Unintelligent design in contract

University of Illinois Law Review

Volumn 2008, Issue 2, 2008, Pages 505-555

  Alces, Peter A ^a  

^a Dept of Economics and Thomas Jefferson Program in Public Policy at the College of William and Mary

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EID: 43049130817     PISSN: 02769948     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Review

References (290)

1. K.M. Llewellyn, On Our Case-Law of Contact: Offer and Acceptance, 48 YALE L.J. 1, 1 (1938).
2. Peter A. Alces, On Discovering Doctrine: "Justice" in Contract Agreement, 83 WASH. U. L.Q. 471, 502-03 (2005) [hereinafter Alces, On Discovering Doctrine].
3. Peter A. Alces, The Moral Impossibility of Contract, 48 WM. & MARY L. REV. 1647, 1656-57 (2007).
4. See generally JAMES GORDLEY, THE PHILOSOPHICAL ORIGINS OF MODERN CONTRACT DOCTRINE (1991).
5. This may be akin to the error of confusing the "is" with the "ought," which Hume identified: For as this ought, or ought not, expresses some new relation or affirmation, 'tis necessary that it shou'd be obsrv'd and explain'd; and at the same time that a reason shou'd be given, for what seems altogether inconceivable, how this new relation can be a deduction from others, which are entirely different from it. DAVID HUME, A TREATISE OF HUMAN NATURE 302 (David Fate Norton & Mary J. Norton eds., 2000). G.E. Moore extended Hume's point by positing the "naturalistic fallacy," the identification of "goodness" with a natural property. G.E. MOORE, PRINCIPIA ETHICA 60 (Thomas Baldwin ed., Cambridge Univ. Press 1993) (1903). The point I make here is analogous and much more modest: we should no more assume that Contract or, for that matter, any body of legal doctrine is normatively coherent than we should assume that what "is" is what "ought" to be (by whatever measure we use to determine what ought to be).
6. Professor Peter Benson correctly demonstrates the error in Lon Fuller and William Perdue's equation of all promises, juridical and, for lack of a better term, casual. See Peter Benson, The Expectation and Reliance Interests in Contract Theory: A Reply to Fuller and Perdue, ISSUES IN LEGAL SCHOLARSHIP, June 2001, at 29-51, (2001), http://www.bepress.com/ils/iss1/art5/. The law need not explain why some promises are enforceable and others are not; but the law does need to offer a normative basis for the enforceability of juridical promises. Benson, as will be developed further below, finds the basis of juridical promise enforcement in his "transfer theory" of contract. Id. at 31.
7. Andrew Kull, Disgorgement for Breach, the "Restitution Interest," and the Restatement of Contracts, 79 TEX. L. REV. 2021, 2033-34 (2001).
8. Id.
9. Id.
10. CHARLES FRIED, CONTRACT AS PROMISE (1981).
11. GRANT GILMORE, THE DEATH OF CONTRACT 71 (1974) (citing commentary to RESTATEMENT (SECOND) OF CONTRACTS § 75 (Tentative Draft No. 2, 1965)). See generally P.S. ATIYAH, PROMISES, MORALS, AND LAW (1981); LON FULLER, THE MORALITY OF LAW (1964).
12. See, e.g.. Randy E. Barnett, A Consent Theory of Contract, 86 COLUM. L. REV. 269 (1986); Peter Benson, The Unity of Contract Law, in THE THEORY OF CONTRACT LAW: NEW ESSAYS 118, 128 (Peter Benson ed., 2001).
13. See generally Richard Craswell, Contract Law, Default Rules, and the Philosophy of Promising, 88 MICH. L. REV. 489 (1989).
14. See generally Craswell, supra note 13. Cf. Jody S. Kraus, Philosophy of Contract Law, in THE OXFORD HANDBOOK OF JURISPRUDENCE & PHILOSOPHY OF LAW 687, 696 (Jules Coleman & Scott Shapiro eds., 2002) (arguing that deontologists and consequentialists often come up with different answers because they are answering different questions).
15. Eric A. Posner, Economic Analysis of Contract Law After Three Decades: Success or Failure?, 112 YALE L.J. 829, 830 (2003) (arguing that "economic analysis has failed to produce an 'economic theory' of contract law, and does not seem likely to be able to do so."). See generally ERIC A. POSNER, LAW AND SOCIAL NORMS (2000).
16. See, e.g., FRIED, supra note 10; Benson, supra note 6; Richard Craswell, How We Got This Way: Further Thoughts on Fuller and Perdue, ISSUES IN LEGAL SCHOLARSHIP, June 2001, http://www. bepress.com/ils/iss1/art2; James Gordley, A Perennial Misstep: From Cajetan to Fuller and Perdue to "Efficient Breach," ISSUES IN LEGAL SCHOLARSHIP, June 2001, http://www.bepress.com/ils/iss1/art4; Stephen A. Smith, "The Reliance Interest in Contract Damages" and the Morality of Contract Law, ISSUES IN LEGAL SCHOLARSHIP, June 2001, http://www.bepress.com/ils/iss1/art1.
17. For a general discussion of "doctrinal coherence," see J.M. Balkin, Understanding Legal Understanding: The Legal Subject and the Problem of Legal Coherence, 103 YALE L.J. 105, 127 (1993) ("To accuse legal doctrine of incoherence is to imagine a set of legal doctrines that might be coherent; to assert that explanations of existing doctrines are not reasonable is to appeal to distinctions and similarities that could be reasonable.").
18. A distinction between Contract and tort is found throughout the reported decisions. See, e.g., Garland v. Davis, 45 U.S. 131, 144 (1846) ("Nor is the difference merely formal or technical between actions founded in tort and in contract."); Spence v. Omaha Indem. Ins. Co., 996 F.2d 793, 796 (5th Cir. 1993) (ruling that the National Flood and Insurance Act of 1968 applies only to contract claims, and not tort claims); Evra Corp. v. Swiss Bank Corp., 673 F.2d 951, 957-59 (7th Cir. 1982) (discussing foreseeable damages as they apply to contract actions as opposed to tort actions); McClure v. Johnson, 69 P.2d 573, 576-78 (Ariz. 1937) (determining that an action for the negligent breach of a contract is an action in contract, rather than tort); Martin v. Julius Dierck Equip. Corp., 384 N.Y.S.2d 479, 482 (N.Y. App. Div. 1976) (ruling that it is the responsibility of a court to determine whether the basis of a plaintiff's case is in tort or contract).
19. E. ALLAN FARNSWORTH, FARNSWORTH ON CONTRACTS § 3.13 (3d ed. 2004).
20. STEPHEN A. SMITH, CONTRACT THEORY 4-5 (2004). According to Smith, historical accounts "reveal the law's causal history," while prescriptive accounts contemplate "the ideal law." Descriptive accounts, of course, seek to describe the law as it is (or was). Interpretive theories "aim to enhance understanding of the law by highlighting its significance or meaning"; their object is to "make sense" of the law. Id.
