Trakman, Leon --- "Towards Contractual Pluralism" [2009] UNSWLRS 28

Last Updated: 23 August 2009

Towards Contractual Pluralism

Leon Trakman[∗]

Citation

This paper was published in Revue de droit des Affaires Internationales (RDAI) / International Business Law Journal / (IBLJ), N° 2, 2009 by Sweet & Maxwell.

Abstract

This article challenges monist theories of contracting that are dominated by such ‘super’ norms as the wills, consent or promises of the parties, or the efficiency of their transactions. It argues instead for a plural theory of contracting that identifies, ranks and applies a plurality of political, cultural and moral values, giving rise to a more richly textured, collaborative and contextual theory of contracting than under legal monism.

Devised to suit Nineteenth Century values, monist theories subject all contract rights to a single determinative or ‘super’ value, such as the liberty to contract. That ‘super’ value is expressed, for example through the wills of the parties to contract, or through the utility of their contracts. The result is a unitary theory of contracting in which one value prevails over all others. If liberty to contract is treated as the ‘super’ value, all other values are subordinated to it.

This article maintains that these monist theories of contracting fail to meet the demands of an increasingly complex legal order. Striving for a more richly textured alternative, it proposes a theory of value pluralism that engages a range of values, beyond a single ‘super’ value like liberty or equality in contracting. It argues that decision agents – notably courts – can identify plural values that are materially related to the issues in dispute. They can rank those values in proportion to their impact on the issues; and they can apply them through a process of deliberative reason and prudential judgment.

The article concludes by proposing a theory of cultural pluralism that is more transaction sensitive, more vibrant and more sustainable than narrow theories of legal monism.

Table of Contents

Introduction

Theoretical debate over the formation of contracts is legendary.[1] The basis for that debate remains, at best, illusive. Is the foundation of contracts tied to the subjective wills of parties who make promises to each other, or about reasonable inferences arising from promise-bearing conduct that courts impute to them? Are promises giving rise to contracts grounded in morality? Is the formation of contacts about the regulatory framework which sets limits upon contractual rights and duties; or is that formation about protecting contracts that are economically efficient?[2]

Theories of contracting are about all these normative values. The problem is that most of these theories are grounded in monism. Monists ordinarily subject all ‘goods’ or rights to a determinative measure, conceived as a ‘super’ value, such as the liberty of the parties to contract.[3] That value may be expressed variously, such as through the wills, consent, or promises of the parties to contract, or more comprehensively, through the utility or efficiency of contracting.[4] Preference monists in particular acknowledge that a ‘super’ value may have different qualities, but that it transcends all ‘lesser’ values.[5] Preference monists may also subscribe to a hierarchy of values, such as to a hierarchy of liberty, equality and efficiency values, so long as a ‘super’ value such as liberty to contract stands at the apex of that hierarchy.[6]

What preference monist theories of contracting lack is a sustainable basis for differentiating among ‘super’ values that may conflict and collide, such as between liberty to and equality in contracting.[7] If the formation of contract law is concerned with the liberty to contract, it cannot as readily focus on other values like equality, other than through their subordination to liberty. If it is engrossed with ‘super’ values that determine the binding force of promises, it cannot equally be about moral, political or cultural values which circumscribe that ‘super’ value.[8]

Plural conceptions of contract do not subscribe to a ‘super’ value, but instead acknowledge a range of values that may be commensurable or incommensurable with one another.[9] Decision agents – typically courts – adopt, rank and apply normative values through a combined process of deliberative reason and prudential judgment.[10] For example, they adopt liberty to and equality in contracting, among other plural values. They rank these values on a ranking scale that pays due cognizance to continuing and discontinuing moral, political and cultural values;[11] and they express their preferences among these values accordingly.[12] For example, they employ political pluralism to synthesize competing governmental policies relating to consumer protection.[13] They resort to cultural pluralism in ascribing preferred cultural values to evolving conceptions of marriage contracting,[14] and they ground implied duties of good faith in contracting in values based on moral pluralism.[15] They reach ‘residue’ or ‘remainder’ determinations in applying these various plural values through the exercise of prudential wisdom, limited by ‘practical reason’.[16] They are constrained in that exercise by the expectation that the political, cultural ,or moral values they adopt are materially related to the issues in dispute, are ranked in proportion to their impact on those issues and are applied through ‘decision procedures’ that supersede traditional rules of evidence.[17]

This article challenges theories governing the formation of contracts that are grounded in narrow conceptions of monism. It argues instead for a plural conception of contracting in which decision agents respond to disparate political, moral and cultural values without subscribing to a single super value.[18] It acknowledges the virtue of them reaching residue determinations by identifying, ranking and applying plural values, as informed by the cultural backgrounds and life experiences of the study subjects.[19] The guiding proposition is that, in drawing from cultural pluralism, they can inform contract law without regressing into unbridled relativism. The overriding aspiration is to enrich contract law rather than augur its ‘death’ on account of monist qualities they attribute to it.[20]

I. From Monism to Preference Pluralism

Monist theories of contract formation trace back to, among other sources, natural law conceptions of ‘right reason’,[21] as embodied in modern deontological liberalism.[22] That liberty consists of the right of autonomous individuals to contract as decision agents on their own behalf. The result is a series of unitary theories of contracting by which individuals are empowered to engage in intentional actions as free and voluntary agents, and whose actions are insulated from the intervention of invasive third parties including the state. Courts as decision agents, in turn, are bound to implement the ‘expressive liberty’ of those autonomous contracting parties.[23]

The fundamental or ‘super’ value in the formation of contracts consists of the liberty of individuals to conclude contracts expressing their subjective wills, consent, or promises.[24] Their liberty in contracting is also manifest in the utility, efficiency, or happiness derived from their autonomous actions.[25] It is preserved by courts that uphold the sanctity of their private agreements.[26]

Preference pluralism transcends monism. Preference pluralists decline to treat any one value, liberty included, as inherently or naturally superior to all others. For them, the election between liberty to contract and equality in contracting is plural in two crucial respects. Firstly, it is plural in denying that values like liberty or equality in contracting are a priori more fundamental than each other, or more fundamental than all other plural values. Secondly, it disagrees that electing among plural values is unavoidably arbitrary. Combining practical reason with prudential judgment, decision agents are expected to make informed choices that take account of continuing and discontinuing moral, political and cultural values. They are also expected to identify and rank commensurable and incommensurable values in reaching suitably articulated ‘residue’ or ‘remainder’ determinations. [27]

Preference pluralism may be challenged on three grounds. Firstly, decision agents may diverge over the nature of plural values, as when they diverge over the nature of liberty and equality in contracting.  Secondly, they may vary in ranking those values, as when they rank liberty over equality or the converse. Thirdly, they may apply those values differently in otherwise similar cases, as when they apply liberty values differently to consumer transactions compared to merchant contracts. Each challenge is subject to response. Decision agents may diverge over the nature of plural values like liberty and equality in contracting, so long as they relate those values to their decisions, as when they relate liberty and equality differently to consumer than to merchant agreements. They may rank plural values differently, as when they reduce the rank of cultural values they regard as regressive and increase the rank of cultural values they regard as progressive. They may also vary in applying ‘decision procedures’ to such values as liberty and inequality in contracting, so long as they apply those procedures in a principled and transparent manner and not by sublimating some plural values to others out of hand.[28]

II. Pluralism: Beyond a Wills Theory

Under a monist wills theory of contracting, the value choice is between finding and not finding a contract in accordance with the manifest wills of the parties, often identified with their subjective wills.[29] Plural values explicated through such values as dignity, knowledge, desire, welfare and happiness beyond the wills of the parties are excluded from consideration.[30]

In treating the parties’ wills as paramount, a monist wills theory of contracting discounts all other values as conflicting with the parties’ wills, or subjugates them in accordance with those wills. For example, in attributing primacy to the sanctity of contract, a legal monist may insist that the manifest wills of the parties expressed through their written contract trump equitable values based on unconscionability, duress or oppression that may diverge from their manifest wills.[31]

Value pluralism challenges unitary conceptions of wills in contracting in different respects. Firstly, it holds that unitary conceptions of wills may be internal flawed. The parties may not manifest subjective wills, as when they fail to cast their minds to the matter, or avoid dealing with it on account of its complexity.[32] Secondly, the parties may share subjective wills, but fail to express them clearly and completely, as when they omit to agree upon future contingencies such as relief from performance.[33] Thirdly, the parties may manifest different and contradictory subjective wills, as when they are at cross-purposes.[34] Value pluralists adopt none of these unitary assumptions. They hold instead that plural values may redress those defects, without presuming to reject the value of consent in reaching plural determinations.[35]

An objective theory of contracting, in subscribing to a reasonable person standard, may redress the fact that the wills of the parties often are not perfected. But it may remain monist by continuing to accord primacy to a single ‘super’ value, the objective wills of the parties.[36] For example, it may insist that objective fairness to an adhesion contract ought to be expressed through the mutual assent of the parties, not in derogation from it.[37]

Alternatively, courts may adopt an objective theory of contracting that is pluralist in nature. For example, they may identify, rank and weigh disparate plural values that vary from liberty, knowledge and dignity to harmony, unity and commonality. They may base their value preferences on the perceived materiality of each plural value, their reluctance to treat any one value as a ‘super’ value that trumps all other values, and their capacity to weigh competing plural values according to determinable ‘decision procedures’.[38]

The practical difficulty is to distinguish between an objective monist theory that augments the wills of the parties and an objective plural theory that transcends their wills. For example, a decision agent who subscribes to a monist theory may uphold the express wills of the parties; and failing that, invoke objective considerations to elaborate upon their unclearly or incompletely expressed wills.[39] In contrast, a decision agent who adopts a plural approach may draw reasonable inferences that substitute for the wills of the parties on grounds that those wills are ill informed, ill-expressed, or if expressed, unfairly advantage one party over the other.[40]

A way of reconciling monist and pluralist approaches toward the objective theory of contracting is by envisaging them along a continuum.[41] According to this approach, decision agents apply the subjective wills of the parties according to the wills of the parties in the first instance, and failing that according to plural values beyond those wills.[42] Depending on the nature and length of the continuum, residue determinations reached by decision agents may affirm the wills of the parties.[43] Alternatively, residue determinations may be incommensurable, not only with those wills, but also with other plural values.[44]

The difference between monist and pluralist approaches to the formation of contracts is principled in nature. A monist approach may enshrine a prime value, such as the liberty to contract at the apex of a ranking system of values. It may engage other normative values like knowledge, welfare, happiness and desire in contracting; but it will subordinate those other values as a matter of principle to a pervasive and unitary liberty to contract.[45]

A plural approach denies primacy, both to a single unitary value and to a comprehensive hierarchy of values beneath it. Instead, it explores whether plural values can be rendered commensurable, not only with the subjective wills of the parties, but also with one another. Failing that, it considers how to arrive at a determination that pays due regard to the conflict among values, including by ranking and weighing them in relation to one another. For example, a court may adhere to a monist theory by construing a contract of adhesion against the drafter on grounds that doing so conflicts with liberty to contract.[46] A pluralist court may reach the same determination, but by ranking a range of commensurable and incommensurable values that include but are not limited to the value of that liberty.[47] A pluralist court may also employ ‘decision procedures’ to identify, rank and weight plural values that diverge from that liberty in order to reach a residue determination.[48]

The extent to which courts hold that plural values can be rendered commensurable depends on the qualities they attribute to those values, the plural means by which they rank them and ends to which they apply them. For example, a court may devise ‘decision procedures’ to regulate onerous ‘no-return’ clauses in consumer supply contracts in graduated stages. Firstly, it may identify competing plural values such as dignity, expediency, welfare and other conceptions of ‘goodness’ in the use of such clauses. Secondly, it may rank plural values such as ‘unfair surprise’ against ‘discount pricing’ in relation to such ‘take-it-or-leave-it’ clauses. Thirdly, a court may arrive at residue determinations based the weight it accords to party-to-party practices such as pre-contractual representations made by producers to consumers, and ‘communal’ values such as industry practice in relation to such disclosures.[49]

Monism and normative pluralism sometimes may lead to the same result. As an illustration, in interpreting the Restatement (Second), a court may subscribe to a monist will theory by adopting the parties’ unusual meaning, say that 100 actually means 50, because it regards their subjective wills as determinative of their intention. It may reach the same determination pluralistically, by weighing competing values associated with liberty, fairness, social utility and public welfare in arriving at a contractual ‘good’ by which 100 actually means 50.[50] The determinative issue is not that resort to value pluralism may produce the same result as in monism. Unlike in monism, plural decision agents do not accord a priori primacy to liberty as the expense of all other values. They decide by identifying, ranking and applying plural values in order to arrive at reasoned and transparent plural determinations.

III. Reconstituting Consent

A traditional theory of contracting holds that courts have a duty to enforce contracts to which the contracting parties have consented.[51] The foundation of that consent is monist, in the voluntary agreement of the parties to contract.[52]

A monist theory of consent may be subjective or objective. It may be subjective when the decision agent subscribes to the explicit consent of the contracting parties, for example as set out in a document under seal to which the parties have expressly agreed.[53] It may be objective when the decision agent imputes a reasonable meaning to the contract in order to clarify or complete their consent.[54]

The consent to contract can be reconstituted to include plural values that transcend a monist theory of consent. This may occur under the third of three default rules.[55] The first default rule entails the ‘direct consent’ (express or implied-in-fact) of the parties. The second rule is ‘indirect consent’ (implied-in-law). Both ‘direct’ and ‘indirect’ consent to contract are unitary in subscribing to the actual or inferred consent of the parties. The third default rule, ‘implied-in-law immutable terms’[56] may be pluralistic in implying-by-law efficiency, fairness or other ‘goodness’ values that are incommensurable with the express or inferred consent of the parties.[57] For example, a court may strike down a ‘radically unexpected term’[58] in an e-consumer transaction even though that term would be valid on a strict interpretation of the express or inferred consent of the parties on grounds that it is incommensurable with countervailing public interest values.[59] This may occur, typically, when a court invokes implied-in-law values of fair play or communal decency to trump terms to which the parties have expressly or implied agreed on grounds that those terms are harsh, oppressive, or unusual.[60]

Courts may also adopt a process of ‘decision procedure’ pluralism to weigh competing values in order to determine whether to affirm, jettison, or reframe the express or inferred consent of the parties. What distinguishes such ‘decision procedure’ pluralism from monist constructions of consent is an unwillingness of decision agents to accord primacy to the express or inferred consent of the parties prior to assessing the commensurability of that consent with a plurality of other values. What further differentiates ‘decision procedure’ pluralism from monism is the transparent manner in which courts may rank plural values that vary from consent, the reasons they may invoke for that ranking and how they articulate that ranking in specific cases. For example, they may identify and rank consent in contracting quite differently depending on the value they attribute to implied-in-law provisions against unconscionable contracting.[61]

Consent ordinarily is significant as a value in a plural theory of contracting, subject to two limitations. Firstly, decision agents may construe consent unduly restrictively under the influence of legal monism. Secondly, they may mask the primacy of consent over competing values by simulating rather than manifesting value pluralism. For example, they may insist that they are identifying a plurality of ‘goodness’ values associated with duress, oppression and undue influence, while sublimating those values to an expressive liberty that ultimately accords exclusivity to the express or inferred consent of the parties.

IV. Obligation as Checklist or Plurality?

An ancillary basis for upholding a contract is that the parties are bound by legal undertakings they have assumed to each other. The basis for their liability resides in a checklist of legal requirements: an offer and acceptance, a serious intention to contact, valid consideration and the presence of complete, certain and non-illusory terms. If this conceptual checklist is satisfied, a court may declare that the contract is binding and enforceable in law.[62]

At its monist narrowest, this checklist serves as a comprehensive ranking system among values that are unified by a single ‘super’ value. For example, all the requirements together constitute a checklist of differently ranked values that are together invoked to affirm the primacy of the parties’ wills or consent.[63]

At its plural widest, the checklist may be subject to plural values of which the parties’ will or consent is illustrative, not transcendent. Under this plural construction, decision agents may compare potentially incommensurable values like liberty, equality and utility, along with the wills and consent of the parties in determining whether a contract is legally binding.[64]

The benefit of a checklist of obligations under a plural theory of contracting is the capacity of decision agents to ascribe different normative attributes to each item in the checklist, without having to accord primacy to any one item. For example, in assessing whether a contract is illusory, they may identify and rank such plural considerations as the social-cultural background, economic knowledge and legal understanding of each party in determining whether, when and how to fetter the contractual discretion of one party.[65]

Decision agents may also invoke ‘decision procedure’ pluralism to weigh checklist requirements.[66] For example, they may devise ‘decision procedures’ to determine the ambit of legal presumptions, such as those governing the so-called ‘trivial’ and non-trivial contractual consequences of a marriage.[67] They may also use ‘decision procedures’ to differentiate among such normative values as liberty, equity, dignity and equality that may impact upon the operation of those presumptions.[68]

A potential problem with ‘decision procedure’ pluralism is that decision agents may rank checklists selectively in order to arrive at decisions that are based on disguised value preferences. A response is that value pluralism may extend the ambit of legitimate value inquiry, while discouraging decision agents from exercising infinite value choices. It may also expect decision-makers to identify and rank plural values in relation to one another, and to articulate their reasons for weighing them differently in order to arrive at transparent and supportable decisions.

