Private Rules and Standards
64 Pages Posted: 17 Aug 2020 Last revised: 21 Sep 2020
Date Written: August 13, 2020
There is an enormous literature on the choice between rules and standards. This literature typically focuses on public laws such as statutes, regulations, and judicial opinions. This Article seeks to examine the rules/standards choice in a different context: private legal directives such as contracts, wills and patents.
Besides making the basic point that private laws also involve a rules/standards choice, the Article makes two contributions. First, it explores the normative arguments for rules and standards when applied to private laws, which are sometimes similar to, and at other times different from, the well-known arguments made in the context of public laws. Second, the Article asks a positive question: will private drafters actually choose a rule or standard, given the drafter’s private incentives? The Article answers by providing a model of how clashing incentives between private drafters (who pursue self-interested goals) and courts (who resist those goals) shapes the rules/standards choice. It then explains how this model helps explain drafting choices and interpretative doctrine with respect to contracts, wills, and patents.
Keywords: rules, standards, rules v. standards, public law, private law, private legal directives, patents, contracts, wills, private drafters
JEL Classification: K1, K10, K12, K2, K20
Suggested Citation: Suggested Citation