Sunday, August 10, 2014
Kar on Contract Theory ... And A Question About "Unified" Theories of Law (Contract, at Least)
My friend Rob Kar (Illinois, left) has posted an article (the first in a series), Contract as Empowerment, a major take on contract theory that has this morning rightly earned "Download of the Week" status from Larry Solum. Rather than re-post the abstract (available from either of the above links), I'm going to excerpt Rob's own blackletter capsule of the theory:
Contract as Empowerment: All other things being equal, contract law rules should be set up to empower people to use promises as tools to meet a range of human needs and interests by inducing others to action. The law should therefore enforce contracts when two basic conditions are met: first, when a particular party has entered into a particular contract with the specific purpose of inducing another to act; and, second, when meeting this purpose depends on granting another contracting party the legal authority to demand compliance. All other things being equal, the law should not—on the other hand—enforce promises in other circumstances.
As I'm still weaning myself here from the last month's awfulness, I confess that what came to mind as I read Rob's introduction was Dan Markel's observation to me that I was often "orthogonal" to existing issues. In that spirit, then, let me be orthogonal to Rob's project, not for a minute taking away from its scholarly creativity, lucidity, thoroughness, and, as discussed below, its admirable persistence in pursuit of theory in the face of a countervailing sense of theoretical nihilism or, as Bob Scott put it at our "Contract as Promise" symposium a few years back, "lazy thinking masquerading as theory." (I really should include an emoji right there.)
Having just read Rob's paper quickly (in a blog post appropriate way), I think I'm generally sympathetic to the underlying claims, based on my own view that (a) we make our way through the world as subjective agents with our own wants; (b) from time to time we enter into interpersonal "I-You" relationships with the goal of satisfying those wants; (c) it's usually not the matter of any significant dispute that we've manifest that relationship in a way that contemplates objective enforcement by law, whether under default rules or interpretation; and (d) that if you allow your "I-You" relationships to look objectively enforceable under the prevailing social construct of law, you can't complain when somebody else uses that construct to stick it to you. (This is alternatively the "if it quacks like a duck, it's a duck" or the "you pays your money, and you takes your chances" theory.)
I'm sure I'm not doing justice to Rob's work, but I see something of a similar view in his development of the "contractualism" aspect of this. That is, we accept that there is a metaphoric (and objective) social contract to which we subject ourselves as soon as we interact with others as persons. Whether that's based, as Rob suggests, in "a moral ideal of equal respect for persons," I don't know as I write this, but it's appealing to somebody who like the idea of a Kantian "kingdom of ends." In other words, I'm okay with "you pays your money and takes your chances" because I accept it as part of living in a civil society, even if I don't get my way all the time.
As I write this, I happen to be reading Roger Scruton's The Soul of the World. Scruton has a section that has given me pause to think about the transformation of the I-You relationship of a promise into an objective and legally enforceable obligation, something about which I've written in the past. Scruton describes one aspect of justice as:
the fulfillment of human freedom - the form of human relations in which obligations are freely undertaken, and objectively binding for the very reason that they are freely undertaken. And we win through to justice by adopting in our mutual dealings the standpoint of the impartial judge.
That seems to me consistent with Rob's contractualism idea, and it adds the following insight. It says that I, as a subjective agent, having interacted with a You, am capable simultaneously of seeing my subjective wants as well as the way that our mutual interaction would look if presented to a third party for resolution of a dispute. I buy that. As Larry Solum has suggested recently, we are talking artificial, not natural, meaning here - an expression in language that none of us constructed on our own, but has meaning nevertheless. It's precisely what I might do when I want something from somebody else, I read the contract, and I conclude that I don't have much of a legal claim. It also explains why I might feel ambivalent about the boilerplate that I didn't read or the acquisition agreement I did read but can't remember any more. On one hand, I may think it's unfair and in fact doesn't reflect something to which I agreed or remember agreeing expressly. On the other hand, it's there objectively, and it invokes some claim on me to be weighed against the fairness.
But I digress from my damnable orthogonality. What I find most interesting about this is Rob's justification for the enterprise itself - something he discusses at pages 42-45 of his SSRN draft, where he goes "meta" for a bit and considers in the context of "value pluralism" whether it makes sense to come up with a general or unified theory of contract law, describing most contract theorists as falling on a spectrum between value pluralism and theory.
Full disclosure: Roy Kreitner described me, I think accurately, as a "metaphysical pluralist" of contract law. So my big question, getting in touch with my inner teleologist and reading the introduction to Rob's paper, is precisely why we feel the need to "harmonize certain core areas of doctrine," to "provide[ ] unified answers," and why it's a problem that contract law has no complete descriptive or normative theory, or that the theories "fail to offer a unified understanding of ... seemingly disparate features of contract law." I think the answer to that question has less to do with contract law than with our seemingly hardwired inclination to teleology: that there are unified explanations, that doctrine ought to be harmonized, that the world ought to be seen as coherent.
To be clear, I love the academic endeavor, and I admire (and envy) Rob's attempt to push the inquiry a step closer to theoretical harmony, even if I view the entire enterprise of theoretical harmonization in this area as quickly turning into an infinite regress. Or, as I have expressed in a piece this summer dealing with legal positivism and contract law, the drive to theoretical and doctrinal unity is a function of practical and speculative reason and lends itself to what I find to be a counter-intuitively "natural" law of contracts. In other words, the positive law of contracts incorporates all sorts of moral, economic, ritual, repose, efficiency, and other factors, but I recoil from the idea that there is some sort of noumenal or ideal framework somewhere out there.
For myself, a metaphysical pluralist, in my cynical moments, to justify what I do nowadays, I turn to the noted philosopher Johnny Hart, the creator of the comic strip B.C. A character, as I recall, B.C. himself, has a stand with a sign that says something like "Philosophical Questions Answered Here." Another character asks, "Why are we here?" To which the answer is: "The sustenance of Hart." In my more thoughtful moments, I think about what I do, and what Rob has attempted here, not as an infinite regress but as another exploration of the line between the descriptive and the normative, between mere explanation and deeper meaning, or between the sacred and the ordinary (hamavdil beyn kodesh l'chol).
Posted by Jeff Lipshaw on August 10, 2014 at 10:37 AM | Permalink