisdictions are responding to this crisis, in terms of legislative and administrative measures specifically tailored to COVID-19. Further, based on such observation and analysis, I endeavored to find implications that might facilitate current contract law to appropriately transform itself corresponding to the change of a society under the shade of COVID-19. I mentioned the need for rigidity of current contract law doctrines, focusing more on contract design ex ante, and systematic relation between contract law and community value in consideration of social costs of contract.
<Keywords>
COVID-19 , contract law , force majeure , change of circumstances , impossiblity , MAC clause , risk allocation , social costs of contract