21. See Alces, On Discovering Doctrine, supra note 2, at 473 (discussing the heuristic over- and under-inclusiveness of the rules and doctrine that make up areas of law).
22. SMITH, supra note 20, at 5.
23. See, e.g., Jody S. Kraus, Reconciling Autonomy and Efficiency in Contract Law: The Vertical Integration Strategy, in SOCIAL, POLITICAL, AND LEGAL PHILOSOPHY 420 (Ernest Sosa & Enrique Villanueva eds., 2001).
24. See ProCD, Inc. v. Zeidenberg, 86 F.3d 1447 (7th. Cir. 1996); see also Peter A. Alces, Guerilla Terms, 57 Emory L.J. 1511,1557-60 (2007) (positing a role for agreement in modern contractual contexts); Brian Bix, Background Rules, Incompleteness, and Intervention, 2004 WIS. L. REV. 379, 386 (discussing the difficulty of finding consent in a world of form contracts).
25. See infra Part I.C.1.
26. See SMITH, supra note 20, at 169.
27. See id. at 168.
28. See id. at 171.
29. ATIYAH, supra note 11, at 37.
30. See FRIED, supra note 10.
31. ATIYAH, supra note 11, at 30-44.
32. FRIED, supra note 10.
33. Id. at 14-17.
34. Id.
35. On the tension between reliance and expectation damages, see L.L. Fuller & William R. Perdue, Jr., The Reliance Interest in Contract Damages (pt. 1), 46 YALE L.J. 52 (1936) [hereinafter Fuller & Perdue, Contract Damages: 1]; L.L. Fuller & William R. Perdue, The Reliance Interest in Contract Damages (pt. 2), 46 YALE L.J. 373 (1936) [hereinafter Fuller & Perdue, Contract Damages: 2].
36. "Just as assent may be manifested by words or other conduct, sometimes including silence, so intention to make a promise may be manifested in language or by implication from other circumstances, including course of dealing or usage of trade or course of performance." RESTATEMENT (SECOND) OF CONTRACTS § 4 cmt. a (1981); see also id. § 19 cmt. a ("[T]here is no distinction in the effect of the promise whether it is expressed in writing, or orally, or in acts, or partly in one of these ways and partly in others. Purely negative conduct is sometimes, though not usually, a sufficient manifestation of assent.").
37. See id. § 1 (1981) ("A contract is a promise or a set of promises...."); id. § 2(1) ("A promise is a manifestation of intention to act or refrain from acting in a specified way, so made as to justify a promisee in understanding that a commitment has been made.").
38. See id. § 90 (1981) (actionable reliance); id. § 344 (allowing remedies for a party's "reliance interest").
39. P.S. ATIYAH, ESSAYS ON CONTRACT 8-9 (1990).
40. GILMORE, supra note 11, at 87.
41. Id. at 90. See generally ATIYAH, supra note 11.
42. GILMORE, supra note 11, at 92.
43. Id. at 87-88.
44. ATIYAH, supra note 11, at 210-11.
45. Id. at 210.
46. See GILMORE, supra note 11, at 88-89.
47. See WILLIAM L. PROSSER, HANDBOOK OF THE LAW OF TORTS 2 (West Publ'g Co. 4th ed. 1971) (1941) ("[O]ne important form of remedy for a tort is... the restitution of what has been wrong-fully taken.").
48. Fuller & Perdue, Contract Damages: 1, supra note 35, at 53-54.
49. Id. at 54.
50. It is clear that Section 90, by its terms, requires reliance for a promise not supported by consideration to be actionable. See RESTATEMENT (SECOND) OF CONTRACTS § 90 (1981). Professor Hillman's three-year empirical survey of promissory estoppel cases revealed that reliance maintains a "crucial role" in the courts' analysis. Robert A. Hillman, Questioning the "New Consensus" on Promissory Estoppel: An Empirical and Theoretical Study, 98 COLUM. L. REV. 580, 597 (1998). Almost two decades earlier, Professor Knapp argued that a comparison of reliance with "such modest and familiar notions as the promise to pay a debt discharged in bankruptcy was like putting Pavarotti in a barbershop quartet." Charles L. Knapp, Reliance in the Revised Restatement: The Proliferation of Promissory Estoppel, 81 COLUM. L. REV. 52, 53 (1981); see also Juliet P. Kostritsky, The Rise and Fall of Promissory Estoppel or Is Promissory Estoppel Really as Unsuccessful as Scholars Say It Is: A New Look at the Data, 37 WAKE FOREST L. REV. 531 (2002) (finding a more nuanced place for reliance in promissory estoppel actions). Nonetheless, the survival of reliance as a necessary element of a promissory estoppel action is not a subject of universal agreement. Professors Farber and Mattheson conclude that "reliance is no longer the key to promissory estoppel. Although courts still feel constrained to speak the language of reliance, their holdings can best be understood and harmonized on other grounds." Daniel A. Farber & John H. Matheson, Beyond Promissory Estoppel: Contract Law and the "Invisible Handshake," 52 U. CHI. L. REV. 903, 904 (1985). Professor Feinman similarly has argued that "promissory estoppel is no longer an appropriate doctrine, given recent developments in the wider scheme of contract law and theory, and thus it is time to move on." Jay M. Feinman, The Last Promissory Estoppel Article, 61 FORDHAM L. REV. 303, 304 (1992). For similar arguments, see Randy E. Barnett, The Death of Reliance, 46 J. LEGAL EDUC. 518 (1996); James Gordley, Enforcing Promises, 83 CAL. L. REV. 547 (1995); Edward Yorio & Steve Thel, The Promissory Basis of Section 90, 101 YALE L.J. III (1991).
51. Fuller & Perdue, Contract Damages: 1, supra note 35; Fuller & Perdue, Contract Damages: 2, supra note 35.
52. Gordley, supra note 16, at 1.
53. See, e.g., Peter A. Alces, Contract Reconceived, 96 Nw. U. L. REV. 39, 50-51 (2001); Peter A. Alces, Regret and Contract "Science," 89 GEO. L.J. 143, 148-54, 161-63 (2000); David W. Barnes & Deborah Zalesne, A Unifying Theory of Contract Damage Rules, 55 SYRACUSE L. REV. 495, 504-05, 520-21 (2005); Barnett, supra note 50, at 518-22; Benson, supra note 6, at 19-20, 23; Richard Craswell, Against Fuller and Perdue, 67 U. CHI. L. REV. 99, 100, 136, 153-54 (2000); Craswell, supra note 16, at 3-6, 7-8; Richard Craswell, Offer, Acceptance, and Efficient Reliance, 48 STAN. L. REV. 481, 499-500 (1996); Feinman, supra note 50, at 305-08; Jay M. Feinman, Promissory Estoppel and Judicial Method, 97 HARV. L. REV. 678, 696 (1984); Gordley, supra note 50, at 568-69; Gordley, supra note 16, at 2-3; Louis Kaplow & Steven Shavell, Fairness Versus Welfare, 114 HARV. L. REV. 961, 1113-14, 1114 n.348 (2001); Avery Katz, Reflections on Fuller and Perdue's The Reliance Interest in Contract Damages: A Positive Economic Framework, 21 U. MICH. J.L. REFORM 541, 557-58, 560 (1988); Michael B. Kelly, The Phantom Reliance Interest in Contract Damages, 1992 WIS. L. REV. 1755, 1756; Charles L. Knapp, Rescuing Reliance: The Perils of Promissory Estoppel, 49 HASTINGS L.J. 1191, 1199, 1228, 1251 (1998); Roy Kreitner, Fear of Contract, 2004 WIS. L. REV. 429, 468; Daniel Markovits, Contract and Collaboration, 113 YALE L.J. 1417, 1443 (2004); Eric A. Posner, Economic Analysis of Contract Law After Three Decades: Success or Failure?, 112 YALE L.J. 829, 871, 878 (2003); Smith, supra note 16, at 17, 24-25; Edward Yorio & Steve Thel, The Promissory Basis of Past Consideration, 78 VA. L. REV. 1045, 1048-50, 1073-75 (1992); Yorio & Thel, supra note 50, at 160-61, 167.
