Invalidity of contract as a mean of legal protection

Abstract

Invalidity of contracts is to be seen much more as a limit on social conduct than a sanction. This limit has a function of protecting private or public interests. Contract is a social relationship. Invalid contract is a social relationship as well. Thus, the consequences of invalidity are about the social consequences of invalidity. In Hungarian contract law, the consequences of invalidity present extensive statutory intervention and strengthen the trend that challenges the sustainability of the traditional model based on freedom of contract. Restitution (in kind or in value) prefers maintaining party autonomy and freedom of contract. ‘Curing’ the contract via judicial amendment, on the other hand, is a strong paternalism. The same is true as to partial invalidity. In these cases, the court would protect the interests of one of the parties against the interests of the other. These phenomena are analysed in this contribution.