ContractsProf Blog

Editor: D. A. Jeremy Telman
Valparaiso Univ. Law School

A Member of the Law Professor Blogs Network

Thursday, May 16, 2013

New in Print

Pile of BooksSean M. Collins and R. Mark Isaac, Holdout: Existence, Information, and Contingent Contracting. 55 J.L. & Econ. 793 (2012)

Christine Spinella Davis,et al., Recent Developments in Business Litigation, 48 Tort Trial & Ins. Prac. L.J. 115 (2012)

Robert W. Emerson and Uri Benoliel, Are Franchisees Well-Informed? Revisiting the Debate over Franchise Relationship Laws. 76 Alb. L. Rev. 193-216 (2012/2013)

Orit Gan, Contractual Duress and Relations of Power, 36 Harv. J. L. & Gender 171 (2013)

Orit Gan, Promissory Estoppel: A Call for a More Inclusive Contract Law, 16 J. Gender, Race & Justice 47 (2013)

David A. Hoffman and Tess Wilkinson-Ryan, The Psychology of Contract Precautions, 80 U. Chi. L. Rev. 395 (2013)

David Hricik, Dear Lawyer: If You Decide It's Not Economical to Represent Me, You Can Fire Me As Your Contingent Fee Client, but I Agree I Will Still Owe You a Fee, 64 Mercer L. Rev. 363 (2013)

Joseph F. Morrissey, A Contractarian Critique of Citizens United, 15 U. Pa. J. Const. L. 765 (2013)

Arthur J. Park, What to Reasonably Expect in the Coming Years from the Reasonable Expectations of the Insured Doctrine, 49 Willamette L. Rev. 165 (2012)

[JT]

May 16, 2013 in Recent Scholarship | Permalink | TrackBack (0)

Wednesday, May 15, 2013

Boilerplate Symposium V: Ethan Leib on the Fetishization of Consent

This is the fifth in a series of posts reviewing Margaret Jane Radin's Boilerplate: The Fine Print, Vanishing Rights and the Rule of Law.

LeibEthan Leib s Professor of Law at Fordham Law School and is the author of What is the Relational Theory of Consumer Form Contract?, in Revisiting the Contracts Scholarship of Stewart Macaulay: On the Empirical and the Lyrical 259 (Jean Braucher, John Kidwell & William Whitford eds., Hart Publishing 2013)

People tend to begin with praise.  In this case, it isn’t just throat-clearing.  Although one could be forgiven for thinking that the subject of consumer form contracts has been mined to death, much impresses in Peggy Radin’s Boilerplate.  Although I don’t agree with all of them, here are just a few of the book’s productive interventions:

  1. Radin invites us to consider whether tort law rather than contract law would make better sense of the consumer form contract gone wrong in which someone is harmed, “out of the blue, by the unexpected actions of another” (23);
  2. Radin invites us to think about how complicity with certain types of boilerplate that divests important procedural and substantive rights has had the systematic effect of converting property rules to liability rules, unilaterally priced by form drafters (75);
  3. Radin questions whether we should be allowing contract to undermine the value of “fair use” of intellectual property or the value of free expression, since some seemingly enforceable boilerplate purports to limit consumers’ permission to use or criticize the products they buy (172-76);
  4. Radin reminds us that when consumers’ reasonable expectations are that they will be exploited by boilerplate, the judicial doctrine allowing enforcement of only consumers’ “reasonable expectations” will prove inadequate in addressing the problems with boilerplate (highlighting the ambiguity in the doctrine between positive and normative expectations) (85);
  5. Radin provokes us by characterizing consumer form contracts as “sturdy indefensibles:” we might need to use them even though they don’t fit the “‘grammar’ of the legal infrastructure of contract law” (143); and
  6. Radin argues that boilerplate should be judged based on the nature of the right involved, the quality of consent provided by those bound, and the dissemination of the right that is purportedly infringed (155).

BoilerplateAnd there are more pearls for readers, too.

But I had one quite basic problem with the book, which cuts to the very core of Radin’s approach. 

Most importantly, she really tries to train the reader not to consider boilerplate instruments as actually contractual.  Indeed, if her editor had allowed it, she might very well have used scare quotes throughout the whole book (rather than just the beginning) to highlight that consumer form contracts with boilerplate are not really contracts.  The reason for their exclusion from the world of contract: because of the routine absence of consent in transactions using boilerplate.  It is the lack of consent (or the severely attenuated consent) in consumer form contracting which underwrites her claim that boilerplate contributes to “normative [and] democratic degradation,” a central trope that recurs throughout the book. 