54. Fuller & Perdue, Contract Damages: 1, supra note 35, at 54.
55. Id. at 52-53.
56. See Smith, supra note 16, at 8 (footnotes omitted): The harm principle states that it is illegitimate for the state to interfere with an individual's liberty unless that individual has harmed (or is about to harm) another individual. Enforcing promises qua promises is inconsistent with this principle, it is said, because a promissory obligation is an obligation to benefit another rather than an obligation not to harm another.... [Enforcing promises is like enforcing an obligation to give to charity. Keeping a promise, like giving to charity, is praiseworthy - a mark of good character-but a failure to do so should not, in itself, concern the law (or at least not be of concern to the law dealing with individual's private relations). Smith relied on John Stuart Mill for articulation of the "harm principle." See JOHN STUART MILL, ON LIBERTY 10-11 (David Spitz ed., 1975) (1859). Smith also cites in this regard Joseph Raz's review of P.S. Atiyah's PROMISES, MORALS, AND LAW. See Joseph Raz, Promises in Morality and Law, 95 HARV. L. REV. 916, 937 (1982). There, Raz observed that "[i]t follows from the harm principle that enforcing voluntary obligations is not itself a proper goal for contract law. To enforce voluntary obligations is to enforce morality through the legal imposition of duties on individuals. In this respect it does not differ from the legal proscription of pornography." Id.
57. James Gordley, Contract Law in the Aristotelian Tradition, in THE THEORY OF CONTRACT LAW: NEW ESSAYS 265, 328 (Peter Benson ed., 2001).
58. Id. at 328 n.279; see also Gordley, supra note 16, at 7.
59. Compare Hume's argument that promises arise only from human convention: "It is only a general sense of common interest; which sense all the members of the society express to one another, and which induces them to regulate their conduct by certain rules." HUME, supra note 5, at 314-15.
60. Fuller & Perdue, Contract Damages: 1, supra note 35, at 59.
61. See, e.g., JOHN RAWLS, A THEORY OF JUSTICE 345 (1972); FRIED, supra note 10, at 16.
62. See supra note 56.
63. See infra Part I.C.
64. SMITH, supra note 20, at 80-82.
65. PETER A. ALCES, THE LAW OF FRAUDULENT TRANSACTIONS §§ 2:21-:22 (2006).
66. Id.
67. See generally JoEllen Mitchell-Lockyer, Common Law Misrepresentation in Sales Cases - An Argument for Code Dominance, 19 FORUM 361, 389-90 (1984).
68. See id.
69. See Randy E. Barnett, The Richness of Contract Theory, 97 MICH. L. REV. 1413 (1999) (reviewing ROBERT HILLMAN, THE RICHNESS OF CONTRACT LAW (1997)).
70. ALCES, supra note 65, §§ 2:21-:22.
71. See RESTATEMENT (SECOND) OF CONTRACTS § 90(1) (1981).
72. See id. at § 347 cmt. a ("Contract damages are ordinarily based on the injured party's expectation interest....")'. E. ALLAN FARNSWORTH, CONTRACTS 756-57 (3d ed. 1999); 11 JOSEPH M. PERILLO, CORBIN ON CONTRACTS § 55.3 (2005).
73. At least in theory. See supra note 50.
74. See Kajima/Ray Wilson v. L.A. County Metro. Transp. Auth., 1 P.3d 63, 68-73 (Cal. 2000) (holding that a contractor could recover in promissory estoppel for the cost of preparing a bid incurred in reliance on the promise, but not for the expected profits from the venture); RESTATEMENT (SECOND) OF CONTRACTS § 90(1) (1981); Appendix, 4 A.L.I. PROC. 98-99 (1926).
75. Professor Smith observes that no one has ever tried to formulate a comprehensive theory of Contract based on reliance. SMITH, supra note 20. at 78.
76. In his Contract Theory, Smith places discussion of Fried's promise theory before discussion of reliance, as though reliance were a response to promise rather than, chronologically, the other way around. Id. at 71. Smith does, however, challenge the position that promise is a necessary condition for the creation of a reliance-based duty as "difficult to defend." Id. at 80.
77. FRIED, supra note 10.
78. Id. at 17.
79. See id. at 28-112.
80. Id.
81. See id. at 7-14.
82. Id. at 12.
83. See RESTATEMENT (SECOND) OF CONTRACTS §§ 1, 2(1), 3 (1981) (indicating the interrelatedness of promise, agreement, and bargain).
84. I am here assuming that we can get past the problem, noted by Smith, that the law generally enforces agreements, but not-with few exceptions-"mere promises." SMITH, supra note 20, at 63-65; see also Brian H. Bix, Contract Law Theory 9 (Univ. of Minn. Law Sch. Legal Studies Research Paper Series, Research Paper No. 06-12, 2006), available at http://papers.ssrn.com/abstract=892783 (noting that much of the law of Contracts is "aimed at distinguishing enforceable bargains from unenforceable 'mere' promises").
85. Smith distinguishes "the kind of intention required to make a promise and the kind of intention that matters in determining the content" of a promise: [S]ubjective intentions are what count in determining whether a promise was made at all: a promise cannot be made without intending to make a promise.... [H]owever, the content of a promise is, on both the ordinary and philosophical understanding of promises, determined objectively. In interpreting a promise, as in interpreting normal communications, the aim is not to determine what the promisor intended, but what the promisor actually meant - which is determined "objectively. " If this view of promising is correct... the objective approach is inconsistent with promissory theories only insofar as it applies to the intention to make a contract. SMITH, supra note 20, at 61-62.
86. Id. at 60-62.
87. Smith, supra note 16, at 20-21, 35.
88. GILMORE, supra note 11, at 65-66.
89. ATIYAH, supra note 11, at 66.
90. GILMORE, supra note 11.
91. Gilmore argued that this was the Holmesian vision: If "we can restrict ourselves to the 'externals' (what the parties 'said' or 'did'), then the factual inquiry will be much simplified and in time can be dispensed with altogether as courts accumulate precedents about recurring types of permissible and impermissible 'conduct.'" Id. at 42.
