Date: Thu, 17 Aug 2006 11:06:36 -0400

From: John Swan

Subject: Contracts Article

Jason,

You might start by looking at Beale and Dugdale, "Contracts Between Businessmen: Planning and the Use of Contractual Remedies" (1975), 2 British Journal of Law and Society 45, and articles by Stewart Macaulay and Ian Macneil. See, in particular, the former’s articles on the automobile industry in, I think, the Encyclopaedia of Comparative Law. (There’s a reference to it in the 1st (but not later) edition of my casebook.)

I do not think that it’s either correct or helpful to say that "business people … did not really want consideration": they would find that issue incomprehensible; they just don’t think about it and are blind-sided when zapped with the doctrine. See, e.g. Gilbert Steel v. University Construction (1976), 12 O.R. (2d) 19, 67 D.L.R. (3d) 606. It is hard to think of a business relation, i.e., a relation between merchants, that it not (or an aspect of) a reciprocal exchange, whether or not the economists can deal with the complex factors that enter into the concept of the exchange. (Macneil is particularly good on this.) You might also look at Barry Reiter’s comment on Gilbert Steel: (1978), 27 U.T.L.J. 468.

There was a study done years ago by Rob Pritchard and Barry Reiter on the expectations of those buying and selling houses on the re-sale market that showed that no one expected the damages the courts would award. The study was, however, never published.

The incentives on merchants both to perform and to tolerate breaches are legion and resort to litigation is seen as little short of a disaster. Those corporations (and their lawyers) who get a reputation for being difficult to deal with or litigious are quickly seen to be dangerous and expensive to deal with.

There’s a huge amount of stuff out there on these topics.

John

-----Original Message-----
From: Jason Neyers
Sent: August 17, 2006 10:15 AM
Subject: ODG: Contracts Article

Dear Colleagues:

I seem to remember reading an empirical contracts article/s which suggested that business people 1) did not really want consideration or 2) think that they were entitled to expectation damages. Does this ring a bell with anyone?

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