Admittedly, it seems intuitive to root contract in consent.  The liberal theory of autonomy to which many versions of contract theory owe their genesis promotes consent as a principal virtue.  So it is no surprise that Radin seeks to maintain the liberal theory of autonomy and contract with it.

But there is a whiff of fetishizing of consent in Radin’s rendering.  Absence and attenuation of consent is everywhere in the transactional world of contract: in employment, long-term corporate relationships, in franchises, in marriage.  Contract is a multifarious enterprise that ultimately governs many modalities of exchange.  Radin surely attempts to explore the fine line between the consensual and non-consensual.  But excluding a huge portion of voluntary exchange from the domain of contract seems unlikely to be true to the rich practice that has, from time immemorial, been a method of channeling and regulating complex relationships in which transactions occur.  I fear a “purer” contract – one without boilerplate and one which squeezes out all attenuated consent – will ultimately leave us with a more ideological product, one that undergirds, reinforces, and grows out of a libertarian rather than a liberal theory of autonomy.  And that may lead to more substantial normative degradation than would fighting bad contracts with some contract law.

[Posted, on behalf of Ethan Leib, by JT]

 

May 15, 2013 in Books, Commentary, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Boilerplate Symposium IV: David Horton on Mass Arbitration and Democratic Degradation

Horton2This is the fourth in a series of posts reviewing Margaret Jane Radin's Boilerplate: The Fine Print, Vanishing Rights and the Rule of Law.

David Horton is Acting Professor of Law at the UC Davis School of Law.

One of Boilerplate’s most provocative claims is that mass contracting causes “democratic degradation.”  To be sure, this idea is not entirely new.  In 1931, Karl Llewellyn called standard forms “the exercise of unofficial government”; forty years later, W. David Slawson analogized to administrative law and argued that adhesive terms, like rules promulgated by unelected bureaucrats, suffer from a democracy deficit.  However, with the rise of public choice theory—which blurs the line between public and private lawmaking by conceptualizing statutes as “deals” between politicians and interest groups—these critiques have all but vanished.  Professor Radin seeks to reinvigorate them.  She contends that boilerplate replaces “the law of the state with the ‘law’ of the firm” and therefore undermines our commitment to representative democracy (p. 16). 

BoilerplateI’m particularly interested in how Professor Radin’s democratic degradation thesis plays out in the field of consumer and employment arbitration.  (For whatever it’s worth, I’ve explored similar issues here and here, and in my forthcoming review of Boilerplate).  Of course, unlike other controversial fine print terms, arbitration clauses can claim to have a democratic pedigree: Congress passed the Federal Arbitration Act in 1925 to encourage the use of private dispute resolution.  Nevertheless, it is widely accepted—even among the Justices—that the FAA’s current musculature is “an edifice of [the Court’s] own creation.”  In addition, the saturation of mandatory pre-dispute arbitration clausesat least among major companies in certain industries—rivals traditional lawmaking in its scale.  For instance, the class arbitration waiver in AT&T’s wireless service contract binds more customers than the combined populations of California, Texas, New York, and Florida.  Thus, to borrow from Professor Slawson, if by making “law” we mean creating or altering enforceable rights or duties, then companies make more law in a day by projecting arbitration across the economy than Congress makes in a year.

Is this spectacular display of private power legitimate?  Professor Radin suggests that it’s not.  She notes that “most people don’t know what arbitration is” and that arbitrators “are widely believed to be more favorable to businesses” (p. 4).  Yet a skeptical reader might push back.  What if, as the Court has repeatedly declared, the bare decision to resolve a dispute in the arbitral forum does not affect its outcome?  Arguably, then mass arbitration is an elegant shortcut to the meandering path of litigation.  Moreover, there are safeguards against drafter overreaching.  Courts can invalidate one-sided arbitration clauses under the contract defense of unconscionability.  Likewise, the vindication of rights doctrine entitles plaintiffs to a judicial forum if they prove that they can’t effectively vindicate federal statutory claims in arbitration.  Before we condemn mass arbitration as do-it-yourself law reform, shouldn’t we insist on evidence that it deprives consumers and employees of substantive rights?       