92. See, e.g., Robert B. Ahdieh, The Strategy of Boilerplate, 104 MICH. L. REV. 1033 (2006); Douglas G. Baird, The Boilerplate Puzzle, 104 MICH. L. REV. 933 (2006); Michelle E. Boardman, Contra Preferentem: The Allure of Ambiguous Boilerplate, 104 MICH. L. REV. 1105 (2006); David Gilo & Ariel Porat, The Hidden Roles of Boilerplate and Standard-Form Contracts: Strategic Imposition of Transaction Costs, Segmentation of Consumers, and Anticompetitive Effects, 104 MICH. L. REV. 983 (2006); Robert A. Hillman, Online Boilerplate: Would Mandatory Website Disclosure of E-Standard Terms Backfire?, 104 MICH. L. REV. 837 (2006); Jason Scott Johnston, The Return of Bargain: An Economic Theory of How Standard-Form Contracts Enable Cooperative Negotiation Between Businesses and Consumers, 104 MICH. L. REV. 857 (2006); Russell Korobkin, Bounded Rationality, Standard Form Contracts, and Unconscionability, 70 U. CHI. L. REV. 1203 (2003); Ronald J. Mann, " Contracting" for Credit, 104 MICH. L. REV. 899 (2006); Henry E. Smith, Modularity in Contracts: Boilerplate and Information Flow, 104 MICH. L. REV. 1175 (2006).
93. See generally John J.A. Burke, Contract as Commodity: A Nonfiction Approach, 24 SETON HALL LEGIS. J. 285, 290 (2000) (stating form contracts account for more than ninety-nine percent of commercial and consumer transactions).
94. Cf. Cotnam v. Wisdom, 104 S.W. 164, 166-67 (Ark. 1907) (imposing liability on the basis of restitution where the defendant received benefits while unconscious).
95. FRIED, supra note 10, at 57.
96. Id. at 69.
97. Id.
98. See Randy E. Barnett, Consenting to Form Contracts, 71 FORDHAM L. REV. 627, 631 (2002) (noting that, because it is difficult for most consumers to judge the likelihood that the remote contingencies described in standard forms will occur, "the rational course is to focus on the few terms that are generally well publicized and of immediate concern, and to ignore the rest"); Robert A. Hillman, Rolling Contracts, 71 FORDHAM L. REV. 743, 746-47 (2002) (observing that, given that the consumer expects that nothing will go wrong with the product and, if it does, that the law will provide protection from harsh terms, "the consumer has good reason not to read the form").
99. 105 F.3d 1147 (7th Cir. 1997).
100. 104 F. Supp. 2d 1332 (D. Kan. 2000).
101. Hill, 105 F.3d at 1148.
102. Id.
103. Id.
104. While it is not worthwhile to pursue this line of criticism at length here, it may be worthwhile to note that vendors who take orders over the phone have, for years, been able to and in fact have recorded conversations "for [ostensibly] training purposes." And as for Easterbrook's concern that the buyer's memory or understanding would fail, Contract law does not impose a memory requirement, only the presence of objective indicia of understanding. As to whether the fact that Contract operates in the objective rather than the subjective realm presents a problem for a promise theory of Contract, see SMITH, supra note 20, at 60-62.
105. Hill, 105 F.3d at 1149 (emphasis added).
106. 86 F.3d 1447 (7th Cir. 1996).
107. Id. at 1450.
108. Id.
109. Id.
110. ProCD, Inc. v. Zeiderberg, 908 F. Supp. 640, 645 (W.D. Wis. 1996).
111. He misunderstands the application and operation of U.C.C. § 2-204 (2003) (which deals with the timing, rather than existence, of an acceptance), § 2-207 (which applies even in the case of a single form), and § 2-606 (which concerns acceptance of contract subject matter, goods, not acceptance of offers at the formation stage).
112. ProCD, Inc. v. Zeiderberg, 86 F.3d 1447, 1452 (7th Cir. 1996).
113. Under the preexisting duty rule, "when a party merely does what he has already obligated himself to do, he cannot demand an additional compensation therefor" Lingenfelder v. Wainwright Brewery Co., 15 S.W. 844, 848 (Mo. 1891); see also RESTATEMENT (SECOND) OF CONTRACTS § 73 (1981) ("Performance of a legal duty owed to a promisor which is neither doubtful nor the subject of honest dispute is not consideration....").
114. ProCD, 86 F.3d at 1452.
115. See, e.g., Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585, 595 (1991) (upholding a forum selection clause on a cruise ticket); Reynolds-Naughton v. Norwegian Cruise Line Ltd., 386 F.3d 1, 2 (1st Cir. 2004) (same); Monsanto Co. v. McFarling, 302 F.3d 1291, 1296 (Fed. Cir. 2002) (upholding a forum selection clause on a form contract concerning the sale of seeds); Adobe Systems, Inc. v. Stargate Software Inc., 216 F. Supp. 2d 1051, 1052-53 (N.D. Cal. 2002) (upholding a shrink-wrap agreement similar to that in ProCD); M.A. Mortenson Co. v. Timberline Software Corp., 998 P.2d 305, 307 (Wash. 2000) (same).
116. Klocek v. Gateway, Inc., 104 F. Supp. 2d 1332, 1335 (D. Kan. 2000).
117. Id.
118. Id. at 1335 n.1.
119. See id. at 1337-38 (comparing Step-Saver Data Sys., Inc. v. Wyse Tech., 939 F.2d 91 (3d Cir. 1991) ("printed terms on computer software package not part of agreement"), Ariz. Retail Sys., Inc. v. Software Link, Inc., 831 F. Supp. 759, 766 (D. Ariz. 1993) (license agreement shipped with computer software not part of agreement), and U.S. Surgical Corp. v. Orris, Inc., 5 F. Supp. 2d 1201, 1207 (D. Kan. 1998) (single use restriction on product package not binding agreement), with Hill v. Gateway 2000, Inc., 105 F.3d 1147 (7th Cir. 1997) (arbitration provision shipped with computer binding on buyer), ProCD, 86 F.3d at 1455 (shrink-wrap license binding on buyer), and M.A. Mortenson Co., v. Timberline Software Corp., 998 P.2d 305, 312-14 (Wash. 2000) (following Hill and ProCD on license agreement supplied with software)); id. at 1339 n.9 (citing Westendorf v. Gateway 2000, Inc., No. 16913, 2000 WL 307369, at *5 (Del. Ch. Mar. 16, 2000) (arbitration provision shipped with computer is binding); Rinaldi v. Iomega Corp., No. 98C-09-064-RRC, 1999 WL 1442014, at *5 (Del. Super. Ct. Sept. 3, 1999) (warranty disclaimer included inside computer Zip drive packaging conspicuous and binding); Brower v. Gateway 2000, Inc., 676 N.Y.S.2d 569, 575 (N.Y. App. Div. 1998) (same); Levy v. Gateway 2000, Inc., 1997 WL 823611 (N.Y. Sup. Ct. Aug. 12, 1997) (same); M.A. Mortensen, 998 P.2d at 312-14).
