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The Broken Promise Of Efficient Breach Theory: Sacrificing Certainty Of Obligation For False Efficiency, Irma S. Russell

Irma S. Russell

The Broken Promise of Efficient Breach Theory: Sacrificing Certainty of Obligation for False Efficiency explores the foundational principles of contract law and economics as a way of assessing the failure of efficient breach theory to effectively describe or critique the damages principles of contract law. Important scholarship has criticized the efficient breach theory on numerous grounds, but to date the scholarship has not explored the fundamental attribute of contract law that I identify here: the transfer of the economic right to reallocate resources efficiently. Economics starts from the fundamental proposition that economic actors have the right to efficiently allocate their …

On Mutual Mistakes, Daniel Cohen

Daniel Cohen

Herein we reconsider what has for over a century been a judicial inconsistency inspiring mostly dismissive scorn. We find a classical disparity in judicial reasoning to have a surprising hidden profundity and we identify it as a sincere though unintentional attempt of erstwhile courts to perform what would today be seen as an admirable effort of social policy making. We shall examine a curious pair of seemingly inconsistent rulings from a century ago and conclude that they are actually consistent with the principles of Law and Economics as understood today, although they were at that time uncomfortably incongruous. The only …

On Mutual Mistakes, Daniel Cohen

Daniel Cohen

Herein we reconsider what has for over a century been a judicial inconsistency inspiring mostly dismissive scorn. We find a classical disparity in judicial reasoning to have a surprising hidden profundity and we identify it as a sincere though unintentional attempt of erstwhile courts to perform what would today be seen as an admirable effort of social policy making. We shall examine a curious pair of seemingly inconsistent rulings from a century ago and conclude that they are actually consistent with the principles of Law and Economics as understood today, although they were at that time uncomfortably incongruous. The only …

A Revised Economic Theory Of Disclosure Duties And Break-Up Fees In Contract Law, Barak Medina, Ofer Grosskopf

Barak Medina

The economic analysis of contract law offers an influential argument against imposing a duty to disclose information and in support of guaranteeing reimbursement (“break-up fees”) for pre-contractual investments in acquiring information. According to the conventional wisdom, a negotiating party invests resources in information gathering on the basis of its expectation to extract the contractual surplus that the investment may generate. As a result, it is arguably essential to protect the investing party’s ability to benefit from its investment in gathering information. Such protection can be provided either by allowing non-disclosure of relevant information that was achieved through a deliberate effort, …

Law, Morality, And Economics: Integrating Moral Constraints With Economic Analysis Of Law , Barak Medina, Eyal Zamir

Barak Medina

Economic analysis of law is a powerful analytical methodology. However, as a purely consequentialist approach, which determines the desirability of acts and rules solely by assessing the goodness of their outcomes, standard cost-benefit analysis (CBA) is normatively objectionable. Thus, for example, it presumably approves the deliberate killing of one innocent person to save the lives of two, and the breaking of a promise whenever it would produce slightly more net benefit than keeping it.

Moderate deontology prioritizes such things as autonomy, basic liberties, truth telling, and promise keeping over the promotion of good outcomes. It holds that there are constraints …

Controlling Family Shareholders In Developing Countries: Anchoring Relational Exchange, Ronald J. Gilson

Ronald J. Gilson

The Law and Finance account of the ubiquity of controlling shareholders in developing markets is based on conditions in the capital market: poor shareholder protection law prevents controlling shareholders from parting with control out of fear of exploitation by a new controlling shareholder who acquires a controlling position in the market. This explanation, however, does not address why we observe any minority shareholders in such markets, or why controlling shareholders in developing markets are most often family-based. This paper looks at the impact of “bad law” on shareholder distribution in a very different way. Developing countries typically provide not only …

