In an interesting paper, forthcoming in the Stanford Law Review, Intuitions About Contract Formation, Tess Wilkinson-Ryan (Penn.) and David Hoffman (Temple), take readers back to key first-year contracts questions involving contract formation. The paper reports five separate studies that seek to, "... fill a gap in the existing literature by exploring how ordinary consumers understand contract formation and how, in turn, their intuitions about contract formation affect their contractual choices." An excerpted abstract follows.
"The first section of this Article surveys intuitions about what the law of formation is. In a world in which the vast majority of contracts are signed without the advice of counsel, most people have to draw inferences based on their background knowledge and beliefs. It turns out that the colloquial understanding of contract formation is about the formalization of an agreement rather than actual assent.
In the second part of the Article, we tease out the intuitive relationship between formation and obligation. The law of contracts is very clear that parties’ obligations to one another turn entirely on whether or not they have mutually manifested assent to be bound. And, in fact, we find that behavioral results suggest that legal (or legalistic) formation does enhance commitment to a deal irrespective of its power to impose sanctions; it seems that the law has freestanding normative force. However, we also find that the subjective sense of obligation is not as black or white as the law would predict. Parties are influenced by the natural, informal obligations to one another that build over the course of a transaction, increasing their commitment to the partnership in stages rather than all at once at the moment of formation."