An Examination of Real Estate Contracts Toward the Development of Fair Contract Terms

Abstract

This research aims to examine the characteristics of unfairness found in contracts of sale and agreements to sell immovable property, including legally prescribed standard form contracts. The study conducts a comparative analysis of foreign legal frameworks' unfair contract terms to develop recommendations for enhancing consumer protection in contracts for the sale or agreement to sell immovable property, thereby ensuring greater fairness for consumers. Documentary research was employed as the primary method of data collection.

          The findings indicate that unfair contractual terms in real estate transactions affecting consumers can be classified into five major categories: (1) contract terms that employ complex language that is difficult to understand; (2) ambiguous terms that allow business operators to exercise discretionary power in interpretation; (3) terms granting unilateral rights to business operators to terminate the contract and forfeit payments made by consumers; (4) terms that prospectively exempt business operators from liability; and (5) terms affecting consumers’ payment obligations in cases involving increases or decreases in the area of the immovable property.

          To address these issues, the researcher proposes the establishment of clear criteria for determining which types of contractual terms may be considered detrimental to consumers. Contracts should also include provisions expressly notifying consumers of their rights. Furthermore, Thailand should consider adopting the Japanese approach to calculating damages recoverable by business operators from consumers.