Yet in spite of, or rather because of, these shortcomings, the law of contract continues to occupy a peculiar and central place in legal education whose influence extends across the entire curriculum. Purified by a careful process of exclusion, it conveys to students a particular idea of law as a whole - an idea of what law essentially is. Through carbolic smokeballs, old oats and the intricacies of offer and acceptance, students not only begin to learn the lore which will identify them as guardians of the mysteries of the law, but also come
to learn what 'real' law is. Like the reality constructed in our primary socialisation as children, the reality of law which the law of contract first constructs tends to retain for ever its massive Power over us.
To see through this, and thereby to understand that what lies beyond the technical rules are the deeper and more lasting lessons that the law of contract teaches, one must first dispose of the widespread assumption that the importance of the law of contract in the law school is a reflection of its importance in practice.
While it is undoubtedly true that in a world increasingly dominated by market exchange the institution of contract is of central importance, it does not follow that so too Is the law of contract as constituted by the standard texts. First, as any legal practitioner knows, since the law of contract consists only of general rules and principles it rarely provides more than a very partial picture of the relevant legal rules in any real situation. Today there are few types of contract which are not governed by special legal rules, and/or are subject to particular public law provisions. Generally these do not supplement the supposed general principles (such as freedom of contract), but run counter to them. Only by more or less rigorously excluding these 'special' rules can the idea of the law of contract be sustained.
Secondly, if the importance of the law of contract of the textbooks were a reflection of its importance in practice, it is inexplicable why so much space is given to topics such as consideration, offer and acceptance, privity, and mistake, which rarely arise in practice. Conversely it is equally puzzling why so little attention is given to such practically important issues as contract drafting, interpretation and negotiation, Is it because these latter issues are necessarily concerned with the terms of contracts, and it is in their terms that contracts most clearly reveal themselves as the expression of relations of power rather than the embodiment of principles?
Thirdly, many empirical studies show that the law of contract has a limited effect on the way people in business operate in practice, rarely determining the outcome even when a dispute arises.
While it looks initially like a great waterfall running into every corner of life, it turns out that by the time the law of contract has flowed down to the real world it is reduced to a mere trickle which only holds in ;a few crevices. Indeed it is difficult to avoid the conclusion that so little relation does it have to the real world of the practising lawyer, let alone that of the businessman, tenant or the consumer, that it is little more than a creation of the academy, constituted by the very texts which purport to describe it. This suggests that it is a form of knowledge which has dominion only in the classroom and the examination hall where the student encounters the carefully crafted problem situation in which anything that would challenge the view that general principles can provide answers has been legislated out of existence. Indeed I would argue that the modern law of contract is not merely constituted by the student texts (for which there is ample historical evidence from its origins in the nineteenth century), but that it is constituted by exclusion.
Thus the precarious claim to importance of the law of contract depends not only on excluding special statutory provisions and references to the realities of legal and business practice, but, most importantly, on a continuous attempt to exclude the uncertainties and indeterminacies in contract doctrine which challenge some of its central constitutive claims, namely the possibility of deducing answers to particular situations from purely legal general rules and principles, and without recourse to political and moral argument and assumptions. This is achieved in various ways: by carefully constructing and purifying the facts of problem situations, thereby concealing the political and other value preferences implicit in choosing what is to be considered legally relevant; by deploying the ubiquitous trick of precedent, namely suggesting that just because the decision in the instant case is logically consistent with certain chosen precedents it, and no other decision, logically follows; and, on no better grounds than that it is a contract course, by continually excluding as irrelevant ways of conceiving the relationship between the parties as other than contractual, thereby continuously concealing from the student the fact that law merely solves the problems it itself creates. Furthermore, by focusing exclusively on the interparty relation, the law of contract simply conjures ideas of justice other than interparty fairness out of existence. Questions of social and distributive justice, which relate to consequences and which threaten the orderly world of rules and principles, are simply outlawed from the toytown world of the contract class.
In this way the liberal individualist conception of justice (which restricts justice to general rules of just conduct and ignores the fact that different people and groups have different access to the resources of wealth, education and power), remains unchallenged as the silent underpinning of the law of contract. Just rules are conveniently conflated with a just world. Indeed one of the features of The Law of Contract which appeals to students is that since it is comprehensible without any knowledge of the real world, a simple idea of justice as the-same-rules-for-all suffices. It is important to recognise that this apparent comprehensibility is only possible if one excludes from sight the unequal world to which the law of contract applies.
