Decolonising Contract Law

A robust legal education requires an understanding not only of the law as it currently is, but also of the political, economic, social and cultural context in which laws are constructed. This includes analysis of social justice and legal issues relating to Australia’s First Peoples. Australia’s colonial project is ongoing and all law graduates should be aware of the multiple ways in which the Australian legal system impacts upon Indigenous peoples. This is an important aspect of decolonising the law curriculum.


Contract Law has not traditionally been considered a subject in which to introduce and explore legal issues confronting Australia’s First Peoples. However, the issue of freedom of contract provides an interesting site for analysis of injustice experienced by Indigenous peoples. The doctrine of freedom of contract maintains that people are to have freedom to enter into contracts of their own choice with other people or businesses of their own choice, rather than being coerced into contractual arrangements. As Carter explains, the doctrine of freedom of contract holds that:


(1) contracting parties should be free to agree to whatever agreement they wish; and (2) people should be free to decide to enter into contracts with whoever they please and should not be compelled to enter contractual relationships. (J W Carter, Cases and Materials on Contract Law in Australia (LexisNexis Butterworths, 6th ed, 2012) 6-7)

Contract law teachers can highlight that this significant legal doctrine has formed the foundation of much historical and contemporary contract law. It is the key concept underpinning classical contract theory, yet it is not a reality historically or currently experienced by all Australian citizens. It is interesting to consider whose contractual freedom has been facilitated and whose contractual freedom has been curtailed through government laws.


Australia has a long history of constraining Indigenous peoples’ contractual freedom. For example, throughout Australia’s earlier colonial period, many Indigenous workers were forced into employment contracts with exploitative working conditions. Legislation stipulated that Indigenous people could be paid under award wages for their labour, and they were subject to paternalistic control by ‘protectors’ who intensively governed every aspect of Indigenous lives. Such control extended to how social security payments were spent, and when and where Indigenous people could travel. In all of these ways, freedom of contract was denied to Indigenous people who were portrayed as unworthy of liberalism’s promises regarding individual autonomy.


The government’s contemporary development of income management laws for some welfare recipients also provides a fruitful site for analysis of curtailed contractual freedom. Originally introduced as part of the Northern Territory Emergency Response in 2007 and applicable only to Aboriginal welfare recipients, income management has since been expanded and now operates in multiple Australian jurisdictions. However, Indigenous welfare recipients are disproportionately represented amongst those subject to income management, and Aboriginal communities are grossly over-represented in terms of the geographical locations the government has selected for income management trials.


The government’s rhetoric about income management is that it is to promote socially responsible behaviour and to ensure that social security payments are not spent on drugs, alcohol, gambling or pornography. Yet many of those subject to the scheme do not have problematic spending in these areas, as evaluation of income management in the Northern Territory has shown. People can be subject to income management regardless of how responsibly they spend their social security payments, and the vast majority of welfare recipients currently experiencing income management are subject to compulsory income management rather than voluntary income management. Many of those subject to income management think the scheme is unfair and discriminatory.


Those targeted by income management laws have 50 per cent or more of their welfare payments quarantined (depending on which income management category they are in). These quarantined sums can only be spent at government approved retailers on government approved priority needs, and are usually spent using a government issued BasicsCard. This system excludes a wide range of consumer outlets for everyday goods and services. There are numerous businesses, real estate agents and landlords who do not want to participate in the income management system, which has the effect of shrinking the market of goods and rental housing available for those on low incomes. This can exacerbate disadvantage experienced by welfare recipients. Evaluation of income management also reveals that the scheme has led to an increase in the cost of goods and services for numerous welfare recipients who are poorly positioned to bear this burden.


Engaging with a curtailed freedom of contract case study, as outlined above, can enrich the Contract Law curriculum and highlight historical and contemporary legal injustice experienced by Australia’s First Peoples.


Dr Shelley Bielefeld


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