46 Pages Posted: 2 May 2019 Last revised: 30 Jul 2019
Date Written: April 11, 2019
Scholars and judges think they can address the multiple purposes and values of contract law by developing different doctrinal regimes for different transaction types. They think if we develop one track of contract doctrine for sophisticated parties and another for consumers, we can build a better world of contract: protecting private ordering for sophisticated parties and protecting consumers’ needs all at once. Given the growing enthusiasm for laying down these separate tracks and developing their infrastructures, this Article brings a necessary reality check to this endeavor by highlighting for scholars and judges how doctrine in contract law functions in fact: it creeps back and forth from track to track. Bespoke contract law ends up as general contract law – and law designed for one contract ecosystem will almost invariably migrate to a different transactional environment. Thus, contract doctrine will be applied in a context for which it is not suited, where it may actually undermine stated doctrinal goals.
This Article identifies “creep” from sophisticated party doctrine into consumer contract law and from consumer contexts into sophisticated party transactions through a few case studies. It then elaborates the mechanisms by which creep occurs: porous definitions of transaction-types; contract drafting practices of standardization with portable provisions that confuse courts; and good old common law analogical reasoning that involves law jumping from track to track. We conclude by instructing judges to be more mindful of the process of contract creep; warning contract drafters to appreciate better the risks and costs of their drafting practices; and exhorting contract theorists to include the risks and costs of creep as they develop their doctrinal edifices, which are likely to be applied off-track.
Keywords: contract law, sophisticated parties, consumer law, contra proferentem, arbitration, form contracts, contracts of adhesion
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