A pervasive risk with a conceptual checklist is in failing to recognize contractual relationships in which such checklists are inapposite. For example, courts may fail to take adequate account of non-contractual behavior in business that is based on informal dealings and that are concluded in the absence of a checklist of contractual requirements. A plural theory of contracting may offset this risk by attributing normative attributes to those dealings, including by placing value on good faith as a determinant of such non-contractual relations.[69]

V. Reframing the Bargain

Under a theory of legal monism, the bargain exemplifies the ‘super’ value ascribed to the free choice of the parties.[70] The boundary of the bargain resides in the unitary confines of the bargained-for-exchange and its separation from gratuitous ‘acts of giving’.[71] Other values, such as fairness between the parties may arise in attributing properties to the bargain, but not to usurp it. So long as the bargain is supported by a benefit or a detriment and has some value, it exemplifies the ‘super’ value ascribed to the free will of the parties to contract.[72]

A plural bargain theory engages competing values in determining the nature and effect of a bargain. As guiding policies, judges may identify the ‘bargained-for-exchange’ with value preferences directed at selectively disciplining parties who make gratuitous promises, protecting the reasonable expectations of those to whom those promises are made and evaluating whether bargains promote the material (or non-material) wellbeing of others generally.[73] In ranking these values in relation to one another, they may weigh the rights of parties to determine the nature of bargains against the power of courts to circumscribe those rights on grounds of expediency, equity and social justice. They may apply these weighted rights to arrive at reasoned assessments and prudential judgments about governmental policies that impact upon bargains, regulatory principles that articulate those policies and rules that govern the application of those principles to specific cases. [74]

The risk in pluralistic conceptions of the bargain is that they may empower decision agents to differentiate between contracts and non-contracts, not limited to gifts, by ranking and weighing values disparately. On the one hand, they may endorse a priori conceptions of the bargain in the exchange of value. On the other, they may reinvent the nature and limits of the bargain to suit the perceived needs of each new case. What is valuable may come to depend, less on objectively verifiable conceptions of the bargain than upon an inadequate articulation of the nature of private rights and competing conceptions of the public good. These hazards are endemic to any process of decision-making that may be ill conceived or misapplied, not limited to value pluralism. What the ranking and weighing of plural values adds to decision-making is greater range and depth of inquiry over the nature and limits of a bargain. Included in the assessment of whether a contract ought to be binding in law in the absence of a bargained-for-exchange is whether it promotes a preferred ranking of moral, political and cultural values. Such a determination is reached by ranking and weighing those values in relation to one another and in assessing their impact in specific cases, for example in determining whether a promise to keep a past debt is binding in the absence of new consideration for that debt [75].

VI. The Moral Dimensions of a Promise

Moral monism subscribes to a ‘super’ moral value that trumps all other values in establishing the binding legal force of a contract. The moral basis for holding a promise binding in law also supersedes the separation between law and morality, as it is articulated by analytical legal positivism.[76] According to moral pluralism, the moral basis for a legal promise may be grounded in diverse normative values such as liberty, dignity, friendship, mutual respect, compliance, cooperation and comity.[77]

At least four moral bases for contracting compete for recognition in determining whether a promise is legally binding. Firstly, promises are legally binding because of the intentional moral foundation of those who make promises.[78] Secondly, promises are legally binding to protect the reasonable reliance of those who would be detrimentally impacted by the failure of parties to keep those promises.[79] These first two bases can be summarized as holding the parties bound for having “intentionally invoked a convention whose function is to give grounds – moral grounds – for another to expect the promised performance.”[80] Thirdly, parties may be legally obliged to keep their promises in according honor, respect, or deference to the binding force of those promises.[81] Fourthly, those who are morally ‘at fault’ in violating their promises may be held accountable for the ensuing legal consequences of that violation.[82] That accountability may be primarily to compensate specific parties who suffer loss on account of that default, to deter such default, to extract retribution on account of it, or to achieve some other moral end.[83]

Under a theory of moral monism, any one of these moral values may be determinative as the ‘super’ value that determines whether a promise ought to be legally binding. In contrast, under a theory of moral pluralism, that determination derives, not from a ‘super’ moral value, but from the ranking and weighing of plural moral values that may, but need not be incommensurable with one another or with other plural values.[84]

One concern about moral monism is its reliance on a moral hierarchy, such as the moral superiority of ‘keeping one’s word’ to which other moral values are subordinated.[85] Another concern is that monist theories of morality may have overlapping scope of application. If promises are binding because others reasonable rely on them, a ‘contract as promise’ may be little more than a proxy for a monist wills or consent theory of contracting.[86] The promise is binding because the wills or consent of the parties renders it so. If promises are binding to protect the reasonable reliance of those to whom promises are made, the promise may amount to little more than the moral reframing of promissory estoppel.[87] The basis of the promise resides either in the undertaking of the promisor, or in the reasonable reliance of the promisee.

Conceived through a plurality of values grounded in belief, faith, decency, honor, courage, or other conceptions of morality, moral pluralism may regress into endless discourse about the rightful supremacy of one moral preference over a plurality of others.[88] If a promise is legally binding according to some moral good beyond its discrete value to the promisee, the contract formed may become captive to the vagaries of some preferred socio-moral or political good.[89] If the value preference is to engage fault in ‘breaking’ a promise, the moral foundation of a contract may be subject to disparate opinions about distributive, punitive, corrective and restorative theories of justice.[90] The result may be morality run amuck and contract law along with it. Decision agents may reach an infinite range of ‘remainder’ legal determinations, varying from retribution for unconscionable conduct to restorative justice in deference to minority cultures.[91]

These risks of moral indeterminacy being inculcated into contract law are illustrated in the Restatement (Second) of Contracts, in holding that reliance upon a promise should be ‘reasonable’ ‘as justice requires’.[92] In delineating the moral dimensions of reasonableness ‘as justice requires’, moral pluralism may spiral to an array of incongruous moral machinations and through them, diverse legal possibilities. The result may be to recast the objective reasonable person into a morally indeterminate anthropomorphic legal person.[93]

One response is that moral indeterminacy is unavoidable in probing the moral dimensions of legally binding promises. Exploring different moral dimensions is precisely what moral pluralism strives to achieve. Its purpose is to transform the anthropomorphic reasonable person into an objectively ‘moral’ person who is bound by the dictates of conscience to act justly, to collaborate evenhandedly with others and to contribute to a preferred conception of the moral good in contracting. Far from being legally indeterminate, decision agents may be expected to identify, rank and apply moral values in a reasoned and transparent manner in the formation of contracts.[94]

VII. Self- or Civic Regulation?

A theory of contract regulation may entail self-regulation by the parties,[95] civic regulation by public authorities, or some blend of the two.[96] In issue is why, when and how self- and civic regulation ought to interact, who ought to decide and according to what criteria.[97]

A theory of contract self-regulation is ordinarily, but not necessarily, monist. For example, the assumption in a liberal society is that parties ought to be free to regulate their own affairs by their own means according to their wills, consent, or promises.[98] However, self-regulation may be based on a plurality of values such as the knowledge, desire, dignity, character and reputation of the parties, beyond their unitary wills, consent, or promises.[99]

The civic or public regulation of contracts may also be based on monist or pluralist values. Under a monist theory, civic regulation may have the primary goal of remedying infractions on the free choice of the parties, such as through a primary legal order that circumscribes self-regulating conduct.[100]

Under a plural theory of contracting, the nature of public regulation may vary in response to competing civic virtues associated with market efficiency, equality of treatment, or social justice. Decision agents – legislatures, administrators and courts, among others -- may devise regulations in response to the perceived socio-economic background and life experiences of typical parties, the complexity of the products or services in issue and the nature and extent of market competition in the sector.[101] They may attribute policies, principles, processes and performance requirements to those regulations that are designed to vary in intrusiveness upon self-regulation by the parties. For example, uniform law commissions may formulate policies that discourage e-sellers from imposing particular types of nullifying clauses upon e-consumers, such as those denying returns after opening product wrappers, or those that accord e-sellers extensive latitude in nullifying warranties.[102] They may also prohibit straight-jacket clauses that proscribe class actions, that impose a ‘choice’ of arbitration on e-consumers, or that mandate the e-seller’s home state as the exclusive jurisdiction for resolving disputes.[103]

Each of these public determinations may depend on particular value assumptions. For example, uniform law commissioners may consider the extent to which e-sellers have deeper pockets, more bargaining leverage and greater contractual sophistication than e-buyers.[104] They may also assess the extent to which e-buyers have access to self-help such as through consumer complaint blogs, boycotts of e-suppliers, fast-track measures of dispute avoidance and affordable class actions against e-sellers.[105]

Public regulators may diverge in identifying and ranking potentially incommensurable values in reaching residue determinations. They may also differ in adopting and applying ‘decision procedures’ to those values.[106] Typifying such divergences was dissension among the Commissioners on Uniform State Law over the policies, principles and standards to apply to e-consumer contracts under the Uniform Computer Information Transactions Act (UCITA).[107] For example, they diverged over how to regulate e-consumer practices, such as how to regulate ‘click-wrap’ contracts.[108] They disagreed over how to circumscribe the use of specific clauses in such contracts, not limited to warranty protection, product return and dispute settlement clauses.[109]

How meaningfully public regulators engage plural values depends on how they identify, rank and weigh those values, how they devise regulations to preserve or vary from them, and how they implement those regulations in practice.[110] In issue often is the need for public regulators to evaluate key questions in order to make complex ‘decision procedure’ choices. To what extent should they engage in proactive or reactive administrative scrutiny of e-consumer contracts, including in monitoring standardized terms used in those contracts?[111] What ground rules, if any, should legislatures and courts prescribe to prevent e-sellers from unfairly dominating e-markets while still preserving a free enterprise market?[112] When should courts base their interpretation of e-contracts on traditional legal principles grounded in duress,[113] unconscionability[114] and rules of construction like the contra proferentem rule[115]; and when should they construct implied-in-law terms beyond those traditional principles? In answering these questions, the devil inevitably will lie in the detail.

What value pluralism can imbed in the regulation of contract law is a working theory of civic regulation that is inquiring, informed, collaborative and sustainable. This will require that decision agents identify plural values which are susceptible to reasonable analysis and prudential assessment, which they can rank in some proportion to one another and which they can apply coherently to regulate contracts. The decisions they reach may well be more complex than those derived from monism; but they are also likely to be more situation-responsive within a multifaceted socio-economic society facing novel regulatory issues.[116]

VIII. From Discrete Transactions to Relation Contracts

A distinction is sometimes drawn between discrete transactions and relational contracts.[117] Discrete transactions resemble ‘classical’ agreements in that the parties are engaged in one-off dealings rather than long-term relationships. The transaction, whether written or oral includes everything. It delineates the transaction, the parties, and the terms. Discrete transactions are ordinarily monist. What you see is what you get, a hermetically sealed unitary theory of contracting grounded in the wills or intention of the parties.[118]

Relational contracts involve ongoing dealings between the parties. The normative value of their relationship is paramount. It encompasses their business environment including the customs and usages of their trade; it may also engage such plural factors as their cultural backgrounds, political affiliations and socio-economic stature. It transcends the terms of discrete transactions to which they may be parties, such as the terms governing quantity, price and delivery at particular moments of time.[119]

Relational contracts may be based on monist or pluralist values. They may be based on monist values such as the reasonably inferred consent of the parties.[120] They may be based on pluralist values such as the knowledge, desire and dignity of the parties, along with the perceived ‘goodness’ and fairness of a mutually advantageous relationships. These plural values, in turn, may include party-specific considerations such as the trust, confidence and goodwill the parties share and communal considerations such as the reputation they enjoy among their peers.[121]

One may adopt diametrically opposed views of discrete transactions and relational contracts. According to one view, both discrete transactions and relational contracts are monist; both are grounded in commensurable values; and both are explicated through a monist theory of contracting based on consent. The decision agent’s role is merely to determine the unitary features of each transaction according to its place on a continuum from discrete transactions to relational contracts. [122]

The contrary view is that discrete transactions and relational contracts are fundamentally different in kind. According to this view, a unitary theory of contracting is suited to resolving contracts engaging discrete transactions, but ill-suited to settling relational conflicts that entail a plurality of ‘non-discrete’ cultural, economic and political values. A discrete transaction is formed at the precise moment at which the parties consent, namely, the moment of their accord and satisfaction. A relational contract is based on an interaction among plural values during the ebb and flow of their continually changing relationships.[123]

According to this plural view, relational contracts focus on normative values beyond the wills or consent of the parties. For example, decision agents, including the parties, may base their normative preferences on such ‘soft’ plural values as the cultural backgrounds and life experiences of the parties including among others, their knowledge, wisdom, desires and judgment.[124] Decision agents may also reach winner-take-some determinations based on plural cultural values grounded in compromise and reconciliation, rather than winner-take-all remedies that embody the express wills or consent of the parties.[125] Combining the exercise of practical reason with prudential wisdom, they may resist the dualist contest between liberty and equality in contracting in favor of an amalgam of plural values transcending both.[126]

Take Westinghouse’s celebrated commercial impracticability case in 1981.[127] Westinghouse, a long-term supplier of uranium, sought an excuse from its uranium supply contracts on grounds of unforeseen increases in prices arising beyond its control.[128] The parties initially attempted to negotiate to resolve supply and price conflicts. They subsequently engaged in protracted litigation; the court appointed a special master to broker a party-to-party settlement which the court adopted as its decision.[129]

Supporting a unitary view grounded in monism, the Westinghouse parties had consent to the conditions contained in their supply contracts. They subsequently disputed the interpretation of those conditions, including whether they provided for an excuse for performance on grounds of force majeure and whether courts should permit that excuse on grounds of ‘commercial impracticability’ under s.2-615 of the Uniform Commercial Code [UCC}. Failing settlement, they litigated to resolve their conflict over the meaning and application of the express and inferred terms in their agreement, as well as the applicability of a legal remedy under the UCC.[130]

Supporting a plural view, the litigation was not about the express or inferred terms to which the parties had agreed. It was about a judicially brokered settlement based on their ongoing relationship within a changing macro-political and cultural environment.[131] The court in the Westinghouse case required that the parties propose a resolution reflecting their economic and related relational interests which it incorporated into its winner-take-some decision.[132] However much it co-opted the value preferences of the parties, the court’s residual determination varied from their original will or consent.[133] That it adopted their brokered settlement as distinct from their original consent demonstrates its aversion to deciding relational disputes according to unitary values grounded in their pre-existing agreement.[134]

Key issues for a court deciding whether to defer to changing relational interests are its perception of the nature of the ongoing interactions between the parties, the cultural and political saga surrounding each relationship and the contractual consequences it infers from that saga.[135] In arriving at residue preferences, it may try to reconcile confusing, contradictory and conjectural evidence about the cultural fabric of that relationship. It may also resist unitary measures that are used to resolve conflicts over consent in discrete transactions which it considers ill-fitting.[136]

Judges who base their plural determinations on party-preferred values in relational contracts may be accused of temerity.[137] Judges who base their plural determinations on judicially imposed values may be accused of excessive audacity.[138] In issue is neither their temerity nor their audacity, but the normative values they attribute to complex relationships, the way they rank those values, the weights they attribute to them, and the reasoned decisions they reach in light of those values.

IX. The Limits of Utilitarianism

Almost a legend in its own time is the idealization of ’efficient’ contracting.[139] In ‘Law and Economic’ terms, a transaction is efficient when it maximizes upon profits or produces economic or social benefits that outweigh its costs.[140] Such ’efficiency’
is usually attributed to neo-liberal principles grounded in free market economics with its roots in utilitarian philosophy.[141] Expressed in contractual terms, parties profit or benefit most by concluding efficient – optimal or beneficial -- contracts.[142]

‘Law and economics’ is founded on monism. A single but comprehensive value – efficiency – is conceived as determinative. The guiding assumption of ‘preference utilitarianism’ is that parties may prefer to accord different attributes to efficiency, so long as they subscribe to efficiency as the determinative ‘super’ value.[143]

The free market assumption ascribed to efficient contracting is that, in competitive markets, contracting parties have the right to make ‘efficient choices’ for themselves. As Richard Epstein once proclaimed: “surely all transactions made in organized markets at competitive prices must go unquestioned, for to hold one of these exchanges suspect would be to strike down all identical transactions."[144]

A countervailing assumption is that, in markets that are not organized and in which prices are not competitively determined, courts may justifiably question the free market exchange between the parties.[145] They may devise ancillary default rules in order to minimize opportunistic behavior, to avert improper pressure exerted by one party on the other,[146] to cure market disruptions and to elaborate on conditions that contracting parties may have failed properly to address themselves.[147] In exceptional cases, courts may invoke these default rules to redress the social cost of inefficient contracting, to remedy abuses of bargaining power in contracting,[148] and to ‘fill gaps’ in incomplete contracts.[149] The assumption in each case is that, by remedying these deficiencies, courts will reach efficient outcomes.[150]

Several normative questions arise in applying these judicial ‘default rules’. Firstly, how should courts arrive at ‘efficient choices’ without undermining the free choice of the contracting parties?[151] Secondly, how should they reconcile ‘efficient choices’ with ‘fair choices’? [152] Expressed pluralistically, how should they reach residue determinations in light of the potential incommensurability between ‘free’ and ‘fair’ choices?[153]

A central problem with traditional ‘Law and Economics’ is that it treats efficiency as a ‘super’ value, while subordinating other values to it. The determinative issue is whether an outcome is ‘efficient’, not whether it is ‘equitable’ or ‘in the public interest’.[154] Unlike in a pluralistic analysis, courts applying ‘Law and Economics’ do not make residue choices among incommensurable values because efficiency, as a super value, trumps all other values.[155]

Take the example of a party who buys a patent at a bargain basement price for a widely used life-saving drug from a beleaguered patent-holder, aiming to corner the drug market and raise the retail price of the drug. The purchase is likely to be efficient for the buyer as a “self-interested egoist who maximizes utility.”[156] But it may possibly be inequitable to the original patent holder; it may also lead to a market shortage of the drug among patients who can no longer afford to buy it.

