Bureaucracy and Contracts of Adhesion

Under the political theory of the liberal state, there is no adequate traditional justification for contracts of adhesion. Professor Macneil seeks to locate their legitimacy in the nature of modern bureaucracy. He demonstrates how this mode of legitimation sets limits for government intervention. In his conclusion, Professor Macneil emphasizes the significance of his analysis for a fuller understanding of the validity and the complex operation of contracts of adhesion

Contractual Choice of Law in Contracts of Adhesion and Party Autonomy

The article attempts to argue that contracts of adhesion do not conform to the notion of autonomy that underlies the choice of law by the parties and is incompatible with the principle of mutuality on which the power of the parties to make the choice of applicable law rests. The main theme of the article is to suggest that the choice of law clause in contracts of adhesion shall not take effect (although the clause may not necessarily be invalid), unless and until the other party (adherent) meaningfully agrees or a court scrutinizes the contract for the true assent of the adherent. The article proposes and advocates a “second chance” approach for the contractual choice of law in contracts of adhesion in order to protect the adherents’ interest that otherwise would be adversely affected. Part II of this article begins with an analysis of the autonomy in selecting the governing law for the contract and also discusses the mutuality that is needed in the process of choice of law by the parties. Part III focuses on one-sided scenarios of contracts of adhesion, particularly the cohesive “wrap” agreements, and their incompatibility with mutuality-based autonomy in contractual choice of law. Part IV provides a critical view of the doctrines employed by courts in the United States to deal with contracts of adhesion, with a focus on the issue as to whether those doctrines would, to the extent that the parties’ assent is truly expressed, help ensure the autonomy that the parties are supposed to have in making a choice of law in contracts of adhesion. In Part V, the article addresses why adherents should have a “second chance” against an adhesive choice of law clause, and how the “second chance” is to be exercised. The article concludes in Part VI by pointing out that given its uniqueness, the choice of law issue should be coped with separately from other parts of the contract. The basic argument is that for contracts of adhesion, though the time may not yet be ripe for a set of new rules to police the choice of law clause, adherents should not necessarily adhere to the choice of law made by the other party, but rather should be given a second chance to really make a choice, namely to either agree or disagree. Thus, as a general rule, a choice of law clause in an adhesion contract shall be presumed ineffective; and thus, unenforceable unless the adherent’s true assent is confirmed

An Important Time for the Future of Class Action Waivers and the Power Struggle Between Businesses and Consumers

This Note discusses the inherent problems that come with arbitration clauses in contracts of adhesion. Further, this Note will address the likelihood of a potential change – through future Supreme Court interpretations of the FAA or new legislation. Something must be done to protect those with inferior bargaining power from being forced, through contracts of adhesion, to give up their right to bring class action lawsuits. If Congress, the Supreme Court, and regulatory agencies maintain the status quo, companies will retain the ability to improperly strip consumers of their rights and their due compensation nationwide

Take It or Leave It: \u3cem\u3eMonsanto v. McFarling\u3c/em\u3e, \u3cem\u3eBowers v. Baystate Technologies\u3c/em\u3e, and the Federal Circuit\u27s Formalistic Approach to Contracts of Adhesion

The Federal Circuit has been widely criticized for unrelenting formalism. Perhaps because Congress charged the court with establishing national uniformity in areas of the law where uniformity was lacking, the Federal Circuit has often expressed a significant preference for bright-line rules. According to many critics, this preference has come at the expense of fairness. In two relatively recent decisions, the Federal Circuit has expanded its formalism into the area of contracts of adhesion, a topic it had not had the opportunity to consider before. This Note examines those two decisions, the formalistic approach taken by the Federal Circuit, and the less formal approaches taken by other courts. By examining those other approaches and taking into account relevant intellectual property policy, the Note proposes a less formal, factor-based approach to cases dealing with contracts of adhesion

Readability, Contracts of Recurring Use, nd the Problem of Ex Post Judicial Governance of Health Insurance Policies

While the rhetoric surrounding the passage of the Patient Protection and Affordable Care Act focused on core issues such as cost, quality, and access to care, the dialog rarely acknowledged a key problem-the fact that most Americans do not understand their health insurance. Simply put, consumers do not fully grasp their health insurance coverage because the jargon found in many health insurance contracts is impenetrable to most Americans. This is disconcerting because consumer-oriented information is central to our increasingly consumer-directed health care system. Consumers are expected to make cost-effective choices among the array of health insurance plans that may be available to them, utilize health care services in a cost-effective manner, navigate provider networks, minimize their out-of-pocket expenses, and effectively appeal denials of coverage. Furthermore, unlike other types of insurance agreements, health insurance policies are contracts of recurring use. That is, health insurance policies are routinely and repeatedly invoked by consumers to finance their health care. Yet, such contracts are written at a level that is beyond the reading skills of most Americans. As such, insureds not only have difficultly understanding the details of their coverage, they do not fully comprehend the benefits and rights afforded by the policy. Consequently, the traditional approach of ex post judicial governance of insurance agreements (as adhesion contracts) by interpreting ambiguities in favor of insureds provides inadequate protection for health insurance consumers. If consumers do not understand their coverage rights and benefits, they cannot reasonably be expected to know when those benefits have been wrongly denied. The better, ex ante solution is to make health insurance contracts readable in the first instance by requiring that health insurance contracts meet an eighth grade readability standard as a condition of state approval

Mass Arbitration

For decades, the class action has been in the crosshairs of defense-side procedural warfare. Repeated attacks on the class action by the defense bar, the U.S. Chamber of Commerce, and other defense-side interest groups have been overwhelmingly successful. None proved more successful than the “arbitration revolution”—a forty- year campaign to eliminate class actions through forced arbitration provisions in private contracts. The effects for civil justice have been profound. Scores of claims vanished from the civil justice landscape—claims concerning civil rights, wage theft, sexual harassment, and consumer fraud. The effects for social justice, racial justice, gender justice, and economic justice were especially profound, as the legal claims of minorities, women, wage-and- hour workers, and the working poor were systematically and disproportionately foreclosed. Yet now, just when one would expect the defense bar to be taking a victory lap, prominent defendants are abandoning the hard-fought right to disable the class action through arbitration and instead seeking refuge in class actions in court. Why the about face? A surprising counter-offensive to use individual arbitration to plaintiffs’ advantage—Mass Arbitration. This Article presents a foundational analysis of the subject. This Article develops the first and only case study of Mass Arbitration and provides a taxonomy of the results. What emerges is not a variation on old themes but, instead, a new and distinct model of dispute resolution. The investigation reveals significant ways in which the Mass Arbitration model challenges conventional litigation theory wisdom about the economics of individual claiming, uncovers important differences between the Mass Arbitration model and existing forms of aggregate dispute resolution, recasts long-standing debates in litigation theory and jurisprudence, and provides new perspectives on the relationships among private procedural ordering, public procedural reform, and civil justice. Mass Arbitration, in other words, is a phenomenon in its own right. More importantly, it offers a window into the future of civil justice