Prerequisite: Contracts

Exam Type: No Exam

The seminar will focus on third parties in the law of contracts, commercial transactions, and private law more broadly. A central focus will be the classical “privity” principle in contract, which says that the rights and duties created by a contract are incurred only by those who are privy to it, that is, by the actual parties. In an economy marked by indirect and long-distance contacts, however, the question has often arisen whether third parties should be denied rights, or relieved of duties, merely due to the absence of a private contractual link to others with whom they are connected in other significant ways. This will lead us to study doctrines pertaining to some of the following topics: third party beneficiaries; assignment and delegation; negotiable instruments (and bills of exchange); suretyship; letters of credit; claims in bankruptcy (common debtor, multiple competing creditors); tortious interference with contractual relations; and claims in negligence for pure economic loss. Special attention will be given to the triangular nature of certain conflicts, and to the influence of the legal realists (including Holmes, Karl Llewellyn and Grant Gilmore) on the development of the law. While the emphasis will be on first principles and historical landmarks, we will also strive to consider recent developments that lend support to the claim that the law’s commitment to privity is “one that dies hard.”

In lieu of an exam or research paper, students will be required to write weekly reaction papers.