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Wall, Jesse --- "Pouring new wine into old wineskins: methodology in contract law acholarship" [2022] OtaLawRw 5; (2022) 17 Otago LR 303

Last Updated: 9 March 2024

Pouring New Wine into Old Wineskins


Pouring New Wine into Old Wineskins: Methodology in Contract Law Scholarship

Jesse Wall*

This is a paper about how we do contract law scholarship. It contrasts two methods of scholarship: pluralism and monism. Whilst all private law scholarship seeks to provide a coherent account of the law, “[p] rogressive pluralist accounts challenge the inherent conservatism of coherence theories, by seeking to reintroduce (at a theoretical level, at least) greater sensitivity to the messy complexities” of human interaction.1 ‘Monist’, in comparison, seek to give coherence to the private law with recourse to a much narrower set of values, such as “the liberal state’s promise to respect the freedom of individuals ... [by] construct[ing] a framework of opportunities for individuals in cooperation with others to become authors of their own lives”.2 In this way, Pluralists animate the law by highlighting the plurality of values that private law can be said to be giving effect to, and monist rely upon a singular value of individual freedom or autonomy. Pluralist attempt to follow the same “conventional analytical methods” as their ‘monist’ counterparts whilst also “seeking to identify ‘progressive goals’ within the liberal institution” of private law.3 Pluralist can then emphasise these progressive values as being values that are internal or intrinsic to private law. The purpose of this paper is to defend the Monist methodology, without – I might add – endorsing the conservativism of Monism.

The question at the heart of the debate between Monists and Pluralists is whether we locate a set of reasons – that we all agree are reasons that the law gives legal effect to – as internal to, or external to, ‘contract law’ (the focus here is limited to contract law scholarship, but I suggest that the manoeuvres of the argument here could equally apply to pluralism in property law scholarship).4 I am concerned here with two theories of the aim or purpose of contract law, one that has the effect of internalising these reasons and one that externalises them. Both theories have a lot in common. They both contend that contract law (a) aims to give legal effect to (b) moral reasons, that are: (c) reasons distinctive to the moral relationship between (d) free and equal individuals (e) who have

* Associate Professor, Faculty of Law, University of Auckland.

  1. Lorna Fox O’Mahony “Property Outsiders and the Hidden Politics of Doctrinalism” (2014) 67 CLP 409 at 423.
  2. At 423 (footnote omitted).
  3. At 424 (footnote omitted).
  4. See, for instance: Gregory S Alexander “Pluralism and Property” (2011) 80 Fordham L Rev 1017; Joseph William Singer “Democratic Estates: Property Law in a Free and Democratic Society” (2009) 94 Cornell L Rev 1009; and Hanoch Dagan “Pluralism and Perfectionism in Private Law” (2012) 112 Colum L Rev 1409.

voluntarily undertaken obligations to one another; and that are also (f) reasons that have been (albeit imperfectly) articulated in positive law. The theories differ in terms of how we understand (d) the freedom and equality of contracting individuals. ‘Monism’ presumes a formal freedom and equality, and then externalises other reasons outside of its narrow concern. ‘Pluralism’, in comparison, is concerned with substantive freedom and equality, which pulls in a range of moral reasons into contract law.

The immediate implication from this contrast is that both theories of ‘contract law’, imply different taxonomies of what contract law is. To explore this difference in taxonomy, I will consider with the relationship between the answers to two simple questions. The first question asks ‘what is contract law?’, and the second, ‘why do we have it?’. I am interested in how answers to the second question are tested against an answer to the first. Which might be what we expect; we generally expect a theory of the purpose of contract law to be able to align with what we understand contract law to be. When we assess theories in this way we might find that a theory cannot account for enough contract law doctrine, or that it captures doctrine beyond what we consider to be contract law. In either instance, the asymmetry is taken to count against the theory. The question therefore becomes whether our two theoretical approaches

- pluralism and monism – can respond to the asymmetry between ‘what we think contract law is’ and ‘the contract law that is implied from the theory of contract law’.

I will argue here that the inability of pluralism to address this asymmetry points to a deeper problem with pluralism. At the surface level, pluralism implies either an arbitrary taxonomy of ‘what contract law is’ or a taxonomy that is so all-encompassing that it discards any pretense of (f) accounting for positive law. The more fundamental problem is that it cannot have a robust understanding of the moral relationship between contracting individuals whilst operating within the confines of (a) to (f). Only monism can work within those confines. Hence, pluralism struggles under the pressure of identifying a plurality of moral reasons for why we have contract law that are also reasons that can be found, or inferred from, positive law. As a result of this pressure, pluralism provides either an arbitrary understanding of ‘what contract law is’ or an expansive understanding. It this expansive understanding that is both unsupported by positive law and, furthermore, hides the way in which different values enter our legal reasoning.

I start this paper by setting out ways in which we might answer the two simple questions: what is contact law? (in section 1) and, why do we have it? (in section 2). I then explain (in section 3) how monism is unable to account a range of – what we might rightly consider to be - contract law doctrine, and then consider how a monist might respond to the criticism. I argue (in section 4) that pluralism suffers from a similar problem, in that it requires our understand of what contract law is to be broader than what positive law can support. I then explain why pluralism is less able (than

monism) to respond to this problem of asymmetry. Following on from this, I then identify (in section 5) the more fundamental problem with pluralism, that it is ultimately trying to pour new (perfectionist) wine into old (liberal) wineskins.5 I can then explain (in section 6) how this concern should influence the way we engage in private law scholarship.

