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What’s Morality Got To Do With It?

Responding to Seana Valentine Shiffrin, The Divergence of Contract and Promise, 120 Harv. L. Rev. 708 (2007)

I have my doubts about Professor Shiffrin’s view of what minimal moral virtue requires in the promissory realm. I have doubts as well that Professor Shiffrin has adequately dispatched the “separatist” objection that the morality of promising (mostly formulated in the context of gratuitous promises in the personal realm) has limited relevance to moral and legal norms in arm’s-length contracts. At any rate, I think a lot more work needs to be done to convince skeptics (of whom I am one) that these enterprises are bound together by more than a pun on the word “promise.”

These disagreements will have to wait for another day. For now, I want to take on board Professor Shiffrin’s view of promissory morality and its relevance to the law of contracts, in order to pursue a different concern: whether what she perceives to be a moral failing of contract law might not reduce to mundane problems of contract formation (did the parties know what they were agreeing to?) and interpretation (what exactly were they agreeing to?).

It seems to me two very different things could be bothering Professor Shiffrin. The first is the worry that the typical individual does not understand most of the collateral terms in the contracts he signs. This is a legitimate and serious concern, particularly when the terms are supplied by unstated default rules to which the parties’ consent is inferred from their silence. When the average homeowner hires a carpenter to build bookshelves pursuant to a verbal contract that specifies nothing about performance standards and remedies, does she really understand that the carpenter’s obligation to give her what she bargained for — bookshelves built to her specifications — is implicitly limited to expectation damages, which are themselves limited by the substantial performance rule, the Hadley rule, inability to collect for hard-to-quantify losses, etc.? If this is indeed what is bothering Professor Shiffrin, it is a very different problem from the one raised by her Article. This problem has nothing to do with the substantive terms of contract law, default or mandatory. It is a garden-variety (albeit serious) procedural problem that is wholly internal to existing contract law: when should apparent consent to stated and implied terms be treated as binding?

The second possibility is that Professor Shiffrin does not really believe it is sufficient for the law to accommodate the morally virtuous act; at least in some cases it must mandate it. In short, perhaps she is a reflectivist after all. While her Article is equivocal on this point, Professor Shiffrin seems to suggest that moral virtue requires that some principles be made nonwaivable. Among those are the principle that breach is “impermissible as opposed to merely subject to a price”; and that illusory promises (that is, promissory noises that in fact bind the speaker to nothing) are morally wrong.