Contracts Commons^™

Promises, Trust, And Contract Law, Anthony J. Bellia Jr.

Journal Articles

The need for individuals to be able to trust that promises will be performed is central to justifying a law that renders certain promises enforceable. This Article argues that the legal enforcement of certain promises to meet this need does not necessarily diminish the personal relationships of trust in which such promises are made, as has been argued. Rather, this Article argues, the making and performance of legally enforceable promises can assist individuals in building relationships of trust, as it assists them in the pursuit of myriad goods.

An Inconsistently Sensitive Mind: Richard Posner's Celebration Of Insurance Law And Continuing Blind Spots Of Econominalism, Jeffrey W. Stempel

Scholarly Works

Seventh Circuit Judge Richard Posner is well known for bringing economic analysis to bear on a host of issues, including infamously controversial notions such the market for baby sale. Not surprisingly, Posner's insurance law opinions reflect economics, but perhaps not to the degree one would expect. A review of Posner's 20 years of opinions relating to insurance issues reviews his pragmatic jurisprudence as well. Decisions frequently reflect not only economics but also situational context and considerations of business reality as well as a sophisticated grasp of basic insurance doctrine and contract law. As a general matter, Posner also displays considerably …

Is Article 2 The Best We Can Do?, Robert E. Scott

Faculty Scholarship

You will all be happy to know that, haying listened to my colleagues for the last three hours, I have completely forgotten what I was planning to say. But I haven't forgotten why I am here. I am the proverbial skunk at the garden party, and I hope to fulfill my role as the only skeptic in the group. I must tell you candidly, however, that I agree with everything Gail Hillebrand had to say. That doesn't mean she is going to agree with anything that I have to say, but perhaps there are two skeptics here this afternoon.

My …

The Property/Contract Interface, Thomas W. Merrill, Henry E. Smith

Faculty Scholarship

This Article explores the distinction between in personam contract rights and in rem property rights. It presents a functional explanation for why the legal system utilizes these two modalities of rights, grounded in the pattern of information costs associated with each modality. To test this theory, the Article examines four legal institutions that fall along the property/contract interface – bailments, landlord-tenant law, security interests, and trusts – in order to determine how the legal doctrine varies as the underlying situation shifts from in personam, to in rem, to certain relations intermediate between these poles. With respect to each institution, we …

Precontractual Reliance, Lucian A. Bebchuk, Omri Ben-Shahar

Articles

During contractual negotiations, parties often make reliance expenditures that would increase the surplus should a contract be made. This paper analyzes decisions to invest in precontractual reliance under alternative legal regimes. Investments in reliance will be socially suboptimal in the absence of any precontractual liability-and will be socially excessive under strict liability for all reliance expenditures. Given the results for these polar cases, we focus on exploring how "intermediate"-liability rules could be best designed to induce efficient reliance decisions. One of our results indicates that the case for liability is shown to be stronger when a party retracts from terms …

Contracting With Electronic Agents, Anthony J. Bellia Jr.

Journal Articles

Established contract doctrine provides no clear answer to the question whether exchanges arranged by the interaction of electronic agents are enforceable. This Article explores whether the law should enforce exchanges arranged by the interaction of electronic agents. It examine how normative theories of contractual obligation inform the issue, with an eye toward the strengths and weaknesses of each theory. The theories that most strongly support the enforcement of exchanges arranged by electronic agents, this Article explains, are those that ground contractual obligation in protecting the ability of individuals to pursue their reasonable objectives through reliable arrangements.

Reconsidering The Reliance Interest, Christopher W. Frost

Law Faculty Scholarly Articles

This essay discusses the place of Fuller and Perdue's The Reliance Interest in Contract Damages in the contracts classroom. After first describing my use of The Reliance Interest, I will set out what I consider to be the pedagogical benefits of beginning the course with remedies and the attractiveness of Fuller and Perdue's analytical model in conveying an understanding of the remedial structure. Next, I will discuss the views of critics Craswell, Kelly and Barnes. Finally, I will revisit the place of Fuller and Perdue's work in the contracts course in light of these criticisms.

