Abstract

The American Republic was established on the foundation of natural law which held that individual rights came from mankind being made in the Image of God and that those rights were inalienable. The  recognized natural law rights included the right to own property and to enter contracts and the upholding of those rights was considered the primary purpose of contract law. The Founding Fathers believed market forces were best at determining economic efficiency. Those rights established a sound foundation for the flourishing of free enterprise which turned the United States into the world’s greatest economic power. In the modern era, many judges have adopted the law and economics theory of contract law. Law and economics theory rejects the idea that the primary purpose of contract law is upholding the individual rights to own property but rather to advance economic efficiency which might involve judges overturning or more often modifying the terms of a contract to maximize economic efficiency. The Biblical Natural Law of the Founding Fathers provides a better basis for contract law than the law and economic theory. The law and economics theory distorts the roles of judges and goes against the proper rooting of contract in the individual rights to own property and to enter contracts.

Keywords: Nature law rights, Contract law, Economic efficiency, Economic theory