Under a monist analysis, the value of efficiency is paramount; all other values are subordinated to it. On establishing that the purchase of the patent and the sale of drugs in terms of it are efficient, equity and social expediency may cease to be determinative.[157]

Under a pluralistic analysis, decision agents may elect among incommensurable values including but not limited to efficiency, equity and social expediency. As such, they may prefer to hold that, however efficient the sale is for the patent purchaser, it is inequitable for the beleaguered patent seller; or it leads to an ‘impoverished pre-social conception of human life” [158] for being inaccessible to patients generally.

‘Law and Economics’ is not without a response to this plural challenge.[159] As the ‘second wave’ of ‘Law and Economics’ recognizes, a cost-benefit analysis may incorporate values like corrective and distributive justice in the qualitative assessment of efficiency.[160] In effect, decision agents engaging in preference monism may take account of the equitable and social cost of contracting in deciding whether or not to set aside, or otherwise circumscribe the sale of that drug patent.[161]

Such ‘preference monism’ still falls short of ‘preference pluralism’ because it provides that, should normative values be in conflict, the value of efficiency trumps all alternative values. As a result, decision agents may elect among competing values in support of efficiency, not in derogating from it.[162] ‘Law and Economics’ denies the plural alternative in which the value of efficiency is incorporated into a ranking of values in which no one value is treated as a priori more valuable than the others.[163] In this respect, ‘Law and Economics’ is limited in its scope of application in a manner that ‘preference pluralism’ is not.

X Unitary or Plural Rationality?

A monist theory of rationality holds that the exercise of rationality is a ‘super’ value by which decision agents identify, rank and weigh other values, such as utility or efficiency. For example, the exercise of rationality may establish that maximizing benefits in contracting is the most rational action to adopr in the circumstances. The determinative ‘super’ value is the rational process that justifies the maximization of those benefits, as distinct from the maximized benefits themselves.[164]

In contrast, plural rationality subscribes to a plurality of alternative rational processes in respect of which no one rational process is per se determinative. For example, a process of rational reasoning may be invoked to elect among such incommensurable alternatives as ‘free’, ‘efficient’ and ‘fair’ choice. The result may be a rational decision grounded in values like efficiency in contracting, the sanctification of promises,[165] the equitable treatment of the contracting parties, or an amalgam of these or yet other values. [166] Unlike unitary rationality, plural rationality does not treat a single rational process as a priori more rational than all others, although it may conclude in favor of one process in consequence of a rational assessment of the competing alternatives.[167]

‘Preference rationality’ in particular holds that normative preferences are based on a rational choice among plural values which may be commensurable or incommensurable with one another. The process of rational choice may entail compromise among preferred values that include non-rational ones. For example, a preference rationalist may reach a rational determination based on moral or political or even emotional reasons, so long as that process of rational choice includes a value assessment of the plural alternatives.[168]

An example of ‘preference rationality’ at work arises in establishing the ‘just price’ of a contract.[169] Decision agents may employ rational processes to formulate ‘fair’ monetary policies, principles and standards;[170] and to circumscribe predatory prices.[171] They may use rational measures, such as quantitative economics, to determine how suppliers set prices, how they notify buyers of changes in price and how those practices may vary among sellers and buyers.[172] They may employ rational ‘decision procedures’ to determine whether those prices are reasonable or not.[173] In reaching such determinations, they may invoke rational processes to establish the extent to which pricing policies deter, punish, or reformulate suspect pricing practices.[174] They may engage in rational behavioral studies, too, to affirm the reactions of study subjects to regulatory policies governing those prices, as well as to the enforcement of those policies in specific cases.[175]

What ‘preference rationality’ can add to contract theory are rational processes of choice that encompass a range of moral, economic and cultural values which decision agents can rank coherently in arriving at reasoned elections among plural alternatives. ‘Preference rationality’ is the means by which they can decide complex cases in light of a fuller spectrum of values than are ordinarily considered by monist decision makers. For example, ‘preference rationalists’ may be better equipped to determine the ‘just price’ based on a their rational assessment of changing market forces, including more sophisticated mechanisms for monitoring and responding to prices changes in target markets.[176]

A particular criticism of ‘preference rationality’ is that it may lead to indeterminacy or manipulation in choosing among a range of rational alternatives.[177] Using plural processes to identify and rank a range of values does not ensure that those rational processes are reconcilable, or that they will lead to rationally determined results. Rational processes can also be stage-managed to affirm preferred value choices. But placing the blame for indeterminacy or the manipulation of values on the doorstep of rational decision-making may fail to recognize the intrinsic worth of ‘preference rationality’ in weighing plural alternatives that would ordinarily be marginalized under a theory of rational monism.

However imperfectly decision agents may engage in rational processes, their resort to ‘preference rationality’ may still assist them to measure ‘patterns’ of party practices in light of such varied factors as age and gender, education and wealth.[178] It may enable them to arrive at value determinations about transaction costs including information costs, bargaining and decision costs and policing and enforcement costs in relation to consumer protection.[179] It may also assist them to balance incommensurable values grounded in efficiency and fairness in reaching decisions, such as about the ‘just price’.[180]

XI. Functionalism as Decision Procedure Pluralism

Functional study is an important measure of ‘decision procedure’ pluralism[181] As an illustration, study subjects may adopt decision procedures by which they weigh hypotheses about business behavior in select trades;[182] they verify, challenge, or reify normative presuppositions about the efficiency or fairness of contractual behavior,[183] and they reach residue determinations by reconciling incommensurable plural values about contracting practices in select industries and trades.[184]

Decision procedures may also be designed to determine the veracity of study assumptions.[185] For example, study agents may use structured interviews with study subjects to assess suppositions about competing business attitudes towards particular kinds of contractual and non-contractual behavior.[186] They may invoke ‘social fact’ evidence to determine the influence of such background factors as race, age and gender, faith and religion, along with employment experiences based on educational credentials, professional licensing and employment history.[187] For example, study agents may invoke ‘decision procedure’ functionalism to measure how study subjects have engaged in informal business relationships, when they have dispensed with formal written contracts crafted by lawyers, and how they have settled their differences amicably through interim negotiations. Study agents may also assess the negotiating strategies used by study subjects, as well as civic responses adopted by decision agents to those strategies, such as through statutory schemes circumscribing anti-competitive behavior and the judicial application of those schemes to particular cases.[188]

Decision procedures used in functional study are not value free. For example, the functional assessment of non-contractual behavior in business may be prefaced upon the rational supposition that such behavior ought to be predominantly self-regulated, or conversely, subject to particular kinds and degrees of civic regulation. A credibility test for ‘decision procedure’ pluralism is whether these suppositions are open to scrutiny, or whether functional study serves as a feigned attempt to affirm pre-existing suppositions about the sufficiency or otherwise of self-regulation in disparate social contexts.[189]

At their best, functional studies of social behavior may help to test rational suppositions about the nature and significance of contractual relationships without becoming captive to those suppositions. They may also help to assess the functional impact of preferential values such as efficiency and morality upon those suppositions.[190]

At their worst, functional analyses may be dressed up to verify predetermined normative biases, or degenerate into a “highly amorphous sociological inquiry” with dubious instrumental ends.[191] The functional results reached may be expensive, unreliable, self-justifying, irrational and ultimately, inconclusive.[192]

How well functional studies promote ‘decision procedure’ pluralism depends on the suppositions that are imputed to them, the terms of reference that govern those studies, the manner in which they are conducted in practice, and the determinations that study agents derive from them. None of this is to deny the value of functionalism, but merely to set ‘rational’ limits on the feasibility and credibility of such studies in relation to contracting.

XII. Construing Commensurable and Incommensurable Values

An interpretative theory of contracting holds that the formation of contracts is determined primarily through a process of interpretation, or more expansively, through contract construction.[193] Interpretative theory may be grounded in monism when courts interpret contracts in accordance with ‘super’ values such as those associated with the ‘wills’, ‘promise’ or ‘consent’ of the parties,[194] or more comprehensively, with happiness or utility.[195] Courts may also resort to monist methods of interpretation, for example by interpreting the ‘plain word’ or ‘true’ meaning of a contract in accordance with the actual or inferred intentions of the parties.[196]

In contrast, courts may engage in interpretative pluralism when they take account of plural conceptions of ‘the right’ or ‘the good’ that transcend the ‘wills’, ‘promise’ or ‘consent’ of the parties.[197] They may employ interpretative pluralism when they superimpose conceptions of good faith grounded in moral, political or cultural values upon contracts beyond their ‘plain word’ meaning.[198] They may also resort to interpretative pluralism when they arrive at remainder determinations in accordance with competing conceptions of ‘the good’, beyond the intention-bearing conduct of the parties.[199]

In practice, judges may adopt graduated steps in interpretation, commencing with monism and concluding with pluralism.[200] For example, they may commence by interpreting ‘whole agreement clauses’ in contracts as ‘fully integrated’ in expressing the will or consent of the parties and by admitting extrinsic evidence only to clarify ambiguities in those contracts.[201] They may progress to plural constructions of contracts when they subject the express terms of contract to implied-in-law duties of good faith which they impute to the parties.[202] They may ‘fill gaps’ in those contracts by taking account of the course of dealings[203] and performance of the parties,[204] the ‘network effect’ of their conduct[205] and industry norms of behavior that courts impose on them by mandate of law.[206]

Courts may also use ‘gap filling’ techniques progressively, commencing with monism and concluding with pluralism. For example, they may commence with the monist assumption that contracts have lacunae or ‘gaps’ which courts need to ‘fill’ to clarify or complete the intention of the parties. They may progress to the pluralist assumption by which they ‘fill gaps’ for plural reasons beyond clarifying or completing those intentions.[207]

The problem is that courts may diverge over the virtue, manner and extent of judicial ‘gap filling’. Those that adhere to a monist interpretation may decline to ‘fill gaps’ in contracts that are not reasonably inferred from the intention of the parties on grounds that courts should not ‘make contracts’ for the parties.[208] Those that are ambivalent about interpretative monism may claim that they are merely clarifying or completing the intention of the parties, whereas their decisions may reflect plural values that disavow those intentions.[209] Those that are self-avowedly pluralist may decide that particular contract terms are unfair to one party, inefficient, or contrary to public policy by resorting to implications of law that pay scant regard to the intention of the parties.[210]

There is nothing theoretically objectionable to courts interpreting contracts on monist grounds based on the manifest wills, promises or consent of the parties, or on plural grounds beyond such monism. The problem is that courts may appear to suck and blow at the same time. They may claim to adhere to monist rules of interpretation, while adopting plural value preferences instead. Alternatively, they may claim to subscribe to plural methods of interpretation while applying unitary methods in fact. The result may be rules of interpretation which courts apply selectively, inconsistently and even spuriously in interpreting contracts. Typical among these are judicially conjured fictions which courts invoke to hypothecate the intentions of the parties but which bear no rational relationship to the state of minds of the parties. [211]

Plural methods of interpretation offer the benefit of an interpretative continuum along which courts can identify interpretative alternatives, their reasons for exercising preferences among them, and their manner of applying those preferences in particular cases. Tension along that continuum, from contract interpretation to judicial construction, is inescapable. No interpretative continuum can explain itself. Decision agents need to do so. How adequately they do so in fact will depend on both the plural methods of construction they invoke and how they employ them in fact.[212]

XIII. Beyond Critical Analysis

Critical race, feminist and social theorists attack classical and neo-classical theories of contracting for relying on self-serving liberal values.[213] They challenge the right of atomized individuals to act as free, efficient, rational and functional agents.[214] They dispute liberal principles of contract law on grounds that they artificially differentiate between private rights and the public realm, transform ‘private’ rights to contract into benefits for the moneyed elite,[215] undermine the enterprise bargaining power of the working poor, reverse the emancipation of women and minorities, and disempower consumers en masse.[216]

At the same time, Critical Scholars sometimes acknowledge that liberal principles may benefit members of disadvantaged groups; but that such benefits are marginal at best and accomplished through co-optation at the fringes of the privileged mainstream.[217]

Critical scholarship challenges liberal theories of contracting in particular for raising legal form over legal substance; [218] for using paternalistic principles of contract law to mask substantive inequalities;[219] for invoking contract procedures to perpetuate systemic disadvantages; [220] for recasting a ‘reasonable white male person’ into a ‘reasonable person’ standard ;[221] and for falsely equating that standard with equity.[222]

Critical scholarship also challenges legal pluralism.[223] Under siege are feigned attempts by judicial pluralists to align private rights to contract with a ‘plural good’ that, at best, are only incrementally greater than the sum of individual privileges within it.[224] Pluralist courts are doubted for using ‘decision procedures’ restrictively, for tolerating a narrow communal sphere around contract rights, and for failing to establish a meaningful balance between liberal rights and communal values.[225] Challenged, too, is the indeterminacy of plural values that are associated with legal liberalism.[226]

Critical Scholarship has a legitimate quarrel with liberal contract theory. Theories based on the wills, consent and promises of contracting parties may accord priority to individual rights at the expense of social, economic and political values.[227] Decision agents like courts may misapply value pluralism, leading to legal indeterminacy.[228]

What Critical Scholarship has not adequately acknowledged is the extent to which statutes and judicial precedents may have enhanced plural conceptions of equality, including by extending contractual rights to disadvantaged groups.[229]

Nor has Critical Scholarship’s nihilist critique produced a viable alternative to plural contracting, other than through utopian idealism.[230] Its utopian adaptation of ‘the good’ may be virtuous, but it may also regress into the preferred idealism of some groups at the expense of others.[231]

XIV. Cultural Pluralism

Cultural pluralism does not reject individualistic values, such as relate to the wills, promises or consent of the contracting parties, but instead contextualizes them in light of the plural alternatives.[232] A guiding rationale is that individual free choice is not a bad thing, so long as it takes account of the cultural context in which that free choice is explicated.[233] Having the choice to buy a good or service is not only about the wills, promises or consent of the individuals engaged in that purchase and sale, nor wholly about the efficiency, functionality, and rationality of their choices. It is about cultural life experiences, varying from the shared cultural values that particular groups share to the impact of those cultural values on individuals within those groups.[234] Cultural values, in turn, are determined according to the background and life experiences of individuals and groups arising from their membership in or association with identifiable cultures.[235] These cultural relationships are based on ‘connecting’ factors, such as age, gender, sexual orientation, ethnicity, religion, language, and geographical proximity that connects individuals to discrete cultural groups [236] Including as part of a legal culture, too, is the cultural background and life experience of legislatures and courts that influence the formulation of legislative policies and judicial reasoning respectively.[237]

Cultural pluralism has particular virtues when applied to contracts. Firstly, it can provide a cultural framework in which to assess commensurable and incommensurable values, such as by providing evidence of the cultural background and life experiences against which to measure ‘free’, ‘fair’, ‘efficient’, ‘rational’, or ‘functional’ choice.[238] Secondly, it can augment individuated values grounded in the wills, promise or consent of individuals by taking account of particular cultural experience such as the technological, linguistic and commercial training and experience of the contracting parties. For example, it can identify disparate cyberspace cultures in which e-contracts are formed, not unlike disparate merchant cultures associated with the Medieval Law Merchant.[239] Thirdly, it can assist in arriving at residue determinations based on the cultural background and life experiences of particular parties, such as the financial acumen, contractual and legal experience of .e-consumers in determining whether they have constructive notice of allegedly predatory e-pricing practices.[240]

Cultural pluralism may also accord greater value to cultural ‘otherness’ in contracting than narrow individualistic theories of ‘free choice’ without excluding those individualistic theories.[241] What is culturally ‘good’ may help to transform the anthropomorphic ‘reasonable person’ into a culturally imbued person.[242] For example, cultural pluralism can help to identify divergences in the trading background, bargaining know-how and contracting experience of e-consumers,[243] such as by distinguishing mass e-consumers from e-consumer resellers in construing licensing restrictions on the resale of e-consumer goods.[244]

Decision agents who resort to cultural pluralism may transcend monist macro-cultures. For example, they may recognize different cultural processes of decision-making, such as collaborative methods of contracting. They may also subscribe to different ‘decision procedures’ in applying those collaborative methods to mediate mediate family and religious contract disputes, not unlike in the Westinghouse case.[245] They may also inculcate within their judicial cultures a winner-take-some approach that accommodates competing efficiency and equity values and that helps to sustain ongoing relationships.

Cultural pluralism is subject to three primary challenges. The first is that decision agents may diverge over the nature and significance of cultural values. Such divergence is unavoidable and is often identified with cultural change itself. One response is that decision agents are expected to identify the applicable matrix of cultural values, as well as rank and weigh cultural values in light of that matrix. For example, they need to demonstrate how family, religious and social backgrounds may imbed different cultural attributes in different kinds of cohabitation agreements, not limited to different kinds of ‘marriage’ contracts.[246]

The second challenge is that decision agents may rank comparable cultural values differently, leading to cultural indeterminacy. In response, decision agents are unlikely to arrive at perfect symmetry in applying cultural values to particular cases. Cohabitation agreements may share cultural attributes; but these are unlikely to be culturally uniform even among specific types of cohabitation agreements, such as among same sex-couples. Cultural pluralism does not purport to produce perfect symmetry. What is does expect a decision agent to do is rank and weigh cultural values in light of their perceived impact upon parties who may have unique cultural backgrounds and life experiences. [247] .