The rejoinder to this rejoinder can be found in the Court’s recent jurisprudence.  In AT&T Mobility LLC v. Concepcion, the Court held that class arbitration waivers must be enforced even if small-value consumer protection claims will “slip through the legal system.”  Thus, in perhaps the most fraught context in all civil litigation—the class action—the Court has disavowed the principle that the switch to an arbitral forum is outcome-neutral.  It has allowed drafters to engage in aggregate contracting—a practice that Professor Radin persuasively argues is not “contracting” at all—while denying adherents the ability to aggregate claims.  And in the pending case of American Express Co. v. Italian Colors Restaurant, the Court is expected to extend Concepcion and mandate bilateral arbitration of federal antitrust claims even though the cost of expert fees alone greatly exceeds any individual plaintiff’s potential recovery.  Just as Professor Radin contends, the casualties of this quiet revolution will be “rights that are granted through democratic processes” (pg. 16). 

[Posted, on David Horton's behalf, by JT]

May 15, 2013 in Books, Commentary, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Tuesday, May 14, 2013

Weekly Top Tens from the Social Science Research Network

SSRNRECENT HITS (for all papers announced in the last 60 days) 
TOP 10 Papers for Journal of LSN: Contracts (Topic)  

March 9, 2013 to May 8, 2013

RankDownloadsPaper Title
1 204 Offer and Acceptance in Modern Contract Law: A Needless Concept 
Shawn J. Bayern
Florida State University - College of Law
2 200 One Sided Jurisdiction Clauses - A Casenote on Rothschild 
Pascal AncelGilles Cuniberti
Universite du Luxembourg, University of Luxembourg
3 124 Culpa in Contrahendo in European Private International Law: Another Look at Article 12 of the Rome II Regulation 
Najib Hage-Chahine
Université Paris II - Panthéon-Assas
4 113 Promise, Contract, Personal Autonomy, and the Freedom to Change One's Mind 
Dori Kimel
University of Oxford - Faculty of Law
5 105 Transfer of Rights and Obligations Under DCFR and CESL: Interactions with English and German Law 
Hugh BealeWolf-Georg Ringe
Warwick School of Law, Copenhagen Business School, Department of Law
6 101 Preemption Without Borders: The Modern Conflation of Tort and Contract Liabilities 
Max N. Helveston
DePaul University - College of Law
7 96 Efficient Breach Is Dead; Long Live Efficient Breach 
Gregory Klass
Georgetown University - Law Center
8 96 Discretion 
D. Gordon SmithJordan C. Lee
Brigham Young University - J. Reuben Clark Law School , Brigham Young University - J. Reuben Clark Law School
9 92 Contract Law in Europe and the United States: Legal Unification in the Civil Law and the Common Law 
Hein D. Koetz
Max Planck Institute for Comparative and International Private Law
10 89 FRAND's Forever: Standards, Patent Transfers, and Licensing Commitments 
Jay P. KesanCarol M. Hayes
University of Illinois College of Law , University of Illinois at Urbana-Champaign - College of Law

RECENT HITS (for all papers announced in the last 60 days) 
TOP 10 Papers for Journal of Contracts & Commercial Law eJournal 

March 9, 2013 to May 8, 2013

RankDownloadsPaper Title
1 284 The Fiduciary Obligations of Financial Advisors Under the Law of Agency 
Robert H. Sitkoff
Harvard Law School
2 204 Offer and Acceptance in Modern Contract Law: A Needless Concept 
Shawn J. Bayern
Florida State University - College of Law
3 173 Private Equity Firms as Gatekeepers 
Elisabeth de Fontenay
Harvard Law School
4 114 Promise, Contract, Personal Autonomy, and the Freedom to Change One's Mind 
Dori Kimel
University of Oxford - Faculty of Law
5 106 Transfer of Rights and Obligations Under DCFR and CESL: Interactions with English and German Law 
Hugh BealeWolf-Georg Ringe
Warwick School of Law, Copenhagen Business School, Department of Law
6 102 Preemption Without Borders: The Modern Conflation of Tort and Contract Liabilities 
Max N. Helveston
DePaul University - College of Law
7 97 Efficient Breach Is Dead; Long Live Efficient Breach 
Gregory Klass
Georgetown University - Law Center
8 96 Revenge of the Clerks: MERS Confronts County Clerk and Qui Tam Lawsuits 
Dustin A. Zacks
King, Nieves & Zacks PLLC
9 96 Discretion 
D. Gordon SmithJordan C. Lee
Brigham Young University - J. Reuben Clark Law School , Brigham Young University - J. Reuben Clark Law School
10 92 Contract Law in Europe and the United States: Legal Unification in the Civil Law and the Common Law 
Hein D. Koetz
Max Planck Institute for Comparative and International Private Law

[JT]

May 14, 2013 | Permalink | TrackBack (0)

Boilerplate Symposium III: Andrew Gold, Is Boilerplate Contractual?

