Substituent effects on the nitrogen-15 and carbon-13 shieldings of some N-arylguanidinium chlorides

The 13C and 15N chemical shifts of five N-arylguanidinium chlorides carrying polar substituents, ranging in character from 4-methoxy to 4-nitro groups, have been determined by NMR spectroscopy at the natural-abundance level of 13C and 15N in dimethyl sulfoxide solution. Comparison of the 13C shifts of these salts with those of monosubstituted benzenes shows that the guanidinium group induces an average downfield shift of -5.8 ppm of the resonance of the aryl carbon to which it is attached (C1), an average upfield shift of +4.2 ppm for C2 and C6, and a small upfield shift of +1.9 ppm for C4. The shifts of C3 and C5 are small and erratic relative to the corresponding carbons in monosubstituted benzenes. The 15N resonances of the guanidinium nitrogens are quite sensitive to electric effects resulting from substitution of polar groups at C4. The 15N shift of the ==NAr nitrogen relative to that of the salts suggests that the predominant tautomer for N-arylguanidines is (H2N)2C==NAr. The 15N shifts of the (NH2) 2 nitrogens correlate rather well with σp- parameters, whereas the shifts of the -NHAr nitrogens seem to correlate only with R values derived from the σp- substituent constants

Third Party Beneficiaries and Contractual Networks

An increasing trend of economic agents is to form productive associations such as networks, platforms and other hybrids. Subsets of these agents contract with each other to further their network project and these contracts can create benefits for, or impose costs on, agents who are not contract parties. Contract law regulates third party claims against contract parties with the third party beneficiary doctrine, which directs courts to ask whether the contracting parties “intended” to benefit a particular third party. We show here what courts do with third party claims when network members fail to perform for third parties and what the law’s best responses to such breaches should be. Among our principal results are that courts honor third party claims when contract members likely can price them and when third parties incur substantial reliance losses, but protect third party interests less frequently than they should and refuse relief when contract members can identify the potential beneficiary class but not every agent who is likely to be in it.

Contract Interpretation Redux

Contract interpretation remains the largest single source of contract litigation between business firms. In part this is because contract interpretation issues are difficult, but it also reflects a deep divide between textualist and contextualist theories of interpretation. While a strong majority of U.S. courts continue to follow the traditional, formalist approach to contract interpretation, some courts and most commentators prefer the contextualist interpretive principles that are reflected in the Uniform Commercial Code and the Second Restatement. In 2003, we published an article that set out a formalist theory of contract interpretation to govern agreements between business firms. We argued that, although accurate judicial interpretations are desirable, accurate interpretations are costly for parties and courts to obtain. Thus, any socially desirable interpretive rule would trade off accuracy against contract-writing and adjudication cost. This tradeoff implies that risk neutral business parties will commonly prefer judicial interpretations to be made on a limited evidentiary base, the most important element of which is the contract itself. But importantly, we also argued that commercial parties\u27 preferences along this dimension will be heterogeneous. Thus, any interpretation rules the state adopts should be defaults and the state should defer to the expressed preferences of particular parties regarding interpretation. This Review clarifies and extends these arguments, which have prompted a number of antiformalist responses. We respond to our critics and summarize empirical data that support our theory. Although much academic commentary suggests otherwise, both the available evidence and prevailing judicial practice support the claim that sophisticated parties prefer textualist interpretation. Sophisticated commercial parties incur costs to cast obligations expressly in written and unconditional forms to permit a party to stand on its rights under the written contract, to improve party incentives to invest in the deal, and to reduce litigation costs. Contextualist courts and commentators prefer to withdraw from parties the ability to use these instruments for contract design. The contextualists, however, cannot justify rules that so significantly restrict contractual freedom in the name of contractual freedom

Rethinking the Laws of Good Faith Purchase

This article is a comparative economic analysis of the disparate doctrines governing the good faith purchase of stolen or misappropriated goods. Good faith purchase questions have occupied the courts and commentators of many nations for millennia. We argue that prior treatments have misconceived the economic problem. An owner of goods will take optimal precautions to prevent theft if she is faced with the loss of her goods; and a purchaser will make an optimal investigation into his seller’s title if the purchaser is faced with the loss of the goods. An owner and a buyer cannot both be faced with the full loss, however. The good faith purchase question thus presents a problem of “double marginalization,” and as with these problems generally, it cannot be solved in a first best efficient way. However, the laws of the major commercial nations are less efficient than they could be. This is particularly true of current U.S. law: In the U.S., an owner always can recover stolen goods, which reduces her incentive to take optimal precautions but creates first best incentives to search for stolen goods. In turn, a buyer of those goods makes a suboptimal investigation into title because the owner may never find him. We propose that the owner should be permitted to recover goods only if she satisfies a negligence standard set at the socially optimal precaution level (which we argue is feasible). This would increase her incentive to take precautions while retaining her efficient incentive to search. Since owner search and buyer investigation are complements, our proposal leaves unchanged the buyer’s (suboptimal) incentive to investigate. Also under current law, an owner who voluntarily parts with her goods cannot recover them from a good faith purchaser. This rule reduces the owner’s incentive to search and so reduces the buyer’s incentive to investigate. Thus, we propose that a negligence standard should apply to owners generally. We argue that the verifiability objections to a vague standard of negligence can be satisfied by the specification of rule-like proxies for owner negligence. A comparative analysis of the law of good faith purchase in the leading commercial jurisdictions shows the chaotic nature of the current disparity in treatment of owners and buyers. Since today many stolen goods cross national borders, a generally applicable solution to the good faith purchase issue will further reduce the demand for stolen goods, reduce the incidence of strategic litigation and enhance social welfare

Contract Interpretation Redux

Contract interpretation remains the largest single source of contract litigation between business firms. In part this is because contract interpretation issues are difficult, but it also reflects a deep divide between textualist and contextualist theories of interpretation. While a strong majority of U.S. courts continue to follow the traditional, formalist approach to contract interpretation, some courts and most commentators prefer the contextualist interpretive principles as exemplified by the Uniform Commercial Code and the Second Restatement. In 2003, we published an article that set out a formalist theory of contract interpretation to govern agreements between business firms. We argued that, although accurate judicial interpretations are desirable, accurate interpretations are costly for parties and courts to obtain. Thus, any socially desirable interpretive rule would trade accuracy off against contract writing and adjudication cost. This trade-off implies that risk neutral business parties will commonly prefer judicial interpretations to be made on a limited evidentiary base the most important element of which is the contract itself. But importantly, we also argued that commercial parties\u27 preferences along this dimension will be heterogeneous. Thus, any interpretation rules the state adopts should be defaults and the state should defer to the expressed preferences of particular parties regarding interpretation. This Review Essay clarifies and extends these arguments which have prompted a number of anti-formalist responses. We respond to our critics and summarize empirical data that support our theory. Although much academic commentary suggests otherwise, both the available evidence and prevailing judicial practice support the claim that sophisticated parties prefer textualist interpretation. Sophisticated commercial parties incur costs to cast obligations expressly in written and unconditional forms to permit a party to stand on its rights under the written contract, to improve party incentives to invest in the deal, and to reduce litigation costs. Contextualist courts and commentators prefer to withdraw from parties the ability to use these instruments for contract design. The contextualists, however, cannot justify rules that so significantly restrict contractual freedom in the name of contractual freedom