Faculty Scholarship Digest
Larry T. Garvin
Larry T. Garvin, Globe Refining Co. v. Landa Cotton Oil Co. and the Dark Side of Reputation, 12 NEV. L.J. 659 (2012).
This article was a part of a symposium on the worst Supreme Court decisions of all-time. Larry concedes that his entry was no Dred Scott or Korematsu, and may not even be the worst contracts decision of all-time, though it certainly is worthy of the “Hall of Shame.” So why Globe Refining? “Because, in its modest way, it shows how a determined and brilliant judge can foul up the law with even an unpromising set of facts.” And, in this case, that judge was Oliver Wendell Holmes, Jr.. Globe Refining dates back to the pre-Erie days of substantive federal common law, and Justice Holmes used this unremarkable contract dispute (Globe Refining alleged that Landa failed to provide the oil Globe Refining had contracted to buy) to establish a new and wrong-headed requirement for the recovery of contract damages that persisted with surprising strength simply because of the reputation of the opinion’s author.
As described by Larry, Global Refining began with a rather egregious procedural error in applying the rules of diversity jurisdiction (presumably to enable Justice Holmes to address his pet substantive issue), the purely procedural elements of which were a departure from prior law and were subsequently ignored. Substantively though, (and as a piece of finding the amount in controversy insufficient for diversity jurisdiction) Globe Refining introduced the “tacit agreement” test for recovery of contract damages, in addition to the limitation of foreseeability famously expounded in Hadley v. Baxendale. Under the “tacit agreement” test, liability must be set in terms that the breaching party “would have assented to if they had been presented to his mind.” Although prior to Global Refining, the “tacit agreement” test was not followed in the United States and was only sporadically followed in England, Holmes’ endorsement gave it immediate momentum that, though eventually beaten back by Williston, the Restatements, the UCC and other critics, “survives to this day . . . as the law of a few states and an influence on the law of still more.” The article details the reasoning of both aspects of the case and analyzes in detail its subsequent treatment and effect. Why did Holmes do it? It matched his theory of contract, and Larry points to the perils of applying “a juridical method without regard to the actual facts and law at issue” as one of the lessons of the case. He also, notes, however, a long correspondence between Holmes and his friend Frederick Pollock in which they debated contract theory and in which Holmes crowed that he had the opportunity to address the issue in Globe Refining and “I done it,” thus, Larry notes, playing the ultimate trump on his friend.
Larry T. Garvin, Contract Theory and Contract Law, in Bin Liang & Hong Lu eds., JURISPRUDENCE, translated into Chinese by Xiaoyi “Amy” Sun (Renmin Univ. of China Press 2011).
This chapter is part of a book intended for advanced social science students in China seeking an introduction to jurisprudence, with chapters by leading scholars in a variety of fields. Larry’s chapter covers theories of contract law and important recent developments in the field. This includes the recent trends towards theories that take account of non-contractual relations, transaction costs and behavioral tendencies, as well as a rise in normative approaches to contract. On the doctrinal level one of the trends examined is the increased prominence of form contracts and contracts of adhesion that have been a part of the rise in electronic commerce. Notwithstanding the increasing variation across contract types and across jurisdictions, Larry finds some broadly applicable principles.
Larry T. Garvin, FARNSWORTH ON CONTRACTS (3RD ED.) (2009 UPDATE).
Garvin has been a co-author on this leading treatise for a number of years, with sole responsibility since Professor Farnsworth’s death in 2005. By now, the update has grown to include 385 pages of text and more than 1,000 case citations. The update includes expanded references to secondary sources, more coverage of drafting issues, and close attention to developments with the ALI. A
lthough a book like this is, of necessity, filled with see cites to be added to footnotes in the main text, Garvin’s style (and trademark thoroughness) still peek through. For example, the Update has contained a note that “Judge Easterbrook’s statement [referenced in the text] has been much criticized by commentators,” followed by a string cite with parentheticals. Now that passage has the additional comment, “Judge Easterbrook seems unrepentant, continuing to assert this even in cases governed by UCC Article 2A . . . [!]”
Larry T. Garvin (w/the late E. Allan Farnsworth), FARNSWORTH ON CONTRACTS 2011-2 CUMULATIVE SUPPLEMENT (Walters Kluwer 2011)
This latest version of the supplement to the famous three volume contracts treatise now itself runs nearly 800 pages. Curious what commentators have to say about material adverse change clauses? Then this is the book for you. Seriously, though, Larry’s supplement includes literally thousands of cases and thorough treatment of the secondary literature with the lucid yet comprehensive coverage you would expect from Larry, as you did from his late coauthor, Professor Farnsworth.
Larry T. Garvin (w/the late E. Allan Farnsworth), Farnsworth on Contracts 2012-1 (Walters Kluwer 2011).
This latest version of the supplement to the famous three volume contracts treatise now runs 1,000 pages; an extraordinary compilation of knowledge. The volume’s comprehensive and thoughtful coverage includes more than ten percent new material, including a full discussion of the Supreme Court’s recent decisions approving class-action waivers in consumer contracts that Professor Cole has carefully analyzed.
Larry T. Garvin, 2010 CUMULATIVE SUPPLEMENT TO FARNSWORTH ON CONTRACTS (Wolters Kluwer 2010).
In this latest update to the well-known leading contracts treatise, Larry adds many new cases and articles that were published in the past year. The text of the supplement now runs 451 pages.
Larry T. Garvin (w/the late E. Allan Farnsworth), FARNSWORTH ON CONTRACTS 2010-12 CUMULATIVE SUPPLEMENT (Walters Kluwer 2010).
This latest version of the supplement to the famous three volume contracts treatise now itself runs over 600 pages, about one quarter larger than last year. It includes analysis of some recent changes regarding arbitration, citations to opinions by the newest Supreme Court Justices (sitting in the ‘09-‘10 term), literally thousands of cases and thorough treatment of the secondary literature. In short, the lucid yet comprehensive coverage you would expect from Larry, as you did from his late coauthor, Professor Farnsworth.
Larry T. Garvin (w/the late E. Allan Farnsworth), Farnsworth on Contracts 2012-2 (Walters Kluwer 2012).
The supplement to the famous three-volume contracts treatise crossed the 1,000 page threshold earlier this year and constitutes a stunning compendium of information. This midyear update includes new material on questions both large (how many states have adopted amended Article 2) and small (whether sending out a resume can create an implied-in-fact contract).
Larry T. Garvin (w/the late E. Allan Farnsworth), FARNSWORTH ON CONTRACTS (3rd ed.) 2011-1 Cumulative Supplement (Walters Kluwer 2010).
This latest version of the supplement to the famous three volume contracts treatise includes more than 100 pages of new material since last year’s update, including coverage of upcoming American Law Institute and Uniform Law Commission projects related to contract law and important developments in many individual subjects within the law of contracts. As usual, the supplement has the comprehensive and impeccable coverage that has become Larry’s trademark.