This is the third in a series of posts reviewing Margaret Jane Radin's Boilerplate: The Fine Print, Vanishing Rights and the Rule of Law. Gold

Andrew Gold is a Professor of Law at the DePaul University College of Law.

Margaret Jane Radin’s new book, Boilerplate, is an outstanding contribution to the literature on contract theory and policy.  In this review, I will focus on her analysis of consent, and in particular what it means to have consent for purposes of contract theory.  For the most part, my concern will be conceptual, and not normative.  This conceptual focus has normative implications, however.  Radin argues that tort law is an appropriate means to regulate mass market boilerplate, in part because she believes that boilerplate is not properly conceptualized in contract terms.   As she concludes: “it would be better to stop referring to boilerplate as contractual, because of its lack of fit with contract theory and with the basic principles of the legal system regarding what a contract is and what a contract is for.”  (Radin, Boilerplate, at 242)  This claim appears to be grounded in the vital role consent plays in contract theory.  I share the view that consent is vital to contracts, but I am less sure that boilerplate should be seen as non-contractual.

As Radin indicates, boilerplate involves a spectrum of cases.  At one end of the spectrum are the “sheer ignorance” cases.  In these circumstances, the hapless consumer discovers after the fact that he or she is supposed to have entered a contract.  Yet the consumer has no idea that this was happening at the time the contract was supposedly entered into.  (Id. at 21-23)  A good example is a purported agreement which states, at the bottom of the page, “‘Upon reading this page, you agree to be bound by these terms and conditions.’”  (Id. at 13)  There is no ready way to square these cases with standard views of consent, and I entirely agree with Radin that they are problematic.  It is questionable whether they should properly be called contracts.  With that in mind, let’s bracket the sheer ignorance cases.

BoilerplateSuppose, instead, that we consider another case – the online consumer who has been presented with detailed terms and clicked “I agree,” thus purportedly entering into a boilerplate contract.  Very often, the consumer has not read the terms when clicking “I agree,” and would not fully understand them if they had been read.  This is apparently not a sheer ignorance case as Radin defines that category.  Can these cases be understood in terms of contractual consent?  Maybe not, if consent means informed consent.  At times, Radin seems to mean informed consent, as when she suggests that information asymmetry would render it problematic to assimilate clicking “I agree” to what she calls “the ordinary conception of consent”.  (Id. at 25)  Yet it is highly debatable whether consent means informed consent, outside of those limited areas in which the law goes out of its way to insist on informed consent (e.g., the provision of medical services).  And there is no indication that contract theory relies on the idea of informed consent as it is usually applied.

Assuming informed consent is not the standard, there are a variety of fact patterns which suggest that clicking “I agree” can implicate consent.  Randy Barnett has offered a compelling example of this type.  He describes a promise based on a sealed envelope:

Suppose I say to my dearest friend, “Whatever it is you want me to do, write it down and put it into a sealed envelope, and I will do it for you.”  Is it categorically impossible to make such a promise?  Is there something incoherent about committing oneself to perform an act the nature of which one does not know and will only learn later?

(Randy E. Barnett, Consenting to Form Contracts, 71 Fordham L. Rev. 627, 636 (2002).)  This is a quite plausible case of consent – full-fledged consent – and this would be so even if consent is understood in subjective terms.  It also has important implications for the present inquiry.  It suggests that not knowing precisely what one has consented to is not a per se bar to consent.

Barnett recognizes an important limit on the envelope example.  There are cases where a promisor could reasonably say: “‘while I did agree to be bound by terms I did not read, I did not agree to that.’”  (Id. at 637)  Radically unexpected terms would not have been consented to in a case like the envelope case.  A similar limit seems to apply in the case of clicking “I agree” with respect to unread boilerplate.

Radin raises several concerns with a focus on expectations.  She suggests that expectation-based approaches will not make for a predictable jurisprudence.  (Radin, supra, at 85)  That may be right, although this is an empirical question.  But the possibility that courts are not institutionally well-situated to assess the unexpectedness of contract terms is not an argument that addresses the conceptual question at issue.  It does not tell us whether we have consent for contract theory purposes.  Instead, it is an institutional argument regarding good legal policy.

