Three Proposals to Harness Private Information in Contract
16 Pages Posted: 17 Sep 1997
Date Written: August 1997
Savvy judges realize that they are normally less informed than private litigants and will accordingly be prone to error in deciding cases. Judges in deciding contract cases should therefore try to harness the parties' private information. This paper applies this idea of harnessing private information to make three proposals about how judges should decide contracts cases. In particular, I favor (1) interpretive safe harbors, (2) extending Hadley v. Baxendale to benefit buyers as well as sellers; and (3) giving defendants the option of making injunctions inalienable.
JEL Classification: K12
Suggested Citation: Suggested Citation