Seligman on Moral Diversity & Efficient Breach

Matthew Seligman (Cardozo School of Law) has posted Moral Diversity and Efficient Breach (117 Mich. L. Rev. 885 (2019)) on SSRN.  Here is the abstract: Most people think it is morally wrong to breach a contract. But sophisticated commercial parties, like large corporations, have no objection to breaching contracts and paying the price in damages when doing so is in their self-interest. The literature has ignored the profound legal, economic, and normative implications of that asymmetry between individuals’ and firms’ approaches to breach. To individuals, a contract is a promise that cannot be broken regardless of the financial stakes. For example, millions of homeowners refused to breach their mortgage contracts in the aftermath of the housing crisis even though doing so could have saved them tens or even hundreds of thousands of dollars. Their moral beliefs led homeowners to forgo opportunities for efficient breach that firms would have seized, thus…

Read more detail on Recent Law Professor posts –

This entry was posted in Law Professors. Bookmark the permalink.

Leave a Reply