Particularly revealing of how the law of contract is constituted by exclusion is the way it skirts around the real substance of contracts, and rarely reaches the parts that matter to the parties: their terms and contents. Thus most of its doctrines are about peripheral issues such as formation, privity, assignment and breach. Furthermore, by drawing its material Purely from instances of dispute, it focuses on the exceptional as opposed to the unexceptional realities daily sustained by the terms of contracts. Of course in recent years the idea of freedom of contract - the official excuse for standing back from the contractual terms - has been encroached upon by ideas of unconscionability, duress and inequality of bargaining (as in UCTA, the Unfair Contract Terms Act of 1977). Because of the generality of such encroachments, the standard texts have not been able to retain their distance and ignore them. But in teaching them as mere supplements to the body of contract law, to be considered only when the edifice is firmly in place, traditional expositions have sought to minimise the danger they pose by their open-ended standards and their capacity to disclose real people and consequences beneath the classroom abstractions of As and Bs. In truth, however, such doctrines are indeed dangerous supplements, for they threaten to expose what, to preserve its identity, the law of contract must necessarily suppress, namely that contract is an instrument of power, not only in a few exceptional cases, but in its very nature. To understand this is to open the way to revealing how contract merely serves to provide a cloak of legitimacy to the underlying structural inequalities of power in society, such as those of class, gender and race. If we think there are good reasons why the little old lady should not be held strictly to all the terms of a hire-purchase contract just because she has 'agreed' to them, why (for example) should the employee, often with less real choice than the old lady, be held to his or her contract of employment? Do not all contracts merely give legal expression to the relative power of the parties?
So far, then, I have suggested that the law of contract conceals more than it reveals about the social order in a world based on market exchange; that it is constituted by excluding and suppressing; and that it is little more than an academic creation whose validity scarcely extends beyond the artificial world of the classroom. If this were all we could perhaps dismiss it simply as an irrelevant academic exercise, a mere waste of time, which, through inertia, has somehow survived from a time long gone when it was genuinely believed that there were discoverable universal rules and principles. However, in my view, the law of contract as it is traditionally taught is more than a mere waste of time. It is positively pernicious, for it performs important ideological functions for the existing social order. It is this that enables us to understand why it retains its central place in the law school curriculum.
As I have suggested, it is the law of contract which conveys par excellence to students an image of what law as a whole is, and of what real' law is like. This image has various related aspects. First, it is an image of law as founded on a mixture of commonsense and an everyday sense of justice, albeit one refined over the centuries by the relentless application of pure reason. In short, through the law of contract, law appears as a form of wisdom, the product of reasoned reflection on experience, which, like all forms of wisdom, is only to be challenged by the foolish. Secondly, through the law of contract, law appears a logically coherent set of rules, principles and concepts, which in all but exceptional cases generates clear and determinate solutions. In short, law appears, at least potentially, as a self-sufficient form of reasoning. Thirdly, the law of contract projects an image of law as a set of rules which logically follow from a restricted number of self-evident principles which can be abstracted from particulars and consequences. Fourthly, it presents law as both eternal and universal, like the laws of physics; something whose rules, though discovered at particular times and places, once discovered have a timeless and universal validity. Fifthly, by purging virtually all reference to statute, so that the law of contract appears to be an almost pure creation of the common law, it projects an image of real law not as manmade but as the product of judicial discovery.
The law of contract, then, projects an image of law as a whole as the universal and eternal wisdom which reason has discovered, and communicates an idea of law as beyond policy and politics - the neutral language of commonsense and justice. Furthermore, denied any other viewpoint, students are likely to treat an exposition of the rules as a description of how the world really works. The law of contract creates a master-image of the well-ordered society; a society in which law appears as the 'haven of justice', divorced from the dirtiness of business, politics, power and the conflict of interests and of values; a society which rises above the uncertainties and incoherences of political and moral argument. This is the first and most general lesson which the law of contract teaches. However, it also teaches two more particular ideological lessons.
First, it serves to make the contingent fact of capitalism, the appearance of social relations as market-exchange relations, look like the necessary facts of life, by concealing that the conceptualisation of social relations as contractual is not outside history but has a history. Secondly, by creating the appearance that, through the law of contract, such relations are, or can be made, subject to universal principles of commonsense and justice, it serves to put the justice of the market-based social order beyond question. By projecting the (liberal) image of social order as purely the product of individual choices, and by assuming that one can equate a person's interests with what he consents to, the law of contract renders power largely invisible, thereby making the relations of power that constitute capitalism look like relations of justice. Put differently, t-he law of contract takes at face value, and gives legal expression to, the self-image of capitalism as an order of opportunity, choice and voluntary exchange in which all individuals can participate on equal terms. What that conceals is not only that opportunities and choices are not equally available, and that exchanges are often far from voluntary, but also that the only choices on offer are those consistent with maintaining the existing system of capitalist production relations. This precisely requires that those relations be seen as no more than the product of voluntary individual exchanges.