In Search Of Best Efforts: Reinterpreting Bloor V. Falstaff, Victor P. Goldberg

Faculty Scholarship

When contracting parties cannot quite define their obligations, they often resort to placeholder language, like "best efforts." They (and their counsel) likely have little idea of what they might mean, but, so long as they avoid litigation, it will not matter much. But "best efforts" clauses are on occasion litigated, and courts must read content into them. In Bloor v. Falstaff, a casebook favorite, the court held that Falstaff s lackluster promotional efforts for Ballantine beer violated its best efforts covenant. So far as I can tell, no commentators have questioned this outcome. Indeed, some commentators have found Falstaff …

Preface To The Gateway Thread, Deborah W. Post

Scholarly Works

No abstract provided.

Dismantling Democracy: Common Sense And The Contract Jurisprudence Of Frank Easterbrook, Deborah W. Post

Scholarly Works

No abstract provided.

The Law Of Contract And The Concept Of Change: Public And Private Attempts To Regulate Modification, Waiver, And Estoppel, David V. Snyder

Articles by Maurer Faculty

This article argues that contractual change is inherently problematic because contract and change are fundamentally antithetical. Because change is inevitable, however, the law of contract attempts to regulate the effect of change. These attempts are divided into two realms: public regulation, including the preexisting duty rule and its substitutes, and private regulation, including contractual "no oral modification" and "no oral waiver" clauses. The article criticizes not only the preexisting duty rule but also the duress and good faith tests that have been suggested as substitutes. Instead, the article proposes a "coercion" test, which is stated in detail and which is …

The Richness Of Contract Theory, Randy E. Barnett

Georgetown Law Faculty Publications and Other Works

This essay is a review of The Richness of Contract Law: An Analysis and Critique of Conemporary Theories of Contract Law by Robert A. Hillman (1997).

Throughout the book, Hillman offers a number of useful insights about various issues of contract law and theory--as he has in his numerous law review articles--but in this review the author is concerned with his overall theme: a general skepticism about "unifying" or "highly abstract" contract theories that fail to mirror the richness of contract law. In this regard, Hillman stands in the "realist" tradition of the previous generation of contracts scholars. Hillman attempts …

Self-Help In Contract Law: An Examination And Proposal, Celia R. Taylor

Sturm College of Law: Faculty Scholarship

Contrary to the common perception that Americans are overly litigious, many disputes never reach the court room. One reason for this is the availability of self-help--actions taken without recourse to third party intervention. The author explores self- help doctrine in American commercial law. Specifically, she considers the availabilityof self-help under the Uniform Commercial Code and the Restatement (Second)of Contracts. She shows that self-help is widely supported in these sources but that in practice it is not properly understood or applied. She argues that self-help should be encouraged uniformly in all commercial transactionsand suggests an addition to existing statutes that would …

The Cisg Convention And Thomas Franck's Theory Of Legitimacy, Anthony S. Winer

Faculty Scholarship

The Contracts for the International Sale of Goods (CISG) Convention is one of the most talked-about, and written-about, aspects of international commercial law. Ss time progresses, it may become evident that significant numbers of commercial actors and significant numbers of courts and other adjudicatory bodies are simply choosing not to apply the Convention. In such event, the question as to why there should be such a reluctance to adopt the Convention will present itself. This Article finds helpful perspective on this question in the work of international legal scholar Thomas Franck. Specifically, guidance is drawn from the theory of international …

Unreason In Action: A Case Study In The Wrong Approach To Construing The Liability Insurance Pollution Exclusion, Jeffrey W. Stempel

Scholarly Works

For more than twenty-five years, a significant component of the scholarly commentary on insurance law has focused on the so-called “reasonable expectations doctrine” enunciated by then-Professor (now Judge) Robert Keeton in his justly celebrated 1970 article. The reasonable expectations principle made a seemingly sudden emergence with the appearance of Keeton's article and has held particular attraction to academics while simultaneously prompting resistance from elements of the bench and bar, and particularly from the insurance industry. The doctrine's life to date can be described as one of early growth followed by subsequent retreat and dilution, with continuing controversy.