1. What is Contract Law?

We may feel that we all share the same answer to this question. Consider, nonetheless, a scenario where we are teaching a contract law course together (or co-authoring a contract law textbook). To do so, we would need to arrive at a consensus as to what counts as contract law, as opposed to the peripheral laws that otherwise pertain or relate to contracts. We need to differentiate, in order words, between the doctrine that we will teach (or write about) and the doctrine that we should leave to other courses (or other textbooks). To illustrate how we might formulate this contract law taxonomy, consider the following ‘ten commandments’ that we will include or exclude in our course (or textbook):
  1. You shall not revoke a promise once the acceptance of the promise has been communicated to you.
  2. You shall have no right to performance of a promise that was induced by a false or misleading statement;
  3. In the event of nonperformance of a promise, you shall put the other party into the position they would have been had you performed your promise;
  4. You shall not enforce a promise from person over whom you have influence, where the exchange calls for an explanation, and where that person did not receive independent legal advice;
  5. You shall not exploit a party’s bargaining disability in a way that results in a transaction that manifestly improvident for that party;
  6. You shall not use another’s promise to exclude one’s own liability for negligence causing personal injury to that person.
  7. Moses may, by Order in Council, make regulations prescribing fair terms in promises to consumers of goods or services;
  8. No prenuptial promises shall be enforceable unless both parties have fully disclosed their financial status and received independent legal advice.
  9. You shall not refuse to undertake promises on the basis of another person’s race, ethnicity, or national origins; and
  10. You shall not cancel employment promises except for the reasons
specified in the Employment Relationships Tablet.

  1. Matthew 9:14–17; Mark 2:18–22; Luke 5:33–39; and Robin West “The New Legal Criticism” (2017) 117 Colum L Rev Online 144 at 150.

In formulating our course (or textbook), I speculate that we would jettison (viii) prenuptial agreements, (ix) discrimination prohibition, and

(x) reasons for dismissal, to family law, public law, and employment law, respectively. We might disagree about including commandment (vii) fair terms for consumers whilst excluding commandment (x) reasons for dismissal.6 After all, both commandments represent a concern for power imbalances that arise in particular categories of contracts. The differential treatment of these branches of contract in academic teaching and scholarship (where it occurs) may just be a convention that needs to be reconsidered in light of contract law theory. But for now, we can appreciate the task: to forge some consensus7 on a course (or textbook) that convers the ‘core’ of contract law: arguably, commandments (i) to (vii). We would also be critical of other courses (or textbooks) that get this taxonomy wrong; ‘no self-respecting contract law lecturer would exclude any of the first seven commandments in favour of the latter three’, we might say at the morning tea break at a contract law symposium.

I highlight this exercise because whenever we engage in contract law theory we undertake the same task. That is, we also adopt or assume some kind of taxonomy of what counts as contract law (and jettison a body of rules that merely pertain to contracts). Whilst theory ought not be a slave to doctrine, we should nonetheless expect some degree of symmetry between a given theory of contract law and what we take to count as contract law. Hence, if I am right, and the general consensus is that we understand commandments (i) to (vii) to be part of contract law proper, then the next question becomes whether a theory of the aim or purpose of contract law is able explain commandments (i) to (vii) without also capturing commandments (viii) to (x). Let us therefore turn to consider the second question.

2. Why do we have it?

There are different ways of asking this second question. We might inquire about the values that contract law serves, the aims that contract law pursues, or the reasons for action that contract gives legal effect to. This paper is focused – narrowly – on two theories of why we have contact law, that differ only in terms of whether contract serves a singular value (monism) or a range of values (pluralism). These two theories are set out formally below. I attribute the ‘pluralism’ to Dagan and Dorfman’s theory of ‘Just Relationships’ (as it applies to contract law).8 Whilst it represents a methodology that I will eventually endorse here, the version
  1. My thanks to an anonymous referee for raising this point.
  2. See Stephen A Smith Contract Theory (Oxford University Press, Oxford, 2012) at 9.
  3. Hanoch Dagan and Avihay Dorfman “Just Relationships” (2016) 116 Colum L Rev 1395. See also John Gardner “Dagan and Dorfman on the Value of Private Law” (2017) 117 Colum L Rev Online 179; West, above n 5; and Benjamin C Zipursky “The Cathedral Through the Looking Glass: A Commentary on Dagan and Dorfman’s Just Relationships” (2017) 117 Colum L Rev Online 165.

of monism that is set out below is constructed primarily as a point of contrast (without much concern for whether it can be attributed to any particular theorist). In order to isolate the one point of difference between the accounts, both theories can be understood in term of six methodological commitments ((a) to (f)).

According to monism, contract law:

(a) aims to give legal effect to (b) moral reasons, that are:

(c) reasons distinctive to the moral relationship between (d) formally free and formally equal individuals (e) who have voluntarily undertaken obligations to one another; and

(f) reasons that have been (albeit imperfectly) articulated in positive law.

In comparison, pluralism contends that contract law:

(a) aims to give legal effect to (b) moral reasons, that are:

(c) reasons distinctive to the moral relationship between (d*) substantively free and substantively equal individuals (e) who have voluntarily undertaken obligations to one another; and

(f) reasons that have been (albeit imperfectly) articulated in positive law.