In short, in contract classes the student may learn little of practical utility but he or she learns two of the vital lessons on which the legitimacy of capitalism depends, namely what 'real' law is, and that market capitalism is, or at least can be made, an order of justice. What, then, can a critical contract course do, and what might it look like?
The
first and most obvious thing it can do is to avoid participating in constructing
the image of contract law, and thereby law as a whole, which has been
sketched above. This means de-centring the textbooks, using them selectively
and suspiciously rather than allowing them to define and dominate the
course. By viewing cases as the central legal text and the orthodox textbooks
merely as a gloss or commentary upon the cases, which offer one possible
reading rather than a statement of the law, one creates an idea of law
which is at once more open and uncertain. Moreover, by contrasting the
official reading of the textbook with the various other possible readings
of the cases one is able to draw out the unspoken assumptions and political
and moral preferences which give the appearance of coherence and certainty
to the official reading.
Secondly, a critical course must move beyond the artificial world of the
Court of Appeal to explore the realities of contracting practice, the
consequences of such practice, and the legal interpretation of it. By
viewing contract not as a statement of rules in some ideal world but as
a practical tool which may be deployed with greater or lesser skill, and
which reflects the power of those using it, inequality of bargaining and
unfair contract terms are revealed not as a gloss or awkward addition
on a logical body of rules based on freedom of contract, but as inherent
in the nature of contractual relations. For example, studies on the use
and non-use of the law of contract in practice do not simply reveal the
context in which the text of the law (conceived as self-sufficient) operates,
but rather the context reveals the character of the text: one of power.
Thirdly, by focusing not on the so-called 'general' law of contract, but
on the particular categories of contract, such as marriage, employment
and consumer contracts (which are excluded from the standard texts precisely
so that the claim that there is a general law of contract can be maintained),
one challenges the image that these contract texts purvey, namely that
social relations are regulated by reason, justice and commonsense. Nothing
demonstrates more simply the ideological role of the orthodox contract
texts than showing how rarely in practice the rules they proclaim operate
without qualification, and how the law of contract is little more than
a mirage constructed by academics which maintains a connection with justice
only by abstracting from all particular circumstances and effects.
Fourthly, rather than seeing each case as little more than an example
of the application of preexisting rules and principles (introduced primarily
for clarification), each case should be seen for what it was: the occasion
or opportunity for judicial decision. Consequently it should be interrogated
in terms of what led to the particular decision; what political and moral
attitudes informed judicial opinion; and what assumptions make that opinion
plausible. By drawing out the dominant liberal individualism and the very
occasional glimpse of other views informing contract cases, one cannot
avoid confronting the fact that contract law is not outside politics but
part of it.
Fifthly, by opening up, through the cases, the incoherences, uncertainties
and indeterminacies which the textbooks so skilfully conspire to conceal,
one necessarily reveals that the law of contract, to the extent that one
can talk of it at all as a whole, is not a set of universal rules outside
particular times and places, but has a history, not only in the sense
that the rules have changed, but in the more important sense that conceiving
of social relations as contractual relations is historically relative.
Only when legal decisions appear to be the product of pure 'legal logic'
does it seem possible to dispense with history, just as the truth claims
of science, if accepted, appear to render the history of science superfluous.
While the history of contract can be and has been written from many viewpoints,
it is difficult to deny the central importance of viewing it as an aspect
of the history of capitalism, and of viewing contract as both the practical
instrument and the legal ideological expression of the relations of market
exchange (see Grigg-Spall and Ireland in this chapter). Together with
property law it has become one of the principal means of giving legitimacy
to the class relations of capitalism. Furthermore, since the law of contract
tends to become the model or measure of law in general, to leave unchallenged
the relationship between contract and capitalism is to leave unquestioned
the relationship between law in general and capitalism. This is not to
deny that to view the history of contract in terms of the history of capitalism
alone may be insufficient.
Finally, and most importantly, by opening up contract law in these ways,
exploring it in terms of its consequences, drawing out the political ideologies
it silently expresses, revealing the historical circumstances of its development,
and demonstrating the potential openness of the cases, one brings into
sight exactly what the textbooks suppress, namely ideas about the expression
of social relations in terms which give voice to quite different ways
of conceiving living together. Thus while contract gives legal expression
to society as a collection of isolated distrustful strangers, submitting
only to general rules out of enlightened self-interest, to challenge contract
is to struggle to conceive of and express other ways of living together,
based for example on altruism, ideas of solidarity or on constructing
norms through engaging in genuine conversation and discussion. Today the
dilemma is to respond to this challenge without simply suggesting the
largely discredited option of extending the role of the state, for that
is to replace the tyranny of the law of contract with the tyranny of state
administration of people Both deny people control over the conditions
of their own existence.