Another response draws our attention to the distinction between empirical expectations and a separate category, normative expectations.  The argument here is that we have an ambiguity between expectations as they may exist among contracting parties (the empirical kind), and expectations in the sense of “the just practices that a citizen has a right to expect” (the normative kind).  (Id.)  There are notable and interesting differences between the two types of expectations, and the book offers important insights by drawing our attention to this issue.  In fact, I’m sympathetic to Radin’s concern that empirical and normative expectations can be mixed together in contracts jurisprudence.  Courts may look to either sense of expectations, and the jurisprudence may become unpredictable.  But again, this concern does not tell us whether we have consent for contract theory purposes.  This too is an argument regarding good legal policy.

Radin also offers a further argument concerning the different views on contractual consent.  She suggests that the meaning of clicking “I agree” is “more analogous to a contested concept.”  (Id. at 90)  This could raise doubts as to which terms parties have consented to.  It could also raise doubts that any consent exists at all.  The two situations need not coincide.  While the scope of consent could be very uncertain as a matter of objective meaning, this may not mean that people who click on “I agree” have no idea they are agreeing to anything at all.  Whether there is any recognized objective meaning to clicking “I agree” is again an empirical question, and it may vary by community.  Depending on context, I suspect that if you ask online consumers whether they have agreed to anything after clicking “I agree” when confronted by a list of terms, many would think they had agreed to something.  (Of course, it might be something far less than the content which the firm would hope to cover with their contract!)

None of this is to say that Radin is wrong in her policy prescriptions.  My concern, as noted at the outset, is conceptual.  Once we bracket sheer ignorance cases, it is far from clear that mass-market boilerplate falls outside of the consent requirement that underpins much contract theory.  Radin has many other reasons to suggest changes to our legal regime, and I am hopeful that her work will trigger further discussion of the concerns she raises.  Yet it is one thing to say that boilerplate should be regulated in various ways, and another thing altogether to say that it is not contractual.  With that caveat, this book draws our attention to a variety of important consent-related problems.  Boilerplate is a very important contribution to existing debates, and it should be read by anyone interested in understanding the current state of contract law and its potential for reform.

[Posted, on Andrew Gold's behalf, by JT]

May 14, 2013 in Books, Commentary, Recent Scholarship | Permalink | Comments (1) | TrackBack (0)

Boilerplate Symposium II: Theresa Amato on Remedies to the Problems Posed by Boilerplate

Amato

This is the second in a series of posts reviewing Margaret Jane Radin's Boilerplate: The Fine Print, Vanishing Rights and the Rule of Law.

Theresa Amato, a public interest lawyer, is the executive director of Citizen Works, and the director of the Fair Contracts Project (faircontracts.org).

Professor Radin’s masterpiece Boilerplate sets forth the intellectual underpinnings for an energetic movement to correct the imbalance of power between corporations and consumers in fine print contracts.  Her explanations of the degradation of consent and the resulting diminishment of the rule of law should incite all those who read it to not merely nod in accord, but to take action.   

Radin calls for a new legal way to analyze the boilerplate that she painstakingly shows fails to merit the term “contract” —and therefore should not be evaluated under contract law.  Instead, she suggests we evaluate these mice-print monstrosities as a product itself that can cause harm.  The boilerplate should be considered a potential inflictor of consumer harm through massive “rights deletion,” or “rights strip mining,” as Ralph Nader says, and thus should be addressed in tort, or under a new legal rubric altogether.  This bold suggestion alone elevates the book to compulsory reading as most academic articles tend only to set forth descriptions and analyses of the epic failure of the disclosure regulatory paradigm, but then fall short on solutions and action. 

In both academia and consumer advocacy, far too few people are focused on solving the problem—to create remedies beyond studying the problem or treating its symptoms in a legal aid, case-by-case manner.  Though there may be disagreement on the exact contours or how to solve the problems of boilerplate, there does seem to be some movement in recognition, at least, that there is a problem in need of solution.  