120. Id. at 1341.
121. ProCD, 86 F.3d at 1450.
122. Klocek, 104 F. Supp. 2d at 1341.
123. Id.
124. "The Court finds that the act of keeping the computer past five days was not sufficient to demonstrate that plaintiff expressly agreed to the Standard Terms." Id. at 1341.
125. Barnett, supra note 12, at 292; see also Randy E. Barnett, Contract Remedies and Inalienable Rights, 4 SOC. PHIL. & POL'Y 179, 184 (1986); Randy E. Barnett, Contract Scholarship and the Reemergence of Legal Philosophy, 97 HARV. L. REV. 1223, 1242 (1984) (reviewing E. ALLAN FARNSWORTH, CONTRACTS (1982)).
126. Benson, supra note 6, at 27.
127. Barnett writes: The function of an entitlements theory based on individual rights is to define the boundaries within which individuals may live, act, and pursue happiness free of the forcible interference of others. A theory of entitlements specifies the rights that individuals possess or may possess; it tells us what may be owned and who owns it; it circumscribes the individual boundaries of human freedom. Barnett, supra note 12, at 291.
128. Benson, supra note 6, at 31.
129. Barnett, supra note 12, at 293.
130. Id.
131. Id. at 297.
132. Id. at 300. Barnett associates the "will theory" with Morris R. Cohen, David Hume, A.S. Burrows, P.S. Atiyah, and Charles Fried. Id. at 272-74 nn.7-16.
133. Id. at 274.
134. Id. at 302 (emphasis omitted).
135. See 1 WILLISTON ON CONTRACTS § 4:1 (4th ed. 2004) (explaining that consent "is to be judged only by overt acts and words rather than by the hidden or secret intentions of the parties").
136. RESTATEMENT (SECOND) OF CONTRACTS § 71 (1981).
137. See, e.g., Cyberchron Corp. v. Calldata Sys. Dev., Inc., 47 F.3d 39 (2d Cir. 1995) (treating as an enforceable promise a contractor's assurances to a subcontractor, despite the absence of consideration); Webb v. McGowin, 168 So. 196 (Ala. Ct. App. 1935) (enforcing a promise of lifetime support despite a lack of consideration); Shiftman v. Atlas Mill Supply Inc., 14 Cal. Rptr. 708 (Ct. App. 1961) (holding the question of consideration immaterial to an executed promise).
138. 3 WILLISTON ON CONTRACTS § 7:1 (4th ed. 2004).
139. Barnett, supra note 12, at 311.
140. Id. at 312 (footnotes omitted).
141. See Lon L. Fuller, Consideration and Form, 41 COLUM. L. REV. 799, 800 (1941) (arguing the formality of producing a seal was "a check against inconsiderate action" as well as "an excellent device for inducing the circumspective frame of mind appropriate in one pledging his future").
142. See Renney v. Kimberly, 86 S.E.2d 217, 219 (Ga. 1955) (citing a lack of consideration as justification for refusing to uphold a promise to relinquish all claim to a tract of land, when the promisor had no actual claim to the land); Fuller, supra note 141, at 799 (suggesting that consideration is, among other things, a way for courts to avoid enforcing poorly planned promises).
143. Barnett finds that consent is expressed by '"channeling]' one's behavior through the use of a legal formality in such a way as to explicitly convey a certain meaning - that of having an intention to be legally bound-to another." Barnett, supra note 12, at 310. Barnett cites Fuller, who notes that legal formality "offers a legal framework into which the party may fit his actions, or, to change the figure, it offers channels for the legally effective expression of intention." Fuller, supra note 141, at 801.
144. Barnett, supra note 12, at 313. In support of his conclusion, Barnett quotes RESTATEMENT (SECOND) OF CONTRACTS § 75 cmt. a (1981): "Since the principle that bargains are binding is widely understood and is reinforced in many situations by custom and convention, the fact of bargain... tends to satisfy the cautionary and channeling functions of form."
145. Barnett, supra note 12, at 313.
146. U.C.C. § 2-204(1) (2003).
147. Id.
148. See RESTATEMENT (SECOND) OF CONTRACTS § 17 (1981).
149. Barnett, supra note 12, at 313.
150. U.C.C. § 2-106 (2003).
151. Barnett, supra note 12, at 314.
152. See RESTATEMENT (SECOND) OF CONTRACTS § 90(1) (1981).
153. See Barnett, supra note 12, at 276.
154. See, e.g., City of St. Louis v. St. Louis Gaslight Co., 70 Mo. 69, 115 (1879) ("It is not necessary that a consideration should be adequate in point of value to make it sufficient."); Emberson v. Hartley, 762 P.2d 364, 366 n.2 (Wash. Ct. App. 1988) (distinguishing between adequacy and sufficiency of consideration).
155. In equity, adequacy of consideration is sometimes deemed pertinent and determinative. See, e.g., Newman v. Freitas, 61 P. 907, 908 (Cal. 1900) ("[W]hile there was a consideration sufficient to support the contract at law, yet there was no adequate consideration, and that consequently a court of equity would not specifically enforce it.") (emphasis added); Carter v. Grossnickle, 11 Ohio N.P. (n.s.) 465, 1911 WL 864 at *8 (Com. Pl. 1911) ("The question is not whether the consideration of one dollar is sufficient to sustain the deed, but whether that consideration is an adequate consideration to induce or warrant a court of equity to decree specific performance.") (emphasis added).
156. Appendix, 4 A.L.I. PROC. 98-99 (1926).
157. In the Second Restatement, promissory estoppel is defined as [a] promise which the promisor should reasonably expect to induce action or forbearance on the part of the promisee or a third person and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise. The remedy granted for breach may be limited as justice requires. RESTATEMENT (SECOND) OF CONTRACTS § 90 (1981). The First Restatement version read: A promise which the promisor should reasonably expect to induce action or forbearance of a definite and substantial character on the part of the promisee and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise. RESTATEMENT OF CONTRACTS § 90 (1932). For a discussion of the development of these sections, see Yorio & Thel, supra note 50.
158. Appendix, A.L.I. PROC. 101-03 (1926).
159. Contra Barnett, supra note 12, at 317.
160. Id.
161. Peter Benson, Contract as a Transfer of Ownership, 48 WM. & MARY L. REV. 1673 (2007).
162. Id. at 1673-74.
163. See Fuller & Perdue, Contract Damager: 1, supra note 35, at 52-53.
164. Id. at 61.
165. The principal point of Fuller and Perdue's second installment is that "the contractual reliance interest receives a much wider (though often covert) recognition in the decisions than it does in the textbooks." Fuller & Perdue, Contract Damages: 2, supra note 35, at 418.
166. Benson, supra note 161, at 1722.
167. Id.; Benson, supra note 12, at 137.
168. Benson concludes: If we must suppose that contract formation consists in a transfer of entitlement from one party to the other - as is necessary if the expectation principle is to function as a principle of compensation - the... analysis of a transfer of ownership in the case of an executed conveyance of property should also apply to contract. Benson, supra note 12, at 132.
