What We Consent to When We Consent to Form Contracts: Market Price

Abstract

Contracts require consent, yet no one reads form contracts. So what do we consent to when we consent to form contracts? Scholarly answers to this question range from “we consent to everything but the radically unexpected” to “we consent to nothing but the specifically negotiated.” This essay offers a new answer: when we consent to form contracts we consent to pay market price.

Part I of this essay discusses Randy Barnett’s argument that consent to form contracts is consent to be legally bound, which raises the question of whether there are any limits on what can be consented to via form contract. Part II discusses Carnival Cruise Lines v. Shute as illustrative of Barnett’s theory and argues that Carnival’s approach should be rejected. Part III of this essay argues that consent to form contracts should be construed as consent to pay market price.

Keywords: Consent, Assent, Form Contracts, Standard Form Contracts, Contracts of Adhesion, Market Price, Randy Barnett, James Gordley, Aquinas, Carnival Cruise Lines, Shute, Equal Exchange, Bounded Rationality, Rolling Contracts, Behavioral Economics, Just Price, Commutative Justice

JEL Classification: J12