. There is an ongoing debate in the philosophical and jurisprudential literature regarding the nature and possibility of Contract theory. On one hand, are those who argue (or assume) that there is, or should be, a single, general, universal theory of Contract Law, one applicable to all jurisdictions and all times. On the other hand, are those who assert that Contract theory should be localized to particular times and places, perhaps even with different theories for different types of agreements. This article considers one facet of this debate: evaluating the relevance of the fact that the remedies available for breach of contract can vary significantly from one jurisdiction to another. This wide variation in remedies for breach of a (contractual) promise is one central difference between promises in morality and enforceable agreements in law. The article asserts that variation of remedies strongly supports the conclusion that there is (and can be) no general, universal theory of Contract Law.

https://papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID1921081_code119209.pdf?abstractid=993949&rulid=64782&mirid=5

Contract Rights and Remedies, and the Divergence between Law and Morality*

.............................................................................................................................................................. 3 Abbreviations .................................................................................................................................................... 4 Cases Cited ......................................................................................................................................................... 6 Statutes and Conventions Cited ................................................................................................................ 26 Chapter 1: Introduction ............................................................................................................................... 28 1.1 Interpretative Philosophy Of The Convention .................................................................... 31 1.1.1 International Character: ...................................................................................................... 32 1.1.2 Uniformity in Application: .................................................................................................. 33 1.1.3 The Observance of Good Faith: ......................................................................................... 34 1.1.4 General Principles: ................................................................................................................. 34 1.2 Do the Rules of the Convention Benefit the Parties? ........................................................ 36 1.2.1 Operates to minimize transaction costs: .............................................................. 37 1.2.2 Does not allow or de-incentivizes the potential of parties to act in an opportunistic manner: ..................................................................................................................... 39 1.2.3 Places liability on the best-risk avoider: ............................................................... 41 1.3 Issues Under Consideration ........................................................................................................ 43 1.3.1 The function of the principle of good faith: ......................................................... 43 1.3.2 The issues surrounding the inclusion of standard terms into the contracts of sale: ................................................................................................................................ 43 1.3.3. The issue of open-price terms: ................................................................................. 44 1.3.4 The question of the period within which notice of non-conformity must be provided: ......................................................................................................................................... 44 1.3.5 The rate at which interest has to be paid on sums in arrears: .................... 45 1.3.5 The guiding principles for the interpretation of the term ‘foreseeability’ as contained in Article 74: .............................................................................................................. 46 1.4 Approach: ........................................................................................................................................... 46 1.5 Limitations: ........................................................................................................................................ 48 Chapter 2 Good Faith ................................................................................................................................... 50 Introduction .............................................................................................................................................. 50 2.1 The differentiation between good faith as a tool of interpretation and good faith as a general principle: ................................................................................................................ 54 2.2 Analysis of the definition and scope of the principle of Good Faith ........................... 56 2.2.1 Good faith in English Law: .................................................................................................. 56 2.2.2 Expectation of the parties: .......................................................................................... 60 2.2.3 Special rules for particular contracts: .................................................................... 60 2.2.4 Limitation on contractual freedom in certain instances: ............................... 61 2.3 Good faith in US law: ...................................................................................................................... 62 2.4 Good Faith in German Law .......................................................................................................... 66 2.5 Good Faith in the Convention ..................................................................................................... 70 2.5.1 Drafting History of the Convention ................................................................................. 70 2.6 The application of the principle of Good faith in practice: an analysis of case law ........................................................................................................................................................................ 74 2.6.1 Good faith viewed solely as a guide to interpretation. ............................................ 74 2.6.2 Good faith as imposing substantive requirements on the parties...................... 76 2.6.3 Good faith as a gap-filler ...................................................................................................... 77 2.6.4 Good faith general requirement used to impose further obligation upon a party: ....................................................................................................................................................... 79 2.7 The Recommended Approach .................................................................................................... 81 2.7.1 Good Faith is too vague to provide meaningful guidance as a general principle ................................................................................................................................................. 82 2.7.2 The UNIDROIT principles and the Convention........................................................... 87 2.7.3 Defining good faith from within ....................................................................................... 89 2.8 The standard of conduct that the Convention requires of the parties to the contract ....................................................................................................................................................... 90 2.8.1 Requirement of honest communication and co-operation ................................... 90 2.8.2 Obligation not to act in a manner contrary to the other party’s reasonable expectation ........................................................................................................................................... 91 2.8.3 Obligation to act in a reasonable manner even where acting otherwise might not be in contravention of the express wording of an article (the rule against creative compliance) ........................................................................................................................ 91 2.7 Should parties expressly incorporate the principle in their contracts? ................... 94 2.8 Conclusions: ...................................................................................................................................... 98 Chapter 3 Battle of Forms ...................................................................................................................... 100 Introduction ............................................................................................................................................ 100 3.1 Comparative Analysis of Domestic Law Rules on BOF ........................................... 104 3.1.1 United Kingdom: ................................................................................................................... 104 3.1.2 United States ........................................................................................................................... 108 3.1.3 German Law: ........................................................................................................................... 114 3.2 Analysis of the Travaux ....................................................................................................... 116 3.2.1 Considerations ....................................................................................................................... 122 3.3 Theoretical Framework of Analysis ............................................................................... 123 3.3.1 LSR and Efficiency ........................................................................................................ 124 3.3.2 KOR and Efficiency ....................................................................................................... 128 3.4 Goldberg’s Best Shot Rule .......................................................................................................... 129 3.5 Article 19 of the Convention ..................................................................................................... 131 3.5.1 AC Opinion No. 13 ................................................................................................................. 133 3.6 Conclusion ........................................................................................................................................ 136 Chapter 4 Open Price terms ..................................................................................................................... 14