169. Id. at 128.
170. Id.
171. Id. at 137.
172. Benson, supra note 161, at 1680 (emphasis added).
173. See id. at 1681-93.
174. Id. at 1682.
175. See id. at 1681-83.
176. T.M. Scanlon, Promises and Contracts, in THE THEORY OF CONTRACT LAW: NEW ESSAYS 86 (Peter Benson ed., 2001).
177. Benson, supra note 161, at 1683-88.
178. Id. at 1684.
179. Eric Posner analyzes this idea in the context of charitable gifts in Altruism, Status and Trust in the Law of Gifts and Gratuitous Promises, 1997 WIS. L. REV. 567.
180. Cf. HUME, supra note 5, at 314-15 (arguing that promises are only enforceable because society enforces them).
181. Benson, supra note 161, at 1687.
182. Gordley, supra note 57.
183. Benson here responds to Gordley, supra note 57.
184. Benson, supra note 161, at 1690 (quoting Gordley, supra note 57, at 297).
185. Id.
186. Id. at 1691 (emphasis added).
187. Id.
188. See id.
189. Gordley, supra note 57, at 307.
190. Benson, supra note 161, at 1692.
191. See id. at 1674.
192. "[W]e treat the doctrines [of Contract law] just as provisionally fixed points for working out a conception of contract and we begin with them because no better or more natural starting point offers itself for the purposes of a public basis of justification." Benson, supra note 12, at 138. By "public justification," Benson means "the mode of justification and reasoning that is appropriate to settle the fair terms... of interaction and cooperation among persons." Id. at 124 n.12.
193. It would seem that Benson would also have to reconcile the generally substitutional rather than specific nature of Contract damages too, but he has not done that, yet. He has, though, acknowledged that "complete argument for this claim requires that we show how all the significant doctrines and principles of contract law fit within this conception." Benson, supra note 161, at 1731 n.90. My reaction to Benson does not focus on the doctrines he has not yet chosen to explain; it confronts the conclusions he has reached in the exegesis he has offered so far.
194. Treatment of Benson's approach to the unconscionability doctrine must be left for another day, though nothing he says about unconscionability undermines the analysis and conclusions here.
195. "[T]he reasonably construed expression of assent in and of itself, not the thought process that produced it, is the operative factor in formation." Benson, supra note 12, at 139.
196. "[T]here is in law a liberty to revoke an as yet unaccepted offer." Id. at 140.
197. Id. at 143.
198. "Where an offer invites an offeree to accept by rendering a performance and does not invite a promissory acceptance, an option contract is created when the offeree tenders or begins the invited performance or tenders a beginning of it." RESTATEMENT (SECOND) OF CONTRACTS § 45(1) (1981).
199. "An offer which the offeror should reasonably expect to induce action or forbearance of a substantial character on the part of the offeree before acceptance and which does induce such action or forbearance is binding as an option contract to the extent necessary to avoid injustice." Id. § 87(2).
200. Indeed, the title of Section 45 is "Option Contract Created by Part Performance or Tender" (emphasis added).
201. Benson, supra note 12, at 143.
202. RESTATEMENT (SECOND) OF CONTRACTS § 45, cmt. b (1981) ("The rule of this Section... yields to a manifestation of intention which makes reliance unjustified.").
203. Benson, supra note 12, at 142 n.32.
204. Id. at 142.
205. Id. at 143.
206. RESTATEMENT (SECOND) OF CONTRACTS § 45, cmt. b (1981).
207. Id. § 87(2) (emphasis added).
208. Benson, supra note 161, at 1680.
209. Benson, supra note 12, at 143. Benson concludes that "[t]he doctrine of offer and acceptance seems at its core to be indifferent to the very kinds of considerations that centrally concern distributive justice." id. Benson does address, obliquely, the "idea of estoppel," but his treatment of the doctrine does not clarify how he would respond to the challenge presented by sections 45 and 87. See id. at 146 n.35.
210. Id. at 143.
211. Id.
212. RESTATEMENT (SECOND) OF CONTRACTS § 87 (1981).
213. Benson, supra note 161, at 1713 (emphasis added).
214. Id.
215. See RESTATEMENT (SECOND) OF CONTRACTS § 90(1) (1981). Benson acknowledges that "[w]hat is often referred to as 'promissory estoppel' has all the markings of the principle of detrimental reliance applied in a contractual setting." Benson, supra note 12, at 176.
216. Benson, supra note 12, at 175.
217. RESTATEMENT (SECOND) OF CONTRACTS § 90 (1981).
218. See, e.g., Goldstick v. ICM Realty, 788 F.2d 456, 463-64 (7th Cir. 1986) (advocating a "value of the promise" approach to damages in a promissory estoppel setting); Chedd-Angier Prod. Co., Inc. v. Omni Publ'n Int'l, Ltd., 756 F.2d 930, 936-37 (1st Cir. 1985) (applying section 90 of the restatement to affirm the lower court's award of "full contract damages"); Daigle Commercial Group, Inc. v. St. Laurent, 734 A.2d 667, 674-75 (Me. 1999) ("A promise binding under [promissory estoppel] is a contract, and full-scale enforcement by normal remedies is often appropriate.'") (quoting RESTATEMENT (SECOND) OF CONTRACTS § 90 cmt. d (1981) (alteration in original)).
219. RESTATEMENT (SECOND) OF CONTRACTS § 90(1) (1981).
220. Benson notes that "[r]eliance-based analysis cannot view the promise or representation as one side of a transfer of rights between the parties." Benson, supra note 12, at 175.
221. It should be clear that Benson's argument is similarly compromised to the extent that we can discover promise-based liability in which a measure of recovery other than expectation is awarded. That would, for example, include Paola Gas Co. v. Paola Glass Co., 44 P. 621 (Kan. 1896) and Griffin v. Colver, 16 N.Y. 489 (N.Y. 1858), which Fuller and Perdue cite as illustrating the difficulty in calculating damages in cases where the defendant's breach results in the plaintiffs property remaining idle. While the former case found damages in the plaintiffs lost use of his property (a reliance calculation), the latter found the appropriate measure to be the loss of profits which would have been made had the defendant performed his promise (an expectation calculation). See Fuller & Perdue, Contract Damages: 1, supra note 35, at 75.
222. Benson, supra note 12, at 177; see also RESTATEMENT (SECOND) OF CONTRACTS § 73 (1981) ("Performance of a legal duty owed to a promisor which is neither doubtful nor the subject of honest dispute is not consideration....").
223. Benson, supra note 12, at 179.
224. These include a novation, the receipt of additional consideration, changed or unforeseen circumstances, and invocation of statutes such as U.C.C. § 2-209, which permit modification without additional consideration. U.C.C. § 2-209 (2003). Additionally, contracting parties may circumvent the rule's application by simply agreeing to do so. FARNSWORTH, supra note 19, §§ 4.21-.22.
