Osler, Hoskin & Harcourt LLP Distinguished Lecture debates the technology of contracts

George Triantis, Eli Goldstein Professor of Law, Harvard Law School

Faculty, students, staff and alumni gathered in Macdonald Hall on October 23, 2010, to hear Professor George Triantis of Harvard Law School deliver the second 2010-11 Osler, Hoskin & Harcourt LLP Distinguished Lecture in Business Law. The Canadian-born Triantis presented a talk entitled “The Economics, Morality and Technology of Contracts.”

Triantis began by discussing his background as a scholar in the Law and Economics school of analysis, observing that the movement draws its current vitality from “an intensified courtship between theory and practice,” a point he demonstrated throughout his talk with frequent allusions to real-world applications of theory.

He used two concepts to frame his discussion of contract formation, “technology” and “morality.” As he noted, many critics of economic analysis contend that morality has been lost as a result of its development but he feels that “in most cases” this has not been the case.

This led into a discussion of contract formation. Triantis highlighted “the problem of incomplete contracts,” referring to gaps in the conditions outlined by the contract. He noted that parties generally rely on the courts to fill in these gaps, and that in some cases parties may even enter into a contract to “buy into” the court’s gap-filling power.

“Although the promise is the atom of a contract, a promise is not a contract,” Triantis said. “Many transactions occur without promises, and many promises are given without contract. In addition, when contracts are signed actual performance ends up being quite different from what is promised, and in this light contracts seem like formalities, simple skeletons of prospective dealings.”

Fundamentally, he sees a contract as a tool, but one which can potentially be very expensive. This is why he advocates careful crafting “so as to decrease the costs and enhance its effectiveness.” This belief translates into his own teaching of Contracts, where he puts “a lot of emphasis on the design of contracts” observing that the parties making a contract are “the ones that make the rules.”

This is why, for Triantis, technology offers a fresh way of looking at contracts: viewing a contract as analogous to software. Like software, a contract is “a set of instructions” to be interpreted by a future court.

He also discussed the relation of remedies to contract formation, highlighting the “alternative promise of a monetary payment” as an alternative to a conditional promise. Here he used a concrete example from outside the realm of law to illustrate his ideas, discussing air travel.

Triantis ended his talk with a question and answer period, where he was asked questions regarding issues such as where the moral concern comes from in an economic efficiency approach, the relationship between legal wrongs and moral wrongs, and the role of the statute of frauds. He said he came away with a positive impression of Queen’s Law students: “the questions were just great and the students were really, really sharp.”

After concluding his remarks, Triantis engaged in a spirited discussion involving several faculty members and students. The conversation was followed by a reception in the Student Lounge, where he fielded more questions from interested students.

"I thought it was a very interesting lecture,” said Osler Business Law Symposium student Ted Gotlieb, Law '11. “Professor Triantis did a good job connecting contemporary issues in contract law to real-world situations, and the discussion afterwards was thought-provoking."

In the distinguished business law lecture series generously sponsored by Osler, Hoskin & Harcourt LLP and directed by Professor Paul B. Miller, five internationally renowned academics delivered topical and scholarly papers in 2010-11. For more information on the other lecturers and to see a video of Professor Triantis' presentation, see http://law.queensu.ca/events/oslerDistinguishedLecturesInBusinessLaw.html.