{"id":328,"date":"2015-05-12T15:52:25","date_gmt":"2015-05-12T19:52:25","guid":{"rendered":"https:\/\/www2.law.temple.edu\/10q\/?p=328"},"modified":"2015-05-12T15:52:25","modified_gmt":"2015-05-12T19:52:25","slug":"a-fuller-understanding-of-contractual-commitment","status":"publish","type":"post","link":"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/","title":{"rendered":"A Fuller Understanding of Contractual Commitment"},"content":{"rendered":"<p>What do recitals of contractual obligation actually <em>do<\/em>? Pennsylvania, uniquely, permits parties to contract into obligations under the Uniform Written Obligations Act. But many other states permit mere recitals of consideration to conclusively establish the enforceability of a contract, even gratuitous promises otherwise unsupported by bargained-for-exchange.<\/p>\n<p>In contract theory, the enforceability of such naked recitals (and the UWOA) are contested. Law Professor Lon Fuller, writing in 1941, famously argued that such formal devices evidence, channel, and caution promisees. He thought that like other legal formalities\u2212e.g., wax seals, the \u201crequirement of a writing,\u201d \u201cattestation, notarization\u201d\u2212recitals of consideration induced individuals to feel and behave in a more committed way to the underlying term supported by the formal recitation.<\/p>\n<p>In a draft paper, <a title=\"Professor Zev Eigen\" href=\"http:\/\/www.law.northwestern.edu\/faculty\/profiles\/ZevEigen\/\" target=\"_blank\" rel=\"noopener noreferrer\">Professor Zev Eigen<\/a> and I have tested Fuller\u2019s hypothesis by means of an experiment on 2000 online subjects. The basic framework for the experiment involved paying participants to divide a sum of money between two third-parties. We then added an extra element\u2014a formality\u2014which depended on the experimental condition: (1) language reciting consideration (a \u201crecital\u201d), (2) a recital accompanied by a sum of money; (3) language <em>disclaiming<\/em> contract formation; or (4) a control, with no reference to contract at all.<\/p>\n<p>Participants were given the opportunity to back out of their commitments and claim a portion of the funds they allocated to third-parties for themselves. Somewhat astonishingly\u2014given the absence of legal sanction for breach of the contract, the anonymous nature of the survey, and reputed greed for small sums of cash among Internet survey respondents\u2014a majority of all subjects across conditions refused to deviate from the allocations initially made. They stuck to their promises, with or without formalities. But some did not.<\/p>\n<blockquote><p>We found that recitals of consideration did no significant work in motivating individuals to stick with their commitments.<\/p><\/blockquote>\n<p>By contrast, bonus consideration\u2014providing subjects a nominal amount of money (ranging from $0.25 to $1.00) to seal their agreement\u2014significantly increased compliance. This tends to support Fuller\u2019s argument that the only \u201creally effective\u201d form of consideration is \u201cnominal consideration actually handed over.\u201d And, in a finding of special relevance to current debates about \u201cno contract\u201d clauses (e.g., in term sheets), <em>disclaimers <\/em>of obligation appeared to perversely <em>increase <\/em>the likelihood that subjects would keep their bargains.<\/p>\n<p>Two other findings are of interest. Women were <em>significantly<\/em> more likely to keep their bargains than men. And, generally, older subjects were more likely to remain committed to their initial allocations than younger subjects. The differences here are stark: 54% of subjects aged 18-24 backed out of their commitments, as compared to 24% of those 45-54 and only 22% of those aged\u00a055-64.<\/p>\n<figure id=\"attachment_354\" aria-describedby=\"caption-attachment-354\" style=\"width: 737px\" class=\"wp-caption aligncenter\"><a href=\"https:\/\/law.temple.edu\/10q\/wp-content\/uploads\/sites\/12\/2015\/06\/Hoffman_Contracts_Chart.png\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-354\" src=\"https:\/\/law.temple.edu\/10q\/wp-content\/uploads\/sites\/12\/2015\/06\/Hoffman_Contracts_Chart.png\" alt=\"Hoffman_Contracts_Chart\" width=\"747\" height=\"543\" srcset=\"https:\/\/law.temple.edu\/10q\/wp-content\/uploads\/sites\/12\/2015\/06\/Hoffman_Contracts_Chart.png 747w, https:\/\/law.temple.edu\/10q\/wp-content\/uploads\/sites\/12\/2015\/06\/Hoffman_Contracts_Chart-300x218.png 300w\" sizes=\"auto, (max-width: 747px) 100vw, 747px\" \/><\/a><figcaption id=\"caption-attachment-354\" class=\"wp-caption-text\">Figure 1: Likelihood to back out of agreement, by age and condition<\/figcaption><\/figure>\n<p>The paper (which you can download <a title=\"A Fuller Understanding of Contractual Commitment\" href=\"http:\/\/papers.ssrn.com\/sol3\/papers.cfm?abstract_id=2567830\" target=\"_blank\" rel=\"noopener noreferrer\">here<\/a>) discusses these findings in more detail and suggests how they might cause us to rethink contract doctrine.