Let Us Never Blame a Contract Breaker

Posner, Richard A.

doi:10.1017/cbo9780511780097.002

Cited by 18 publications

(23 citation statements)

References 7 publications

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“…The majority of subjects consistently selected "not immoral" in all different types of contingencies in which the promisor decided to breach but compensated the promisee for loss of expectancy. This result serves as evidence that most people perceive the moral value of breach of contract in a manner that is compatible with the Holmesian theory of the contractual obligation (Holmes 1881(Holmes :299, 1897Posner 2009;Markovits & Schwarz 2011).…”

Section: Introductionsupporting

confidence: 71%

“…The primary duty to perform has no "mystical significance," and "[t]he only universal consequence of a legally binding promise is, that the law makes the promisor pay damages if the promised event does not come to pass" (Holmes 1881:266). When a person enters into a contract in which she promises to perform, then this person has an option to perform or to pay damages (Posner 2009(Posner :1350.…”

Section: The Holmesian Theory Of the Contractual Obligationmentioning

confidence: 99%

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Morality, Compensation, and the Contractual Obligation

Mittlaender

2016

SSRN Journal

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This article presents empirical estimates suggesting that most people do not perceive breach of contract followed by compensation for the promisee as immoral. In the absence of compensation, the article reveals that individuals commonly perceive the moral value of breach depending on the consequences thereof, with the unfairness of the outcome-and not the inefficiency-as the preponderant factor. Contract law reflects observed interpersonal morality and allows courts to rescind the contract on grounds of impossibility, impracticability, or frustration if the breach is fair and the promisor avoids exceptionally high losses, but not if the breach is unfair and the promisor breaches to profit from a substitutive transaction. The law, moreover, does not punish breach, nor inevitably require performance by the promisor, but instead aims at compensating the victim, thereby reflecting how most individuals perceive breach followed by compensation, from a normative standpoint: as not morally wrong.

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Section: Introductionsupporting

confidence: 71%

Section: The Holmesian Theory Of the Contractual Obligationmentioning

confidence: 99%

Morality, Compensation, and the Contractual Obligation

Mittlaender

2016

SSRN Journal

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show abstract

“…The primary duty to perform has no “mystical significance,” and “[t]he only universal consequence of a legally binding promise is, that the law makes the promisor pay damages if the promised event does not come to pass” (Holmes :266). When a person enters into a contract in which she promises to perform, then this person has an option to perform or to pay damages (Posner :1350).…”

Section: Theories Of Contract and Of The Immorality Of Breachmentioning

confidence: 99%

“…If you do not do so, but pay fully compensatory damages, then you also fulfill the obligation. In both cases, no blame can be attributed to the promisor, for the promisor does not breach the obligation (Posner ; Markovits & Schwartz ). Breach of the contractual obligation occurs only when the promisor does not undertake the promised action and does not compensate the promisee.…”

Section: Theories Of Contract and Of The Immorality Of Breachmentioning

confidence: 99%

Morality, Compensation, and the Contractual Obligation

Mittlaender¹

2019

J Empirical Legal Studies

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This article presents empirical estimates suggesting that most people do not perceive breach of contract followed by compensation for the promisee as immoral. In the absence of compensation, the article reveals that individuals commonly perceive the moral value of breach depending on the consequences thereof, with the unfairness of the outcome—and not the inefficiency—as the preponderant factor. Contract law reflects observed interpersonal morality and allows courts to rescind the contract on grounds of impossibility, impracticability, or frustration if the breach is fair and the promisor avoids exceptionally high losses, but not if the breach is unfair and the promisor breaches to profit from a substitutive transaction. The law, moreover, does not punish breach, nor inevitably require performance by the promisor, but instead aims at compensating the victim, thereby reflecting how most individuals perceive breach followed by compensation, from a normative standpoint: as not morally wrong.

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“…A distinct objection to deterrence‐based arguments for profit‐stripping (as well as to arguments based on ‘desert’) contests the very notion that contractual breach is a ‘wrong’ which the law should seek to prevent (or ‘punish’). The conventional view is that a breach of contract is a ‘wrong’ because it constitutes a violation of the legal duty to perform a contractual undertaking. But some argue that not all breaches of contract are ‘wrongful’ on the basis that contractual undertakings do not always create a legal duty to perform.…”

Section: The Justification For Disgorgement Damagesmentioning

confidence: 99%

Contract Theory and Gain‐Based Recovery

Winterton¹

2013

Modern Law Review

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Let Us Never Blame a Contract Breaker

Cited by 18 publications

References 7 publications

Morality, Compensation, and the Contractual Obligation

Morality, Compensation, and the Contractual Obligation

Morality, Compensation, and the Contractual Obligation

Contract Theory and Gain‐Based Recovery

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