Allow me to briefly unpack these six commitments. In order to isolate the variable at (d), the remaining commitments are shared methodological commitments. The first is located in the phrase (a) ‘aims to give legal effect to’. For Dagan and Dorfman, contract law “participates in constructing core categories of interpersonal relationships around their underlying normative ideals”.9 In simpler terms, contract law “helps people to do what they ought to do anyway, quite apart from [contract law]”.10 Both theories under consideration take the view that the aim of contract law is to help people do what they have reasons to do anyway, and that ‘help’ can take a range of different forms. The key point is that, given this assumption, what remains in contention is what those reasons are (as we shall see at (d), below).

The second constant is that the monism and pluralism under consideration here are both (b) moral theories of the aim of contract law. Both seek to account for the relationship between individuals that is pre-political, in the sense that it is independent of concerns for welfare, material equality, or just distribution. In this way, contract law operates within a private sphere, independent of the concerns that we associate with public power and public institutions. This then enables contract law and private law institutions to “leave individuals and associations free to act effectively in pursuit of their own ends”11 whilst helping

  1. Dagan and Dorfman, above n 8, at 1450. See also Hanoch Dagan “The Utopian Promise of Private Law” (2016) 66 UTLJ 392.
  2. Gardner, above n 8, at 186.
  3. John Rawls Political Liberalism (Columbia University Press, New York, 1993) at 268–269; and Dagan and Dorfman, above n 8, at 1402.

individuals and associations to act (only) on the moral reasons that apply to the contractual relationship.12 In this way, contract law then “stands on its own distinctive ground”13 and avoids being “just another means to serve our public goals”.14

The third constant is that both accounts are concerned with a moral relationship that is (c) distinctive moral relationship. Whilst the moral relationship between the two parties – in general – may be informed by a range of moral reasons, the contractual relationship is predicated upon a distinctive set of those reasons. In this way, both accounts presume that contract law “concerns itself only with values that reflect the distinctive nature of the justification of” contract law.15 As we will see momentarily, contract law is “distinctive in only answering to” the values of freedom and equality.16 In comparison, a theorist could be unshackled by this structure, and give “due regard to ‘core liberal values’ but without needing to be exclusively fixated with them”.17

The fourth constant is located in the phrase (e) ‘who have voluntarily undertaken obligations to one another’. This is a placeholder for an argument that differentiates contractual obligations from tortious ones. For clarity, it does not imply that the content of the obligations that one party owes the another is voluntarily undertaken. Rather, it implies that one “party’s externally observable conduct could be reasonably understood as such an undertaking” is the basis for the imposition of obligations owed to the other party.18 Or, at least, the purpose of imposing such obligations is to support the practice of voluntary undertakings.19

The final point of consensus is that both accounts seek to (f) identify the reasons that “emanate from the law itself”.20 The assumption here is that a “faithful reading of the law itself” will render the moral reasons that contract law aims to give legal effect to.21 In following this method, any given criticism of contract law is a critique according to its own stated or inferred ideals, rather than being assessed against moral reasons found outside of posited law, or assessed against economic or political reasons, more generally.

Which now leaves the point of disagreement that I seek to isolate. According to the monistic account, a contractual relationship is between

  1. Dagan and Dorfman, above n 8, at 1450. 13 At 1442.
  2. Gardner, above n 8, at 182.
  3. Ernest J Weinrib Corrective Justice (Oxford University Press, Oxford, 2012) at 48; and Dagan and Dorfman, above n 8, at 1405.
  4. Gardner, above n 8, at 191. 17 At 200.
  5. Hanoch Sheinman “Contractual Liability and Voluntary Undertakings” (2000) 20 OJLS 205 at 209.
  6. Joseph Raz “Promises in Morality and Law” (1982) 95 Harv L Rev 916 at 933–938; and Sheinman, above n 18, at 211.
  7. Dagan and Dorfman, above n 8, at 1399; and West, above n 5, at 147.
  8. West, above n 5, at 149.

(d) formally free and formally equal individuals. The way in which contracting individuals are (d) free can be understood in negative terms; it is “the independence from being constrained by another’s choice”.22 A contractual right is, however, a constraint on another’s choice, and “thus to use them as if they were merely part of external nature is to poison the source of the moral power we enjoy”.23 The “crucial moral discovery that free men [and women] may yet freely each other purposes”24 lies in seeing contracts as enabling “free persons to exercise self-mastery together” and to “set and pursue their own purposes interdependently”.25 It is through the exercise of formal freedom that one party can grant another “powers over [his or her] person and property in a way that is consist with [his or her] exclusive power to determine how they will be used”.26 The (d) formal equally stems from each individual having the capacity to pursue their own ends in this way without being under “duties to act for any purposes in particular, no matter how meritorious”.27 Interpersonal respect for free and equal individuals therefore requires non-interference with the purposes with which one acts and a commitment to enabling free and equal persons to pursue their own purposes though the interdependency of contractual undertakings.

The subtle but significant difference between monism and pluralism lies in the shift from (d) formally free and equal individuals to (d*) substantively free and equal ones. Substituting Raz and Anderson in place of Nozick and Ripstein, pluralists add two conditions to the exercise of freedom and recognition of equality.28 Substantive equally introduces sensitivity towards the “the contingency, the context, and the vulnerabilities of individual contractors”,29 recognising that – in substance – not every contracting individuals are equal in their capacity to pursue their own ends and assess their own self-interest. Nor are contracting individuals necessarily orientated towards pursuing their own self-interest. Substantive freedom introduces the condition that, if freedom (or autonomy) is to be pursued in a morally relevant way, freedom requires material preconditions to be satisfied and sufficiently valuable ends to be pursued. In reaction to the “shallow libertarian

  1. Immanuel Kant The Metaphysics of Morals (Mary Gregor (translator), Cambridge University Press, Cambridge, 1991) at 63; Arthur Ripstein Force and Freedom: Kant’s Legal and Political Philosophy (Harvard University Press, Cambridge, 2009) at 35; and Dagan and Dorfman, above n 8, at 1403.
  2. Charles Fried Contract as Promise: A Theory of Contractual Obligation (2nd

ed, Oxford University Press, New York, 2015) at 8.