A survey of the academia and advocacy landscape reveals:

  • The fine print qua fine print has grown longer and mutates more frequently, as NYU School of Law Professor Florencia Marotta-Wurgler has documented, for example, with on-line contracts;
  • Businesses are not self-policing on boilerplate, or making market corrections for the consumer’s benefit.  To the contrary, recent Supreme Court decisions have spurred rights-reducing action, by sanctioning, for example, mandatory arbitration and class action waivers;
  • Consumer abuses in fine print will not be solved with financial literacy courses and by blaming consumers for not reading unilaterally-imposed contracts, which they cannot understand if they do, and then don’t necessarily use to make decisions, as Loyola Law School Los Angeles Professor Lauren Willis and others have ably documented;
  • Despite decades of computer use, inadequate corporate transparency regulation means that in many industries terms of service are still not online; it is often difficult to obtain copies of the contracts—until after becoming a customer for the underlying product or service.   This has the additional potential to skew academic research to on line industries, and not necessarily where some of the gravest rights-reducing behavior may exist, e.g., in harder-to-obtain nursing home or employment contracts.
  • The judiciary applies antiquated tenets of contract law—in a legal fiction—that upholds abusive provisions in a case-by-case unconscionability analysis, primarily enforcing them by continuing to place the outdated “duty to read” on consumers, including those who patently cannot.  Consumers face a curtailed potential for redress, especially when coupled with disappearing class action potential. 
  • Federal and state agencies to date have not allocated significant resources for a much needed focus on the corporate fine print—not even at the bully pulpit level—nor have they posited suitable alternatives.   
  • Instead of Congress doling out more regulatory authority to agencies (as they did with the CFPB and the SEC and as they should to help fix this), for example, members continue to contest the CFPB, have failed to grant the Federal Trade Commission Administrative Procedures Act rulemaking authority, leaving it hamstrung, and have failed to hold hearings on the widespread abuses of boilerplate affecting tens of millions of Americans daily.     

Boilerplate
We at Fair Contracts believe that there should be greater focus on seeking a systemic, upstream solution to boilerplate.  Though some would hang their hats on piecemeal “improved disclosure” as a least invasive means of correction, such a course of action alone is tepid and wholly inadequate to the serious problems documented by Radin and others.  

Nor must we only wait for the next glacial restatement of contract law, or a revolution of contract theory that reverses the legal presumption of enforcement of harmful contract terms, or a different way to analyze the legality of fine print contracts, including treating them as torts as all of these are definitely long, long, long-run solutions.

Intermediary, if admittedly only partial, remedial steps exist that we should explore for innovation that could lead to a better future for consumers, including: 

  • Dramatic elevation of public awareness of the rights removal hazards contained within the fine print, with a multi-pronged education and media campaign;
  • Significant increases in data collection of contracts and scholarship across multiple industries, with more empirical research to ascertain the prevalence of harmful consumer provisions, their collusive origins, and their negative economic consequences, with examples of how consumer harm is caused to large categories of people who forfeit their rights without knowledge of doing so; 
  • Promulgation of a model set of principles for provisions within, and reform of, the fine print;
  • Outright legislative and regulatory bans (or workarounds – through ombudsman consumer review boards) on contract provisions that undermine the rule of law, fair competition and democracy, including the deprivation of consumers of the civil justice system and their First Amendment rights,  vendor assertions of no accountability (thus allowing contract law to eat tort law alive) and consumer disadvantageous unilateral modification powers; 
  • Development of model state and federal legislation to ensure a fair regulatory playing-field;
  • Development of a “fair trade” or “hypoallergenic” or “green-star energy-efficient”-type seal that does not necessarily signal a “fair contract” but does signal the absence of a known set of provisions that reduce consumer rights for those consumers who care about them, which should be most if the educational goals were attained, and thus obviate the need to read through the fine print for at least that standardized set of terms symbolized by the seal.  This would permit consumers an actual market within which to shop, should government fail to act to preserve their rights; and  
  • Studying the consequences from other countries which are ahead in consumer protection.  There is a reason that the EU black and grey lists terms, as does Australia:  They are unfair to consumers and their governments do not let corporations dictate all the terms, rewriting and undermining in a private ordering those public policies passed as legislation.  In early April 2013, The Consumer Council of Hong Kong urged businesses to produce short and simple contracts that eliminate unfair terms and is starting to provide model contracts.  See: http://www.consumer.org.hk/website/ws_en/competition_issues/policy_position/2012040301.print

We should be debating these matters in the United States. We need an organized consumer constituency to reverse the contract peonage so reform efforts may gain the momentum needed to create alternatives to the unilateral, corporate-dictated status quo. 

