Judicial review of contractual clauses is an essential mechanism for ensuring balance in private relationships, especially when there is abuse or significant imbalance between the parties. 

Although autonomy of will is a fundamental principle of Contract Law, judicial intervention may occur in exceptional situations to correct injustices. The challenge lies in establishing the limits of this review without compromising legal certainty and the predictability of contracts.

Fundamental principles of private law contracts

In Private Law , contracts are governed by principles that balance the freedom of the parties and fairness in legal relations. These principles ensure that agreements are made and executed in a balanced manner, preventing abuses.

Principle of autonomy of will and contractual freedom

The autonomy of will ensures that the parties have the freedom to contract, choosing the terms and conditions of the agreement. This principle allows individuals to define their obligations, while respecting current legislation.

However, contractual freedom is not absolute. It must obey the limits imposed by law, good morals, and public order. The Judiciary can intervene when contractual clauses violate fundamental rights or generate excessive imbalances.

The social function of contracts and their relationship to judicial review. 

The social function of contracts ensures that agreements serve not only individual interests but also the collective well-being. Contracts must fulfill their purpose without harming third parties or the community.

This principle allows for judicial intervention in clauses that cause disproportionate harm to one of the parties. Thus, contracts that go against social justice or solidarity can be adjusted by the judiciary to ensure balance.

Good faith and contractual balance

Objective good faith establishes a standard of conduct based on honesty, transparency, and mutual cooperation between the parties, applicable from negotiation to contract execution.

This principle ensures that those involved act in accordance with legitimate expectations, promoting trust and legal certainty in contractual relationships.

On the other hand, subjective good faith refers to the individual intention of each party, considering their perception and knowledge of the contractual relationship.

Although relevant, subjective analysis is more limited, as it focuses on the specific awareness and intentions of the contracting parties, unlike objectivity which imposes an expected standard behavior.

When a contractual clause is deemed abusive or confers an excessive advantage to one of the parties, judicial intervention may be necessary to restore contractual balance. In this context, objective good faith serves as the basis for the review or annulment of contractual provisions that contravene the principles of equity and justice.

Thus, objective good faith guides contractual relations, ensuring that the parties execute contracts in a fair and balanced manner, while subjective good faith assesses the intention and individual knowledge of each party involved.

Hypotheses for judicial review of contractual clauses

The theory of excessive onerousness is a legal mechanism that allows for the revision or termination of contracts when unforeseen events make the performance of one of the obligations excessively burdensome. In the Brazilian Civil Code, this theory is outlined in articles 317 and 478 to 480.

Definition and application in the Civil Code

Article 317 stipulates that, if due to unforeseen circumstances there is a clear disproportion between the value of the performance due and the value at the time of its execution, the judge may correct it to ensure contractual balance.

Articles 478 to 480 deal with the possibility of terminating or revising the contract when the performance of one of the parties becomes excessively burdensome due to extraordinary and unforeseeable events, resulting in an extreme advantage for the other party.

Factors justifying the review: unpredictability and disproportionate burden.

For the theory of excessive onerousness to apply, it is necessary that extraordinary and unforeseeable events occur after the contract is signed, causing a significant imbalance in the obligations of the parties.

This imbalance should make the performance of one party excessively burdensome, while the other obtains a disproportionate advantage. In such cases, the aggrieved party may judicially request a review or even the termination of the contract, aiming to restore the originally agreed-upon balance.

Unfair clauses in consumer contracts

In the context of consumer relations, consumer protection is ensured by the Consumer Protection Code (CDC), especially regarding abusive contractual clauses. Article 51 of the CDC declares null and void any clauses that place the consumer at an excessive disadvantage or that are incompatible with good faith and equity.

Identifying abusive clauses

Unfair clauses are provisions that unbalance the contractual relationship in favor of the supplier. Examples include:

• Exclusion or limitation of the supplier's liability for product or service defects.
• Imposing excessively burdensome obligations on the consumer.
• Possibility of unilateral alteration of the contract by the supplier, without the consumer's consent.

The Judiciary considers such clauses null and void, preventing them from producing legal effects.

The role of the judiciary in the review of adhesion contracts.

Contracts of adhesion are those whose clauses are unilaterally pre-established by the supplier, without the possibility of negotiation by the consumer. In this type of contract, the consumer is left only with the option of accepting or rejecting the terms, which can generate imbalances in the contractual relationship.

Given this vulnerability, the Judiciary plays an essential role in reviewing these contracts. If it identifies abusive clauses, it can declare them null and void, guaranteeing the restoration of contractual balance. This intervention seeks to protect consumer rights and ensure greater fairness in consumer relations.

Abuse of rights and contractual imbalance

In contractual matters, abuse of rights occurs when one party uses their rights excessively or contrary to good faith, causing harm to the other party. This practice distorts the purpose of the contract and can be characterized as an unlawful act, as provided for in article 187 of the Brazilian Civil Code.

When there is an abuse of economic power, the stronger party imposes disadvantageous conditions, creating a contractual imbalance. In these cases, the Judiciary can intervene to review or annul abusive clauses, restoring equity between the parties and ensuring the social function of the contract.

Limits to judicial review of contracts

The Judiciary should apply judicial review of contracts cautiously, in order to preserve legal certainty and the stability of contractual relations. Judicial intervention is justified only in exceptional situations, such as cases of excessive burden or abusive clauses, when there is a clear imbalance between the parties.

Respect for private autonomy is fundamental, ensuring that parties can freely establish the terms of their contracts. Predictability in legal transactions ensures trust and encourages commercial relations.

Therefore, judicial intervention should not occur in equal and symmetrical contracts, where the parties have equal negotiating power and there is no evidence of abuse or significant imbalance.

The closing thought 

Judicial review of contractual clauses is an essential tool for ensuring balance and fairness in private relationships, especially in situations of abuse or significant imbalance between the parties. Understanding the limits and possibilities of this judicial intervention is fundamental for professionals seeking to excel in Private and Business Law.

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References 

DINIZ, Maria Helena. Course of Brazilian Civil Law: Theory of Contractual and Extracontractual Obligations: 3. 36th ed. São Paulo: Saraiva, 2020. v. 3. 932 p. ISBN 9788553613205.

Superior Court of Justice. The STJ's view on the theory of unforeseen circumstances in contractual relations. March 26, 2023. Available at: https://www.stj.jus.br/sites/portalp/Paginas/Comunicacao/Noticias/2023/26032023-A-visao-do-STJ-sobre-a-teoria-de-imprevisao-nas-relacoes-contratuais.aspx.