The Economics Of Standardized Contracts, Enrico Baffi

enrico baffi

There are basically four characteristic features of mass contracting: the reduced negotiations, the dissemination of standard form contracts, the presence of abusive clauses and the recapitulation of the contract and its execution in a single act of stipulation. a) The reduction in negotiations is the result first of all of the costs that this activity requires and of the costs required to manage personalised contracts; secondly, this reduction is the consequence of the greater advantage of mass-produced goods compared to personalised goods; thirdly and lastly, it also derives from the limit of the range of possible clauses that can be …

La Buena Fe En La Negociación De Los Contratos: Apuntes Comparatísticos Sobre El Artículo 1362 Del Código Civil Peruano Y Su Presunto Papel Como Fundamento De La Responsabilidad Precontractual (2004), Leysser L. Leon

Leysser L. León

En este artículo, se efectúa un análisis histórico y comparativo de la responsabilidad civil por daños ocasionados durante los tratos previos al contrato.

A propósito, se demuestra, con los mismos instrumentos metodológicos, por qué las cláusulas normativas generales (Generalklauseln) son inapropiadas en ordenamientos jurídicos como el peruano, y por qué son aplicables a esta hipótesis de ilícito civil las reglas de la responsabilidad aquiliana o extracontractual (artículo 1969º del Código Civil peruano).

Plain Meaning Vs. Broad Interpretation: How The Risk Of Opportunism Defeats A Unitary Default Rule For Interpretation, Juliet P. Kostritsky

Juliet P Kostritsky

Plain Meaning vs. Broad Interpretation: How the Risk of Opportunism Defeats a Unitary Default Rule for Interpretation Juliet P. Kostritsky, Case Western Reserve Abstract This essay argues that it is the wrong to think that courts must make a dichotomous choice always to prefer extrinsic evidence or always to exclude it. Sometimes the appropriate interpretive methodology should explicitly forego extrinsic evidence while at other times it should embrace extrinsic evidence. The choice between the two methodologies should depend upon an assessment in each case about which interpretive methodology is most likely to (1) curb opportunistic behavior; and (2) and implement …

Judicial Incorporation Of Trade Usages: A Functional Solution To The Opportunism Problem, Juliet P. Kostritsky

Juliet P Kostritsky

This Article argues that the strategy of rejecting trade usages unless they are part of the express contract is too rigid. The rejection is premised on an overly narrow cost/benefit analysis that fails to account for the functional role that such usages may play in curbing opportunistic behavior and thereby increasing gains from trade and overall welfare. Plain meaning and incorporation must each be evaluated to see how each one can achieve the parties’ presumed instrumental goals of curbing opportunism—the “hold-up” game. Decision makers should also consider the particular reasons why parties failed to include the trade usages n their …

“The (Cisg) Road Less Travelled”: Grecon Dimter Inc. V. J.R. Normand Inc., Antonin I. Pribetic

Antonin I. Pribetic

This case comment discusses two recently released Canadian decisions on the enforceability of arbitration clauses from the perspective of the United Nations Convention on Contracts for the International Sale of Goods 1980 CISG). At first glance, the Supreme Court of Canada's decision in GreCon Dimter Inc. v. J.R. Normand Inc. appears to be a case upholding the primacy of international commercial arbitration, choice of forum and choice of law clauses. Upon closer scrutiny, however, the Supreme Court of Canada failed to consider the application of the CISG to the overall dispute. Interestingly, the same choice of forum and choice of …

Bringing Locus Into Focus: A Choice-Of-Law Methodology For Cisg-Based Concurrent Contract And Product Liability Claims, Antonin I. Pribetic

Antonin I. Pribetic

The article discusses choice-of-law theories for both contractual and tort/product liability claims governed by the CISG. The underlying theme is that concurrent claims are not necessarily equivalent claims. While concurrent liability in contract and tort (namely, product liability) may be applicable or alternative remedies available, the focus of the CISG is the harmonization of rules governing international sale contracts. The article argues that factors such as the place of injury or where the damages are sustained are less relevant than the situs of the contract, based upon the view that, without privity of contract, the concurrent tort would not arise. …

عرض ملخــص لأطروحــة جامعيــة: الضمانــات الخاصــة بعيــوب ما بعــد الإنشــاء فــي عقــود البنــاء و الإنشــاءات: الأســاس النظــري و توزيــع المخاطــر - دراســة مقارنــة فــي القوانيــن الكويتــي، الفرنســي و الانجليــزي, Mashael Alhajeri

Mashael Alhajeri

No abstract provided.

