Copyright (c) 1985 University of Wisconsin Law SchoolWisconsin Law ReviewMay, 1985 / June, 19851985 Wis. L. Rev. 581LENGTH: 15538 wordsSYMPOSIUM: LAW, PRIVATE GOVERNANCE AND CONTINUING RELATIONSHIPS: RELATIONAL CONTRACT: COMMENT: RELATIONAL CONTRACT THEORY IN A COMPARATIVE PERSPECTIVE: TENSIONS BETWEEN CONTRACT AND ANTITRUST LAW PRINCIPLES IN THE ASSESSMENT OF CONTRACT RELATIONS BETWEEN AUTOMOBILE MANUFACTURERS AND THEIR DEALERS IN GERMANY.NAME: CHRISTIAN JOERGES *BIO: * Professor of Law, Bremen University; Co-Director, Center for European Legal Policy, Bremen; Dr. jur., Frankfurt University 1969; Assessor, 1971; Dozent, Frankfurt University 1973. My participation at Madison was made possible through both the support of the symposium organizers and a financial contribution from the Deutsche Forschungsgemeinschaft. I am also indebted to Stewart Macaulay and Bill Whitford for their patient advice and to many participants of the symposium for their helpful suggestions.SUMMARY: ... There have been efforts in Germany to adapt general contract law doctrines to the special conditions of long-term contractual relations and, moreover, there exist intensive discussions on the means and the fairness of contract adjustment terms in various areas. ... The Federal High Court's refrain from a more precise definition of the adopted standards -- thus imposing a duty on the parties to renegotiate their relation -- may be interpreted by Macneil as the emergence of truly relational contract law. ... Relational contract law may turn out to be flexible enough to adapt even to the constant changes that dynamic competition policy concepts would require. ... In this respect, relational contract law is nothing other than a "functional" response to the deficiencies of an outmoded model. The ideological and political neutrality of the concept is perfectly consistent with the method used in Macneil's analysis of new values and norms accompanying the emergence of relational contract law. ... The question whether relational contract law theory claims to guide the judicial decision-making process seems thus to be answered in the negative. ... At this level, justifying the content of rules or principles is abandoned and replaced by the justification of procedures guiding the discourse of synthetic moral judgments. ... My interestin the concept of relational contract law likely has thus, for Macneil, a surprising background. ... HIGHLIGHT: Traditionally, contract disputes between German automobile manufacturers and their dealers have been limited, with the terms of the contracts drawn overwhelmingly in favor of the manufacturers; dealers protected themselves through associational actions. Passage of the Standard Terms Act of 1976, coupled with the announcement of recent Federal High Court decisions interpreting that Act have, however, indicated that the courts are becoming -- at least in a contracts context -- more willing to balance the manufacturers' need for flexible adjustment mechanisms against the dealers' desire for a less one-sided contractual arrangement.On the other hand, recent German court decisions involving automobile manufacturer-dealer contracts made within the context of German antitrust law concerning vertical restraints of trade have permitted manufacturers the right to insist that dealers accept exclusive dealing and purchasing arrangements. Thus, the antitrust cases have reinforced the one-sidedness of these contracts.In this Comment, Professor Joerges explains that this inconsistency could partially be resolved through refinement either of economic analysis of law approaches or German contract law scholarship, but that neither method ever will be satisfactory. Professor Joerges suggests, instead, that Ian Macneil's relational contract theory is a more satisfactory method for resolving the inconsistency of these decisions because it better integrates an understanding of the relationship of competitive processes and contractual behavior.Nonetheless, Professor Joerges suggests that Macneil's theory needs refinement in two respects. First, it is based upon an incomplete critique of classical contract, which equates rights with freedom and assumes therefore that institutionalized rights are a satisfactory guarantee of a legitimate social order. Second, it inadequately explains the development of neo-classical law from classical law because it is a functional model whose ideological and political neutrality neglects the necessity of making normative judgments in assessing conflicts among colliding legal claims generated from social conflict.TEXT: [*582] Ian Macneil's work on relational contracts has hardly been perceived as yet in Germany; n1 even less noted are efforts to synthesize his theory with the economic analysis of law; n2 and recognition of critical reactions to Macneil is non-existent. This does not, of course, mean that the non-legal and legal phenomena identified by Macneil have not been observed. There have been efforts in Germany to adapt general contract law doctrines to the special conditions of long-term contractual relations n3 and, moreover, there exist intensive discussions on the means and the fairness of contract adjustment terms in various areas. n4 For this reason, the law of relational contracts is a fascinating subject for comparative research and analysis. Although it would certainly be worth doing this research within the broad framework of Macneil's approach, such an ambitious attempt would demand too much from this Comment. Thus, I have chosen to resort to an American virtue: Iwill present a concrete example and explain my general comments about Macneil's approach by reference to this concrete topic. My example deals with the relations in Germany between automobile manufacturers and their authorized dealers. It thus concerns a relatively small sector of the broad spectrum of relational contracts as understood by Macneil. The first reason for choosing this subject is simply the fact that it is one to which I have recently devoted much time. n5 More importantly, it manifests exemplary qualities: The relations between automobile manufacturers and their dealers have never conformed [*583] to the patterns of "classical"contract law; and they seem to overstrain the regulatory capacities of "neo-classical" contract law as well. Furthermore, these relations are affected by "external" policies, n6 such as antitrust objections to their effects on the competitive
View Full Document
Unlocking...