An efficiency based resolution of contentious issues under the Convention on International Sale of Goods

Black-letter law declares that a contract to perform personal services cannot be specifically enforced. Many courts, scholars, and commentators have claimed that such enforcement would constitute “involuntary servitude” under the Thirteenth Amendment. This Article, however, rejects that conventional wisdom. A careful reading of the history leading to the ratification of the Thirteenth Amendment reveals that, at the time of its adoption, “involuntary servitude” had a specific legal meaning, one that did not extend to any specific enforcement of a personal service contract. Rather, courts that were forced to draw the line between contract enforcement and “involuntary servitude” looked to coercion in the creation of the contract, the length of its duration, the power of the master over the servant, and the adequacy of the servant’s compensation to determine if enforcement of an agreement would constitute “involuntary servitude.” Since the Thirteenth Amendment’s adoption, the U.S. Supreme Court has never found involuntary servitude in any case except those in which at least one of these factors and arguably all four of them was present. In short, neither the original meaning of “involuntary servitude” nor its subsequent interpretation by the Court justifies a per se prohibition on specific performance of personal service contracts.

Specific Performance and the Thirteenth Amendment

El analisis economico del Derecho (AED) estudia los fenomenos juridicos sirviendose de las teorias y las
herramientas metodologicas proporcionadas por la economia. El AED puede cumplir una funcion
normativa (senalar que decisiones juridicas deberian adoptarse con el fin de maximizar ciertas
preferencias), una funcion predictiva (determinar las consecuencias sociales que pueden tener las decisiones
juridicas) y una funcion explicativa (poner de manifiesto los factores que determinan la forma y el
contenido las decisiones juridicas). El AED ha recibido innumerables criticas. En este trabajo consideramos
y tratamos de refutar, en la medida en que lo merezcan, aquellas que impugnan su valor explicativo en
general y del Derecho de danos en particular, que es el ambito juridico donde esta cuestion se ha discutido
mas profusa e intensamente. En particular, ponemos de relieve que el AED ofrece explicaciones del Derecho
de danos realmente practicado mas exactas, amplias, simples, fecundas, unificadoras y coherentes que las
propuestas por otras teorias alternativas, como la de la «justicia correctiva».

Sobre el poder explicativo del análisis económico del Derecho

The conflict between external and internal perspectives in private law is both exaggerated and underplayed. Both external and internal perspectives pay too little attention to how the ‘micro’ level...