The third challenge is that decision agents may diverge over the cultural values they identify in otherwise comparable cases. Again, cultural pluralism does not purport to lead to consistent determinations. Its aim is to provide ‘decision procedures’ against which decision agents can reach culturally informed decisions in particular cases. For example, courts may attribute different cultural attributes to the practices of end user e-consumers compared to e-consumer resellers. They may also diverge due to differences in their judicial cultures, as arises from disparities in their ideological backgrounds and life experiences. But far from being pitfalls, these cultural differences may well be virtues that enrich their judicial discourse as well as plural decision-making.[248]
 
Divergence among cultural values is itself a justifiable embodiment of cultural pluralism. Not only do cultures change. So too do the value inferences decision agents may impute to and draw from them. Decision agents may typically differ over the range of plural value options. They may diverge in ranking allegedly progressive and regressive cultural values, such in distinguishing between same–sex and heterosexual cohabitation contracting.[249] They may differ in responding to an intersection of cultural differences,[250] such as between ethnicity and gender in employment contracting,[251] or age, education and business experience in contracts that restrict the licenses of e-purchase resellers. [252] Cultural pluralism encourages decision agents to explore such value differences, not to repress them. It also encourages them to identify, rank and assess those value preferences rather than accept or reject them out of hand.

Cultural pluralism does not reject the priority that decision agents may accord to individual rights. But it expects them to scrutinize individual rights in light of shared cultural values. Its purpose is to determine the attributes of those cultural values, the manner in which they are shared within an applicable cultural community; and the virtue of applying those values selectively to particular cases. The strength of cultural pluralism depends in part on the willingness of decision agents to identify and weigh a full spectrum of cultural values. The success of cultural pluralism hinges on the capacity of decision agents to address those cultural values in a lucid, palpable and transparent manner.[253]

Conclusion

What the Nineteenth Century delivered as a tightly framed ‘wills theory’ of contracting, the Twentieth Century unraveled into a series of liberal theories about why, when and how contacts are formed. What these Twentieth Century theories retained was their deep-seated commitment to legal monism.

Notable Twentieth Century legal scholars attempted to drag the common law including contract law into the plural present. However innovative was the sociological jurisprudence of Roscoe Pound, [254] the functionalism of Frederick Kessler[255] and the legal realism of Karl Llewellyn,[256] monist theories of contracting grounded in variations of free choice theory have continued to prevail.[257]

This article makes the case for legal pluralism in contracting. Its overriding purpose is to challenge intractable theories of monism and dualism that are imbedded in the formation of contracts. If contract formation is about preserving the reasonable expectations of the parties, value pluralism is about framing their expectations in light of socio-economic, political and cultural values that transcend the atomized individual. If monism in contracting is about enforcing the free, efficient, or rational choices of individuals, cultural pluralism is about valuing cultural backgrounds and life experiences that impact on those choices.[258]

Cultural pluralism in particular is about resisting the polarization that arises when consent is juxtaposed against no-consent, promise against no-promise and will against no-will theories of contracting. It is about assessing plural values in light of practical reason and prudential wisdom in order to arrive at residual value determinations that are affirmed by the cultural background and life experience of the contracting parties.
 
Decision agents who base their decisions on cultural pluralism may be accused of resurrecting or favoring some cultural values above others.  These criticisms can be directed against any decision-making process that entails selecting, ranking and weighing values. A theory of cultural pluralism in contracting cannot be perfect, or even perfectible; but it can be explicated, reasoned and justified. It can also serve as a coherent framework within which decision agents can respond to cultural difference without falling prey to cultural-legal myopia. 

Ultimately, the resilience of cultural pluralism in contracting will depend on the application of two bulwark principles. The first is that no one set of cultural values ought to be treated as a priori more fundamental than all others. The second is that choosing among cultural values requires a principled appraisal of their differences, not an arbitrary election among them. Satisfying these two principles will determine the future of pluralism in contracting and in some ways, the future of contracting itself.

