Clear Rules Still Produce Fuzzy Results: Impossibility in Indian Contract Law

Arizona Journal of International & Comparative Law, Vol. 27, No. 1, 2010

30 Pages Posted: 28 Mar 2011

See all articles by C. Scott Pryor

C. Scott Pryor

Campbell University - Norman Adrian Wiggins School of Law

Date Written: May 5, 2010

Abstract

Robert Scott and others have forcefully argued that the justification for commercial statute-drafting is efficiency. Since commercial parties can draft their own contracts, legislatures should draft default rules, he argues, only when it will save commercial parties time and money. Greater efficiency is achieved when the costs of the gains produced by commercial transactions are reduced. Thus, with few exceptions, the rules of commercial law should be clear, precise, and what most parties would want most of the time. Statutory precision emulates a well-drafted agreement and reduces the risk of moral hazard. The excuse of contractual impossibility (including the liberalized version of commercial impracticability as well as the reciprocal doctrine of frustration of purpose, collectively, impracticability) stands in some tension with the goal of efficiency.

Two responses to this uncertainty seem plausible. First, the law could provide a more precise impracticability rule, one that complies with the precision corollary. Alternatively, we can simply give up on the impracticability project, leaving risks to fall where they may and any excuses to the contract parties and their drafting efforts. This article will address the feasibility of the first alternative, that we can build a better impracticability mousetrap. Instead of speculating about what forms a more precise version of impracticability might take, we will examine a currently subsisting example, section 56 of the Indian Contract Act, 1872. I conclude that the Indian Supreme Court has missed an opportunity to apply section 56 as originally understood and that those who stress the goal of efficiency should not count on judicial application of even precise rules.

Keywords: Contracts, Indian Contract Act, Impossibility, Impracticability

Suggested Citation

Pryor, C. Scott, Clear Rules Still Produce Fuzzy Results: Impossibility in Indian Contract Law (May 5, 2010). Arizona Journal of International & Comparative Law, Vol. 27, No. 1, 2010 , Available at SSRN: https://ssrn.com/abstract=1792964

C. Scott Pryor (Contact Author)

Campbell University - Norman Adrian Wiggins School of Law ( email )

225 Hillsborough Street
Raleigh, NC 27603
United States
919.865.4650 (Phone)

HOME PAGE: http://law.campbell.edu/

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
152
Abstract Views
1,101
Rank
349,390
PlumX Metrics