The Problem Of Internalization Of Social Costs In The Thought Of Ronald Coase, Enrico Baffi

enrico baffi

This work examines the influence of Coasian thought on the analysis of the concept of externalities as used by economists and legal economists. Ronald Coase, a Chicago scholar, advanced a series of critiques of the Pigovian tax system; the theorem that bears his name is merely the best known. In his 1960 work, he sought to demonstrate that the internationalization of social costs was not always socially useful. In addition, he identified other institutional solutions to which systems can – and often do – resort. One of these solutions is to simply authorize the harmful activity without introducing mechanisms to …

Strangers In A Strange Land - Transnational Litigation, Foreign Judgment Recognition, And Enforcement In Ontario, Antonin I. Pribetic

Antonin I. Pribetic

Well into the new millennium, the landscape of international business commerce continues to change dramatically. As many companies expand into global markets, the extant business reality of prosecuting or defending lawsuits arises from companies relying upon standard or boiler plate contracts or invoices when selling goods and services to customers or buying products from suppliers or third parties. This article discusses transnational contractual and litigation issues in Canada, with specific application to the province of Ontario. This article first addresses, from an Ontario company perspective, the importance of incorporating choice of forum, choice of law, and time of the essence …

Rights And Obligations Of Third Parties, Aristides N. Hatzis

Aristides N. Hatzis

Three different issues, related to third party involvement in a contractual relationship, are examined. The first two (assignment of contractual rights/delegation of contractual duties and third-party beneficiary contracts) are examined in a unified way. After pointing to the striking similarity between beneficiary and assignment contracts, we discuss the non-simultaneous assent argument, the danger of creating open classes of beneficiaries without the intention of the contracting parties, and other problems. In a second part, we deal with the controversial issue of efficient breach due to inducement by a third party. After reviewing the literature, we briefly consider the use of liquidated …

Forgotten Equity: The Enforcement Of Forum Clauses, Graydon S. Staring

Graydon S. Staring

When courts differ widely and sharply on which of three or four procedural courses shouold be taken to enforce a contractual right of unquestioned validity, and every such course openly strains orthodox procedural doctrine, we may suslpect they are all wrong. We can confirm that they are wrong when we recognize the right in question is not a procedural incident at all but the right to a substantive performance, bargained for by the parties, that has about it an illusory appearance of procedure and, because of its substance, does not fit comfortably within merely procedural doctrine. Such is the right …

The Parol Evidence Rule In Wisconsin: Status In The Law Of Contract, Revisited, Michael Anthony Lawrence

Michael Anthony Lawrence

This Comment surveys Wisconsin parol evidence cases decided from 1980 through mid-1991. Drawing upon a 1972 New York University Law Review article for its methodology, the Comment empirically examines whether it is useful to categorize Wisconsin decisions according to the business sophistication (i.e., “status”) of parties to the contract. The Comment concludes that status is important in Wisconsin parol evidence cases, despite the fact that courts rarely mention it as a factor. The data indicate that the nature of the proffered parol evidence is important as well.

The Comment suggests that the results of this law-in-action survey are useful to …

A New Theory Of Assent-Based Liability Emerging Under The Guise Of Promissory Estoppel: An Explanation And Defense, Juliet P. Kostritsky

Juliet P Kostritsky

This article demonstrates that apparently divergent approaches (bargain and promissory estoppel) share unifying elemental criteria that situate them all squarely within an assent-based theory of enforceability. This article differs from scholarship that depicts promissory estoppel as having a different conceptual or theoretical basis for enforcement. This article posits that promissory estoppel, together with other orthodox doctrines, are merely substitute doctrinal methods for showing the assent required for an enforceable consensual exchange.