Boilerplate Symposium Part XIII: Charles Calleros on the Reasonable Expectations of Consumers
Charles Calleros is a Professor of Law at Arizona State University’s Sandra Day O’Connor College of Law.
Peggy Radin’s new book, Boilerplate,is welcome contribution to the literature precisely because it is sufficientlyclearly and plainly written to be accessible to a broad spectrum of educatedand intellectually curious readers. Itthusly helps to fulfill our obligation to educate not just future lawyers butalso members of the general public, who can perform more effectively asconsumers, business owners, and citizens if they are exposed to thoughtfulpresentations of the legal issues of the day, from civil liberties tocontractual consent.
Professor Radin’s description of theincreasing frequency of attenuated consent in adhesion contracts raises asignificant questions: Is World A(agreement), around which much of our first-year teaching is based, fastbecoming the exception to the norm of World B (boilerplate), creating adisconnect between our laws and the realities of contracting.
I still hold out hope for a world inwhich market or legal forces can advance meaningful assent, so – unlike ProfessorLieb – I did not detect of “whiff of fetishizing of consent in Radin’srendering.” Moreover,although I agree with Professor Gold that “not knowing precisely what one hasconsented to is not a per se bar to consent,” truly voluntary and unconstrainedconsent of that nature ought to be exceedingly rare.
Of the broad array of possibleremedies surveyed by Radin, in my view the most elegant would be market-drivensanctions for abusive clauses – such as loss of reputation and businessstemming from negative consumer reviews disseminated on the web – and consumerself-help, such as actually holding up the line and reading the exculpatoryclause on a short form and making a reasoned decision about whether to assent(as my wife did when she refused to enroll our child in an otherwise veryattractive preschool when the two-page form included an extreme exculpatory andindemnification clause that the school refused to sever). To return to anearlier theme of educating the public about legal rights, our schools and othereducational platforms (see, e.g., www.iCivics.org)should teach students in secondary school to be informed consumers and criticalreaders of forms, so that “holding up the line” is viewed as a responsible act(providing businesses with an incentive to efficiently inform consumers at adifferent point, so as to keep the line moving).
But, what of contexts in whichobjectionable clauses are buried in many pages of fine print, dissuading arational consumer from expending the time and effort to engage in a criticalreading, such as when deciding to click “I agree” on a web page withoutactually reading the terms?
Here, I am intrigued by thepossibility of applying the reasonable expectations doctrine to all consumeradhesion contracts in which it would be unrealistic to expect the consumer towade through a document to discover and understand terms to which the consumerlikely would object if they were brought to her attention. See,e.g., Harrington v. Pulte Home Corp.211 Ariz. 241, 119 P.3d 1044 (Ct. App. 2005) (applying this doctrine outside ofthe insurance context, although finding the doctrine was not satisfied by thefacts).
True, the doctrine would need to betweaked so that it did not validate highly objectionable clauses simply becauseconsumers have come to expect oppressive corporate behavior and have resignedthemselves to the futility of finding or understanding unfair terms. Rather than allowing widespread corporateabuses to define the baseline, consumers should be empowered to expect thatadhesive terms in lengthy standard forms will fall within a range that isjudged to be objectively reasonable. Tofirmly establish this baseline, I am drawn to the European model of anadministrative agency defining types of clauses that are flatly orpresumptively invalid, and to empowering the agency with private attorneygeneral capacity to enforce the norms, even when individual claims are small,although I concede that our legal system is highly unlikely to embrace thesemechanisms.
With respect to contract terms thatdo not fall within a limited list of flatly prohibited clauses, a robustreasonable expectations theory could further and more flexibly exclude termsthat are buried in boilerplate and lie outside the boundaries of what consumersshould be held to reasonably expect, thus providing an incentive to businessesto highlight and plainly express potentially objectionable terms so as tosecure actual assent, perhaps evidenced by separate initialing orsignature. For example, on a websitethat links to terms so lengthy that most consumers are dissuaded from surveyingthem for objectionable terms, the doctrine would incentivize a business tohighlight potentially objectionable terms at the beginning of any reference tothe agreement, thus alerting a consumer immediately to the nature and locationof clauses that warrant exploration. Ifsales suffer as a result, businesses may be forced to moderate their terms sothat consumers are willing to give actual consent to terms brought to thefore.
[Posted, on Charles Calleros’ behalf, by JT]