"The Contract Frontier: A Study of the Modern Joint Venture" Free Download

SARATH SANGA, University of California, Berkeley

How can corporations be competitors and partners at the same time? This is the dilemma of the corporate joint venture. I argue that the key legal challenge facing corporate co-venturers is to construct a coherent set of fiduciary duties among the corporate partners. This paper makes three contributions.

First, the paper shows that the default fiduciary duties of corporate joint ventures conflict. This fact --- that the law itself creates a conflict --- has not been previously recognized by the literature. The paper then presents a theory of how corporations respond to this fiduciary conflict: Corporations (1) alter the default loyalty duties through a covenant not to compete (CNC) and then (2) avoid conflicts by operating the venture through a separate entity. This theory thus offers a new role for both CNCs and entities.

Second, this contractual response is actually quite fragile because states vary considerably to the extent they (1) are willing to enforce covenants not to compete and (2) permit partners to alter their fiduciary duties. The paper offers a policy recommendation in light of these enforcement problems: an internal affairs doctrine for corporate joint ventures.

Finally, the paper details the existence of joint venture networks. These networks further compound fiduciary conflicts and require us to update both competition policy and the theory of the firm.

"Rethinking Contractual Choice of Law: An Analysis of Relation Syndrome" Free Download

MO ZHANG, Temple University - James E. Beasley School of Law

The doctrine of contractual choice of law provides the parties with the power to select the law that governs their business or other private activities crossing jurisdictional boundaries. An issue facing the choice is whether the law chosen by the parties must bear certain relation between the enacting state or country and the parties, transactions or disputes. In the United States, such relation is required in order for the chosen law to become enforceable, but elsewhere in the world, the relation is not essential to the choice of law by the parties.

In 2001, as part of their initiative to have a broader reform, the American Law Institute and the National Conference of Commissioner on Uniform State Laws attempted to replace U.C.C. §1-105 with §1-301. The major change was the deletion of the “reasonable relation? requirement for contractual choice of law. The replacement was considered as a necessary step in the reform, and it was also deemed as an effort to align the U.C.C. with the established international commercial practices. Unfortunately, however, the attempt failed. As a result, the contractual choice of law in the United States remains significantly at odds with the international trends.

This article argues that it is conceptually problematic to insist on the relation requirement for the contractual choice of law because such requirement is not only rooted in the misunderstanding of the very nature of the parties’ autonomy in choice of law, but also derived from the undue concerns about state interests. Also as a practical matter, the relation requirement often situates American businesses in a dilemma when they deal with their international counterparts on the choice of law. The failure of the U.C.C. §1-301 revision reflects the persisting hostility in the U. S. towards the power of the parties to select governing law, and also evidences the gap between the U.S. and many other countries in the conflict of laws. The article concludes that both the parties and the states involved would be better off without relation requirement in contractual choice of law.

"Bitcoin and the Uniform Commercial Code" Free Download
Cardozo Legal Studies Research Paper No. 458

JEANNE L. SCHROEDER, Yeshiva University - Benjamin N. Cardozo School of Law

Much of the discussion of bitcoin in the popular press has concentrated on its status as a currency. Putting aside a vocal minority of radical libertarians and anarchists, however, many bitcoin enthusiasts are concentrating on how its underlying technology – the blockchain – can be put to use for wide variety of uses. For example, economists at the Fed and other central banks have suggested that they should encourage the evolution of bitcoin’s blockchain protocol which might allow financial transactions to clear much efficiently than under our current systems. As such, it also holds out the possibility of becoming that holy grail of commerce – a payment system that would eliminate or minimize the roles of third party intermediaries. In addition, the NASDAQ and a number of issuers are experimenting with using the blockchain to record the issuing and trading of investments securities.

In this Article, I examine the implications for bitcoin under the Uniform Commercial Code (the “U.C.C.?). Specifically, I consider three issues. In Part 1, I discuss the characterization of bitcoin – which I am using generically to refer to any virtual or cryptocurrency – under Article 9. The bad news is that it does not, and cannot be made to fit into, the U.C.C.’s definition of “money?. If held directly by the owner, bitcoin constitutes a “general intangible?. Unfortunately, general intangibles are non-negotiable. This could greatly impinge on bitcoin’s liquidity and, therefore, its utility as a payment system.