225. I have not here treated Benson's conceptualization of the unconscionability doctrine in terms that would confirm his consent-based transfer theory. Suffice it so say that Benson needs to find (and so finds) that unconscionability may be articulated "in terms of the parties' presumed intentions." Benson, supra note 12, at 187. While a thoughtful response to his argument would require more than marginal treatment, the pithy response would suggest, once again, that he may have to distort the doctrine (or, at least present it less than completely) in order to formulate it in terms that support his analysis. For Benson, unconscionability is about equivalence of exchange; certainly equivalence matters, but there is just more to it. U.C.C. § 2A-108, for example, permits courts to avoid as unconscionable contracts to which consumers are party wholly on procedural rather than substantive grounds. Also, in order to most coherently appreciate the role of unconscionability, it may be necessary to more fully engage the operation of the other deal policing mechanisms, most notably impracticability, frustration, and mistake.
226. Thomas W. Merrill & Henry E. Smith, The Morality of Property, 48 WM. & MARY L. REV. 1849 (2007).
227. Id. at 1855-57, 1870-90, 1894-95.
228. And this possibility, keep in mind, is framed in terms of the success of the extant theories.
229. Merrill & Smith, supra note 226, at 1854.
230. All law?
231. Though it is curious that at the outset of their article, the authors say that "[a]n institution assumed to be wholly dependent on law for its existence is unlikely to be infused with strong moral content." Merrill & Smith, supra note 226, at 1849. There seems to be some tension between the two statements. If law is understood as serving certain coordination, expertise, and efficiency functions, see LARRY ALEXANDER & EMILY SHERWIN, THE RULES OF RULES 232 n.4 (2001), then there is no reason to believe that the fact of an institution's dependence on law could not "be infused with strong moral content." The morality may just be latent, which, of course, is a matter of perspective.
232. A corollary of Merrill and Smith's proposition is that "when legal protection of property is out of sync with common morality, we often see widespread disregard of legally recognized property rights." Merrill & Smith, supra note 226, at 1854. They offer downloading of copyrighted material from the web as an example of this. Id. They could certainly also have used photocopying of music without payment to composers as another example of the same phenomenon. While it is not clear that downloading and such photocopying reveals morality - it may rather reveal more about ignorance of copyright laws - what matters is their point that law is impotent to overcome the common morality, at least over time. If they are correct then we may discover a common morality by reviewing the law in practice and be sure that that common morality is venerable. They may also be only partially correct (common morality may only resist without actually defying law) and their point would still be an important one, insofar as it tells us where to look for the morality of law.
233. Id. at 1857.
234. The proposed futures market in terrorism, funded by the Pentagon "in the belief that it might help predict the probability of future terrorist attacks," certainly did not achieve a common moral acceptance. Peter Wayner, Predict the Future? You Can Bet on It, N.Y. TIMES, Oct. 2, 2003 at G5. However, the market's lack of acceptance seems to derive more from a failure of public relations and education than from a common moral objection. See id. Thus, it is not immediately clear why morality must be generally accessible in order to be a common morality. The true moral foundation of an institution may be latent or opaque, at least so far as the masses are concerned. There would not seem to be anything in moral theory that requires a normative explanation to be patently obvious. Cf. Merrill & Smith, supra note 226, at 1851 ("[T]he type of morality that will support a system of property rights must be suitable for all members of the community.") Again, though, Merrill and Smith's normative conclusions, for present purposes, need not depend on their accessibility conclusions.
235. Merrill & Smith, supra note 226, at 1865. The causation is "not reciprocal" in the sense that we do not think of both the polluter and the victims of the pollution as being, together, causes of the pollution problem. Merrill and Smith are responding here to an economic perspective "under which the polluter has the 'entitlement to pollute' that the resident can take upon payment of the polluter's cost of abatement or shutting down." Id. (citing Guido Calabresi & A. Douglas Melamed, Property Rules, Liability Rules, and Inalienability: One View of the Cathedral, 85 HARV. L. REV. 1089, 1116 (1972)). For a similar economic perspective, see R.H. Coase, The Problem of Social Cost, 3 J.L. & ECON. 1 (1960).
236. Merrill & Smith, supra note 226, at 1866.
237. 563 N.W.2d 154 (Wis. 1997).
238. Id. at 166.
239. See id. at 157.
240. See id. at 160.
241. Merrill & Smith, supra note 226, at 1873 (quoting Jacque, 563 N.W.2d at 161).
242. 545 U.S. 469 (2005).
243. Id. at 477.
244. Merrill & Smith, supra note 226, at 1880.
245. Id. at 1882.
246. Id.
247. Id. at 1883.
248. Merrill and Smith point to "trespasses, bad faith adverse possession, takings for economic development, and nonviolent property crimes." Id. at 1894. For an argument that the Contract law is similarly intolerant of bad faith behavior, see David Morris Phillips, The Commercial Culpability Scale, 92 YALE L.J. 228 (1982) (arguing that a scale of scienter explains the U.C.C.'s allocation of risk of loss).
249. Price controls at one time seemed to make sense, until we learned that they resulted in more rather than less consumer hardship.
250. It could, for example, be the case that the Jacques had already rented a portion of their property to the defendant and then agreed to refund $50 of that rental in order to keep the defendant from crossing a particular portion of the property.
251. 129 N.E. 889 (N.Y. 1921).
252. 382 P.2d 109 (Okla. 1963).
253. See RESTATEMENT (SECOND) OF CONTRACTS § 229 (1981) ("To the extent that the non-occurrence of a condition would cause disproportionate forfeiture, a court may excuse the non-occurrence of that condition unless its occurrence was a material part of the agreed exchange.").
254. Jacob & Youngs, 129 N.B. at 890.
255. Id.
256. Id. at 891.
257. Id. at 890.
258. Id. at 890-91.
259. See id. at 890.
260. See id. at 891 ("This is not to say that the parties are not free by apt and certain words to effectuate a purpose that performance of every term shall be a condition of recovery.").
261. See generally RESTATEMENT (SECOND) OF CONTRACTS §§ 224-230 (1981); Richard Lord, 3 WILLISTON ON CONTRACTS § 7:18 (4th ed. 2004).
262. 382 P.2d 109 (Okla. 1962).
263. Id. at 111.
264. Id. at 112.
265. Id. at 114.
266. RESTATEMENT (SECOND) OF CONTRACTS §§ 347, 348(2)(b) (1981) (setting the standard measure of damages as loss in value and allowing for damages based on cost of completion only "if that cost is not clearly disproportionate to the probable loss in value").
267. Id. § 347 cmt. b (reflecting that loss in value must sometimes be determined based on the value of performance "to the injured party himself and not [its value] to some hypothetical reasonable person or on some market").
268. Id.
269. Merrill & Smith, supra note 226, at 1872-73.
270. Id. at 1880 & n.42.
271. See Benson, supra note 161, at 1725-31.
272. See Alces, On Discovering Doctrine, supra note 2, at 473.
273. "Discrimination refers to our ignoring portions of data that can be ignored without impairing its message ... (reducing the size of the data pattern to make it more manageable)." See id. at 505; STEPHEN WOLFRAM, A NEW KIND OF SCIENCE 549 (2002).