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>What do recitals of contractual obligation actually do? Pennsylvania, uniquely, permits parties to contract into obligations under the Uniform Written Obligations Act. But many other states permit mere recitals of consideration to conclusively establish the enforceability of a contract, even gratuitous promises otherwise unsupported by bargained-for-exchange. In contract theory, the enforceability of such naked recitals<\/p>\n","protected":false},"author":5,"featured_media":355,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[31,8],"tags":[],"coauthors":[34],"class_list":["post-328","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-contracts","category-faculty-authored","masonry-post","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.2 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>A Fuller Understanding of Contractual Commitment - The Temple 10-Q<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"A Fuller Understanding of Contractual Commitment - The Temple 10-Q\" \/>\n<meta property=\"og:description\" content=\"What do recitals of contractual obligation actually do? Pennsylvania, uniquely, permits parties to contract into obligations under the Uniform Written Obligations Act. But many other states permit mere recitals of consideration to conclusively establish the enforceability of a contract, even gratuitous promises otherwise unsupported by bargained-for-exchange. In contract theory, the enforceability of such naked recitals\" \/>\n<meta property=\"og:url\" content=\"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/\" \/>\n<meta property=\"og:site_name\" content=\"The Temple 10-Q\" \/>\n<meta property=\"article:published_time\" content=\"2015-05-12T19:52:25+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/law.temple.edu\/10q\/wp-content\/uploads\/sites\/12\/2015\/06\/Hoffman_Contracts_Chart.png\" \/>\n\t<meta property=\"og:image:width\" content=\"747\" \/>\n\t<meta property=\"og:image:height\" content=\"543\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"David A. Hoffman\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"David A. Hoffman\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/\"},\"author\":{\"name\":\"Books Schatschneider\",\"@id\":\"https:\/\/law.temple.edu\/10q\/#\/schema\/person\/23e7012f0cf133dbeb0e76693c9e0154\"},\"headline\":\"A Fuller Understanding of Contractual Commitment\",\"datePublished\":\"2015-05-12T19:52:25+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/\"},\"wordCount\":484,\"commentCount\":1,\"image\":{\"@id\":\"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/law.temple.edu\/10q\/wp-content\/uploads\/sites\/12\/2015\/06\/Hoffman_Contracts_Featured.png\",\"articleSection\":[\"Contracts\",\"Faculty Authored\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/\",\"url\":\"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/\",\"name\":\"A Fuller Understanding of Contractual Commitment - 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Hoffman","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/#article","isPartOf":{"@id":"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/"},"author":{"name":"Books Schatschneider","@id":"https:\/\/law.temple.edu\/10q\/#\/schema\/person\/23e7012f0cf133dbeb0e76693c9e0154"},"headline":"A Fuller Understanding of Contractual Commitment","datePublished":"2015-05-12T19:52:25+00:00","mainEntityOfPage":{"@id":"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/"},"wordCount":484,"commentCount":1,"image":{"@id":"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/#primaryimage"},"thumbnailUrl":"https:\/\/law.temple.edu\/10q\/wp-content\/uploads\/sites\/12\/2015\/06\/Hoffman_Contracts_Featured.png","articleSection":["Contracts","Faculty Authored"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/#respond"]}]},{"@type":"WebPage","@id":"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/","url":"https:\/\/law.temple.edu\/10q\/a-fuller-understanding-of-contractual-commitment\/","name":"A Fuller Understanding of Contractual Commitment - 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