[Posted, on Theresa Amato's behalf, by JT]

May 14, 2013 in Books, Commentary, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Monday, May 13, 2013

Boilerplate Symposium I: Peter Alces on Consent

AlcesThis is the first in a series of posts reviewing Margaret Jane Radin's  Boilerplate: The Fine Print, Vanishing Rights and the Rule of Law.

Peter A. Alces, Rollins Professor of Law and Cabell Research Professor of Law, The College of William & Mary School of Law

 In this fine book, Margaret Jane Radin concludes that “consent” lacks a reality referent in contract.  That is, somewhere between what she describes as  “World A (Agreement),” the universe of enforceable promises negotiated “at arms’ length” by parties of similar relative sophistication, and “World B (Boilerplate),” where standard and oppressive terms effect normative and democratic degradation, consent is lost.  This conclusion is not shocking; it is difficult to think of anyone (probably including even Randy Barnett) who honestly believes that real consent has very much to do with most (even virtually all) contracting these days.  So we can all agree: where there is boilerplate, there is no “meaningful” consent, which is to say there is none of the consent that should matter to contract.  From that premise, Professor Radin concludes that World B is not a contracts universe at all, but is instead a realm better understood by reference to tort principles (and it is even worse than Grant Gilmore ever imagined).

Boilerplate But once we acknowledge the death of consent, how much more new is there to say about boilerplate?  You could despair with Professor Radin that political forces make it unlikely that the American justice system will respond as would the European Union; that consequentialist apologists rely on arm chair empirical assumptions without actually doing the necessary math; that by a 5-4 decision of the United States Supreme Court the Federal Arbitration Act has been contorted to undermine our justice system; that a curiously reasoned decision of the United States Court of Appeals for the Seventh Circuit has somehow become the prevailing (if not final) word on contract formation: but at the end of the day, it is difficult to identify certainly  the extent of the harm or glimpse a viable cure.  (Those troubled by boilerplate need to do the same math they complain form contracts proponents fail to do.)

While Professor Radin is right that there are distinguishable Worlds of contract, she does not make clear enough that the two Worlds are on a continuum; they are not so clearly dichotomous.  Further, the contours of the continuum are obscure: many very sophisticated people know quite well what they are giving up when they sign a form contract or click “I agree," and yet do so willingly.  That is generally the rational thing to do.  Now Boilerplate does put boilerplate on a three dimensional matrix that would be sensitive to degrees of consent, alienability of the right in issue, and the size of the cohort prejudiced.  But in describing Worlds A and B in dichotomous terms, the book may obscure the reasons why it remains rational to agree to form contracts, without reading their terms.  So I think the book would have been stronger had it described Worlds A and B along a fourth dimension. 

What Professor Radin has to say about consent is surely true, but what she says is really a truism: we know that consent is a conclusion rather than an analytical device, and that consent is also a term of art, largely divorced from the important normative work it can do in World A.  What we do not know, though, is when World A becomes World B: it is not just the case that all form contracts are World B contracts.  Whether a contract is World A or World B is a function of the very factors that contract doctrine could take seriously, if the composition of the Supreme Court were different, and if all Federal Courts of Appeal judges knew a bit more about the common law of contract and the UCC.

[Posted, on Peter Alces's behalf, by JT]

May 13, 2013 in Books, Contract Profs, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Boilerplate Symposium: The First Five

RadinWe begin our online symposium on Margaret Jane Radin's book, Boilerplate: The Fine Print, Vanishing Rights and the Rule of Law with five posts this week.  This post will serve to introduce our guest bloggers.

Peter A. Alces is the Rollins Professor of Law and Cabell Research Professor of Law at the College of William & Mary School of Law, where he has taught since 1991.  He is the author of A Theory of Contract Law: Empirical Insights and Moral Psychology; Commercial ContractingThe Law of Suretyship and GuarantyBankruptcy: Cases and MaterialsCases, Problems and Materials on Payment SystemsThe Commercial Law of Intellectual PropertySales, Leases and Bulk TransfersThe Law of Fraudulent Transactions; and Uniform Commercial Code Transactions Guide. He has also published  articles in the Northwestern, Michigan, Minnesota, Illinois, North Carolina, Fordham, California, Texas, and William and Mary Law Reviews, and the Emory, Ohio State and Georgetown Law Journals. 

