The Applicable Regime in the Doctrine of Impracticability

The Applicable Regime in the Doctrine of Impracticability

  • Submitted By: mach3495
  • Date Submitted: 05/01/2016 11:03 PM
  • Category: Business
  • Words: 288
  • Page: 2

doctrine is based on fault, but the strict liability regime doesn`t accept this. The supporters of this regime support it due to its economic efficiency. For example Judge believes that we cannot solve the problem of risk allocation by fault, we can solve it by each party`s expectation from contract performance. In other words the strict liability supporters don`t pay attention to fault and believe that the promisor should compensate the promise for the whole damages. Strict liability regime decreases the costs of optimizing risk allocation by imposing whole damages on the promisor, so it saves the time and costs of the court. Researchers maintains that strict liability is the appropriate approach which parties prefer. Scott associates strict liability with rule-based jurisprudence and fault concerns with broad standards. He then reasons that parties must choose between writing rule-based contracts, strict liability contracts that determine outcomes regardless of eventual state of the world and contracts that are more flexible and include standards fault based contracts such as good faith and the like. Researchers conclude that courts should refrain from filling contractual gaps with broad standards if the contract is silent, because parties can best determine the optimal mix of precise and vague terms and can draft standards cheaply if they want them. If they fail to do so, party autonomy demands strict liability. The bottom line in an excuse case must be to enforce a promise to perform strictly unless the parties expressly included a vague term such as fault to deal with a supervening event. But this idea is not correct, because contracts have some issues that require interpretation. The parties’ intent is not obvious and only fault regime can solve these problems.

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