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  • Print publication year: 2021
  • Online publication date: May 2021

Types of Contracts and Law’s Autonomy-Enhancing Role

Summary

INTRODUCTION

In The Choice Theory of Contracts Michael Heller and I offer a way to understand contract which departs from two entrenched tenets of contract theory. First, we argue that contract theory should move beyond the universalising tendency advocated by the Willistonian project and shift at least some of its emphasis from ‘general’ contract law to (or rather back to) particular contract types. Whereas contract is an important category for thinking, the various contract types – including the residual type of ‘freestanding contracting’ – are the proper categories for deciding. In other words, while the Willistonian tradition emphasises contract's uniformity, choice theory highlights its multiplicity.

We are not the first to warn against the flattening effects of contract monism and the unprincipled multiplicity of the common law (and European civil law) that Williston hoped to systematise. But unlike other critiques, choice theory offers a principled account of contract's multiplicity. The principle that stands at the foundation of contract law is autonomy. At this point we again part ways with existing theories. Liberal theories of contract typically aim at distilling an autonomy-based account purged of any teleological foundation. Our account is diametrically different, since choice theory embraces autonomy's role as contract's telos. Contract, we argue, is a valuable convention – indeed, a convention that any liberal polity must enact – because and to the extent that it proactively enhances individual autonomy, namely people's self-determination or self-authorship; our right to write and re-write the story of our lives.

One important takeaway of choice theory lies at the juncture of these two proposed shifts. A teleological theory of contract, which celebrates its autonomy- enhancing function, offers the key for understanding contract's multiplicity and appreciating its role in a liberal polity. Indeed, a proper understanding of contract as an essentially power-conferring (as opposed to duty-imposing) institution implies that its most fundamental contribution to liberal societies is in expanding our options. Thus, by ensuring the multiplicity of contract types – more specifically, the availability of diverse, normatively attractive contract types in each important sphere of human interaction – contract law complies with autonomy's fundamental imperative of enabling people to make their lives meaningfully their own by legitimately enlisting others to their most important projects.

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