Theresa Amato is the executive director Citizen Works which she started with Ralph Nader in 2001. After earning her degrees from Harvard University and the New York University School of Law, where she was a Root-Tilden Scholar, Amato clerked in the Southern District of New York for the Honorable Robert W. Sweet. She was a consultant to the Lawyers Committee for Human Rights (Human Rights First) and wrote an influential human rights report on child canecutters in Haiti and the Dominican Republic. She then became the youngest litigator at Public Citizen Litigation Group, where she was the Director of the Freedom of Information Clearinghouse in Washington D.C.  In 1993, Amato founded the nationally-recognized, Illinois-based Citizen Advocacy Center and served as its executive director for eight years. She currently serves as its Board President.  Most recently, she has launched Fair Contracts.org to reform the fine print in standard form contracts.  In 2009, The New Press (New York) published her book, Grand Illusion: The Myth of Voter Choice in a Two-Party Tyranny.  She also appears prominently in the Sundance-selected and Academy Awards short-listed documentary “An Unreasonable Man.”  

BoilerplateAndrew Gold is a professor of law at the Depaul University College of law.  His primary research interests address legal theory and the law of corporations. Following graduation from Duke University School of Law, he clerked with the Honorable Daniel Manion of the Seventh Circuit, and with the Honorable Loren Smith of the Court of Federal Claims. After his clerkships, he joined Skadden, Arps, Slate, Meagher & Flom, where he practiced corporate litigation. Professor Gold's article, "A Property Theory of Contract," was lead article in the 2009 volume of the Northwestern University Law Review. His recent publications also include articles in the William and Mary, U.C. Davis, and Maryland law reviews. In 2007, Professor Gold received the College of Law's Award for Excellence in Scholarship, and, in 2010, he received the Award for Excellence in Teaching. During the 2011-2012 academic year, Professor Gold was a Visiting Scholar at Harvard Law School, and in Fall 2011, he was an HLA Hart Visiting Fellow at the University of Oxford. His scholarship has focused on contract theory; private law theory; fiduciary duties in corporate law; and Section 10(b) of the Securities Exchange Act.

David Horton joined the UC Davis faculty in 2012, after three years at Loyola Law School, Los Angeles.  He received his B.A. cum laude from Carleton College in 1997 and his J.D. from UCLA School of Law in 2004.  At UCLA, he was elected to the Order of the Coif and served as Chief Articles Editor of the UCLA Law Review.  He then practiced at Morrison & Foerster in San Francisco and clerked for the Honorable Ronald M. Whyte of the United States District Court for the Northern District of California.  From 2007 to 2009, he taught legal research and writing at UC Berkeley School of Law.  Horton’s research focuses on wills and trusts, federal arbitration law, and contracts.  His recent work has appeared or will soon appear in the NYU Law Review, Northwestern University Law Review, Georgetown Law Journal, UCLA Law Review, Notre Dame Law Review, North Carolina Law ReviewUniversity of Colorado Law Review, and Virginia Law Review in Brief, among others.  He also wrote an amicus brief on behalf of contracts professors in AT&T Mobility LLC v. Concepcion, the recent Supreme Court case. 

Ethan J. Leib is a noted expert in constitutional law, legislation, and contracts.  His most recent book, Friend v. Friend: Friendships and What, If Anything, the Law Should Do About Them (2011), explores the benefits of legal recognition of friendship and was published by Oxford University Press.  He has three forthcoming articles on public law subjects: one in the Journal of Political Philosophy examining fiduciary principles in political representation; one in the California Law Review applying the fiduciary principle to the activity of judging within democracies; and one in The University of Chicago Law Review exploring whether elected judges should be interpreting statutes differently from their appointed colleagues.  Leib's other academic writing has appeared in journals such as the Yale Law Journal, Northwestern University Law Review, UCLA Law Review, Constitutional Commentary, Election Law Journal, Journal of Legal Education, Law & Philosophy, and elsewhere.  He has also written for a broader audience in the New York Times, USA Today, SF Chronicle, Policy Review,Washington Post, New York Law Journal, The American Scholar, and The New Republic.  Before joining Fordham, Leib was a Professor of Law at the University of California–Hastings.  He has served as a Law Clerk to Chief Judge John M. Walker, Jr., of the U.S. Court of Appeals for the Second Circuit and as an Associate at Debevoise & Plimpton LLP in New York.

We look forward to a stimulating fortnight of exchanges on this important new book.

[JT]

May 13, 2013 in About this Blog, Books, Commentary, Contract Profs, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)