Anthony Townsend Kronman

Mistake, Disclosure, Information, and the Law of Contracts

[The greater part of the writers on natural law] are of opinion, that the good faith which ought to govern the contract of sale, only requires that the vendor should represent the thing sold as it is, without dissimulating its defects, and not to sell it above the price which it bears at the time of the contract; that he commits no injustice in selling it at this price, although he knows that the price must soon fall; that he is not obliged to disclose to the vendee a knowledge which he may have of the circumstances that may produce a depression of the price; the vendee having no more right to demand that the vendor should impart this knowledge than that he should give away his property..

Paternalism and the Law of Contracts

Our legal system, like every other, limits the power of individuals to enlist the state in the enforcement of their private agree.ments.1 In a broad sense, all limitations of this sort restrict the contractual freedom of those involved by depriving them of the right to decide whether their voluntary arrangements shall be legally binding. Many of these limitations are intended to protect the interests of third parties, including the general interests of society at large: Two neighbors cannot make an enforceable contract to rob a third, nor can a group of businessmen negotiate a pricefixing agreement that will be binding as a matter of law. Other restraints on contractual freedom, however, are primarily intended to protect those whose freedom they restrict. Restraints of this sort aim to protect people from themselves by limiting their capacity to make enforceable agreements of various kinds. In general, any legal rule that prohibits an action on the ground that it would be contrary to the actors own welfare is paternalistic. The prohibition against suicide,2 the requirement that motorcyclists wear helmets, 3 laws that restrict the use of drugs4 or make education compulsory5 are all

Practical Wisdom and Professional Character

IThe existence of the legal profession is something most lawyers take for granted. Lawyers of course do many different things, and lead different sorts of lives, but those who make their living in the law tend to assume, without much reflection, that they have a bond or association of some sort with others who do the same and believe they share something important in common with them. It is not at all clear, however, what this common element is, and the great diversity of tasks that lawyers perform – representing litigants, counseling clients, advising legislators, administering government programs, and deciding cases – can easily make one doubt whether the search for a link leads to anything but empty generalities.One may, of course, conclude that the main law jobs, as Karl Llewellyn called them, have nothing important in common, and that the legal profession is only a name for a disconnected collection of pursuits with no substance or reality of its own. This is not, however, a very satisfying view, to lawyers at least, and is likely to provoke the quick reply that what lawyers share in common is after all quite easy to discern. All lawyers, regardless of the nature of their work, possess a general knowledge of the law which they have acquired through a specialized program of instruction; laypersons lack such knowledge and it is this, one might argue, which marks the line between those who are lawyers and those who are not and, thus, defines the scope and nature of the profession.