Law Commons^™

The Public Cost Of Private Equity, William Magnuson

William J. Magnuson

This Article presents a theory of the corporate governance costs of private equity. In doing so, it challenges the common view that private equity’s governance structure has resolved, or at least significantly mitigated, one of the fundamental tensions in corporate law, that is, the conflict between management and ownership. The Article argues that this widespread perception about the corporate governance benefits of private equity overlooks the many ways in which the private equity model, far from eliminating agency costs, in fact exacerbates them. These governance costs include compensation structures that incentivize excessive risk-taking, governance rights that provide investors with few …

Deal Structure, Cathy Hwang, Matthew Jennejohn

Northwestern University Law Review

Modern commercial contracts—those governing mergers and acquisitions and financial derivatives, for instance—have become structurally complex and interconnected. Yet contract law largely ignores structural complexity. This Article develops a theory of “contractual structuralism” to explain the important role of structure in every aspect of contract law, from the design of a contract to courts’ interpretation and enforcement.

For generations, scholars have debated whether a court should consider only the text of a contract or also consider broader context to determine parties’ intent. More recently, scholars have shown that parties can choose between textual and contextual interpretation by drafting a contract provision …

The Best And Worst Of Contracts Decisions: An Anthology, Rachel Arnow-Richman, Daniel D. Banhizer, Scott J. Burnham, Et Al.

Florida State University Law Review

The common law of contract is an intellectual and political triumph. In its mature form, it enables judges whose ideological goals may differ to apply doctrines that provide the right to make enforceable promises; with legislation, the common law also provides proper limits on that right. Lately, scholars have produced a flood of contract law theory that enriches our thinking about and grounding for contract law norms. But the real work of common law development has always occurred in the trenches-in judicial decisions. In those trenches and on the framework built there, some decisions matter far more than others, and …

The Public Cost Of Private Equity, William Magnuson

Faculty Scholarship

This Article presents a theory of the corporate governance costs of private equity. In doing so, it challenges the common view that private equity’s governance structure has resolved, or at least significantly mitigated, one of the fundamental tensions in corporate law, that is, the conflict between management and ownership. The Article argues that this widespread perception about the corporate governance benefits of private equity overlooks the many ways in which the private equity model, far from eliminating agency costs, in fact exacerbates them. These governance costs include compensation structures that incentivize excessive risk-taking, governance rights that provide investors with few …

Unframing Legal Reasoning: A Cyclical Theory Of Legal Evolution, Larry A. Dimatteo

UF Law Faculty Publications

This article draws from legal history to inform a part of legal theory. The legal history examination focuses on two theories of legal development - Henry Sumner Maine's "progression thesis" and Nathan Isaacs's "cycle theory." After examining these two theories of legal development, the analysis shifts to how legal history informs theories of legal reasoning. There are numerous long-standing debates on how "law" should be interpreted. These debates are replicated in the question of how "contracts" should be interpreted. Contract law and contract interpretation will be the focus in examining how history informs legal theory, and more specifically, legal reasoning. …

The Best And Worst Of Contracts Decisions: An Anthology, Daniel Barnhizer Et Al.

Florida State University Law Review

The common law of contract is an intellectual and political triumph. In its mature form, it enables judges whose ideological goals may differ to apply doctrines that provide the right to make enforceable promises; with legislation, the common law also provides proper limits on that right. Lately, scholars have produced a flood of contract law theory that enriches our thinking about and grounding for contract law norms. But the real work of common law development has always occurred in the trenches-in judicial decisions. In those trenches and on the framework built there, some decisions matter far more than others, and …

Contract As Commodified Promise, Erik Encarnacion

Vanderbilt Law Review

Many scholars assume that lawmakers should design contract law with the goal of facilitating commercial promises. But the question of which promises count as commercial remains neglected. This Article argues that this question matters more than one might initially expect. Once we understand commerciality in terms of commodificationroughly, treating something as subject to market norms-surprising recommendations for reform follow. First, if contract law should enforce commodified promises, we should demote the consideration doctrine to a presumption of enforceability rather than a formal requirement. Second, we should adopt a rule, contrary to current doctrine in most jurisdictions in the United States, …

Baby M Turns 30: The Law And Policy Of Surrogate Motherhood, Eric A. Feldman

All Faculty Scholarship

This article marks the 30th anniversary of the Supreme Court of New Jersey’s Baby M decision by offering a critical analysis of surrogacy policy in the United States. Despite fundamental changes in both science and society since the case was decided, state courts and legislatures remain bitterly divided on the legality of surrogacy. In arguing for a more uniform, permissive legal posture toward surrogacy, the article addresses five central debates in the surrogacy literature.

First, should the legal system accommodate those seeking conception through surrogacy, or should it prohibit such arrangements? Second, if surrogacy is permitted, what steps can be …

Spite: Legal And Social Implications, Jeffrey L. Harrison

UF Law Faculty Publications

Spite is not a simple concept. The same actions may be motivated by a desire to harm others as a source of the actor’s satisfaction. They may also be a reaction to a personal sense of injustice. Finally, spite-like actions are consistent with simply righting a wrong. This Article makes the case that spite, in its worst from, is comparable to theft. It is a taking of someone’s sense of well-being without consent. It also claims that the purchase of positional goods is ultimately spite driven. It canvasses tort law, contracts, tax law, trademark, and criminal law in an effort …

Does Failure To Mitigate Damages Bar Recovery Of The Costs Of Mitigation?, Gregory S. Crespi

Faculty Journal Articles and Book Chapters

It is well established that a person who makes reasonable efforts to mitigate her damages after a breach of contract will be able to recover the costs of those mitigation efforts as incidental damages and that a person who fails to make such efforts will be denied recovery of the damages that could have been avoided. But will a person who fails to take reasonable efforts to mitigate damages still be able to recover the probable cost of those mitigation efforts as an offset against the reduction in her damages for failure to mitigate, even though she did not incur …

Why Autonomy Must Be Contract's Ultimate Value, Hanoch Dagan, Michael A. Heller

Faculty Scholarship

In “The Choice Theory of Contracts”, we develop a liberal theory of contract law. One core task of the book was to persuade advocates of economic analysis that they must situate their enterprise within our liberal framework. Autonomy, rightly understood, is the telos of contract.

Oren Bar-Gill pushes back strongly in “Choice Theory and the Economic Analysis of Contracts”. He offers a penetrating – perhaps devastating – critique of our approach. Bar-Gill notes the substantial convergence between choice theory and a welfarist view. If he is right, then what does choice theory add?

Our task in Part I of this …

One Judge's Legacy And The New York Court Of Appeals: Mr. Justice Cardozo And The Law Of Contracts, Meredith R. Miller

Touro Law Review

No abstract provided.

Autonomy For Contract, Refined, Hanoch Dagan, Michael A. Heller

Faculty Scholarship

In The Choice Theory of Contracts, we advance a claim about the centrality of autonomy to contract. This Issue offers thoughtful and penetrating critiques. Here, we reply. Autonomy is the grounding principle of contract. In Choice Theory, we stressed the (1) proactive facilitation component of autonomy, in particular, the state’s obligation regarding contract types. Here, we highlight two additional, necessary implications of autonomy for contract: (2) regard for future selves and (3) relational justice. These three aspects of autonomy shape the range, limit, and floor, respectively, for the legitimate use of contract. They provide a principled and constrained path for …