Promise in the United States

Promise Definition

An engagement by which the promisor contracts towards another for the performance of some act. 1 Denio (N. Y.) 226. “We are in the habit of considering as the essential feature of contract a promise by one party to another, or by two parties to one another, to do or forbear from doing certain acts. We are further in the habit of using the word ‘promise’ to signify a binding promise, as opposed to the offer of a promise, or, to use the cumbrous terminology of Austin, a pollicitation. … There are then three stages necessary to the making of that sort of agreement which results in contract: There must be an offer, there must be an acceptance of the offer resulting in a promise, and the . law must attach a binding force to the promise, so as to invest it with the character of an obligation.” [1]

Explore Promise in the legal Dictionaries.

Collateral Promise Definition

A promise is collateral if another is the primary or principal debtor, and the relations of debtor and creditor remain unchanged both as to the right and the remedy, and no trust is created by the transaction. [2]

Promise Theory

Serious problems with the promise theory begin the moment we seek a rationale for enforcing promises. The problem for which the promise theory is supposed to be the solution is to figure out exactly why it is that contracts are legally enforceable (and, therefore, which commitments should be enforced). That is, we are concerned, not with why persons ought to keep their word, but with why and therefore when coercion may be used by third parties, including the State, to compel promisors either to perform or pay damages when they fail to keep their word. The best-known answers to the question of legal enforceability provided by the promise theory are often either highly moralistic or tort-like in nature.

Professor Fried, for example, has argued that the obligation to keep one’s promises is a moral one:

“An individual is morally bound to keep his promises because he has intentionally invoked a convention whose function it is to give grounds-moral grounds-for another to expect the promised performance. To renege is to abuse a confidence he was free to invite or not, and which he intentionally did invite. To abuse that confidence now is like (but only like) lying: the abuse of a shared social institution that is intended to invoke the bonds of trust.”

But a moral theory of promising, standing alone, would have courts enforcing purely moral commitments, which is tantamount to legislating virtue. Such an open-ended rationale leads to serious problems for the value of freedom of contract. First, it commits courts to enforcing promissory commitments that the parties themselves may never have contemplated as “contractual” or legally enforceable, thereby undermining the value of freedom from contract. Second, once the moral behavior of the promissor is deemed relevant to the issue of enforceability, the promise theory also appears to make relevant to the issue of enforcement other moral aspects of the promisor’s behavior that may argue against enforcement, thereby undermining the value of freedom to contract. In this manner, the common-law rights of contract can come to resemble the judicial discretion of a court of equity.

Another popular justification of the promise theory looks at the promise from the direction of the promisee. That is, persons may be compelled to perform or pay damages because others have relied or are likely to rely upon a promise to their detriment. This was the rationale for contract law apparently favored by Fuller and Perdue in their famous article The Reliance Interest in Contract Damages -although, as evidenced by his later article, Consideration and Form, Lon Fuller himself never took an injurious reliance theory as far as the many subsequent law professors who so admire his earlier path-breaking work. When the enforceability of promises is justified in this way the promise theory is but a short step away from a detrimental reliance theory. That is, once the injury suffered by the promisee is made the principal rationale for enforcing promises, we *1026 end up with the following very tort-like theory of contract: Just as tort actions compensate persons injured by physical conduct, contract actions compensate persons injured by verbal promissory conduct. In such an approach, either dimension of freedom of contract plays little, if any, role. In sum, this way of justifying the promise theory ultimately transforms it into the detrimental reliance theory, which undermines rather than supports contract as a distinct type of consensual obligation within the liberal conception of justice.

Even the efficiency rationale for the promise theory provided by law-and- economics scholars creates problems. According to this view, an exchange of promises (bargains) is enforceable because both parties are made better off ex ante. Sole reliance on this rationale creates two problems. First, it apparently permits promises to go unenforced whenever it can be shown that factors such as unequal bargaining power or disparities of information undermine the normal assumption of mutual ex ante gain. Second, it enables some to ask why the efficacy of contracts should be assessed according to the ex ante benefits rather than some assessment of ex post fairness of the exchange. Why is the perspective of the parties before the exchange occurs the most appropriate point in a transaction to assess whether someone is made better or worse off by an exchange?

Yet another serious problem for freedom of contract is created by the promise theory’s exclusive focus on promises once it is conceded, as it must be, that many real-world contract law problems arise precisely because parties have unavoidably left “gaps” in their promises. Some theorists argue that other nonpromissory principles must be used to determine the “gap-filling” rules of contract law. According to Charles Fried, who takes exactly this position, where gaps exist in a contract, “the court is forced to sort out the difficulties that result when parties think they have agreed but actually have not. The one basis on which these cases cannot beresolved is on the basis of the agreement-that is, of contract as promise.” While Fried, perhaps reluctantly, concedes this point, other theorists who are quite hostile to viewing consent as central to contract law-such as relational theorists Ian Macneil and Peter Linzer -exalt in this view.

Perhaps more surprisingly, some law-and-economics scholars have adopted the same argument. [FN23] Because the problem of promissory gaps is pervasive, the promise theory implicitly legitimizes a variety of gap-filling rules based not on the parties’ explicit or implicit consent, but on any policy or principle a court or legislature may happen to prefer. As Richard Craswell has argued, “debates over the question of why promises are binding … do much less than is commonly supposed to settle the role to be played by efficiency, non-economic values, or ethical theories generally in selecting contract law’s background rules.”

Promise in Foreign Legal Encyclopedias

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Notes

1. This definition of Promise is based on The Cyclopedic Law Dictionary.
2. This definition of Collateral Promise is based on The Cyclopedic Law Dictionary.

See Also

• Collateral Undertaking
• Promise Of Marriage
• Promise as Consideration
• Contract Formation
• New Promise