Table of Contents

Beyond the Real and the Paper Deal: The Quest for Contextual Coherence in Contractual Interpretation

Zhong Xing Tan, National University of Singapore (NUS) - Faculty of Law

Whither Remoteness? Wellesley Partners LLP v Withers LLP

Aaron Taylor, University of Oxford - Keble College

Revisiting the Rationality Assumption of Disclosure Laws: An Empirical Analysis

Uri Benoliel, “College of Law and Business
Jenny Buchan, UNSW Australia Business School, School of Taxation and Business Law, University of New South Wales
Tony Gutentag, Hebrew University of Jerusalem, Faculty of Social Sciences, Eliezer Kaplan School of Economics and Social Sciences, Department of Psychology, Students

Unfair Advantage – An Intriguing Example of Legal Transformation in the Swiss Private Law

Aleksander Maria Grebieniow, Romanistisches Institut

Suspensions, Debarments, and Sanctions: A Comparative Guide to United States and World Bank Exclusion Mechanisms

Nathaniel E. Castellano, George Washington University - Law School


CONTRACTS & COMMERCIAL LAW eJOURNAL

"Beyond the Real and the Paper Deal: The Quest for Contextual Coherence in Contractual Interpretation" Fee Download
The Modern Law Review, Vol. 79, Issue 4, pp. 623-654, 2016

ZHONG XING TAN, National University of Singapore (NUS) - Faculty of Law
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Contract lawyers are often divided between two schools of thought: formalism and contextualism. In the realm of contractual interpretation, this division illuminates various debates surrounding the modern contextual approach. Ultimately, however, the divide between the ‘real and the paper deal’ does not fully reflect the relevant fault lines. The real contest is between rival interpretations attempting to make the most coherent sense of the available text and context surrounding the document. In characterising the true nature of the exercise, I draw upon theories of coherence to articulate a framework of ‘contextual coherence’ that involves concepts of competing narratives, the rational motivations of the parties, and the need for a holistic assessment of the best hypothesis, in accordance with the English courts’ ‘iterative approach’ to interpretation. I demonstrate that this framework enables us to explain and evaluate recent cases such as the UK Supreme Court decision of Arnold v Britton.

"Whither Remoteness? Wellesley Partners LLP v Withers LLP" Fee Download
The Modern Law Review, Vol. 79, Issue 4, pp. 678-690, 2016

AARON TAYLOR, University of Oxford - Keble College

In Wellesley v Withers, the Court of Appeal held that where a defendant is concurrently liable in tort and contract, the contractual rules for the remoteness of loss must apply. Two principal reasons emerge from the judgments. The first, that each party has had the chance to alert the other to unusual risks, is valid but often unconvincing. The second is more original and compelling: that the nature of any responsibility assumed in tort is distinct from, but wholly defined by, the valid contract. This note seeks to develop that argument. It then addresses the uncertain issue of concurrent liability in equity. It suggests that in a case in which any fiduciary duties arise out of, and are defined by, a valid contract, it may now be appropriate to apply the contractual remoteness rules to a concurrent claim for breach of contract and equitable compensation.

"Revisiting the Rationality Assumption of Disclosure Laws: An Empirical Analysis" Free Download

URI BENOLIEL, “College of Law and Business
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JENNY BUCHAN, UNSW Australia Business School, School of Taxation and Business Law, University of New South Wales
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TONY GUTENTAG, Hebrew University of Jerusalem, Faculty of Social Sciences, Eliezer Kaplan School of Economics and Social Sciences, Department of Psychology, Students
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Disclosure laws are based on one central assumption: that disclosees are, by their very nature, rational actors. This article questions the validity of this theoretical assumption. The article empirically shows that franchisees, who are considered sophisticated disclosees, are unrealistically optimistic about disclosed risks.

In this empirical study, franchisees (N = 205) completed an online research questionnaire, in which they compared their own chances of experiencing disclosed risks with the chances of their colleagues. It was found that franchisees were optimistically biased. Franchisees believed that the chances that their franchisor might opportunistically terminate their franchise are significantly lower than that of an average franchisee in their chain and state.

The theoretical and practical implications of overconfidence in the franchise business are discussed.

"Unfair Advantage – An Intriguing Example of Legal Transformation in the Swiss Private Law" 
Fourth Biennial ESCLH Conference Culture, Identity and Legal Instrumentalism, June 28th – July 1st 2016

ALEKSANDER MARIA GREBIENIOW, Romanistisches Institut
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This paper demonstrates a mixed approach to the theme of the instrumentality of law by both analysing the goal of a legal transformation and the techniques adapted to achieve it. The correct recognition of a certain practical necessity has lead the Swiss Federal Tribunal to an intriguing judgement “Fussballclub Lohn-Fall? of 1997. The legal remedies provided for cases of unfair advantage have been then creatively modified praeter legem. The adaptation was strongly influenced by foreign legal patterns.

The Swiss Code of Obligations of 1911 provides a norm in art. 21 on unfair advantage (unconscionable contract), prescribing that if one party takes unjustified advantage over the weaknesses of another in order to receive an excessive benefit, such a contract is avoidable. Its wording has been shaped over a hundred years ago and still remains intact. However, over the course of the 20th century the necessity for a more efficient protection has arisen. The legal doctrine and jurisprudence were constantly pointing out the incompleteness of the remedies provided by art. 21 of the Code of Obligations. In the “Fussballclub Lohn-Fall? (BGE 123 III 292) the Swiss Federal Tribunal finally introduced the possibility to modify the contract. Its decision has been described as “a sign of the zeitgeist, spirit of the time?. It was the Swiss legal doctrine that has imposed the new measure under the influence of the German “quantitative Teilnichtigkeit? (quantitative partial nullity). The historical heritage of the Roman laesio enormis has also played its role.

"Suspensions, Debarments, and Sanctions: A Comparative Guide to United States and World Bank Exclusion Mechanisms" 
Public Contract law Journal, Vol. 45, No. 3, Pp. 403-448, 2016

NATHANIEL E. CASTELLANO, George Washington University - Law School
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Suspension and debarment are powerful, versatile legal tools for excluding contractors from competing in procurement markets. They have long been used as administrative remedies in the United States to avoid doing business with irresponsible contractors. The World Bank relies on them as means of sanctioning and deterring behavior that compromises the Bank's dual mandate of eliminating extreme poverty and increasing shared prosperity. Although both the U.S. and the World Bank sanctions systems use similar terminology of suspension and debarment and ultimately produce the same result of excluding contractors from procurement markets, these systems exist in very different institutional and legal contexts and were designed to achieve different objectives. This article provides comparative analysis of the U.S. suspension and debarment system and the World Bank's sanctions system. It then explains what U.S. contractors need to know in order to mitigate the risk of being excluded from Bank-financed contracts.

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Contracts & Commercial Law eJournal

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

RANDY E. BARNETT
Carmack Waterhouse Professor of Legal Theory, Georgetown University Law Center

LISA E. BERNSTEIN
Wilson-Dickinson Professor of Law, University of Chicago - Law School

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

ROBERT A. HILLMAN
Edwin H. Woodruff Professor of Law, Cornell Law School

AVERY W. KATZ
Milton Handler Professor of Law, Columbia University - Law School

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

ALAN SCHWARTZ
Sterling Professor of Law, Yale Law School

MICHAEL J. TREBILCOCK
Professor and Chair in Law and Economics, University of Toronto - Faculty of Law

ELIZABETH WARREN
Leo E. Gottlieb Professor of Law, Harvard Law School