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[∗] B.Com., LL.B. (Cape Town) LL.M., S.J.D. (Harvard). Immediate Past Dean and Professor of Law, University of New South Wales, Australia, The author is grateful to Bob Hillman at Cornell Law School, Stewart Macaulay at Wisconsin Law School, Brian Bix at Minnesota Law School for their valuable comments on an earlier draft, to Emily Burke for her assistance and to the Social Sciences and Humanities Research Council of Canada for funding the initial research and the University of New South Wales for a decanal leave to write it.
[1] On this theoretical debate, see e.g. DANIEL L.O’NEILL, MARY LYNDON SHANLEY AND IRIS MARION YOUNG, ILLUSION OF CONSENT (PENN. STATE, 2008); FRANCIS H. BUCKLEY, JUST EXCHANGE: A THEORY OF CONTRACT (ROUTLEDGE, 2005); FRANCIS H. BUCKLEY, ED., THE RISE AND FALL OF FREEDOM OF CONTRACT (DUKE UNIV.PRESS, 1999); Leon E. Trakman, Contracts: Legal, in 3(8) INTERNATIONAL ENCYCLOEPEDIA OF THE SOCIAL AND BEHAVIORAL SCIENCES 102 (2001); R.A. HILLMAN, THE RICHNESS OF CONTACT LAW: AN ANALYSIS AND CRITIQUE OF CONTEMPORARY THEORIES OF CONTRACT LAW (KLUWER, 1997); MICHAEL TREBILCOCK, THE LIMITS OF FREEDOM OF CONTRACT (HARVARD, 1993); JAMES GORDLEY, THE PHILOSOPHICAL ORIGINS OF MODERN CONTRACT DOCTRINE (OXFORD, 1991); RUTH R. FADAN & TOM BEAUCHAMP, A HISTORY AND THEORY OF INFORMED CONSENT (OXFORD, 1986).
[2] On the philosophical value of rights and responsibilities under a theory of legal pluralism, see LEON E. TRAKMAN & SEAN GATIEN, RIGHTS AND RESPONSIBILITIES (UN.TORONTO, 1999). On the proposition that the moral foundation of a contract resides in the consent of the parties to transfer rights and assume duties, see Randy E. Barnett, A Consent Theory of Contract, 86 COLUM. L. REV. 269 (1986). On the public policy rationale behind legally binding promises, see R.A. BUCKLEY, ILLEGALITY AND PUBLIC POLICY (SWEET & MACWELL, 2002); M. FURMSTON, CHESHIRE, FIFOOT AND FURMSTON, LAW OF CONTRACT (14TH Ed., BUTTERWORTHS, 2001) at p.449;Leon E. Trakman, The Effect of Illegality in the Law of Contract: Suggestions for Reform, 55 CAN.BAR REV. 627 (1977).
[3] Monism has a lengthy history. For example, the first issue of the philosophical journal, “The Monist”, was published in1881. See further http://monist.buffalo.edu/.
[4] On an all-encompassing monist philosophy of justice, see e.g. JOHN RAWLS, A THEORY OF JUSTICE (HARVARD, 1971). On monist wills, consent and promise theories of contracting, see infra Sections II, III and VI respectively. On monist utility and efficiency theories, see infra Section IX. But cf. RONALD DWORKIN, SOVEREIGN VIRTUE: THE THEORY AND PRACTICE OF EQUALITY (HARVARD, 2000) at p.4-5.
[5] On preference monism in utilitarian philosophy, see e.g. J.B.SCHOEEWIND AND DALE. E.MILLER, eds., UTILITARIANISM IN THE BASIC WRITINGS OF JOHN STUART MILL (NEW YORK: RANDOM HOUSE, 2002) at p.241.
[6] On the ordering of values in monism, see e.g. WILLIAM A GALSTON, LIBERAL PLURALISM (CAMBRIDGE, 2002) at p.6.
[7] On this conflict between liberty and equality, see ISAIAH BERLIN, infra note 11. For a critique of monism generally, see GALSTON, supra note 6 at p.8.
[8] The pervasive issue relates to why a promise is legally enforced. As Mel Eisenberg once proclaimed, “A promise, as such, is not legally enforceable. The first great question of contract law, therefore, is what kinds of promises should be enforced." See M. Eisenberg, The Principles of Consideration, 67 CORNELL L.REV.640(1982). See too Omri Ben-Shahar & Lisa Bernstein, The Secrecy Interest in Contract Law, 109 YALE L.J.1885 (2000).
[9] On such commensurable and incommensurable values, see e.g. DAVID WIGGINS, INCOMMENSURABILITY: FOUR PROPOSALS, in RUTH CHANG, INCOMMENSURABILITY, INCOMPARABILTY AND PRACTICAL REASON (HARVARD, 1997); BERNARD WILLIAMS, MORAL LUCK (CAMBRIDGE, 1981); MICHAEL STOKER, PLURAL AND CONFLICT VALUES (OXFORD, 1990).
[10] This combination of deliberative reason and prudential wisdom is expressed here through the conception of “preference pluralism”. See further infra note 12.
[11] For the view that liberty and equality are fundamentally in conflict, see ISAIAH BERLIN, FOUR ESSAYS ON LIBERTY (OXFORD, 1969). On moral pluralism, see .e.g. RUTH CHANG, ed., Putting Together Morality and Well-Being, in PRACTICAL CONFLICT, supra note 9; JOHN KEKES, THE MORALITY OF PLURALISM (PRINCETON, 1993); CHARLES E. LARMORE, PATTERNS OF MORAL COMPLEXITY (CAMBRIDGE,1987).
[12] Such ‘preference pluralism’ is distinguished from ‘foundational pluralism’ in not accepting that one value may prevail over all others, for example, that liberty to contract may prevail over equality or efficiency in contracting. For a classical view of ‘normative’ or ‘preference pluralism’, see G.E.MOORE, PRINCIPIA ETHICA (CAMBRIDGE: CAMB., 1903). On ‘foundational pluralism’, see e.g. JUDITH JARVIS THOMSON 1997, The Right and the Good, 94 J.PHIL.273, 275-76 (1997). See further note 88.
[13] On political pluralism particularly in relation to ‘public’ cultures, see MICHAEL WALZER, SPHERES OF JUSTICE: A DEFENSE OF PLURALISM AND EQUALITY (BASIC BOOKS, 1984).
[14] See infra Section XIV.
[15] On such implied terms in a consent theory of contracting, see infra Section III/ On the complexity particularly of moral pluralism, see e.g. P.BAUMANN AND M.BETLZER, eds. PRACTICAL CONFLICTS (CAMBRIDGE, 2004); T. CHAPPELL, UNDERSTANDING HUMAN GOODS (EDINBURGH, 1998); L.Becker, Places for Pluralism" 102 Ethics, 707-719 (1992); C. LARMORE, PATTERNS OF MORAL COMPLEXITY (CAMBRIDGE, 1987); C.GOWANS ed., MORAL DILEMMAS (OXFORD, 1987).
[16] On ‘practical reason’ in making normative choices among incommensurable values, see Joseph Raz, Incommensurability Agency in CHANG, supra note 9. See too JOSEPH RAZ, ENGAGING REASON: ON THE THEORY OF VALUE AND ACTION (OXFORD, 1999) at p.48-49. ["If of the options available to agents in typical situations of choice and decision, several are incommensurate, then reason can neither determine nor completely explain their choices or actions" at p.48.] It is arguable that Raz’s imputation of ‘practical reason’ to rational choice is reductionist. A more accurate descriptor of the normative choice among incommensurable values is ‘preferential reasoning’ which is used henceforth.
[17] Decision procedures transcend traditional rules of evidence in the willingness and ability of decision agents to use ‘social fact’ evidence to identify, rank and apply political, cultural and moral values in reaching residue determinations. On ‘social fact’ evidence, see infra note 188. On the application of decision procedures to cultural pluralism, see infra Section XIV.
[18] It is arguable that a ‘normative pluralist’ may also be ‘foundational monist’ in expressing a preference for both different kinds of values such as liberty and equality (normative pluralism) but also for a ‘super’ value among those values (foundational monism). It is arguable, too, that normative pluralism can lead to a richer form of monism.
[19] See supra Section XIV.
[20] This plural conception is distinguishable from the late Grant Gilmore’s conception of the ‘death’ of contract arising from the alleged erosion of consent in contracting and the growth of ‘fault’ as a substitute value determinant. . One result, according to Gilmore, was the fragmentation of the law of contracts and its gradual incorporation, inter alia, into the law of torts. See GRANT GILMORE, THE DEATH OF CONTRACT (OHIO STATE, 1974). Contrary to Gilmore, the fact that contracting is subject to normative justifications other than consent to contract, such as to efficiency and public order in contracting, merely establishes value contestation around the formation of contracts, not its conceptual or normative death. See further infra esp. Sections VII-X.
[21] On the (natural law) liberal roots of deontological liberalism in the formation of contracts, see CHRISTOPHER WOLFE, NATURAL LAW LIBERALISM (CAMBRIDGE, 2006); JOHN RAWLS, THE LAW OF PEOPLES (HARVARD, 1999); PATRICK S. ATIYAH, THE RISE AND FALL OF FREEDOM OF CONTRACT (OXFORD, 1979).
[22] Deontological liberalism, in placing reliance on rules and principles, rather than ‘goods’, may be monist in subscribing to a single determinative value, or pluralist in adopting different values. However, deontological legal liberalism is ordinarily monist since it usually subscribes to unitary values identified with the individual’s rights and correlative duties. See LEON E. TRAKMAN & SEAN GATIEN, RIGHTS AND RESPONSIBILITIES, supra note 2, Chapter 2.
[23] William Galston describes this process as “expressive liberty”, encompassing a fit between outward existence and inner conceptions of values. See WILLIAM A. GALSTON, LIBERAL PURPOSES: GOODS, VIRTUES AND DIVERSITY IN THE LIBERAL STATE (NEW YORK: CAMBRIDGE, 1991) at p.10. See further Section VII.
[24] “According to the classical view, the law of contract gives expression to and protects the will of the parties, for the will is something inherently worthy of respect." See Cohen, The Basis of Contract, 46 HARV.L.REV.553,575 (1933). On the genesis of this classical view, see FREDERICK POLLOCK & FRANKLIN STRAWN DICKSON, PRINCIPLES OF CONTRACT (BLACKSONE, 1888). See further infra Sections II (Wills), III (Consent) and VI (Promise).
[25] See further infra Section IX. On the normative relationship between love and liberalism in Judeo-Christian values see PAUL A. KAHN, PUTTING LIBERALISM IN ITS PLACE (PRINCETON, 2008)
[26] Parties who freely conclude contracts are legally ‘bound by their pacts’: pacta sunt servanda. On the ancient origins of this concept, see Paradine v. Jane (1647) Aleyn 26.
[27] On ‘the good’, see e.g. FRED FELDMAN, PLEASURE AND THE GOOD LIFE (OXFORD, 2004); CHRISTINE SWANTON, VIRTUE ETHICS: A PLURALISMTIC VIEW (OXFORD, 2003). See too BERLIN, supra note 11.
[28] See further supra text accompanying note 16 and infra Section XIV.
[29] On the wills theory in contracts, see e.g. BUCKLEY, JUST EXCHANGE, supra note 1, at p.27. On the evolution of the wills theory of contracts in Continental European philosophical and legal thought, see JAMES GORDLEY, PHILOSOPHICAL ORIGINS, supra note 1, ch.7.
[30] Some pluralists identify the ‘wills’ of the parties with their ‘intentional actions’. For example, Joseph Raze holds that “the will is the ability to choose and perform intentional actions.” JOSEPH RAZ, ENGAGING REASON, supra note 16, at p.47
[31] On the sanctity of promises, see supra note 26.
[32] On the subjective theory in contracts, see e.g. LARRY D. DIMATTEO, CONTRACT THEORY: THE EVOLUTION OF CONTRACTUAL INTENT, CH.2 (MICH.STATE, 1998).
[33] As Judge Skelly Wright once stated in Transatlantic Financing Corp.[1966] USCADC 243; , 363 F.2d 312, 318–19 (D.C. Cir. 1966) a case on commercial impracticability arising from the 1966 Suez Canal closure: “Parties to a contract are not always able to provide for all the possibilities of which they are aware, sometimes because they cannot agree, often simply because they are too busy” (at p. 318–19).
[34] The contradictory subjective wills of the parties is illustrated in classic English case of Raffles v Wichelhaus, Ct. of Exchq. 159 Eng Rep.375 [1864]. There, the parties agreed upon a shipment ex peerless; but each had a different ship, ‘Peerless’, in mind. The court concluded, inter alia, that the parties lacked consensus ad idem.
[35] For a detailed treatment of vices or defects in consent in European contract law, see generally JAMES GORDLEY, THE ENFORCEABILITY OF CONTRACTS IN EUROPEAN LAW (CAMBRIDGE, 2001)
[36] The absence of the perfected wills of the parties is central to the objective theory of contracting. See generally STEVEN J. BARTON, ELEMENTS OF CONTRACT INTERPRETATION, chs.2-3 (OXFORD, 2008). See too F.D. Rose, Consensus ad idem: Essays in Honour of Guenter Treitel, 56 CAMB.L.J.231 (1997).
[37] On such mutual consent, see e.g. W.DAVID SLAWSON, BINDING PROMISES: THE LATE 20TH-CENTURY REFORMATION OF CONTRACT LAW CH.1 (PRINCETON, 1996).
[38] Preference pluralists – like preference monists -- ordinarily treat ‘goodness’ as a value with many different attributes. However, unlike preferential monists, preferential pluralists do not treat one conception of ‘goodness’ as inherently superior to all others. On preference monists, see text accompanying note 5. On a preference pluralist view in law, see JOSEPH RAZ, ENGAGING REASON, supra note 16, at p.46-67.
[39] For objective incursions on the subjective theory of contracting, see RESTATEMENT (SECOND) OF CONTRACTS, § 2 comment b (1979); E. ALLEN FARNSWORTH, CONTRACTS § 3.6, at 114 (1982); Ian R.MacNeil, Restatement (Second) of Contracts and Presentiation, 60 Va.L.REV.589 (1974).
[40] On such unfairness in adhesion contracting, see e.g. Todd D. Rakoff, Contracts of Adhesion: An Essay in Reconstruction, 96 HARV. L. REV. 1173 (1983); Leon E. Trakman, The Interpretation of Contracts: A Common Law Dilemma, 59 CAN.BAR REV. 241-300 (1981); Reuben Hasson, The Special Nature of the Insurance Contract: A Comparison of the American and English Law of Insurance, 47 MOD.L.REV.502 (1984).
[41] That continuum, arguably, commences with a subjective wills theory and moves through different phases of the objective theory.
[42] See further infra Section III. See generally Randy E. Barnett, The Sound of Silence: Default Rules and Contractual Consent, 78 Va.L.REV.821 (1992).
[43] Affirming the wills of the parties must necessarily be for plural reasons beyond those wills.
[44] On the view that the values of liberty and fairness are incommensurable, see ISAIAH BERLIN, supra note 11.
[45] On this pervasive liberty, see e.g. BUCKLEY, JUST EXCHANGE, supra note 1, at pp.17 & 27.
[46] For classical commentary on "contracts of adhesion," see E.W. Patterson, The Delivery of a Life Insurance Policy, 33 HARV. L. REV.198 (1919); Friedrich Kessler, Contracts of Adhesion—Some Thoughts About Freedom of Contract, 43 COLUM. L. REV. 629, 642 (1943); Frederick Kessler, The Protection of the Consumer under Modern Sales Law, Part 1: A Comparative Study, 262 YALE L.J. (1964).
[47] The case for courts injecting plural standards of fairness into contracts is strongest in transactions involving structural bargaining disparities between parties. See e.g. Michael I. Meyerson, The Reunification of Contract Law: The Objective Theory of Consumer Form Contracts, 47 U. MIAMI L. REV. 1263, 1270 (1993). This is especially evident in construing insurance contracts. See Robert E. Keeton, Insurance Law Rights at Variance with Policy Provisions, 83 HARV.L.REV.961 (1970); Roger C. Henderson, The Doctrine of Reasonable Expectations in Insurance Law After Two Decades, 51 Ohio St. L.J. 823 (1990); Kenneth S. Abraham, Judge-Made Law and Judge-Made Insurance: Honoring the Reasonable Expectations of the Insured, 67 Va. L. REV. 1151 (1981).
[48] On ‘decision procedure’ pluralism, see e.g R.E. Bales, Act-utilitarianism: account of right-making characteristics or decision-making procedures? 8 AM.PHIL.Q.257 (1971). Courts may also employ ‘covering values’ as the framework in which they weigh, order and sort plural values. See e.g. Ruth Chang. Putting Together Morality and Well-Being in P. BAUMANN & M. BETZLER, supra note15 at p.114. See further Section XI.
[49] On identifying, ranking and applying plural values, see infra Section XIV.
[50] For arguments based on fairness in contracting, see e.g., Leon E. Trakman, Winner Take Some: Loss Sharing and Commercial Impracticability, 69 MINN.L.REV.471-519(1985). For arguments based on efficiency, see Sheldon Halpern, Application of the Doctrine of Commercial Impracticability, supra note 14 at p.1133. See too Richard A. Posner & Andrew M. Rosenfield, Impossibility and Related Doctrines in Contract Law: An Economic Analysis, 6 J. LEGAL STUD.83, 89-92(1977). On efficient contracting, see infra Section IX.
[51] A leading proponent of a consent theory of contracting is Randy Barnett. See BARNETT,
A Consent Theory of Contract, supra note 2, at p.309-310.
[52] See e.g. Barnett, ibid, at p.327.
[53] A ‘consent theory’ see BARNETT, A Consent Theory of Contract, supra note 2, at p.305 and 331. On ‘contract as promise’, see infra Section VI.
[54] In subscribing to an objective measure of consent, Randy Barnett emphasizes the difficulty in ascertaining the subjective state of mind of the parties. But he does not see anything contradictory between his conception of objective consent and consent as a subjective measure of agreement. See Barnett, supra note 2, at p.305-310.
[55] Ibid at p.318-19. On monist liberal theories of contracting grounded in default rules, see Russell Korobkin, The Status Quo Bias and Contract Default Rules, 83 CORNELL L. REV. 608, 611–12 (1998). But see W. DAVID SLAWSON, BINDING PROMISES supra note 37, at p 21.
[56] See e.g. Barnett, supra note 2 at pp.308-310, 318-19.
[57] Ibid. See too Barnett, The Sound of Silence: Default Rules and Contractual Consent, 78 Va.L.REV.821 827-8 (1992). It is arguable that all three default rules in consent theory, including immutable implied-in-law consent, are monist in that they each subscribe to unitary values. Even immutable implied-in-law values may draw upon a single unitary conception of public policy – a pervasive fairness value – rather than to plural public policy values.
[58] Ibid. See Barnett, Consenting to Form Contracts, 71 FORDHAM L.REV.627,637 (2002).
[59] See e.g. Margaret Jane Radin, Contract Formation - Assent: Humans, Computers, and Binding Commitment, 75 IND.L.J.1125 (2000). Radin distinguishes between the "contract-as-consent" model which "involves the meeting of the minds between two humans" from the "contract-as-product" model involving standards prescribed by legislatures, industry-agreed standardizations and standards set by technical bodies such as the Institute of Electrical and Electronic Engineers (at p.1125 et seq.)
[60] For example, a court may construe an unreasonable price term in a contract restrictively on grounds that the values of commercial expediency and fairness may transcend the express or inferred consent of the parties. § 2–305 of the UCC, notably, provides that courts can imply terms in contracts of sale, including by establishing a reasonable market price which may take account of plural values beyond the consent of the parties. See further Lickley v. Max Herbold, Inc., 984 P.2d 697 (Idaho 1999); Koch Hydrocarbon Co. v. MDU Resources Group,988 F.2d 1529, 1534 (8th Cir.1993).
[61] On unconscionabillty, see infra note 172. On aspects of ‘decision procedure’ pluralism in relation to consent, see Barnett, supra note 1 at p.318-19.
[62] This conception of legal obligation is grounded in analytical legal positivism, notably in the correlative relationship between legal rights and legal duties. See further LEON TRAKMAN AND SEAN GATIEN, RIGHTS AND RESPONSIBILITY CH.1-2, supra note 2.
[63] On values that are ranked below a single ‘super’ value under legal monism, see supra Section I.
[64] On such preference pluralism, see text accompanying note 12.