  1. At 8.
  2. Ripstein, above n 22, at 108. 26 At 127.
    1. Weinrib, above n 15, at 11.
    2. Zipursky, above n 8, at 165; Dagan and Dorfman, above n 8, at 1442, citing Joseph Raz The Morality of Freedom (Clarendon Press, Oxford, 1986) at 162 and 265; and Elizabeth Anderson “How Should Egalitarians Cope with Market Risks?” (2008) 9 Theo Inq L 239 at 255.
    3. West, above n 5, at 151; and Dagan and Dorfman, above n 8, at 1399–1400.

conception of individual independence from the state”, substantive freedom seeks to secure for individuals “the material wherewithal to truly guide their own lives on the basis of their chosen conception of the good”.30 And, in reaction to the shallow libertarian independence that is “exhausted by the requirement that no one gets to tell anyone else what purposes to pursue”, substantive freedom (or ‘autonomy’) requires “an adequate range of options” for an individual to pursue.31 This concern for the social and material circumstances in which an individual exercises his or her freedom, his or her capacity to make free choices and further his or her self-interest, and the value of ends that are being pursued by exercising his or her freedom, introduce a range – or ‘plurality’– of values. Pluralist then claim that the aim of contract law is to (a) give legal effect to this (d*) plurality of values.

Finally, our impression of these six commitments may be that they are too narrow and restrictive for any theory of contract law. In particular, both theories are confined to: identifying (b) moral reasons, that are (c) distinctive to the contractual relationship, that are also (f) reasons that can be stated in, or inferred, positive law. To forecast the analysis in the following sections, I suggest that such an impression is right. I will argue that monism’s success lies in identifying a narrow set of moral reasons that can fit the confines of six narrow commitments. And where pluralism struggles is in trying to fit a broad set of moral reasons into the same confines. But to appreciate this deeper problem, we need to first consider the bodies of contract law doctrine that is implied by these theories of contract law.

3. The So-Called Monistic Failure

When it comes to our ten commandments, and contact law doctrine more generally, monism confronts the difficulty in accounting for “the vast heterogeneity” of contract law doctrines.32 Monism is able to explain

(i) offer and acceptance, (ii) misrepresentation and (iii) the expectation measure of damages. It is contestable whether monism is able to explain why a contract may be vitiated on the basis of (iv) undue influence or

(v) unconscionably, since the monist theories forgo consideration of the context in which freedom is exercised and the adequacy of the options pursued. Moreover, monism is much less able to explain (vi) why a party cannot forgo through contractual agreement their right to reparation for personal injury, or why (vii) free and equal contracting parties who can pursue their own self-interest must nonetheless agree to consumer contracts on certain prescribed terms. It is also unable to (and perhaps, makes no attempt to) explain why the (viii) law needs to limit how parties to a prenuptial agreements exercise their freedom to contract; it cannot

  1. West, above n 5, at 151. See Dagan and Dorfman, above n 8, at 1399–1400.
  2. Hanoch Dagan Reconstructing American Legal Realism & Rethinking Private Law Theory (Oxford University Press, New York, 2013) at 171–172, citing Raz, above n 28, at 162.
  3. Dagan, above n 31, at 162.

explain why (ix) the law protects civil and political rights by prohibiting a party from refusing to contract on the basis of a protected characteristic; and, it cannot explain why (x) contracting individuals should be unable to agree to an at-will employment agreement.

Faced with this difficulty, Dagan suggests that monists “face rather

unappealing choices”.33 They can either:34

(1) defend the taxonomy: define their respective subjects [here, contract law] so as to marginalise the considerable sections that are not really responsive to the regulative principle they advocate;

(2) call for reform: discard any pretence to account for our existing law and present their theory as reformist, advocating a significant legal change that will indeed render that field...guided by their favourite regulative principle; or

(3) retreat to a higher level of abstraction: come up with a sufficiently abstract and capacious regulative principle so as to encompass the heterogenous legal materials they theorise about.

I agree that monism is forced into one of these three tactics. In response to the allegation that monism is unable to (1) ‘defend their narrow taxonomy’. Monists are unable to explain that what counts as contract law is limited to commandments (i) to (v). Hence, the monist is forced to at least try and bolster their explanation of (iv) undue influence and

(v) unconscionability, and otherwise jettisoning commandants (vi) to

(x) to other doctrinal categories. The struggle here is a problem of ‘fit’.35

As Smith explains:36

A theory of contract fails the fit criterion if it rejects as an exception or as misclassified so much of contract law that those familiar with the law would not recognize what remains as ‘contract’ law.

Recall that we are relying on an initial consensus on what counts as contact law, and in doing so, “we must rely on the experience of lawyers and others familiar with contract law to tell us when we have gone too far” or not far enough.37 Since the initial monist taxonomy excludes doctrine (commandants to (vi) to (x)), at least some of which that lawyers consider to be contract law, those familiar with contract law would find that the monist account does not go far enough.

