Form & Substance in Nancy Kim's Wrap Contracts

19 Pages Posted: 5 Sep 2014

Date Written: July 25, 2014

Abstract

Nancy Kim’s book, Wrap Contracts, is ambitious and well worth reading. Kim coins the term “wrap contracts” to expose, explain and demystify the world of mostly online contracting. By revealing the ubiquity (and audacity) of wrap contracts, Kim also skillfully demonstrates that just about everything we do or want to do now involves a contract and, as a result, non-drafting parties like consumers have no choice but to accept the terms imposed by wrap contracts if they want to participate in modern society. In demonstrating so persuasively that drafters of wrap contracts consistently make more aggressive use of even more one-sided terms in their contracts than their offline counterparts, Kim has effectively made the case that wrap contracts pose significant problems for non-drafting parties in particular and society in general. That said, the crux of the problem posed by wrap contracts is the (mis)use of bargaining power within a contract law system that permits the (mis)use of unequal bargaining power to go unchecked and unimpeded. Kim’s solutions — the duty to draft reasonably and specific assent — do not effectively address this fundamental problem built into modern contract law. Consequently, it is unclear how Kim’s solutions end up assisting non-drafting parties in any meaningful way. On the contrary, her solutions appear to elevate form over substance in ways that will produce two adverse outcomes for non-drafting parties both of which will make it harder for non-drafting parties to get out of problematic wrap contracts. This is clearly not Kim’s intent. But I fear it will be the result.

Keywords: contracts, contract law system, contract formation, bargaining power, wrap contracts, mutual assent

JEL Classification: K12

Suggested Citation

Hart, Danielle Kie, Form & Substance in Nancy Kim's Wrap Contracts (July 25, 2014). Southwestern University Law Review, Vol. 44, 2014, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2491367

Danielle Kie Hart (Contact Author)

Southwestern Law School ( email )

3050 Wilshire Blvd.
Los Angeles, CA 90010
United States

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