[65] The assumption that an agreement is illusory if one party enjoys a material discretion is questionable even on unitary grounds. Both parties may ‘agree’ to the discretion as the ‘price’ of doing business. An agreement may also fail, not for being illusory, but on moral grounds. For example, the party exercising the discretion may be perceived to be unfairly disadvantaged morally. But what if the other party accepts that discretion as the moral hazard of contracting, as when the seller accepts the buyer’s discretion to renege on a property sale on grounds that available finance is unsatisfactory? Cf. ROBERT HILLMAN, THE RICHNESS OF CONTRACT LAW, supra note 1, at p.40.
[66] On ‘decision procedure’ pluralism, see supra note 48 and infra Section XI.
[67] See e.g. Balfour v Balfour [1919] 2 KB 571, in reasoning that a maintenance ‘agreement’ between spouses constituted a ‘trivial affair of marriage.’ Modern statutory requirements governing spousal maintenance represent countervailing normative values. See infra Section VI.
[68] It is one thing to rely on judges to articulate determinate reasons for distinguishing between a serious legal and some other intention. It is another thing to expect them to be able -- comfortably -- to conceptualize that distinction. Cf Robert Hillman, The Crisis in Modern Contract Theory 67, 71-4 TEX.L.REV.103 (1988). On circumspection about the virtue of a free-standing conception of a ‘serious intention to contract’, see e.g. Samuel Williston, The Law of Sales in the Proposed Uniform Commercial Code, 63 HARV.L.REV.56 (1950).
[69] On the deficiencies of such conceptual rigor in contract law, see David Charny, Hypothetical Bargains: The Normative Structure of Contract Interpretation, 89 MICH.L.REV.1815 (1991). On non-contractual behaviour in business, see e.g. Macaulay, Non-Contractual Relations in Business: A Preliminary Study, infra note 118. See generally infra Section VIII.
[70] On legal monism, see supra Section 1.
[71] On the distinction between so-called ‘bargained’ and ‘unbargained’ contracts, see Robert A. Pollak, Bargaining Around the Hearth, 116 YALE L.J. Pocket Part 414 (2007) For a challenge to ‘consensus ad idem’ in so-called ‘unbargained contracts’ see Joshua A.T. Fairfield, The Search Interest in Contract, 92 IOWA L.REV.1237 (2007). For historical reflection on the ‘value’ of consideration as a bargained-for-exchange, see I. Patterson, An Apology for Consideration, 58 COLUM.L.REV.929, 952-3 (1958).
[72] Nominal value is ascribed to the so-called ‘peppercorn theory’, that even a mere peppercorn may be considered to be valuable exchange for a material benefit. See further Robert A. Prentice, Law and Gratuitous Promise, 2007 U.Ill.L.REV.881 (2007); CHITTY ON CONTRACTS, HUGH BEALE (30TH Ed., SWEET & MAXWELL, 2008), S.27.
[73] See e.g. Mary Becker and Randy E. Barnett, Beyond Reliance: Promissory Estoppel, Contract Formalities and Misrepresentation, 15 HOFSTRA L.REV445 (1987). For an argument that reliance based theories of consent are overstated, see Cohen, The Basis of Contract, supra note 24, at p.579.
[74] On the relationship between the bargain and the normative structure of the contract, see David Charny, Hypothetical Bargains: The Normative Structure of Contract Interpretation, 89 MICH.L.REV.1815 (1991). But cf. Eisenberg, The Bargain Principle and its Limits, supra note 8, 785, n.121 (1982).
[75] On categories in which judges allegedly uphold contracts in the absence of a ‘bargained for exchange’ see CHARLES FRIED, CONTRACT AS PROMISE (HARVARD, 4TH ED., 2006) at p.28. Fried identifies four such categories: include, inter alia, promises to keep an offer open, promises to release a debt, promises to modify a duty and promises to pay for past benefits or favors.
[76] From a ‘positivist’ perspective, only legal promises – not moral ones – are binding and enforceable in law. On debate over this permanent separation between law and morality between H.L.A.Hart (favoring the separation) and Lon Fuller (challenging it), see H.L.A. Hart, Positivism and the Separation of Law and Morals, 71 HARV.L.REV.593 (1958); Lon L. Fuller, Positivism and Fidelity to Law: A Reply to Professor Hart, 71 HARV.L.REV.630-72 (1958). See too Brian Leiter, Legal Realism and Legal Positivism Reconsidered, 111 Ethics, 278 (2001); WILFRED J.WALUCHOW, INCLUSIVE LEGAL POSITIVISM (OXFORD, 1994).
[77] On the moral foundations of freedom of contract in moral philosophy, see e.g. HENRY MATHER, CONTRACT LAW AND MORALITY (GREENWOOD PRESS, 1999); PATRICK ATIYAH, THE RISE AND FALL OF FREEDOM OF CONTRACT, supra note 21; DAVID HUME, AN INQUIRY CONCERNING THE PRINCIPLES OF MORALS 30 n. 5 (C.HENDEL. ED., 1ST ED., 1957).
[78] This moral foundation is closely identified with a wills theory of contracting. See e.g. infra Kronman, note 86. On the theoretical underpinnings of binding promises in contract law, see W.DAVID SLAWSON, supra note 37; Richard Craswell, Contract Law, Default Rules and the Philosophy of Promising 88 MICH.L.REV.(1989). For a classical treatment of moral pluralism, see G.E.MOORE, PRINCIPIA ETHICA (CAMBRIDGE, 1903). See too KEKES, supra note 11; LARMORE, supra note 11
[79] On such ‘detrimental reliance’ see supra note 73 and text accompanying note 87.
[80] See CHARLES FRIED, CONTRACT AS PROMISE, supra note 75 at p.16. See too LON FULLER, THE MORALITY OF LAW 1-2 (YALE, REV.ED., 1969). But see Richard Crasswell, Contract Law, Default Rules, and the Philosophy of Promising, 88 MICH.L.REV.489 (1989); Green, Is an Offer Always a Promise? 23 ILL.L.REV.95,95-7,(1928).
[81] An additional basis for the morally binding nature of promises resides in maintaining the moral order of civil society. See FRANK HEARN, MORAL ORDER AND SOCIAL DISORDER (NEW YORK: ALDINE DE GRUYLER, 1997); DAVID SELBOURNE, THE PRINCIPLES OF DUTY: AN ESSAY ON THE FOUNDATION OF THE CIVIC ORDER (LONDON: SINCLAIR-STEVENSON, 1994). See too Trakman, The Effects of Illegality of Contracts, supra note 2.
[82] On the intersection of fault in torts and contracts, see e.g. PETER W. HUBER, LIABILTY: THE LEGAL REVOLUTION AND ITS CONSEQUENCES (BASIC BOOKS, 1990); Daniel Schwarcz, A Products Liability Theory for the Judicial Regulation of Insurance Policies,” 48 William and Mary Law Review 1389 (2007). See too Jay Feinman, Critical Approaches to Contract Law, 30 UCLA.L.REV.829,834 (1983) [“[c]ontract law is like tort law and judicial action is like legislative action: all necessarily involve public policy judgments in imposing legal liability.”]
[83] See e.g. JACK BEATSON AND DANIEL FRIEDMANN, GOOD FAITH AND FAULT IN CONTRACT LAW (OXFORD, 1997).
[84] On the range of unitary and plural bases for promises in moral theory, see e.g. BUCKLEY, JUST EXCHANGE, supra note 1, ch.4 (‘Fidelity to Promising’); ANDREW ROBERTSON, THE LAW OF OBLIGATIONS 93 (ROUTLEDGE, 2004); PATRICK ATIYAH, PROMISES, MORALS AND LAW 177 (OXFORD, 1981).
[85] On this dilemma, see generally W. DAVID SLAWSON, BINDING PROMISES, supra note 37; MICHAEL TREBILCOCK, supra note 1. But cf. DAVID FELLMAN, THE LIMITS OF FREEDOM (GREENWOOD PRESS, 1973).
[86] On the view that Charles Fried’s theory of ‘contract as promise’ is a wills theory, see Kronman, A New Champion for the Wills Theory (Book Review), 91 YALE L.J.404, 404 (1981).
[87] On the detrimental reliance arising from a promissory estoppel, see supra note 73. But cf. ROBERT HILLMAN, THE RICHNESS OF CONTRACT LAW, supra note 1, at p.52-55.
[88] On the so-called priority of the right over the good, see TRAKMAN AND GATIEN, supra note 2, chs.1-2.. On the priority of the good over the right, see MICHAEL SANDEL, LIBERALISM AND THE LIMITS OF JUSTICE (HARVARD, 1982). See further J.J. Thomson, The Right and the Good, J.PHIL.273 (1997); WILLIAM DAVID ROSS, THE RIGHT AND THE GOOD (OXFORD, 1930).
[89] For Charles Fried’s recognition that courts may construe contracts expansively on grounds of fairness when the parties have failed to make promises. See Fried, supra note 75, at p.25. See further Morris, Practical Reasoning and Contract as Promise: Extending Contract-Based Criteria to Decide Excuse Cases, 56 CAMBRIDGE L.J. 147 (1997); Langille and Ripstein, Strictly Speaking – It Went Without Saying, 2 LEG.STUD.63 (1996). For a libertarian rationale for the morally binding nature of agreements, see ROBERT NOZICK, ANARCHY, STATE AND UTOPIA (NEW YORK: BASIC BOOKS, 1974), at 503.
[90] For intense debate on the so-called permanent separation between law and morality, see H.L.A. Hart, Positivism and the Separation of Law and Morals, supra note 76; Fuller, Positivism and Fidelity to Law, supra note 76. See too JEFFRIE G. MURPHY & JULES COLEMAN, THE PHILOSOPHY OF LAW: AN INTRODUCTION TO JURPSRUDENCE (WESTVIEW, 1990).
[91] On these expansive dimensions of morality, see Lon L. Fuller, Positivism and the Separation between Law and Morals, supra note 76, at p.630 et seq. For critique of morally open-ended judicial activism by ‘new legal formalists’, see e.g. Lisa Bernstein, Merchant Law in a Merchant Court: Rethinking the Code’s Search for Immanent Business Norms, 144 PA.L.REV 1765 (1996).
[92] See RESTATEMENT (SECOND) OF CONTRACTS § 90(1) (1979).
[93] For criticisms of reliance on open-ended conceptions of fairness in arriving at contract remedies, see IAN R. MACNEIL, THE NEW SOCIAL CONTRACT 62 (1980). But see ROBERT HILLMAN, THE RICHNESS OF CONTRACT LAW, supra note 1 who identifies distinct norms of fairness by which courts decide cases, such as in allocating performance losses. See too Hillman, Court Adjustment of Long-Term Contracts: An Analysis Under Modern Contract Law,  36 DUKE L.J.1 (1987).
[94] Arguable, the morality of promises could engage a checklist of moral requirements in respect of which courts fill ‘moral gaps’, not unlike their filling ‘legal gaps’ in a checklist of legal obligations On ‘gap filling’ in deliberately incomplete contracts, see e.g. Omri Ben–Shaha, Agreeing to Disagree: Filling Gaps in Deliberately Incomplete Contracts, 2004 WISC.L.REV.
[95] See e.g. Jean Braucher, Contract Versus Contractarianism: The Regulatory Role of Contract Law, 47 WASH.&LEE L.REV.697, 712, 718 (1990).
[96] Contract theorists are more concerned with theories of self-regulation than public regulation of contracts. See e.g. HUGH COLLINS, REGULATING CONTRACTS (OXFORD, 1999) at p.5-7; Braucher, Contract Versus Contractarianism, supra note 95..
[97] A related issue revolves around the sustainability of contract regulation within a complex social order. See generally GRANT GILMORE, THE AGES OF AMERICAN LAW (YALE, 1977).
[98] On how contracts can be invoked in governing social interaction, see HUGH COLLINS, supra note 96, at p.70, citing Nader, Disputes without the Force of Law, 88 YALE L.J.998 (1979). On free choice, see supra Section II.
[99] The risk in a plural theory of self-regulation is in determining the plural qualifications for such regulation. For example, if knowledge and reputation are preferred values, the insidious inference is that only knowledgeable and people with a public reputation ought to regulate their own affairs.
[100] From a legal perspective, the boundaries of that primary order ordinarily are determined in light of the background and life experience of both those who delineate it, such as state regulators, courts and administrators, and those who are subject to it, cultural groups and individuals. See further infra Section XIV. See too. BUCKLEY, ILLEGALITY AND PUBLIC POLICY, supra note 2.
[101] On the regulatory processes through which contracts are formed, see e.g. HENRY M. HART AND ALBERT B. SACKS, THE LEGAL PROCESS; BASIC PROBLEMS IN THE MAKING AND APPLICATION OF LAW (UNIV.CASEBOOK SERIES, WEST PUBL, 2001).
[102] See e.g. Gatton v. T-Mobile USA Inc.,Cal.App. 4th 571 (2007), Westlaw, para.3.
[103] For a critique of forum selection clauses in e-commerce, see e.g. Brower v. Gateway, 246 A.D.2d 246, 676 N.Y.S.2d 569 (App. Div. 1998). On concerns over choice of arbitration clauses in contracts, see Stephen J. Ware, Arbitration Clauses, Jury-Waiver Clauses and Other Contractual Waivers of Constitutional Rights, 67 LAW & CONTEMP.PROB.167 (2004); Sajida A. Mahdi, Gateway To Arbitration: Issues Of Contract Formation Under The U.C.C. And The Enforceability Of Arbitration Clauses Included In Standard Form Contracts Shipped With Goods, 96 NW. U.L. Rev. 403, 418 (2001); Kristin Johnson Hazelwood, Let the Buyer Beware: The Seventh Circuit's Approach to Accept-or-Return Offers, 55 WASH & LEE L. REV. 1287, 1316 (1998). See too Robert A. Hillman & Jeffrey J. Rachlinski, Standard-Form Contracting in the Electronic Age, 77 N.Y.U.L. Rev. 429, 430 (2002).
[104] It is easier to determine the percentage of consumers who bring suit in response to complex exclusion and limitation of liability clauses than those consumers who understand them. See e.g. Steven P. Croley & Jon D. Hanson, Rescuing the Revolution: The Revived Case for Enterprise Liability, 91 MICH. L. REV. 683, 687 (1993).
[105] A converse indicator is ‘herd behavior’ among consumers. Cf. David Scharfstein & Jeremy Stein, Herd Behavior and Investment, 80 AMER.ECON.REV.465, 466 (1990); Marcel Kahan & Michael Klausner, Path Dependence in Corporate Contracting: Increasing Returns, Herd Behavior, and Cognitive Biases, 74 WASH.U.L.Q.347,353–59 (1996).
[106] See e.g. HUGH COLLINS, REGULATING CONTRACTS, supra note 96, Ch.2.
[107] The UCITA was initially framed as Draft Article 2B-207 and 208 of the UCC. In 2003, after various efforts to have states adopt it, the National Conference of Commissioners on Uniform State Law suspended efforts to obtain further state adoptions beyond Maryland and Virginia that had already adopted it. On the UCITA, see http://www.law.upenn.edu/bll/archives/ulc/ucita/ucita200.htm See too Trakman, Boundaries, infra note 108.
[108] Click-wrap contracts include conditions of sale at the end of the agreement where the e-purchaser is asked to tick an ‘I agree’ box consenting to the purchase. Browse-wrap contracts provide e-purchasers with a hyperlink to another screen containing those terms. See further Leon E. Trakman, The Boundaries of Contract Law in Cyberspace, INT’L.BUS.L.J.161 (2009) [hereinafter “Boundaries”];
Dale Clapperton and Stephen Corones, Unfair Terms in “Clickwrap” and other Electronic Contracts, 35 AUSTRALIAN BUS.LAW REV.152(2007); Kaustuv M. Das, Forum-Selection Clauses in Consumer Click-wrap And Browse-wrap Agreements and the "Reasonably Communicated" Test, 77 WASH.L.REV.481,500 (2002); Robert A. Hillman & Jeffrey J. Rachlinski, Standard-Form Contracting in the Electronic Age, supra note 104 at p. 493; On a now classical discussion on global cyber-commerce, see David R. Johnson and David Post, Law and Borders: The Rise of Law in Cyberspace, 48 STAN.L.REV.1367 (1996).
[109] At the same time, new mandatory rules have evolved to govern the use of new technologies in e-commerce. See e.g. Robert Hillman, On-Line Boilerplate: Would Mandatory Website Disclosure of E-Standard Terms Backfire? 104 MICH.L.REV.837 (2006).
[110] On the regulatory framework behind contract law, see e.g. Jean Braucher, Cowboy Contracts: The Arizona Supreme Court's Grand Tradition of Transactional Fairness, 50 ARIZ. L. REV. 191 (2008); Jean Braucher, New Basics: 12 Principles for Fair Commerce in Mass-Market Software and Other Digital Products, in CONSUMER PROTECTION IN THE AGE OF THE ‘INFORMATION ECONOMY 177, JANE K. WINN ed. (ASHGATE, 2006).
[111] On the ‘judicial management’ of contracts including by mandatory ‘rules of engagement’ between the parties to e-commerce, see Leon E. Trakman, Boundaries, supra note 108. On the judicial management of relational contracts arising from performance delays, reduced supplies and price escalations, see infra text surrounding notes 128-133.
[112] For a thoughtful analysis on the interaction between self- and civic regulation in a democracy, see CHRISTINE PARKER, THE OPEN CORPORATION: EFFECTIVE SELF-REGULATION AND DEMOCRACY (CAMBRIDGE, 2002).
[113] See e.g. Robert L. Hale, Bargaining, Duress and Economic Liberty, 43 COLUM. L.REV.603 (1943); Robert L. Hale, Force and the State: A Comparison of "Political" and "Economic" Compulsion, 35 COLUM. L. REV. 19 (1935); John P. Dawson, Economic Duress – An Essay in Perspective 45. MICH. L. REV. 253 (1947).
[114] On the rationale for such judicial scrutiny on grounds of procedural unconscionability, see e.g Gatton v. T-Mobile USA Inc., 152 Cal.App.4th 571 (2007), para.5: “Oppression, for purposes of rendering a contract provision procedurally unconscionable, arises from an inequality of bargaining power that results in no real negotiation and an absence of meaningful choice.” But see Robert A. Hillman, Debunking Some Myths About Unconscionability: A New Framework for U.C.C. § 2-302, 67 CORN.L.REV.1 (1981).
[115] On the contra proferentem rule, see 11 SAMUEL WILLISTON & RICHARD LORD, A TREATISE ON THE LAW OF CONTRACTS, § 32:12, at 476–81 (4th ed. 1993 & Supp. 2005); Restatement (Second) of Contracts § 206 (1981); 17A Am.Jur.2d Contracts § 342 (2004).
[116] In these respects plural regulatory policies in contracting are inextricably related to functionalism. See infra Section XI.
[117] On the foundation of relational contracts, see R. Macneil, Contracting Worlds and Essential Contract Theory, 9 SOC. & LEG. STUD. 431 (2000); Macneil, Relational Contract Theory: Challenges and Queries, 94 Nw. L.REV.877 (2000); Ian R. Macneil, Contracts: Adjustment of Long-Term Economic Relations under Classical, Neo-Classical and Relational Contract Law, 72 Nw. L.REV.854 (1978). But see Melvin Eisenberg, Why There is No Law of Relational Contracts, 84 Nw.L.REV.805 (2000); Donald J. Smythe, The Doctrine of impracticability and the Governance of Relational Contracts, 13 S. CAL.INTERDISC.L.J. 227 at 339-341 (2004); Kevin Cole, The Characteristics and Challenges of Relational Contracts, 72 NW.U.L.REV 823 (2000).
[118] It is arguable that in both discrete transactions and relational contracts, contracting is about the practices of the parties ‘in action’. See S. Macaulay, Elegant Models, Empirical Pictures, and the Complexities of Contract, 11 LAW & SOCIETY REV. 507-528 (1977); STEWART MACAULAY, CONTRACT LAW IN ACTION (MITCHIE, 1995); See too Stewart Macaulay, Non-Contractual Relations in Business: A Preliminary Study, 28(1) AM.SOCIO.REV 55 (1963).
[119] A key figure in developing the relational contracts perspective is Ian Macneil, see IAN MACNEIL, THE NEW SOCIAL CONTRACT, supra note 94. See too James Fox Jr., Relational Contract Theory and Democratic Citizenship, 54 CASE WESTERN.L.REV.1 (2003).
[120] An inference, in Ian Macneil’s ‘the new social contract’, is that relational contracts are pluralist in nature. See Macneil, Relational Contract Theory: Challenges and Queries, supra note 117. In practice, relational contracts could be unitary, such as in subscribing to a monist preference grounded in the inferred the consent of the parties.
[121] It is arguable that the continuum treats plural relationships as monist, not pluralist. For example, consent may remain a ‘super’ value. All that changes on entering the relational part of the continuum is that the application of that ‘super’ value is modified in light of “fairness’ and ‘goodness’ values without losing its super-value status.
[122] On the judicial construction of consent under a continuum or spectrum approach, see supra, Section IV.