Alternatively, the monist can claim that (2) contract law ought to be limited to rules that give effect to the interpersonal respect between formal free and equality individuals. Implying that contract law ought to be reformed to resemble a more modest set of commandments, arguing for narrow doctrines of undue influence and unconscionably, and arguing against consumer protection and other limitations on the formal freedom

33 At 162.

34 At 162.

  1. My thanks to an anonymous referee for raising this point.
  2. Smith, above n 7, at 10. 37 At 10.

of contract. The struggle here is not just with the criterion of ‘fit’ but with

Smith’s “morality criterion” as well.38

The third available tactic, however, is more promising. The option here is to suggest (3) that, despite the heterogeneity of contract law doctrines, it is nonetheless still necessary to posit the ‘interpersonal respect between formal free and equal individuals’ in order to understand all instances of contracting.39 In making such a claim, the monist can still accept that qualifications to, and deviations from, this norm will arise for specific transaction types. But to understand them as limits and modifications to ‘contract law’ is to understand ‘contract law’ as giving legal effect to ‘interpersonal respect between formal free and equality individuals’.

Hence, the law may limit or modify contracts to further values that are threatened by the unflinching pursuit of formal freedom and equality. For instance, in pursing this third tactic, the monist would explain that the reason for (x) employment standards or (vii) fair terms in consumer contracts is to modify, for specific transaction types, the law that is nonetheless still premised upon the ‘interpersonal respect between formal free and equality individuals’. Similarly, (iv) undue influence and

(v) unconscionability represent vitiation doctrines where the assumption that the contracting individuals are ‘formal free and equal’ can be displaced in the specific circumstances of the case.

Take undue influence, for example – a doctrine that lends itself to a pluralist explanation. When it comes to relationships of influence, the “abnormality” of a transaction, and the end for intervention, “depends on three overlapping considerations: ... its impact on the welfare of the claimant and her particular circumstances ... its appropriateness for the type and specific nature of the parties relationship, and ... the nature of the transaction ...”.40 Now, as we know, both Monist and Pluralist will try to account for these values. A persuasive Pluralist device is to posit the “relational autonomous actor” as the archetype contracting individual and explain how the state “can act to prevent harm to the conditions for the exercise of positive autonomy” in order to generate a “a more appealing and accurate theory of undue influence”.41

The Monist account, in comparison, holds onto the “paradigm autonomous person” as the “rugged individualist” (as “self-sufficient, self-knowing, and rationally self-interested”).42 Monist may, nonetheless, recognise that there are circumstances and transactions where the rugged individualistic picture does not hold, and hence, exceptions to general contract law need to be carved out. It is because ‘contract law’ is premised

38 See at 13–24.

  1. By analogy with Thomas W Merrill “Property and the Right to Exclude” (1998) 77 Neb L Rev 730 at 744.
  2. Mindy Chen-Wishart “Undue Influence: Vindicating Relationships of Influence” (2006) 59 CLP 231 at 254.

41 At 265.

42 At 240.

upon respect for formally free and equal persons, that contract law needs to be limited in this way and in these contexts.

The key point here is that this monist explanation does rely on a (3) retreat to a higher level of abstraction. There is archetype or paradigm that can explain the doctrine, whilst acknowledging that there external and extraneous limits to the archetype or paradigm. The monistic success in pursuing this third tactic lies in orienting all ten heterogenous commandments with reference to the monistic value, without having to account for all ten commandments as being internal or intrinsic to contract law. As we will now turn to consider, pluralism also faces the same set of ‘unappealing choices’, but – unlike monism – pluralism is unable to pursue the third tactic.

4. Pluralism’s Unappealing Choices

Broadening the aim of contract law from the freedom to “set and pursue [one’s] own purposes interdependently”43 to the freedom of “both promisee and promisor to realise their respective desirable goals”44 enables the pluralist to give a wider account of what contract law is. A pluralist can explain much more persuasively how a concern for an individual’s substantive freedom and equally – their inequality of bargaining power, decision-making in relational or intimate contexts, or absence of specialised knowledge or expertise – may require (iv) undue influence and (v) unconscionability doctrines, prescribed (vii) fair terms and (viii) safeguards for prenuptial agreements, and so on. In providing these explanations, pluralists then make a further claim. They claim that rules exist, not as a limitation on the freedom of contract imposed upon contract law from the outside, but as an implication of the freedom of contract from inside contract law’s underlying values. Herein lies an important contrast; between the monistic view that these laws are external limits on ‘the freedom of contract’ principle and the pluralistic view that these laws are implications of ‘the freedom of contract’ principle.

In terms of the taxonomy of what contract law is, choices nonetheless remain with regards to commandments (viii) prenuptial agreements,

(ix) discrimination prohibition and (x) reasons for dismissal. It is open to a pluralist to:

(1) defend the taxonomy, and suggest that commandments (viii), (ix) and (x) belong to family law, public law, and employment law, respectively; or

(2) call for reform, and suggest that such commandments ought to be understood as belonging to contract law.

Interestingly, when faced with these choices, Dagan and Dorfman

(2) call for reform with regards to commandment (ix): discrimination

  1. Dagan and Dorfman, above n 8, at 1404, citing Ripstein, above n 22, at 107–108.
  2. Dagan and Dorfman, above n 8, at 1412 (emphasis added).

prohibition, whilst Dagan and Dorfman also (1) defending a limited taxonomy that excludes commandment (x): reasons for dismissal. In order to gain a critical foothold into pluralism I will start by considering this choice in some detail.

