The Download of the Week is Three Pictures of Contract: Duty, Power and Compound Rule by Gregory Klass. Here is the abstract:
A fundamental divide among theories of contract law is between theories that picture contract law as a power-conferring rule and those that picture it as a duty-imposing one. On the power-conferring picture, contracting is a sort of legislative act, in which persons determine what law will apply to their transaction. On the duty-imposing picture, contractual obligations are a legal response to extralegal, relationship-based obligations, such as the duty to keep a promise. While legal theorists have had much to say about the differences between powers and duties, very little attention has been paid to the problem of how to tell whether a given rule is power conferring or duty imposing – a question that should lie at the center of contract theory. This paper argues that a characteristic mark of a legal power is the law’s expectation that actors will satisfy purposively, in order to achieve the legal consequences. This description allows me to distinguish two types of legal powers. A law’s expectation of its purposive is most often seen in conditions of legal validity designed to ensure such a purpose. A common example is compliance with a legal formality, though other sorts of validity conditions meet this description. The presence of such rules is strong evidence that the law’s sole function is to create a legal power. I suggest reserving the term power-conferring for such laws. Power-conferring theories of contract law face a special difficulty because, with the decline of the seal, the conditions of contractual validity do not unequivocally sort for the parties’ legal purpose. There is, however, a second, often overlooked sense in which a law can generate a legal power. A law might expect, and even encourage, its purposive use without conditioning an act’s legal consequences on the actor’s legal purpose. Evidence of such an expectation can be found in rules whose best explanation assumes that a significant number of persons will use the law purposively. Where a law anticipates its purposive use without conditioning legal effect on it, it is unlikely that the law’s only function is to create a legal power. The law might also be designed to impose duties. I coin the term compound laws for laws that satisfy this description. There is a good argument that contract law is a compound law. The last section of the paper applies these ideas to describe and critique Joseph Raz’s influential comments on voluntary obligations and contract law.
Highly recommended!