28 February 2013

8th International Conference on Contracts

My students found it almost past believing that 50+ law profs would gather for a good time of presentations and arguments about the law of contracts. But we (at least I) did this past week at what was billed as KCON 8 organized by the entrepreneurial Frank Snyder and hosted by Texas Wesleyan Law School in Fort Worth, Texas. Of course, the delicious Tex-Mex food at the White Elephant Saloon didn't hurt.

Over at The Faculty Lounge I posted some initial thoughts about the thrust of the presentations and panels. In short, the "progressive" wing of legal academics are hunting for "form contract" bear. The concerns of some are political; others, however, (and this includes folks who aren't on the political Left) are equally concerned about how it is that we're bound by contracts we neither read not are expected to have read by the other party.

I find myself increasingly puzzled by this phenomenon. The most-followed argument in favor of judicial enforcement of a contract nobody has read is that of the neo-classical economics folks who posit that such contracts are nonetheless efficient. Form contracts, in other words, increase net social welfare. Sure, some folks get screwed by not having any legal remedy when they don't get what they thought they were buying but on the whole the lot of us get more stuff cheaper, which is the American way.

Contracts scholar and libertarian-leaning Constitutional law maven Randy Barnett has posed what I think is a better solution. While we can't be said to have consented to the terms of a contract we've not read, we have consented to be legally bound by what's in it. His helpful analogy posits the example of one who promises a friend to do whatever the friend writes on a piece of paper and seals in an envelope. I haven't directly promised to do whatever is written but I have indirectly promised, which is good enough. Not surprisingly, Barnett believes there are some limits on how far such indirect consent goes--it can't be utterly surprising--which effectively moves the question of the extent of legal enforceability one step back.

Those speaking against enforcement of form contracts at KCON 8 regularly spoke in terms of morality. They did not, however, at least at any of the panels I attended, address the foundation of the moral norms with which they believed enforcement of form contracts conflicted. (All the panels were double-timed so I could attend only half of them. All were recorded so I'll be able to watch those I missed.)

In any event, I plan to keep plugging away on this question that affects each of us and will let folks know when I have something more definite to say.

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