Dagan and Dorfam’s claim is that whilst there is a prohibition on choosing not to contract with another person on the basis of their race, ethnicity, or national origins, and whilst this prohibition is conventionally housed in civil rights law (or human rights law), it ought to be included in the contract law’s broad church.45 To discriminate against someone in such a way is inconsistent with the substantive freedom and equally of that person. If the aim of contract law is give legal effect to the distinctive moral relationship between substantively free and equal individuals who have (or ought to) voluntarily undertaken obligations to one another, then such discriminatory practices repudiates the moral relationship. It follows, for Dagan and Dorfman, that it is contract law that ought to respond to the repudiation. Rather than commandment ix: discrimination prohibition being an outside limitation on the freedom of contract, but it ought to be understand as emanating from within contract law.

Dagan and Dorfman are right, insofar as any such discriminatory practices are inconsistent with the interpersonal respect we owe other free and equal persons. And they are right that we could re-imagine contract law as being the centre of gravity for a prohibition on such practices. But if we do, two implications follow. The first implication is that we overlook how such prohibitions - and the reasons for such prohibitions, more generally – are given legal effect. In terms of the prohibition to discriminate on the basis of race, ethnicity, or national origins, we overlook how such reasons enter the law. We overlook how the prohibition follows from an individual’s civil rights, that each person has by virtue of their humanity, that are rights that we (as a society) have a shared and mutual concern for. We also overlook that these are rights contained in legislative enactments as a result of a distinctive political movement. Whilst a moral (or pre-political) account of contract law does not set out to capture this political dimension, the oversight does have the effect of ‘privatising’ an important strand of public law. The politics, and the civil rights ideology, is hidden as a result. I will return to this concern in the final section.

The second implication is that, if the center of gravity of contract law is the interpersonal respect we owe other free and equal persons (who we voluntarily undertake obligations to), then a lot is caught by that gravitational pull. If contract law aims to give effect to the respect we owe other free and equal persons, then both commandment (ix) discrimination prohibition and commandment (x) reasons for dismissal ought to be understand as emanating from within contract law. This is West’s concern:46

45 At 1425 and 1460.

46 West, above n 5, at 161.

If we should not discriminate in our private commercial dealings because of our duty to regard others as substantive equals, then there are further constraints we should recognise as likewise implicated by this norm of justice. Do we not also violate the substantive equally of others when we fire them at will, for irrational or indeed malicious reasons?

With regards to commandment (x): reasons for dismissal, a pluralist must either (1) defend an arbitrary taxonomy or (2) call for widespread reform.

To (1) defend the taxonomy is to suggest that commandment (ix): anti- discrimination is an implication of contract law whilst commandment (x): reasons for dismissal is a limitation on contract law. And that “seems wrong both logically and normatively”,47 as it would place Bills of Rights inside contract law whilst employment law outside it.

To (2) call for reform is to suggest that both commandment (x): reasons for dismissal and commandment (ix): discrimination prohibition are both implied by contract law, and “the problem with that that while it might be sound as a matter of moral principle, it is not clear that it is sound as matter of legal principle” since “there is no positive law supporting the proposition that the relational justice that is the point of private law renders employment at-will regimes suspect”.48 In doing so, “discard[ing] any pretence to account for our existing law”49 Or, at the very least, attempting to pour new wine into old wine skins. By which I mean, attempting to re-interpret branches of legal doctrine as pursuing a new – pluralistic – purpose.

Hence, in the face of the asymmetry between ‘what contract law is’ and ‘why we have it’, the methodological choices are the same for the monist and the pluralist. The pluralists can try and (1) defend a seemingly arbitrary taxonomy that results from a plurality of values that pulling some, but not all, the legal materials into ‘what counts as contract law’. Alternatively, a pluralists can (2) call for reform to a large body of legal materials, giving into the gravitational pull of the plurality of values, despite the absence of support from positive law.

There remains, as you will recall, a third tactic. The pluralist - like the monist before them – might (3) “come up with a sufficiently abstract and capacious regulative principle so as to encompass the heterogenous legal materials they theorise about”.50 Except, in this case, it cannot help. The reason why the pluralist can account for a broader range of heterogenous legal materials in the first case is because concern for the vulnerabilities of individual contractors, the moral adequacy of their range of options, and the socially embedded way in which individuals exercise their autonomy, provides a broad foundation of moral reasons. The pluralism – or, more specifically, the perfectionism that pluralists incorporate – “requires an

47 At 163.

48 At 162.

49 Dagan, above n 31, at 162. 50 At 162.

elaborate theory of autonomy and an account as to what choices make a person’s life go well”.51 It requires judgment as to the emphasis that ought to be on “the desirability of goals and the worthwhileness of ends”52 or on the value of exercising freedom in pursuit of our own goals and ends. It is the malleability between contract law’s perfectionist and liberal (or imperfectionist)53 impulses that generates a sufficiently ‘capacious regulative principle’ that already enables pluralism to ‘encompass the heterogenous legal materials’. When contract law doctrine emphasises the ‘will of the parties’, pluralist theory can point to the value of exercising freedom per se. When contract doctrine expresses the concern for inequality of bargaining power or the relational inter-dependence of contracting parties, the pluralist can point to adequacy of options in our decision making and the contextual aspects of exercising autonomy. For the pluralist, it is heads-I-win, tails-you-loose logic.