However, despite the …

The Net Profits Puzzle, Victor P. Goldberg

Faculty Scholarship

The use of "net profits" clauses in the movie business poses a problem. The standard perception is that Hollywood accounting results in successful films showing no net profits. If that is indeed so, then why have they survived for over four decades? This Essay argues that a successful movie will fail to yield net profits only if a "gross participant" (a major star whose compensation is in part a function of the film's gross receipts) becomes associated with the film. Since the net profits participants typically are associated with a project first, the question becomes: Why would they be willing …

The "Battle Of The Forms": Fairness, Efficiency, And The Best-Shot Rule, Victor P. Goldberg

Faculty Scholarship

After the parties agree to a sale, the buyer sends a purchase order with one set of boilerplate terms on the reverse side; the seller responds with an acknowledgment and invoice with another set of boilerplate terms. Do they have a contract? If so, on what terms? This so-called "battle of the forms" has given rise to a great outpouring of scholarship and a legislative solution widely perceived as inartfully drafted and generally unsatisfactory. In particular, the Code solution has been criticized because it attempted to solve both the formation and interpretation problems with one rule. The Uniform Commercial Code …

Franchising In The Shadow Of Contract Law: A New Fidelity For Business Relations, Richard Haigh

Dalhousie Law Journal

The institution of franchising has experienced a remarkable growth in North America in recent years. This has provoked a variety of legislative and judicial responses. This article examines the reasons behind the rise of franchising. It proceeds to examine the principal models of statutory regulation of franchise arrangements, and also the range of common law doctrines which courts have brought to bear on disputes arising out of such contracts. The author points out deficiencies in the existing models of franchise regulation and, drawing on legal responses to family disputes, proposes an alternative.

Bootstrapping And Slouching Toward Gomorrah: Arbitral Infatuation And The Decline Of Consent, Jeffrey W. Stempel

Scholarly Works

The Seventh Amendment to the Constitution preserves for litigants a right to a jury trial in actions at law. The right to a jury trial does not attach for equitable actions, but in cases presenting claims for both legal and equitable relief a right to a jury trial exists for common questions of fact. Although many modern statutes and claims did not exist in 1791, the Amendment has been interpreted to require a jury trial of statutory claims seeking monetary damages, the classic form of legal relief, so long as there is a relatively apt analogy between the modern statutory …

The Death Of Reliance, Randy E. Barnett

Georgetown Law Faculty Publications and Other Works

In the mid-1970s, it was an article offaith that contract was not properly conceived as a means by which persons could, by their own choice, make law for themselves to govern their relations. Instead, contract was thought best conceived as the rectification of injuries persons may have caused by their verbal conduct in much the same way that persons have a duty to rectify the injuries caused by their physical acts. With contracts, these injuries consisted of detrimental reliance on the words of another. So conceived, both contract and tort duties are imposed by law, and do not arise from …

More Selected Poems On The Law Of Contracts: Raintree County Memorial Library Occasional Paper No. 2, Douglass Boshkoff

Articles by Maurer Faculty

No abstract provided.

Interpreting Insurance Policies, Jeffrey W. Stempel

Scholarly Works

Like any other contract, an insurance policy may become the subject of a legal dispute. When disputes arise over insurance coverage, lawyers must combine their skill in contract interpretation with their knowledge of insurance law, bringing both to bear on the special problems related to this type of contract. Each dispute has unique traits, but a few basic ground rules of contract law and insurance law can help you interpret insurance policies and resolve disputes over insurance coverage.