[123] The distinction is most evident in finding that precise moment at which the parties have a ‘meeting of the minds” -- or consensus ad idem -- in discrete transactions, compared to the absence of such consent in relational contracts, see F.D. Rose, Consensus ad idem: Essays in Honour of Guenter Treitel, supra note 36. See too Joshua A.T. Fairfield, The Search Interest in Contract, supra note 71.
[124] Value pluralism is implicit in determining when and how to ‘adjust’ long-term relationships. See e.g.Ian Macneil, Contracts: Adjustment of Long-Term Economic Relations, supra, note 117.
[125] See further Trakman, Winner Take Some, supra note 50.
[126] Cf. Stewart Macaulay, The Real and the Paper Deal: Empirical Pictures of Relationships, Complexity and the Urge for Transparent Simple Rules 66 MOD.L.REV.44 (2003).
[127] See In re Westinghouse Elec. Corp. Uranium Contracts Litig., 517 F. Supp. 440, 454 (E.D.
Va. 1981).
[128] The Westinghouse uranium case, again, illustrates the difficulties in determining the foresight of parties and the foresight that ought ‘reasonably’ to be attributed to them. See e.g. Paul L. Joskow, Commercial Impossibility, the Uranium Market and the Westinghouse Case, 6 J. LEGAL STUD.119, 157–58 (1977).
[129] The appointment of a special master to resolve complex issues of fact is far more common in tort litigation than in contracts. See generally, Symposium, Judge Jack B. Weinstein, Tort Litigation and the Public Good, 12 J.L. & Pol'y, 149, 169 (2003) Such an appointment may be the subject of criticism, in part on account of the supposedly consensual nature of contracts, or regarded as justifiable in resolving complex relational contracts. See e.g. Trakman, Winner Take Some, supra note 50. But see Stewart Macaulay, The Real and the Paper Deal, supra note 125.
[130] Arguably, relational contracts may embody both monism and pluralism. As to monism, the parties litigated over the terms of the contract, including over the nature of consent. As to pluralism, the judicially brokered settlement was based on a plurality of values, including values associated with an accommodation and reconciliation between the parties. See e.g. Westinghouse supra, note 127 at p.454-6
[131] In issue, for example, is whether the long-term supplier could have averted or mitigated the risk that eventuated, such as through stockpiling supplies, earmarking alternative suppliers, continuing supplies in reduced quantities, etc.
[132] See further Leon E. Trakman, Winner Take Some, supra note 50.
[133] But cf. Eisenberg, Why There is No Law of Relational Contracts, supra note 117. Eisenberg disputes the existence of a ‘law’ governing relational contracts (at p.817).
[134] See further RICHARD E. SPEIDEL, CONTRACTS IN CRISES: EXCUSE DOCTRINE AND RETROSPECTIVE GOVERNMENT ACTS 3 (Carolina Academic Press, 2007). See too Mark B. Baker, A Hard Rain’s A-Gonna Fall—Terrorism and Excused Contractual Performance in a Post September 11th World, 17 TRANSNAT’L LAW 1, 20–21(2004).
[135] On the complexity of long-term relationships, the difficulty of courts attributing value qualities to the parties and the judicial practice to co-opt party values into their judicial decisions, see supra Section VII.
[136] Courts may also be activist in discrete transactions, for example in responding to the perceived abuse of differences in bargaining power between the discrete parties, while still being monist in subscribing to consent or promise as a ‘super’ value..
[137] A particular reason for courts co-opting party participation in relational decision-making is to facilitate the continuity of their relationships. See further supra Section VII.
[138] One reason for such judicial activism in relational contracting is the responsibility of courts to reach reasonable decisions based on the failure of trust and confidence between relational contractors. See generally, Macneil, Relational Contract Theory: Challenges and Queries, supra note 117.
[139] On ‘law and economics’, see e.g RICHARD POSNER, ECONOMIC ANALYSIS OF LAW (ASPEN BOOKS, 7th Ed., 2007); Richard Posner, Contract Interpretation: The Law and Economics of Contract Interpretation, by Richard Posner, 83 TEX. L. REV. 1581 (2005); Posner & Landes, Legal Change, Judicial Behavior, and the Diversity Jurisdiction, 9 J.LEGAL STUD.367 (1980). See too See Adam J. Hirsch, Evolutionary Theories of Common Law Efficiency: Reasons for(Cognitive) Skepticism, 32 Fla. St. U. L. Rev. 425, 429–30 (2005); Todd J. Zywicki, The Rise and Fall of Efficiency in the Common Law: A Supply-Side Analysis, 97 Nw. U. L. REV. 1551 (2003).
[140] For a now classical conception of the social costs arising from inefficient contracting, see Ronald Coase, The Problem of Social Cost, 31 J.L.& ECON.1-44 (1960).
[141] On the neo-classical liberal – and libertarian – foundations of ‘law and economics’, see F.A.HAYEK, THE IRON CAGE OF LIBERTY (BLACKWELL PUB., U.K., 1969); LUDWIG VON MISES, PLANNING FOR FREEDOM: AND OTHER ESSAYS AND ADDRESSES (LIBERTARIAN PRESS, 1962).  See further JOHN GRAY, HAYEK ON LIBERTY 40 (OXFORD: BASIL BLACKWELL, 1984).
[142] Arguably, there are multiple measures of efficiency. For example, Coleman asserts that ‘Economists as well as proponents of the economic analysis of law employ at least four efficiency-related notions, including: (1) Productive efficiency, (2) Pareto optimality, (3) Pareto superiority, and (4) Kaldor-Hicks efficiency.’ See Coleman, Efficiency, Utility and Wealth Maximization, 8 HOFSTRA L.REV.509,512 (1980).
[143] On John Stuart Mills’ ‘preference utilitarianism’, see J.B. SCHNEEWIND & DALE E. MILLER, Eds., J.S.MILL, UTILITARIANISM IN THE BASIC WRITINGS OF JOHN STUART MILL, ill, Utilitarianism in The Basic Writings of John Stuart Mill, (New York: Random House, 2002) at p.241. See generally FREDERICK ROSEN, CLASSICAL UTILITARIANISM FROM HUME TO MILL (ROUTLEDGE, 2003); DAVID LYONS, FORMS AND LIMITS OF UTILITARIANISM (OXFORD, 1965).
[144] See Epstein, The Social Consequences of Common Law Rules, 95 HARV.L.REV.1717,1748 (1982).
[145] See e.g. Michael I. Myerson, Efficient Consumer, The Efficient Consumer Form Contract: Law and Economics Meets the Real World, 24 GA. L. REV. 583 (1990). [“A party misled as to the utility to be derived from a proposed transaction cannot properly evaluate the true benefits and costs of the deal.’]
[146] On these justifications for judicial intervention in contracts, see Posner & Rosenfeld, Impossibility and Related Doctrines in Contract Law: An Economic Analysis, 6 J. LEG. STUD. 83,88-97 (1977); Rea, Nonpecuniary Loss and Breach of Contract, 11 J. LEGAL STUD. 35,36 (1982).
[147] On a quasi-efficiency analysis holding the ship owner liable for a performance loss because it was best placed to anticipate the closure of the Suez Canal and to insure against it, see Transatlantic Fin. Corp. v. United States, supra note 33 at p.319.
[148] On the argument that one-sided consumer contracts may still be efficient if consumers have market choice including the opportunity to shop for goods and services that suit their needs, see Bebchuk and Posner, One Sided Contracts in Competitive Consumer Markets, 104 MICH.L.REV.827 (2006). Complicating this argument is the extent to which consumers have the opportunity to make discriminate choices based on quality and price terms in otherwise take-it-or-leave-it contracts.
[149] For a traditional ‘law and economic’ argument holding that judicial ‘gap-filling’ including in contract law is efficient, see RICHARD A. POSNER, ECONOMIC ANALYSIS OF LAW 44 (1973). But see Omri Ben–Shahar, Agreeing to Disagree, supra note 94 at p.389; Ian Ayres and Robert Gertner, Filling Gaps in Incomplete Contracts: An Economic Theory of Default Rules, 99 YALE L.J. 87 (1989).
[150] On whether efficiency costs should be measured subjectively or objectively, see J. BUCHANAN, COST AND CHOICE 1-26 (CHICAGO: MARKHAM PUBL., 1969); THIRLBY, THE SUBJECTIVE THEORY OF VALUE AND ACCOUNTING “COSTS”, in J. BUCHANAN & G.THIRLBY, EDS., L.S.E. ESSAYS ON COST, 137 NYU PRESS, 1981).
[151] For discussion on whether law and economics superimposes efficiency upon the consent of the parties, see James M. Buchanan, Good Economics-Bad Law, 60 VA. L. REV. 483, 489–90 (1974).
[152] The argument that efficient choices may also be fair choices may include an assessment of whether paternalism is efficient. See e.g. Eyal Zamir, The Efficiency of Paternalism, 84 Va.L.REV.229, 230 (1998); Anthony T. Kronman, Paternalism and the Law of Contracts, 92 YALE L.J. 763, 778-84 (1983).
[153] For example, a court may invoke plural values to arrive at an efficient and fair outcome, even at the expense of ex ante certainty in contracting. See e.g. Robert E. Scott, The Case for Formalism in Relational Contract, 94 Nw. U. L.REV. 847, 858 (2000) [“If there are to be tradeoffs, why not trade off the chimera of ex ante certainty in favor of ex post efficiency (or fairness].’ On the tension between the ‘foresight’ of risks by contracting parties and efficient outcomes, see Robert A. Hillman, An Analysis of the Cessation of Contractual Relations, 68 CORNELL L. REV. 617, 626 (1983).
[154] On challenges to law and economics on these grounds, see e.g. Dworkin, Is Wealth a Value? 9 J. LEGAL STUD.191(1980). For a defense, see e.g. Posner, A Reply to Some Recent Criticisms of the Efficiency Theory of the Common Law, 9 HOFSTRA L.REV.775 (1981); COLIN M. MACLEOD, LIBERALISM, JUSTICE, AND MARKETS: A CRITIQUE OF LIBERAL EQUALITY (OXFORD, 1998).
[155] For example, judges applying ‘law and economics’ may hold that one-sided boilerplate contacts are not unfair because they reduce transaction costs for both parties and are therefore both efficient and fair. See Judge Richard Posner’s decision in Carr v. CIGNA Securities, Inc. [1996] USCA7 1035; 95 F.3d 544,(7th Cir. 1996). [“[I]t would be unreasonable to expect Carr to pore through 427 pages of legal and accounting mumbo-jumbo looking for nuggets of intelligible warnings.” at p.548.] See generally Richard Posner, Contract Interpretation, supra note 139.
[156] See Veljanovski, The Economic Approach to Law: A Critical Introduction, 7 BRITISH J.LAW & SOCIETY, 158,162 (1980).
[157] An efficiency analysis would not necessarily produce this result. For example, it may be concluded that the sale of the patent is inefficient because the benefit to the drug purchaser is outweighed by the cost to the patent seller and/or to patients who can no longer afford to buy the drug.
[158] See TREBILCOCK, THE LIMITS OF FREEDOM OF CONTRACT, supra note 1, at p.18. On the prospect of ‘patterned differences’ in efficient choices including fairness values, see e.g. NOZICK, ANARCHY, STATE AND UTOPIA, supra note 89 at p.156-57.
[159] On the an attempt to add a moral dimension to efficient choice, see Rickard Posner, The Problematics of Moral and Legal Theory, 111 HARV.L.REV.1637 (1998). But see Ellis Washington, Reply to Judge Richard Posner on the Inseparability of Law and Morality, RUTGERS J.L.& RELIG.1(2001).
[160] See Hadfield, The Second Wave of Law and Economics: Learning to Surf, in MEGAN RICHARDSON AND GILLIAN HATFIELD, THE SECOND WAVE OF LAW AND ECONOMICS (FOUNDATION PRESS, 1999). See too ROBERT HILLMAN, THE RICHNESS OF CONTRACT LAW, supra note 1.
[161] Preference monism may justify such action in principle. As a matter of practice, courts may decline to set a patent aside without statutory authority. See further infra note 363..
[162] Preference monism may also be explicated through rational determinism. See Richard Craswell, In That Case, What Is the Question? Economics and the Demands of Contract Theory,112 YALE L.J .903 (2003)/ On ‘preference monism’, see supra note 5. On ‘preference pluralism’, see supra notes 10 & 12.
[163] On the interface among plural values in relation to efficient breach, see Macneil, Efficient Breach of Contract: Circles in the Sky, 68 Va. L. REV 947,968 (1982)
[164] On rationality in utilitarianism including law and economics, see supra Section IX. Rational choice may also marry behavioral efficiency with the ‘biology’ of behavior. On rationality in relation to behavioral economics and behavior biology, see Owen D. Jones, Time-Shifted Rationality and the Law of Law’s Leverage: Behavioral Economics Meets Behavioral Biology, 95 NW. U. L. REV. 1141, 1151 (2001).
[165] On the rationality of keeping one’s promises, see Peter Vallentyne, The Rationality of Keeping Agreements, in PETER VALLENTYNE ED., CONTRACTARIANISM AND RATIONAL CHOICE: ESSAYS ON DAVID GAUTHIER’S MORALS BY AGREEMENT 177 (CAMBRIDGE, 1991).
[166] An issue in exercising ‘rational’ choices is whether a value pluralist is rational in regretting the consequence of a ‘correct’ – or at least, preferred -- moral choice. See MICHAEL STOKER, PLURAL AND CONFLICT VALUES, supra note 9 and BERNARD WILLIAMS, MORAL LUCK, supra note 9.
[167] The fact that a plural rationalist may conclude in favor of a particular value, such as efficiency stems, not from the primacy of that value as arises under monism, but from its assessment in light of the plural alternatives. See further supra Section II.
[168] See generally STOKER, supra note 9; WILLIAMS, supra note 9.
[169] See LEON E. TRAKMAN, THE EVOLUTION OF THE LAW MERCHANT: OUR COMMERCIAL HERITAGE, CH.1 (FRED B.ROTHMAN, 1983); Dempsey, Just Price in a Functional Economy, 25 AM.ECON.REV. 471, 471, 474-76, 480-86 (1935); De Roover, The Concept of the Just Price: Theory and Economic Policy, 18 J.ECON.HIST.418, 420,421-34 (1958). .
[170] See Eric A. Posner, Contract Law in the Welfare State: A Defense of the Unconscionability Doctrine, Usury Laws, and Related Limitations on the Freedom to Contract, 24 J. LEGAL STUD., 283, 312-14 (1995).
[171] See .eg. Ian Macneil, Bureaucracy and Contracts of Adhesion, 22 OSGOODE HALL L.J. 5 (1984) [arguing that adhesive conditions are often drafted to discourage consumers from reading them,]
[172] See e.g. Russell Korobkin, Unconscionability: Bounded Rationality, Standard Form Contracts, and Unconscionability, 70 U. CHI.L.REV.1203 (2003) [arguing that the efficient use of standard form contracts, including “greater use of mandatory contract terms and judicial modification of the unconscionability doctrine to better respond to the primary cause of contractual inefficiency.]
[173] Some commentators on the law of unconscionability find little ‘rational’ place for law and economics is reaching determinations based on ‘conscience.’ See e.g. Arthur Allen Leff, Unconscionability and the Code—The Emperor’s New Clause, 115 U. Pa. L. Rev. 485 (1967). Cf. Epstein, Unconscionability: A Critical Reappraisal, 18 J.L. & ECON.293 (1975).
[174] For example, contracts may explicitly prohibit customers from altering the terms of a contract. See Richard E. Speidel, Contract Theory and Securities Arbitration: Whither Consent? 62 BROOKLYN L.REV.1335 (1996).
[175] On behavioral studies in functionalism, see infra Section XI.
[176] The claim is not that ’preference rationality’ is value neutral among the plural alternatives, only that it can facilitate choices among them in a manner that is precluded by value monism. See Alvin B. Rubin, Doctrine in Decision-Making: Rationale or Rationalization, 1987 UTAH L. REV. 357, 367; John O. Newman, Between Legal Realism and Neutral Principles: The Legitimacy of Institutional Values, 72 CALIF. L. REV. 200, 204 (1984).
[177] On such indeterminacy, see Joseph Singer, The Player and the Cards: Nihilism and Legal Theory, 94 YALE L.J. 1, 11 (1984).
[178] Cf. Daniel Shaviro, Statistical-Probability Evidence and the Appearance of Justice, 103 HARV.L.REV.530 (1989). Arguably, ‘patterned’ analyses of substantive unconscionability may interfere with private ‘bargains’; declining to engage in ‘patterned’ analyses may lead to abuse of those ‘bargains’.
[179] On the legal significance of boilerplate contracting, see 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 B. Ahdieh, The Strategy of Boilerplate, 104 MICH.L.REV. 1033 (2006); Henry E. Smith, Modularity in Contracts: Boilerplate and Information Flow, 104 MICH. L. REV. 1175 (2006); Omri Ben-Shahar & James J. White, Boilerplate and Economic Power in Auto Manufacturing Contracts, 104 MICH.L.REV. 953 (2006); Harry E. Smith, Modularity in Contracts: Boilerplate and Information Flow, MICH.L.REV.1175 (2006). But see Margaret Jane Radin, Boilerplate Today: The Rise of Modularity and the Waning of Consent, 104 MICH.L.REV.1223 (2006).
[180] On the ‘just price’, see supra note 169.
[181] On ‘decision procedure’ pluralism, see supra note 48 and infra Section XI.
[182] On the use of positive economics to measure behavioural practices, see e.g.See e.g.. MILTON FRIEDMAN, THE METHODOLOGY OF POSITIVE ECONOMICES: IN ESSAYS IN POSITIVE ECONOMICS 3; Priest, Selective Characteristics of Litigation, 9 J. LEGAL STUD.399 (1980). Cf. O'Driscoll, Justice, Efficiency, and the Economic Analysis of Law: A Comment on Fried, 9 J. LEGAL STUD. 355 (1980); Rizzo, Can There Be a Principle of Explanation in Common Law Decisions? A Comment on Priest, 9 J.LEG.STUD 423 (1980).
[183] For a classical theory of functionalism applied to contract law, see W. Friedman, Changing Functions of Contract in the Common Law, 9 TORONTO L.J.15 (1951). See too ROGER COTTERELL, THE SOCIOLOGY OF LAW (1992); WOLGANG GASTON FRIEDMANN, LEGAL THEORY (LONDON: STEVENS, 1967). But see Felix S. Cohen, Transcendental Nonsense and the Functional Approach, 35 COLUM.L.REV.809 (1935).
[184] Functionalism in law is closely identified with Roscoe Pound and the school of ‘sociological jurisprudence’. See Roscoe Pound, Liberty of Contract and Social Legislation, 17 COLUM. L. REV. 538 (1917).
[185] This process of functional verification is sometimes used to legitimate ‘law and economic’ analysis. See e.g. Calabresi, About Law and Economics: A Letter to Ronald Dworkin, 8 HOFSTRA L.REV. 553 (1980); Calabresi & Melamed, Property Rules, Liability Rules, and Inalienability: One View from the Cathedral, 85 HARV. L.REV.1089 (1972).
[186] See e.g. S. Macaulay, Freedom From Contract: Solutions in Search of a Problem? 2004 WIS.L.REV.777.
[187] On socio-legal theory as the coalescence between social theory and pragmatism, see BRIAN Z. TAMANAHA, REALISTIC SOCIO-LEGAL THEORY: PRAGMATISM AND A SOCIAL THEORY OF LAW (QUESTRIA BOOKS, 2005).
[188] On the history of social science research methodologies in law, see e.g John Monahan and Laurens Walker, Judicial Use of Social Science Research, 15 LAW & BEHAVIORAL SCIENCE 580 (1991); Laurens Walker & John Monahan, Social Facts: Scientific Methodology as Legal Precedent, 76 CAL.L.REV.877 (1988); Kenneth Culp Davis, Facts in Lawmaking, 80 COLUM.L.REV.931 (1980).
[189] Functionalism may subject the results of behavioral study to re-assessment. For example, the determination that business ‘deals’ are concluded informally and without lawyers may be re-evaluated in light of evidence that lawyers help to set the ground rules for informal negotiations, serve as a backup resource and intervene should informal business dealings later falter. See further supra Section VIII.
[190] Illustrating the historical value of functional study were predictive studies of judicial behavior based, inter alia, on the socio-economic, political, ethnic and religious background of judges. See Lee Loevinger, Jurimetrics: The Next Step Forward 33 MINN.L.REV.455 (1949). See too HANS W. BAADE, ED., JURIMETRICS (BASIC BOOKS, 2000).