My point here is not that there is anything wrong, as such, with this moral calculus. Rather, my point here is that pluralism has already pursued ‘a sufficiently abstract and capacious regulative principle’ in order to account for the range of legal doctrine. And there is no higher level of abstraction to which to retreat. Hence, the problem remains that this plurality of moral reasons is able to encompass more the heterogenous legal materials than the contract law theorist seeks to theorise about. Hence, the choice remains as between (1) defending an arbitrary taxonomy or (2) calling for an all-encompassing reform of ‘what contract law is’.

5. The Problem with Pluralism

So much for taxonomies. Allow me to now try and articulate my background concern with pluralism that sits behind this concern for the taxonomy it generates. On the monistic account, respect for formally free and equal contracting individuals may generate absolute discretion as to whom to contract with, and upon what terms. On the monistic account, moreover, external rules – premised upon external reasons – provide a limit on this freedom. These external reasons can be political reasons, or open-ended moral reasons, that encroach upon the distinctive moral reasons that contract law aims to give legal effect to. Limits on the formal freedom of contract can then be viewed as a tension between private and public spheres that the law seeks to resolve.

Pluralism, in comparison, hides this tension all within the private sphere; the tension can be – or, has been – resolved through the internal moral calculus of pluralism. That somewhere in the process of identifying how individual contractors may be vulnerable and thereby limited in their capacity to pursue their own self-interest, and somewhere in the

  1. Dagan and Dorfman, above n 8, at 1419.
  2. Gardner, above n 8, at 193.
  3. Michael Walzer “The Imperfectionist” The New Republic (New York, 7 December 1987) at 30.

process of identifying the worthwhile ends that the morality of freedom requires, we can formulate preconditions for prenuptial agreements, prohibitions on discrimination, employment standards, fair terms in consumer contracts, and the law of exclusion clauses. All internally within the sphere of contract law.

The contrast between monism and pluralism therefore comes down to how we classify a set of reasons, that pluralism seeks to internalise into contract law, and that monism tries to keep at arms-length. To understand why I am concerned with pluralism’s attempt to internalise these reasons, we need to return to two (of the five) methodological commitments that are shared between monism and pluralism. Recall that both theories are concerned with (b) moral reasons that contract law gives legal effect to, and that both theories seek to identify the (d) reasons that are articulated (albeit imperfectly) in positive law. With these commitments in mind, let us return to some of our contentious commandments. Starting with (vi): exclusion clauses. The reasons for why a contracting individual cannot exclude themselves from liability for personal injury stem from an explanation of why that person has a right to reparation for wrongfully occasioned personal injury. To understand why we have commandment (vi): exclusion clauses is to understand that the moral reasons that generate the right to reparation outweigh the moral reasons generate the right to freely contract.

Now, this does not seem to pose a problem for pluralist. It seems unproblematic because the relative moral weight of the right to reparation as against the freedom of contract is a balancing act contained in the private sphere with reference to the values of substantive freedom and equality. However, our consideration of (vi) exclusion clauses is just a dress rehearsal, from which we can observe a pattern. We can see how: reasons from outside of the contractual relationship are nonetheless reasons that determine the content of ‘contract law’.

In light of this pattern, consider commandments (viii) to (x). The reason why (viii) prenuptial agreements require financial disclosure and independent legal advice is because the agreement needs to have “decisive weight” if it is to displace the what would otherwise be the just distribution of the relationship property between the spouses or partners when their relationship ends.54 To understand why we have (viii) the law of prenuptial agreements is understand that we need good reasons to outweigh a societal concern for the just distribution of relationship wealth and property.

The reason why a contracting party cannot (ix) discriminate on the basis of another parties’ race, ethnicity, or national origins is because of a shared and mutual concern for civil and political equality. The reasons for civil and political equality outweigh the reasons for an otherwise general discretion to contract. Finally, the reasons why (x) employees can only

  1. Granatino v Radmacher (formerly Granatino) [2010] UKSC 42, [2011] 1 AC 534 at [62] and [70].

be dismissed on particular grounds, and yet retain the general discretion to resign, is because there are good reasons to preserve a fundamental inequality between employee and employer. That we expect employers are to remain committed to a continuous employment relationship, where employees need not be.55 The reasons for commandment (viii) to (x) cannot therefore be reasons internal to the relationship between (formal or substantive) equality between the parties. These are all moral and political reasons outside of the distinctive moral relationship between contracting individuals.

We now arrive at the background problem: the reasons for these commandments (prenuptial agreements, ant-discrimination, unjust dismissal) that are (d) articulated or implied by posited law are not (b)* moral reasons. The reasons that the law aims to give legal effect to though these commandments are reasons extend beyond the distinctive moral relationship between two contracting individuals. The problem with pluralism is that it must convert these extra-moral reasons into moral reasons (or convert open-ended moral reasons into distinctive moral reasons). In doing so, pluralism is blind to how these moral and political reasons enter our legal reasoning. Alternatively, if pluralism seeks to avoid this, and account for a narrow taxonomy of contract law, it must do so without being arbitrary. It must somehow differentiate between contract law’s concern for the substantive freedom and equality of a contracting individual who is in a relationship of influence whilst also explaining contract law’s indifference towards parties to a prenuptial agreement. Which does seem arbitrary, in the same way that Dagan and Dorfman’s distinction between the (ix) discrimination prohibition and

(x) reasons for dismissal is arbitrary.

Monsim, in comparison, recognises that the reasons that underlie commandments (v) to (x) are reasons that are exotic to contract law; they are external limits on contracts that are based upon external reasons. Such reasons may form part of our study of contract law, not because they explain why we have contract law, but because they explain when and how the reasons why we have contract law (the formal freedom and equality of contracting individuals) run out.

