Exam Type: In Class

Contracts are an important type of “private” law. Many contracts arise due to gains from trade owing to differences in (i) resources, (ii) valuation, (iii) expectations, (iv) risk-bearing abilities, and (v) production abilities (from economies of scale, special skills, and specialization and division of labor), and complementarities among those abilities. Other contracts respond to issues, restrictions, obligations or entitlements arising from other laws, such as licenses, disclaimers, settlements, formal requirements, and non-disclosure agreements. Lawyers play crucial roles in crafting contracts and structuring complex projects, linking “suites” of contracts to coordinate multiple parties over time, against background regulation and contract law. Courts and legislatures interact to produce and redirect common law of contract and specialized rules and standards for subtypes of contracts, which evolve over time and vary across jurisdictions, and in contract settings. To do so, they pursue three general goals simultaneously: (1) enhancing welfare of contract parties (or classes of parties), (2) respecting morality (particularly aspects of individual autonomy, but also limits of autonomy), and (3) minimizing costs of administration. Remedies are central, as well as limits on remedies, with courts inevitably developing and applying public policies due to the common need to find, construct and remedy breaches of contracts.