Restitution Discussion Group Archives
| Sender: |
Lionel Smith |
| Date: |
Sun, 30 Jul 2000 18:53:12 -0400 |
| Re: |
"Efficient Breach" |
I agree
with Gerhard Dannemann that when one looks closely, there is not that much
in the concept of efficient breach, and that it is actually a rationalisation
of a purely contingent understanding of remedies in contract law which owes
a great deal to OW Holmes and very little to logic or even economic analysis.
Duncan Sheehan said:
The only dictum guarding against [efficient
breach] seems to be where Lord Nicholls comments that a breach enabling
a party to enter into a more profitable contract elsewhere is not by itself
sufficient reason for granting restitutionary damages. But it is also true that Lord Nicholls seemed to think
there was something in the argument in "Disgorgement of the Profits of
Breach of Contract: Property, Contract and 'Efficient Breach' ". There
the concept of efficient breach is criticised as insupportable, even within
the world of economic analysis, in the absence of detailed empirical evidence
as to transaction costs (of the kind Gerhard described), evidence which
I for one have never seen. And that leaves aside the larger question of
whether economic analysis is relevant in analysing private law. See eg
Ernest Weinrib and Ronald Dworkin passim.
Lionel
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