Sizing up private law

The law of contracts is complex but remarkably stable. What we lack is a widely accepted interpretation of that law as embodying a coherent set of normative choices. Some scholars have suggested that either economic efficiency or personal autonomy provide unifying principles of contract law. These two approaches, however, seem incommensurable, which suggests that we must reject at least one of them in order to have a coherent theory. This article dissents from this view and has a simple thesis: Economic accounts of the current doctrine governing contract damages have failed, but efficiency arguments remain key to any adequate theory of contract law. Contractual liability - like virtually all civil liability - is structured around the concept of bilateralism, meaning that damages are always paid by defeated defendants to victorious plaintiffs. Ultimately, economic accounts of this basic feature are unpersuasive. This criticism, however, leaves untouched many of the key economic insights into the doctrine of contract damages. The limited failure of economic interpretations points toward a principled accommodation of both autonomy and efficiency in a single vision of contract law where notions of autonomy provide the basic structure and economics fills in most of the doctrinal detail.

/pdf/the-failure-of-economic-interpretations-of-the-law-of-3w4qwtbgzb.pdf

The Failure of Economic Interpretations of the Law of Contact Damages

I. IntroductionThe law of contracts is a complex but remarkably stable field. To be sure, new factual situations provide novel challenges for old doctrines, and the interstitial development of the law continues.1 Still, there is widespread agreement about the doctrinal shape of modern contract law.2 What we lack is a widely accepted interpretation of that law. We have historical narratives of how the law developed and innumerable suggestions for how it should be reformed.3 What this work does not offer is an interpretation of current contract law as embodying a coherent set of normative choices. Indeed, much of the scholarly discussion of contract law implicitly or explicitly assumes that any such interpretation is impossible and that the law we have represents, at best, a collection of essentially random and disconnected choices resulting from a series of historical accidents.4 One of the central questions facing students of contract law is whether this theoretically pessimistic view of the law is correct, or whether it is possible to understand it as a coherent normative system.One of the most promising contenders for the role of a unified theory of contract law is economics. On this view, contract law as we have it represents a choice to promote efficiency, and the particular rules we find in contract doctrine are best seen as creating economically optimal incentives for contracting parties.6 The dominant alternative is that contract law is about advancing the liberal ideal of personal autonomy by giving legal effect to the private decisions of contracting parties.7 The apparent success of economics as a methodology comes from the fact that, unlike autonomy, it seems to provide concepts that generate conclusions that are fine-grained enough to account for contract law doctrine.8 The duty to keep one's promises may be a normatively attractive ideal, but it lacks the conceptual power to specify most of the rules of contract law.9Notwithstanding this sunny assessment of economic theories of contract, criticism remains very much alive. Partisans of autonomy theories have stubbornly insisted that efficiency is such a morally bankrupt ideal that economic theories of contract must be rejected, while others have attacked efficiency theories on economic grounds.10 Navigating a route through these competing claims is one of the central tasks for the philosophy of contract law. Some have suggested that rather than seeking a jurisprudential silver bullet that will allow us to reject either autonomy or efficiency once and for all, philosophers of contract law should turn their energies to a theory that provides a principled accommodation of both approaches in a single vision of contract law.11 This Article is part of that project. It has a simple thesis: Economic accounts of the current doctrine governing contract damages have failed, and the nature of that failure places limits on the role of economics in an integrated theory of contract law.Economic theories of contract law are offered as-among other things-an explanation of contract doctrine as we have it.12 They purport to show to us the underlying normative logic of the law. When it comes to contract damages, however, the economic explanation ultimately falls short of success because it cannot account for the bilateralism of contractual liability, which then renders the dominant economic interpretation of damages fundamentally contradictory. Generally speaking, the remedy in contract law involves a transfer from a breaching party to an aggrieved party. The sum paid by the wayward promisor is exactly equal to the sum paid to the disappointed promisee.13 For example, if Jack enters into a contract to fetch water for Jill in return for a fee and Jack then fails to deliver the water as promised, the law of contracts allows Jill to sue Jack for the value of his failed performance. If Jill is successful, the law will require Jack to deliver Jill money. The sum that he pays and she receives will be identical. …

/pdf/the-failure-of-economic-interpretations-ofthe-law-of-lh1fbjamoe.pdf

Nathan B. Oman

Papers

The Failure of Economic Interpretations of the Law of Contact Damages

The Failure of Economic Interpretations ofthe Law of Contract Damages