6. Why should we care?

This paper has been an endorsement of the monist methodology in contract law scholarship. I have argued here that only monism is able to identify the (b) moral reasons that are (c) distinctive to the relationship between individuals who have (e) voluntarily undertaken obligations to one another, that (f) have been articulated in positive law. In doing so, monism is also able to identify the moral and political reasons (what I have described here as ‘external reasons’), that are (~c) outside of “the

  1. See, for instance, John Gardner “The Contractualisation of Labour Law” in Hugh Collins, Gillian Lester and Virginia Mantouvalou (eds) Philosophical Foundations of Labour Law (Oxford University Press, New York, 2018) 33.

distinctive nature of the justification of” contract law,56 that have also been (f) articulated in positive law. Pluralism, in comparison, hides this distinction between internal and external reasons, and the subsequent tension between private and public spheres, behind the abstract and capacious principles of substantive freedom and equality.

But, after all this, why should we care? In this final section, let me pull together my main concern with pluralistic scholarship. My main concerned is premised upon two preliminary concerns.

The first preliminary concern is whether our scholarship should be concerned with the (f) reasons that have been articulated in positive law. Initially, this methodological commitment created the challenge for pluralists to show that positive law embodies a plurality of values that go to the substantive freedom and equality of the parties, and I have sought to demonstrate here that only monism is able to work within the constraint of identifying moral (f) reasons that have been articulated in positive law. Beyond this is a further concern with scholarship that claims “that the discovery, or articulation, of law’s ideals come and should come from the substance of law itself”.57 Where the “the ideals are well grounded and admirable”58 then the scholarship and critique will be able to evaluate when the law has adhered to, or deviated from, those ideals. However, “if the ideals are themselves flawed, so will be the critique”.59 To the extent that our scholarship seeks to evaluate and improve the law (beyond descriptively reporting on its own claims about itself), then the critique may need to be based on ideals from outside the law itself. In this way, if we were to depart from the “coherence lawyering”60 that commitment (f) requires of us, and instead openly criticize contract law and prescribe how it ought to be, we can only do so through the monist method (but without the monist conservatism).61 That is, view contract law as the villain – as a body of legal doctrine that is premised upon a shallow and superficial account of the moral relationship between parties – and then seek to limit and modify it. And then limit and modify contract with reference to a full range of values, that includes concern for the substantive freedom and equality of the parties, without being ‘exclusively fixated with’ narrow liberal values’.

The second preliminary concern is whether we should view contract law as aiming to give legal effect to (b) moral reasons (a pre-political reasons, independent of concerns for welfare, material equality, or just distribution). As I have sought to explain here, even if we view the

  1. Weinrib, above n 15, at 48; and Dagan and Dorfman, above n 8, at 1405.
  1. West, above n 5, at 159. 58 At 159.

59 At 159.

  1. O’Mahony, above n 1, at 5; and Hugh Collins“Utility and Rights in Common Law Reasoning: Rebalancing Private Law Through Constitutionalization” (2007) 30 Dal LJ 1 at 6.
  2. O’Mahony, above n 1, at 15.

phenomenon of contracting as creating a distinctive moral relationship between contracting individuals, we must also acknowledge that there are broader moral and political reasons (outside of the distinctive moral relationship) that limit and inform the relationship. The law may (or may not) intervene in the distinctive contractual relationship on the basis of undue influence, unconscionability, consumer protection, employee or spousal rights (and so on), and whether it does (or does not) is a question that extend beyond the distinctive moral relationship, into broader social and political questions.

My main concern follows from these two preliminaries. Private law claims for itself a ‘private sphere’ that ought to sit interpedently of the public sphere. Critical scholars have warned us from accepting this claim.62 As West explains, according to the critical view, “at best” it is a claim that private law is “is a branch of public regulatory law disingenuously committed to the assertion that it is distinctively different from the public law regimes of which it is a part”.63 Or, “at worst” the claim “justifies the maldistribution of political power that it then disingenuously protects from public critique or political change”.64 As I have sought to explain here, the pluralist methodology enables this type of claim, in attempting to preserve a private sphere for private law to govern, whilst at the same time, obfuscating the tension and conflict between private spheres and public spheres behind the abstract and capacious principles of substantive freedom and equality.

7. Conclusion

This is a paper is ultimately about the methodological choices that we make when we engage in contract law (or private law, more broadly) scholarship. It has been a rejection of the pluralist methodology, and in particular, the attempt to identify a set of values (beyond a liberal core) as emanating from private law doctrine itself. I have argued here that if we are interested in identifying the moral reasons that contract law aims to give legal effect that are (f) reasons that have been articulated in positive law, then only monist is able to account for the symmetry between ‘what contract law is’ and ‘why we have it’. Moreover, I have argued that, if we want to depart from the descriptive constraint in methodological commitment (f), then the problem with pluralism is that hides the tension between the liberal commitment to freedom and formal quality in the private law sphere and broader moral and political values in the public sphere. Contract law is the result of the uneasy and conflict- ridden pursuit of both: formal and substantive freedom, independence and inter-dependence, and freedom from the state and recourse to state institutions. Pluralism errs in making this uneasy pursuit look easy.

  1. See, for instance, Duncan Kennedy “The Stages of the Decline of the Public/Private Distinction” (1982) 130 U Pa L Rev 1349; and Louis Michael Seidman “Critical Constitutionalism Now” (2006) 75 Fordham L Rev 575.
  2. West, above n 5, at 146. 64 At 146.

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