[191] See MICHAEL TREBILCOCK, supra note 1, at p.817. For a Critical Legal Studies critique of the use, inter alia, of functional study to support ‘law and economics’, see Duncan Kennedy, Distributive and Paternalist Motives in Contract and Tort Law, with Special Reference to Compulsory Terms and Unequal Bargaining Power, 41 Md.L.REV.563, 621 (1982).
[192] Of particular concern are the prospective costs of ‘field study’. See e.g. Monahan and Walker, supra note 188.
[193] A leading theorist on contract interpretation is STEPHEN A. SMITH, CONTRACT THEORY (OXFORD, 2004). See too ROBERT HILLMAN, THE RICHNESS OF CONTRACT LAW, supra note 1, at p.125 et seq.
[194] On monist theories of interpretation, see supra Section 1. See too Leon E. Trakman, Interpreting Contracts, supra note 2.
[195] On drafting and interpreting contracts from a ‘law and economics’ perspective, see Steven Shavell, On the Writing and the Interpretation of Contracts, 22 J. LAW ECON. & ORG., 289 (2006); Eric A. Posner, and Richard Zeckhauser, The Design and Interpretation of Contracts: Why Complexity Matters, 95 Nw.L.REV.91 (2000).
[196] On the ‘plain meaning’ of a contract, see Eric A. Posner, The Parol Evidence Rule, Plain Meaning, and the Principles of Contractual Interpretation, 146 U. PA. L. REV. 533 (1998).
[197] On plural methods of interpretation, see e.g. P.BAUMANN & M.BETZLER, PRACTICAL CONFLICT (CAMBRIDGE, 2004).
[198] On the ‘true meaning’ of the contract, as distinct from its ‘plain’ or ‘ordinary word meaning’, see Avery Wiener Katz, Contractual Incompleteness: A Transactional Perspective, 56 CASE W. RES. L. Rev 169 (2005); Eric A. Posner, The Parol Evidence Rule supra note 196, at p.533. See too Justice Michael Kirby, Towards a Grand Theory of Interpretation: The Case of Statutes and Contracts (Speech, Cambridge Univ., 13 July 2002).
[199] On ‘the good’, see supra notes 88-89. On the influence of plural values in the ‘substantive’ of contract interpretation, see e.g. Avery Wiener Katz, The Economics of Form and Substance in Contract Interpretation, 104 COLUM.L.REV. 496 (2004); David Charny, Hypothetical Bargains: The Normative Structure of Contract Interpretation, 89 MICH. L.REV.1915 (1991); Leon E. Trakman, The Interpretation of Contracts, supra note 2.
[200] On such steps in interpretation, see e.g. Ronald Dworkin, Law as Interpretation, TEX.L.REV.(1981); ANDREI MARMOR, INTERPRETATION AND LEGAL THEORY (HART PUBL., 2005). But see Stanley Fish, Working on the Chain Gang: Interpretation in law and literature, TEX.L.REV. (1986).
[201] On establishing the ‘true meaning’ of the contract, see supra note 198. Courts can also use canons of interpretation, like the contra proferentem rule to support both unitary and pluralist theories of construction. See further Michelle Boardman, Contra Proferentem: The Allure of Ambiguous Biolerplate, 104 MICH.L.REV.1105 (2006).
[202] On the requirement of good faith performance, as distinct from good faith contracting, see Tymshare v. Covell, 727 F.2d 1145 (D.C. Cir. 1984) [per Scalia]; E. Allan Farnsworth, On Trying to Keep One’s Promises: The Duty of Best Efforts in Contract Law, 46 U. PITT. L. REV.1,44 (1984); Summers, The General Duty of Good Faith - Its Recognition and Conceptualization, 67 Cornell L. Rev. 810 (1982); Steven Burton, Breach of Contract and the Common Law Duty to Perform in Good Faith, 94 HARV.L REV. 369, 372-73 (1980); Robert Dugan, Good Faith and the Enforceability of Standardized Terms, 22 Wm.& MARY L. REV. 1, 5–7 (1980); Robert S. Summers, Good Faith" in General Contract Law and the Sales Provisions of the Uniform Commercial Code, 54 VA.L.REV.195 (1968).
[203] See U.C.C. § 1-303(b) (2001) [course of dealings].
[204] Id. 1-303(a) [course of performance] For an argument that the parties should devise their own rules of contract interpretation, see Avery Weiner Katz, supra note 199 at p.496.
[205] On this ‘network effect’, see Larry E. Ribstein & Bruce H. Kobayashi, Choice of Form and Network Externalities, 43 Wm. & Mary L.REV.79, 110 (2001); Mark A. Lemley & David McGowan, Legal Implications of Network Economic Effects, 86 CAL L REV.479, 587 (1998); Marcel Kahan & Michael Klausner, Standardization and Innovation in Corporate Contracting (Or “The Economics of Boilerplate”), 83 Va.L.REV.713(1997); Michael Klausner, Corporations, Corporate Law, and Networks of Contracts, 81 Va.L.REV.757(1995).
[206] Id § 1-303(c) [usage of trade]. See too David V. Snyder, Language and Formalities in Commercial Contracts: A Defense of Custom and Conduct, 54 SMU L.REV.617 (2001).
[207] On normative influences including ‘gap filling’ on contract interpretation, see Avery Wiener Katz, supra note 199; David Charny, supra note 199; Leon E. Trakman, The Interpretation of Contracts, supra note 2.
[208] Related to the tension between interpreting and constructing contract terms is the tension between form and substance in contract interpretation. Cf. Eyal Zamir, The Inverted Hierarchy of Contract Interpretation and Supplementation, COLUM.L.REV.1710 (1977).
[209] See Leon E. Trakman, Legal Fictions and Frustrated. Contracts, 46 MOD.L. REV 39-55(1983). But cf George M. Cohen, Implied Terms and Interpretation in Contract Law, in 3 ENCYCLOPEDIA LAW & ECON at p.78 (BOUDEWIJN BOUCKAERT AND GERRIT DE GREEST eds., 2000); See e.g. GEORGE M. COHEN, IMPLIED TERMS AND INTERPRETATION IN CONTRACT LAW (SCRIBD, 2007) at p.1-22, available at http://www.scribd.com/doc/239253/Implied-Terms-and-Interpretations-in-Contract-Law.
[210] Jurists have long recognized a difference between ‘interpreting’ a contract and ‘constructing’ its terms. See e.g. 3 Arthur Linton Corbin, Corbin on Contracts § 534 (1960); see also Arthur L. Corbin, Conditions in the Law of Contract, 28 YALE L.J.739, 740–41 (1919).
[211] See further Trakman, Legal Fictions, supra note 209. For related challenges by ‘new formalists’ directed against judicial gap-filling notably by American legal realists. See Symposium: Formalism Revisited, 66 Chi. L. REV. 527 (1999); Lisa Bernstein, Merchant Law in a Merchant Court: Rethinking the Code’s Search for Immanent Business Norms, 144 PA.L.REV.1765 (1996).
[212] The plural interpretation of contracts is unavoidably variable, in acknowledging that courts may adopt different plural preferences as well as different methods of valuing them. The risk that courts may deny, feign or fail to explain such preferences is real, but is insufficient to dismiss plural methods of interpretation out of hand.
[213] See e.g. Kennedy, Distributive and Paternalist Motives in Contract and Tort Law, supra note191 at p.621.
[214] For a strident critique of liberal rights, see Peter Gabel, A Critique of Rights: The Phenomenology of Rights-Consciousness and the Pact of the Withdrawn Selves, 62 TEX.L.REV.1563 (1984).
[215] See e.g, Duncan Kennedy, The Stages of the Decline of the Private Public Distinction, 130 U. Pa. L. REV. 1349 (1982).
[216] On the institutional disempowerment of minorities ‘without consent’ tracing back to slavery. See ROBERT WILLIAM FOGEL, WITHOUT CONSENT OR CONTRACT: THE RISE AND FALL OF AMERICAN SLAVERY (W.W.NORTON, 1989). On the disempowerment of women, see e.g LINDA MULCAHY & SALLY WHEELER, EDS., FEMINIST PERSPECTIVES ON CONTRACT LAW, supra note 221. On the use of ‘adhesion contracts’ to disempower consumers, see supra notes 40 & 46,
[217] Legal realists are also subject to critical attack for falling short of a direct assault on liberal legal values. See e.g Kennedy, supra note 213. For a legal realist ‘critique’ of fine print clauses in adhesion contracts, see KARL N. LLEWELLYN, THE COMMON LAW TRADITION: DECIDING APPEALS (1960). [“The fine print which has not been read has no business to cut under the reasonable meaning of those dickered terms which constitute the dominant and only real expression of agreement...” at p. 370.]
[218] See .e.g. Duncan Kennedy, Form and Substance in Private Law Adjudication, 89 HARV.L.REV. 685(1976).
[219] Critical legal theorists like Duncan Kennedy reflect on the somewhat paternalistic need for “the decision maker...to take the beneficiary under his wing and tell him what he can and cannot do.” See Duncan Kennedy, Distributive and Paternalist Motives in Contract and Tort Law, supra note 191 at p., pp. 621, 634.
[220] On the critical deconstruction of liberal theory, see Jon Bruschke, Deconstructive Arguments in the Legal Sphere: An Analysis of the Fischl/Massey Debate about Critical Legal Studies, 32 ARGUMENTATION AND ADVOCACY (1995).
[221] Some of this criticism revolves around the ‘language’ and ‘culture’ that is ascribed to legal liberalism including the ‘reasonable person’ standard. See generally Duncan Kennedy, A Semiotics of Critique, 22 CARDOZO L. REV. 1147 (2001); Christine Desan, Expanding Legal Vocabulary: The Deconstruction and Defense of Law, 95 YALE L.J. 969 (1986), See too Robert Cover, Violence and the Word, 95 YALE L.J.1601 (1985).
[222] Feminist critiques are among the most revealing challenges to consent based models of contracting, including the judicial application of a reasonable ‘man’ standard. See LINDA MULCAHY & SALLY WHEELER, EDS., FEMINIST PERSPECTIVES ON CONTRACT LAW (ROUTLEDGE CAVENDISH, 2005); Dalton, An Essay in the Deconstruction of Contract Doctrine, 94 YALE L.J. 997, 1063-1065 (1985); See too Cynthia G. Bowman, Dorothy Roberts and Leonard S. Rubinowitz, Race and Gender in the Law Review 100 Nw.U.L.REV.27 (2006); Ellen C. DuBois, Mary C. Dunlap, Carol J. Gilligan, Catherine A. MacKinnon and Carrie J. Menkel-Meadow, Feminist Discourse, Moral Value, and the Law - A Conversation, 34 BUFFALO L. REV. 11 (1985). See generally N.J.HIRSHMAN, RETHINKING OBLIGATION: A FEMINIST METHOD FOR POLITICAL THEORY (CORNELL, 1992); Kimberlé Crenshaw, Mapping the Margins: Intersectionality, Identity Politics, and Violence Against Woman of Color, 43 STAN.L.REV.6 (1991). On Critical Race Theory, see RICHARD DELGADO AND JEAN STEFANCIC, CRITICAL RACE THEORY (NEW YORK, 2001).
[223] The attack on value pluralism is presented, in part, through liberalism allegedly dubious reliance on the divide between public and private values. See e.g. Duncan Kennedy, The Stages of the Decline of the Private Public Distinction, 130 U. Pa. L. REV. 1349 (1982).
[224] See e.g. Kennedy, supra note 218.
[225] On the importance of community values in the development of Critical Legal Studies, see ROBERTO UNGER, THE CRITICAL LEGAL STUDIES MOVEMENT (HARVARD LAW SCHOOL, 1986); also published in 96 HARV. L. REV.561 (1983)
[226] On such indeterminacy, see Joseph Singer, The Player and the Cards, supra note 176 at p.11. But see Kenneth Kress, Legal Indeterminacy, 77 CALIF. L. REV. 283, 286 (1989); Robert Benson, How Judges Fool Themselves: The Semiotics of the Easy Case, in 2 LAW AND SEMIOTICS 31 (R. Kevelson ed. 1988).
[227] See further supra Section II
[228] See e.g. Singer, supra note 226.
[229] Critical Scholarship, arguably, has failed to acknowledge the contributions made by Legal Realism to equality rights. On the legal realist movement, see e.g. Llewellyn, THE COMMON LAW TRADITION supra note 218
[230] On such utopian idealism, see ROBERTO UNGER, THE CRITICAL STUDIES MOVEMENT, supra note 226. But see MARTTI KOSKENNIEMI, FROM APOLOGY TO UTOPIA: THE STRUCTURE OF LEGAL ARGUMENT (CAMBRIDGE, 2006). For an existential exposition of utopia, see MARTIN BUBER, PATHS IN UTOPIA, (SYRACUSE UN. PRESS, 1996)
[231] See UNGER, supra note 230. For a conservative attack upon the radical agenda of Critical Theory, including that it is both self-defeating and undermines its multi-cultural aspirations, see DANIEL A. FARBER & SUZANNA SHERRY, BEYOND ALL REASON: THE RADICAL ASSAULT ON TRUTH IN AMERICAN LAW, (NEW YORK: OXFORD, 1997). But cf. ROBERT HILLMAN, THE RICHNESS OF CONTRACT LAW, supra note 1, at p.190 et seq..
[232] On value pluralism in the context of liberal and communitarian society, see e.g.AMY GUTMANN, LIBERTY AND PLURALISM IN PURSUIT OF THE NON-IDEAL, 66 SOCIAL RESEARCH 1039 (1999). See too RICHARD DAGGER, CIVIC VIRTUES: RIGHTS, CITIZENSHIP, AND REPUBLICAN LIBERALISM (OXFORD, 1997); AMITAI ETZIONI, THE NEW GOLDEN RULE: COMMUNITY AND MORALITY IN A DEMOCRATIC SOCIETY (BASIC BOOKS, 1996).
[233] On the relationship between the ‘self’ and society, see e.g. CHARLES TAYLOR, SOURCES OF THE SELF: THE MAKING OF THE MODERN IDENTIFY (HARVARD, 1989); WILL KYMLICKA, LIBERALISM, COMMUNITY AND CULTURE (OXFORD, 1989); ALADSAIR C. MACINTYRE, AFTER VIRTUE: A STUDY IN MORAL THEORY (UN. NOTRE DAME, 1984); WALTER W. POWELL AND ELIZABETH S. CLEMENS, PRIVATE ACTION AND THE PUBLIC GOOD (NEW HAVEN, CONN: YALE UNIV. PRESS, 1998); MICHAEL WALZER, SPHERES OF JUSTICE (BASIC BOOKS, 1983)..
[234] A significant attribute of culture pluralism is the culture of tolerance, including tolerance of difference. See e.g. CATRIONA MCKINNON, DARIO CASTIGLIONE, THE CULTURE OF TOLERATION IN DIVERSE SOCIETIES: REASONABLE TOLERANCE (MANCHESTER, 2003)
[235] On such cultural values, see e.g. Kenneth Baynes, The Liberal/Communitarian Controversy and Communicative Ethics in UNIVERSALISM VS. COMMUNITARIANISM: CONTEMPORARY DEBATE IN ETHICS, ed. DOUGLAS B. RASUMSSEN (CAMBRIDGE, MASS.: MIT Press, 1990); Douglas A. Buchanan, Assessing Communitarian Critique of Liberalism, 99 Ethics 852-82 (1989).
[236] Will Kymlicka defines a ‘societal culture’ as ‘a culture which provides its members with meaningful ways of life across the full range of human activities including social, educational, religious, recreational, and economic life, encompassing both public and private spheres..' He adds that cultures may be territorially concentrated and based on a shared language. See WILL KYMLICKA, MULTICULTURAL CITIZENSHIP (OXFORD, 1995) at p. 170. See too STEVEN BROOKS, THE CHALLENGE OF CULTURAL PLURALISM (PRAEGER, 2002).
[237] On legal culture, see e.g. David Nelken, (2007) ‘Culture, Legal’ in DAVID S. CLARK, ed., ENCYCLOPEDIA OF LAW AND SOCIETY: AMERICAN AND GLOBAL PERSPECTIVES (SAGE, LONDON) at p. 369–374; WERNER MENSKI, COMPARATIVE LAW IN A GLOBAL CONTEXT (COMBRIDGE, 2006); David Nelken, Using the Concept of Legal Culture, 29 Australian J.Leg.Phil.1–28 ((2004); CSABA VARGO, ed., COMPARATIVE LEGAL CULTURE (DARTMOUTH, UK, 1992).
[238] On cultural pluralism in resolving differences within diverse societies, see e.g. HORACE M. KALEEN, CULTURAL PLURALISM AND THE AMERICAN IDEA: AN ESSAY IN SOCIAL PHILOSOPHY (U.PENN.PRESS,1958)
[239] See LEON E. TRAKMAN, THE EVOLUTION OF THE LAW MERCHANT, supra note 169.
[240] See Leon E. Trakman, From the Medieval Law Merchant to E-Merchant Law, 53 .TORONTO L J.265-304 (2003); James R. Maxeiner, Standard-Terms Contracting in the Global Electronic Age: European Alternatives, 28 YALE J. INT'L. L. 109 (2003). On the ‘just price’ see supra Section X.
[241] But see Monique Deveaux, Cultural Pluralism from Liberal Perfectionist Premises, 32 POLITY (2000).
[242] On such cultural ‘otherness’, see e.g. R.D. GRILLO, PLURALISM AND THE POLITICS OF DIFFERENCE: STATE, CULTURE AND ETHNICITY IN COMPARATIVE PERSPECTIVE (OXFORD, 1998).
[243] On Justice Easterbrook’s controversial decision to enforce an adhesive shrink-wrap licensing agreement on grounds, inter alia, that the ‘consumer’ was more truly a merchant-consumer and also a lawyer, see ProCD, Inc. v. Zeidenberg, U.S. Court of Appeals, Seventh Circuit, June 20[1996] USCA7 654; , 1996, 86 F.3d 1447. But see contra William C Whitford, ProCD v. Zeidenberg in Context, 2004 WISC.L.REV. 82.
[244] See Trakman, Boundaries, supra note 108. But see
[245] On the Westinghouse case, see supra Section VIII But cf. Daniel Markovits, Contract and Collaboration, 113 YALE L.J.1417 (2004).
[246] On the nature of ‘decision procedures’ that may be harnessed by cultural pluralism, see supra note 48 and infra Section XI.
[247] On presumptions that may be attributed to marriage contracts that are ‘culturally’ informed not least of all by the judicial culture of the decision agent, see further supra text accompanying note 47.
[248] On the distinction between end-use consumers and consumer resellers in e-contracting, see supra note 243. On such decision procedures, see supra Section XI. On whether savvy consumers not limited to cyber-consumers make things better for consumers generally and/or whether suppliers are able to detect and cater to aggressive consumers while taking advantage of others, see Clayton Gillette, Rolling Contracts as an Agency Problem 2004. WISC.L.REV.679. See too Meyerson, Efficient Consumer, supra note 152.
[249] Measuring progressive and regressive values are easier at the extremes, such as according low weight to cultures in which women are subject to sexual exploitation. Greater difficulty arises in measuring emerging and receding cultural trends, such as in the relationship between gender and evolving e-commerce. For example, should a stay-home mother who buys all the family apparel online and is familiar with browse-wrap contracts, be treated as a merchant-consumer? Should a lawyer who seldom shops online and is not ‘literate’ about browse-wrap contracts be treated differently? See further Trakman, Boundaries, supra note 108.
[250] For example, on the allegedly artificial distinction between merchant and consumer contractual cultures, see Alan Schwartz and Robert E. Scott, Contract Enforcement and Interpretation: Contract Theory and the Limits of Contract Law, 113 YALE L.J.541 (2003); Larry T. Garvin, Small Business and the False Dichotomies of Contract Law, 40 WAKE FOREST L. REV.295 (2005).
[251] See e.g. GRILLO, supra note 242; ELIZABETH FRAZER AND NICOLA LACEY, THE POLITICS OF COMMUNITY: A FEMINIST CRITIQUE OF THE LIBERAL-COMMUNITARIAN DEBATE (TORONTO, 1993).
[252] This issue arises out of cases like ProCD v. Zeidenberg, supra note 243, particularly whether repeat order buyers, like Zeidenberg, ought to be treated as a ‘consumer’ or as a repeat order ‘merchant’. See supra notes 250.
[253] On this challenge see Amitai Etzioni, The Attack on Community: The Grooved Debate, 32 Society 12-17 (1995); DANIEL A. BELL, COMMUNITARIANISM AND ITS CRITICS (OXFORD, 1993); DEREK PHILLIPS, LOOKING BACKWARD: A CRITICAL APPRAISAL OF COMMUNITARIAN THOUGHT (PRINCETON, 1993).
[254] See e.g. Pound, Liberty of Contract and Social Legislation, 18 YALE L.J.482 (1909).
[255] See e.g. Kessler, Contracts of Adhesion, supra note 46.
[256] See e.g. Karl Llewellyn, Some Realism about Realism - -Responding to Dean Pound, 44 HARV.L.REV1222 (1931). See too N.E.H.HULL, ROSCOE POUND AND KARL LLEWELLYN, SEARCHING FOR AN AMERICAN JURISPRUDENCE (CHICAGO, 1997); WILLIAM TWINING, KARL LLEWELLYN AND THE REALIST MOVEMENT (WEIDENFELD AND NICOLSON, 1973).
[257] On philosophical responses to these challenges to modern liberal democracies, see e.g. JOHN DEWEY, RECONSTRUCTION IN PHILOSOPHY (HOLT, 1920); IRWIN EDMIN, JOHN DEWEY: HIS CONTRIBUTION TO THE AMERICAN TRADITION (DOBBS MERRILL, 1995). On functional responses, see e.g. WILLIAM JAMES, PRAGMATISM AND OTHER WRITINGS, GILES GUNN, ED. (PENGUIN CLASSICS, 2000).
[258] On plural conceptions of rights, see TRAKMAN AND GATIEN, RIGHTS AND RESPONSIBILITIES, supra note 2.