In Part 2, I show how this may be mitigated by the rules of Article 8 governing investment securities. If the owner of bitcoin were to choose to hold it indirectly through a financial intermediary, then she and the intermediary could elect to have it treated as a “financial asset? which is super-negotiable. Unfortunately, this comes at the cost of eliminating one of the primary attractions of cryptocurrency, namely the ability to engage in financial transactions directly without a third-party intermediary. However, Article 8, may already provide a legal regime for another contemplated use for the blockchain – namely as a readily searchable means of recording the ownership and transfer of property generally.

In Part 3, I explain how cryptosecurities fall squarely within Article 8's definition of “uncertificated securities.? Ironically, therefore, the creation of bitcoin securities may finally breathe life to little used provisions that were invented almost 40 years ago in a failed attempt to solve a completely different problem.

"Wrap Contracting and the Online Environment: Causes and Cures" Free Download
RESEARCH HANDBOOK ON ELECTRONIC COMMERCE LAW (ed. John A. Rothchild, Edward Elgar Publishing, 2016, Forthcoming)

NANCY S. KIM, California Western School of Law

This chapter explores the origins of online contracts and the development of the law in this area. It summarizes and analyzes existing case law governing wrap contracts and makes several proposals.

"LEADR/Victoria University Commercial Mediation in New Zealand Project Report (June 2015)" Free Download

GRANT HAMILTON MORRIS, Victoria University of Wellington - Faculty of Law

This report delivers the results from the first project to systematically explore commercial mediation in NZ. A key aim of this project is to move the study of commercial mediation in NZ from anecdote to evidence. There has been a lot of talk about the growing importance of commercial mediation in NZ but no empirical evidence to support the claims. This information vacuum weakens the mediation profession’s efforts to effectively promote mediation for commercial disputes. It also leaves the profession vulnerable to criticism from those suspicious of mediation i.e. it is difficult to rebut criticism without convincing evidence.

Specific research questions covered in the project include:

How much commercial mediation is taking place?

What styles of mediation are being used in commercial disputes?

How effective is this mediation?

Who is carrying out commercial mediation? Where is it happening?

How can the use of commercial mediation be increased and encouraged?

What are the key challenges facing commercial mediation?

Relevant written sources have been analysed and individual mediators surveyed and interviewed regarding the nature of their work. Along with providing an overview of NZ’s commercial mediation landscape the project will hopefully stimulate further research into this area of mediation practice. This report assesses the current state of commercial mediation in NZ and offer predictions for the future.


About this eJournal

This eJournal distributes working and accepted paper abstracts dealing with contracts and commercial law. This includes papers and articles dealing with all aspects of contract law and all articles of the UCC, including commercial paper and secured transactions.

Editor: George G. Triantis, Stanford Law School


To submit your research to SSRN, sign in to the SSRN User HeadQuarters, click the My Papers link on left menu and then the Start New Submission button at top of page.

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Advisory Board

Contracts & Commercial Law eJournal

William K. Townsend Professor of Law, Yale University - Yale Law School, Yale University - Yale School of Management

Carmack Waterhouse Professor of Legal Theory, Georgetown University Law Center

Wilson-Dickinson Professor of Law, University of Chicago Law School

Max E. Greenberg Professor of Contract Law, New York University School of Law

Edwin H. Woodruff Professor of Law, Cornell Law School

Milton Handler Professor of Law, Columbia University - Law School

Leffmann Professor of Commercial Law; Senior Fellow, The Computation Institute of the University of Chicago and Argonne National Laboratory, University of Chicago - Law School

Sterling Professor of Law, Yale Law School

Professor and Chair in Law and Economics, University of Toronto - Faculty of Law

Leo E. Gottlieb Professor of Law, Harvard Law School