Enforcing Coasian Bribes For Non-Price Benefits: A New Role For Restitution, Wendy J. Gordon, Tamar Frankel

Faculty Scholarship

In Boomer v. Muir,¹ a subcontractor on a hydroelectric project continued to provide goods and services even though the value of the performance far exceeded the contract price. The general contractor, who was receiving these goods and services, breached the contract even though he was paying less than market price for them.²

In many states, a supplier in the subcontractor's position has among her options the choice of "rescission and restitution."³ That means the supplier may rescind the contract and seek, under the label of "restitution", payment set at market price (or at her cost)⁴ for …

...And Contractual Consent, Randy E. Barnett

Georgetown Law Faculty Publications and Other Works

In Part I, the author contends that when economists persistently ignore the importance of contractual consent, they are missing the crucial problem of legitimacy. In Parts II and IV, he responds to the criticisms of his consent theory of contract advanced by Jay Feinman and Dennis Patterson. Both Feinman and Patterson object to the enterprise in which the author and others are engaging, and he explains why each is wrong to dismiss the current debate over default rules. Finally, in contrast, in Part III the author shows how Steven Burton's theory of default rules, which he finds most congenial, is …

The Power Of Presumptions, Randy E. Barnett

Georgetown Law Faculty Publications and Other Works

Once you start to notice it, you see it everywhere. Burden-shifting is pervasive.The author began to notice the power of presumptions when examining how to protect the rights "retained by the people" referred to in the Ninth Amendment without having to enumerate each one. He proposed the creation of a "presumption of liberty" that would extend the same protective presumption now accorded freedom of speech to all other rightful exercises of liberty. This presumption would shift the burden to the government to justify as necessary and proper any restriction on the rightful exercise of any liberty.

The Reunification Of Contract: The Objective Theory Of Consumer Form Contracts, Michael I. Meyerson

All Faculty Scholarship

Despite the ubiquitousness of standard form contracts in the world of consumer transactions, there is no consensus as to how these contracts ought to be constructed. Some courts continue to treat form contracts as if they were classically negotiated contracts. Others attempt in a variety of ways to factor in the reality that consumers entering into these contracts are not able to negotiate the terms and almost always sign these documents, which are presented on a take-it-or-leave-it basis, without reading them. This article posits that the cause of this continued confusion over form contracts is due to a basic failure …

The Legal Infrastructure Of Markets: The Role Of Contract And Property Law Essay, Tamar Frankel

Faculty Scholarship

Markets are social institutions that facilitate exchange transactions. Therefore, they require a regime of freedom to exchange-a contract regime. Markets can be made more efficient by reducing the transaction and information costs for market actors. Such a reduction can be effected by standardizing the products exchanged, the terms of the transactions, and the nature of the rights transferred. Information costs can be reduced by publicizing the transactions' and by using the services of intermediaries

Feminism And Disciplinarity: The Curl Of The Petals, Carol Sanger

Faculty Scholarship

In this Symposium, feminism has been invited to take a place alongside such well-established disciplines as history, philosophy, and economics in a consolidated exploration of interdisciplinary approaches to law. While sincerely extended – the feminist entry is not the only one that women are writing – and generously unbounded as to scope, ... the invitation raises what for many is a prior question: Is feminism a discipline at all?

As the feminist delegate to this interdisciplinary Symposium, I have therefore taken as my initial task consideration of the issue implicit in the invitation: feminism's credentials as a discipline. I explore …

Striking The Balance In Contract History, Joel Levin, Banks Mcdowell

Cleveland State Law Review

The past three decades have seen an enormous amount of writing by Anglo-American scholars about contract theory. If nothing else, this demonstrates the almost universal perception that there are serious problems with the received theory of contract, the product of giants like Holmes, Williston, Cardozo and Corbin. This theoretical activity, instead of creating a new paradigm, has produced divergent theoretical approaches with various bands of scholars striking off in quite different directions, and in the process leaving most judges and lawyers back at the starting point. What should we be trying to do when we build a contract theory for …

Hungarian Legal Reform For The Private Sector, Cheryl W. Gray, Rebecca J. Hanson, Michael A. Heller

Faculty Scholarship

Hungary is in the midst of a fundamental transformation toward a market economy. Although Hungary has long been in the forefront of efforts to reform socialism itself, after 1989 the goals of reform moved from market socialism toward capitalism, as the old Communist regime lost power and the idea of widespread private ownership gained acceptance. The legal framework – the "rules of the game – is now being geared toward encouraging, protecting, and rewarding entrepreneurs in the private sector.

This Article describes the evolving legal framework in Hungary in several areas: constitutional, real property, intellectual property, company, foreign investment, contract, …