Birmingham-based Wragge & Co has praised the Law Commission ' s " measured approach" to contract reform.
The Commission recently published recommendations on a shake-up of the UK's unfair contracts legislation and, according to partner David Lowe, the proposals are less sweeping than expected.
He said: "Early indications from the Law Commission were that they would recommend a radical overhaul of the law governing commercial contracts. Instead of wholesale reform, companies face only minor changes to the existing regime."
At present, the law governing unfair terms in contracts comes from two sources: the Unfair Contract Terms Act 1977 and the Unfair Terms in Consumer Contracts Regulations 1999. Home grown and European legislation on the same topic has created overlaps and inconsistencies.
Mr Lowe argues that reform is needed but not at the cost of a long-held principle of English law.
He went on: "Commercial parties are free to contract on the terms agreed between them. Whether those terms are fair or not is irrelevant as the balance of bargaining power is equal. It seemed that the Commission would propose the same approach for both business and consumer contracts, requiring all terms to be 'fair'.
"This would have had an unprecedented impact on UK contract law and the commission has sensibly stepped back from such a suggestion."
The effect of the proposed reforms will vary and will depend upon the type of contract. They will establish three separate streams of contracts - business-to-business, contracts with small businesses and contracts with consumers.
The impact on business-tobusiness relationships will be minimal.
Mr Lowe said: "The Commission's proposals are being considered by the DTI, which is due to respond in the autumn. It will be interesting to see what the DTI has to say."
He is one of seven partners in the specialist commercial contracts team.
The team draws on experts from across the firm to advise clients in sectors as diverse as aviation, retail, automotive, leisure and the public sector.