Book contents
- Frontmatter
- Contents
- List of Contributors
- Preface
- Acknowledgment
- I THE CASE FOR STRICT LIABILITY
- II THE CASE FOR FAULT
- III BETWEEN STRICT LIABILITY AND FAULT
- IV WILLFUL BREACH
- 10 When Is a Willful Breach “Willful?” The Link Between Definitions and Damages
- 11 Willful Breach: An Efficient Screen for Efficient Breach
- 12 An Information Theory of Willful Breach
- 13 Contract Law and the Willfulness Diversion
- V COMPARATIVE FAULT
- VI THE MORALITY OF BREACH
- Case Index
- Subject Index
12 - An Information Theory of Willful Breach
Published online by Cambridge University Press: 10 November 2010
- Frontmatter
- Contents
- List of Contributors
- Preface
- Acknowledgment
- I THE CASE FOR STRICT LIABILITY
- II THE CASE FOR FAULT
- III BETWEEN STRICT LIABILITY AND FAULT
- IV WILLFUL BREACH
- 10 When Is a Willful Breach “Willful?” The Link Between Definitions and Damages
- 11 Willful Breach: An Efficient Screen for Efficient Breach
- 12 An Information Theory of Willful Breach
- 13 Contract Law and the Willfulness Diversion
- V COMPARATIVE FAULT
- VI THE MORALITY OF BREACH
- Case Index
- Subject Index
Summary
This chapter argues – in contrast to conventional law and economics wisdom – that supercompensatory damages for willful breach are justified. Willful breach, it argues, reveals information about the “true nature” of the breaching party – that he is more likely than average to be a “nasty” type who readily chisels and acts in dishonest ways, and may have acted in other self-serving, counterproductive ways that went undetected and unpunished. Willful breach triggers extra resentment for what underlies it – for all the other bad things that the breaching party likely did, or, more basically, for the ex ante choice he made to engage in such a pattern of behavior. Thus, when the party is caught in the act of willful breach, he is punished not merely for this act, but for the (probabilistically) inferred mesh of bad conduct. This account provides a concrete foundation for the notion that willful breach violates the “sanctity of contract.” We show that some remedial doctrines are consistent with the information-based account.
Introduction
The Puzzle
Is willful (opportunistic) breach worse than inadvertent breach? Is it more wrongful and deserving of a harsher sanction? Strikingly, two opposite views now have a long-standing tradition within contract law, and they have not been successfully reconciled.
- Type
- Chapter
- Information
- Fault in American Contract Law , pp. 174 - 189Publisher: Cambridge University PressPrint publication year: 2010
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