Ohio State Law Journal
Students in contracts and commercial law courses are routinely taught that Article 2 of the Uniform Commercial Code is a product of the Legal Realist movement-that it was designed by its principal draftsman, Karl Llewellyn, to more accurately reflect the needs and realities of modern business than the prior common law and statutes it displaced That story is important, because it is routinely retold as we explain to students the provisions in Article 2 that change the powers, rights, and responsibilities of contracting parties. Yet that story is a myth. There is relatively little "Realism'" in Article 2, whether we are speaking descriptively or normatively. Moreover, the rhetoric of Realism actually serves to camouflage the deliberate regulatory and social policy decisions that were made by the drafters and the legislators.
This Article, part of a symposium on "Commercial Calamities "focuses on four of the major innovations in contract doctrine introduced by Article 2: the new contract formation rules, the merchant duty of good faith, the relaxation of the certainty requirement, and the greater reliance on trade usage evidence. Upon examination, it turns out that none has any discernable Realist roots. None of them reflects either the needs or desires of actual merchants and the lawyers who represent them. Rather, they are the result of a deliberate but largely unexpressed desire to move away from libertarian ideas of laissez-faire contracting to a regulated communal system purged of hard bargaining and sharp deals. More regulation of contracting in the interest of restraining hard bargaining may be a laudable goal, but it has nothing to do with Legal Realism. This Article argues that the "calamitous" result of this Realist rhetoric is to shift the focus away from the actual policy choices made in the statute to a world of mythical "bargains in fact" where we can pretend that we are simply carrying out the wishes of the parties. Stripping away the rhetoric is the first step in allowing us to take a clean look at what the drafters wrought and to make our own social and political decisions.
Franklin G. Snyder,
Clouds of Mystery: Dispelling the Realist Rhetoric of the Uniform Commercial Code,
Ohio St. L.J.
Available at: https://scholarship.law.tamu.edu/facscholar/198