274. "Leverage" refers to our ability (or propensity) to focus on regularities without becoming distracted by the particulars that are not pertinent to the perceptual or analytical exercise. See Alces, On Discovering Doctrine, supra note 2, at 505; WOLFRAM, supra note 273, at 549-52.
275. See generally CASS R. SUNSTEIN, BEHAVIORAL LAW & ECONOMICS (2000); Cass R. Sunstein, Moral Heuristics and Moral Framing, 88 MINN. L. REV. 1556 (2004).
276. See generally HOWARD MARGOLIS, PARADIGMS & BARRIERS (1993) [hereinafter MARGOLIS, PARADIGMS]; HOWARD MARGOLIS, PATTERNS, THINKING, AND COGNITION (1987) [hereinafter MARGOLIS, PATTERNS].
277. See generally JUDGMENT UNDER UNCERTAINTY: HEURISTICS AND BIASES (Daniel Kahneman et al. eds., 1982).
278. The theoretical world seems to nicely and necessarily devolve into that dichotomy.
279. Kraus, supra note 14, at 687.
280. Alces, supra note 3, at 1662-66.
281. Cf. BRIAN GREENE, THE ELEGANT UNIVERSE: SUPERSTRINGS, HIDDEN DIMENSIONS, AND THE QUEST FOR THE ULTIMATE THEORY (First Vintage Books ed., Vintage Books 2000) (arguing that the limits of the human imagination are the primary obstacle in formulating an ultimate theory of astronomical physics).
282. Perhaps the appropriate answer awaits the proper question. In one sense, then, "the Answer... [i]s... 42" - but we can't fathom the question. DOUGLAS ADAMS, THE HITCHHIKER'S GUIDE TO THE GALAXY (First Ballantine Books ed., The Ballantine Publishing Group 1980).
283. See supra Part I.
284. Perceptual discontinuity and idiosyncrasy invite the creation of generalized rules of thumb, "which on the whole have led to good results but in certain situations lead to errors." MARGOLIS, PATTERNS, supra note 276, at 13. For a physicist's perspective, see MURRAY GELL-MANN, THE QUARK AND THE JAGUAR 29 (1994) ("[W]hen defining complexity it is always necessary to specify a level of detail up to which the system is described, with finer details being ignored. Physicists call that 'coarse graining.'").
285. Much of the Second Restatement, for example, is cast in deontological terms. See, e.g., RESTATEMENT (SECOND) OF CONTRACTS (1981). For example, § 86, "Promise for Benefit Received" ("extent necessary to prevent injustice"); § 94, "Stipulations" ("if the modification is fair and equitable"; "to extent that justice requires enforcement"); § 139, "Enforcement by Virtue of Action in Reliance" ("The remedy granted for breach is to be limited as justice requires."); § 158, "Relief Including Restitution" ("grant relief on such terms as justice requires"); § 173, "When Abuse of a Fiduciary Relation Makes a Contract Voidable" (contract voidable unless "it is on fair terms"); § 176, "When a Threat is Improper" ("threat is improper if the resulting exchange is not on fair terms"); § 184, "When Rest of Agreement is Enforceable" ("reasonable standards of fair dealing"); § 190, "Promise Detrimental to Marital Relationship" ("fair in the circumstances"); § 195, "Term Exempting from Liability for Harm Caused Intentionally, Recklessly or Negligently" (term unenforceable unless "fairly bargained for"); § 205, "Duty of Good Faith and Fair Dealing" (pervasive duty of "good faith and fair dealing"); § 223, "Course of Dealing" ("fairly to be regarded as establishing a common basis of understanding"); § 243, "Effect of a Breach by Non-Performance as Giving Rise to a Claim for Damages for Total Breach" (such impairment of value of contract to injured party "that it is just in the circumstances to allow him to recover"); § 260, "Application of Payments Where Neither Party Exercises his Power" ("just regard to the interests of third persons, the debtor and the creditor"); § 272, "Relief Including Restitution" (if other apposite rules "will not avoid injustice, the court may grant relief on such terms as justice requires"); § 351, "Unforeseeability and Related Limitations on Damages" ("court may limit damages... if it concludes that in the circumstances justice so requires"); § 354, "Interest as Damages" ("interest may be allowed as justice requires"); § 358, "Form of Order and Other Relief" ("order of specific performance... on such terms as justice requires"); § 371, "Measure of Restitution Interest" (measurement of restitution interest "as justice requires"); § 384, "Requirement That Party Seeking Restitution Return Benefit" (compensation in place of return of property in restitution "if justice requires that compensation be accepted") (emphases added throughout).
286. See RESTATEMENT (SECOND) OF CONTRACTS (1981). For example, § 348, "Alternatives to Loss in Value of Performance," (when cost of breach is not adequately proved party may recover cost of completing performance or remedying defects "if that cost is not clearly disproportionate to the probable loss"); § 229, "Excuse of a Condition to Avoid Forfeiture" (court may excuse the nonoccurrence of a condition "to the extent [it]... would cause disproportionate forfeiture"); § 237, "Effect on Other Party's Duties of a Failure To Render Performance" ("condition of each party's remaining duties [is]... that there be no uncured material failure by the other party"); § 241, "Circumstances Significant in Determining Whether a Failure Is Material" (listed circumstances advise on "whether a failure to render or to offer performance is material")(emphases added throughout).
287. As Professor Greenawalt has noted, "[s]trict deontological and strict consequentialist approaches may have a kind of theoretical purity that is lacking in a mixed account; but it would be mistaken to dismiss the latter as incoherent." R. Kent Greenawalt, Violence - Legal Justification and Moral Appraisal, 32 EMORY L.J. 437, 456 (1983). For example, the tort-based statute applied in Peevyhouse contained a consequentialist element - "no person can recover a greater amount in damages for the breach of an obligation than he would have gained by the full performance thereof" - as well as a deontological element - "where an obligation of any kind appears to create a right to unconscionable and grossly oppressive damages, contrary to substantial justice no more than reasonable damages can be recovered." Peevyhouse v. Garland Coal & Min. Co., 382 P.2d 109, 113 (Okla. 1963) (quoting an Oklahoma statute). Under the Peevyhouse court's application of this statute, the remedy sought by the plaintiffs was "unconscionable and grossly oppressive damages, contrary to substantial justice.... Also, it can hardly be denied that if plaintiffs here are permitted to recover under the 'cost of performance' rule, they will receive a greater benefit from the breach than could be gained from full performance." Id. (quotation omitted).
288. Many have argued that the two perspectives do not-cannot-exist in isolation. E.g., RAWLS, supra note 61; Bernard Williams, A Critique of Utilitarianism, in UTILITARIANISM: FOR AND AGAINST 77, 82-87 (1973)
289. See Alces, supra note 3, at 1553-56 (discussing Judge Easterbrook's opinion in ProCD).
290. Contracts Prof. Weekly Spotlight: Nathan Oman, http://lawprofessors. typepad.com/contractsprof_blog/contracts_profs_weekly_spotlight/index.html (last visited Oct. 2, 2007).