David Friedman, ‘Bringing Order to Contracts Against Public Policy’

In 1821, Judge Burrough famously described the public-policy defense in contract law as a “very unruly horse.” To test this proposition, this article presents the first systematic content analysis of public-policy defense case law. The sparse previous literature and the commentaries on the defense tend to accept the notion that this area of contract law proves unruly, relying on theory and leading cases. I reveal an underlying order that emerges from the ordinary run of public-policy defense cases, rather than the leading cases.

An examination of opinions written in 2009 reveals that public-policy defenses that specify a violation of a statute or regulation tend to be twice more successful than those that appeal broadly to public policy. Further, the employment of the defense can be segmented to show that the “unruly” cases only comprise one-third of the sample. These findings, among others, significantly cut the magnitude of the perceived “unruly horse” problem and should reframe our approach to the public-policy defense.

Friedman, David Adam, Bringing Order to Contracts Against Public Policy (August 10, 2011).

First posted 2011-09-03 13:30:51

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