Abstract
This is a reconsideration of Hans Kelsen’s pure theory of law from the standpoint of a long-time business lawyer, contract theoretician, and Kant-influenced epistemologist. The essay: (a) reconsiders the pure theory in the context of contract and business law (i) in light of how legal reasoning operates (something the pure theory accurately characterizes) in contract and business law (as, for example, in the classic consideration/promissory estoppel case, Allegheny College), and (ii) with a more faithful or more satisfying account than Kelsen provided of the kind of knowledge we obtain if we are going to think of contract and business law as a kind of science, whether descriptive or normative, under Kantian conceptions of cognition and reason; and (b) considers the practical and theoretical implications of the foregoing somewhat obscure and arcane distinction, if not for the contract and business lawyers who actually do the practicing, then at least for those who teach them. Facing reality before deciding on a course of action is often the hardest task for lawyers and their clients. I am thus skeptical of a legal “science” that seeks an ironically and paradoxically abstract positive law of contracts, an ideally coherent doctrine that exists somewhere “out there,” removed from its application to real world experience.
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Notes
- 1.
For a review of this debate, see Lipshaw (2012a) and the essays that follow in the symposium issue dedicated to Charles Fried’s iconic book.
- 2.
In Lipshaw (2007), I discussed the difference between an “ought” of moral freedom and the “ought” of legal compulsion implicit in Kelsen’s pure theory.
- 3.
Kant wrote:
Thus although in synthetic judgments we cognize a priori so much about space in general or about the shapes that the productive imagination draws in it that we really do not need any experience for this, still this cognition would be nothing at all, but an occupation with a mere figment of the brain, if space were not to be regarded as the condition of the appearances which constitute the matter of outer experience; hence those pure synthetic judgments are related, although only mediately, to possible experience, or rather to its possibility itself, and on that alone is the objective validity of their synthesis grounded (Kant 1781: 282–283).
This is about as pithy a statement as we get in the Critique of Pure Reason on the relationship of our subjective cognition to the objective world. What follows thereafter is Kant’s extensive and difficult argument—the balance of the Transcendental Analytic—why the assertion is necessarily true. As Paulson notes (1997: xxix–xxx), this is Kant’s argument “that the notion of ‘a world of the senses existing of itself’—existing absolutely—amounts to a self-contradiction, and must be replaced by the notion that the world exists not ‘of itself’ but only in relation to mind.”
- 4.
- 5.
As Alexander Somek suggested to me, I am confronting Kelsen directly with Kant systematically, and not intermediated by the historical circumstance of Kelsen’s relationship with neo-Kantians like Hermann Cohen. For a short and readable account of that history, see Green (2003: 395–398) .
- 6.
“Exercising powers delegated to them by statute, [private] parties set concrete norms for their own behavior, norms that prescribe reciprocal behavior and whose violation constitutes the material fact to be established by the judicial decision” (Kelsen 1934: 70).
- 7.
Hence, Kant’s oft-quoted statement from the Preface to the Second Edition of the Critique of Pure Reason:
Thus I had to deny knowledge in order to make room for faith;…to see this we need merely to compare the culture of reason that is set on the course of a secure science with reason’s unfounded groping and frivolous wandering about without critique, or to consider how much better young people hungry for knowledge might spend their time than in the usual dogmatism that gives so early and so much encouragement to their complacent quibblings about things they do not understand, and things into which neither they nor anyone else in the world will ever have any insight…(Kant (1781: 117).
- 8.
Modus ponens is a rule of inference as follows:
If a, then b.
a.
Therefore b.
- 9.
I cannot say “as Kant did,” because Kant’s views on the “role reason plays in his theoretical philosophy” is less clear than in his moral philosophy, and those views are the subject of a good deal of secondary work by Gerd Buchdahl, Susan Neiman, and others, much of which I adopt here (Williams 2013). I acknowledge that I am adopting a particular view of what Kant meant, whether or not he meant it, but my aim here is not to resolve that issue. I do find these interpreters’ distinctions between cognition and reason both consistent with my own reading particularly of Kant’s Appendix to the Transcendental Dialectic in the First Critique and the Critique of Teleological Judgment in the Third Critique. Indeed, because I think Kant is clearer on these points than his reputation for abstruse writing would make one think, I have quoted him liberally in the footnotes to this essay. More importantly, I find the distinction between cognition and reason to be powerful in assessing my own bouts of transcendental illusion as well as what seems to me to be the conflation of truth and belief in others. Undoubtedly there is a distinction between cognition and reason in Kant’s work, and my aim is to explore how that distinction, in light of Kelsen, might inform, if not contract jurisprudence, then the role contract law and contract lawyering play in light of all the other norms that operate among contracting parties.
- 10.
It is perhaps only incidental to my analysis of Kelsen that Kant himself probably thought so (Weinrib 1987: 478–491).
- 11.
Thus Peter Goodrich (2009: 480) has criticized traditional legal theory, insulated from the other disciplines, as “a normative order that is predominantly choral and liturgical, as much propelled by acclamation as celebration.”
- 12.
Kelsen encapsulated the basic norm:
The basic norm confers on the act of the first legislator—and thus on all other acts of the legal system resting on this first act—the sense of ‘ought’, that specific sense in which legal condition is linked with legal consequence in the reconstructed legal norm, the paradigmatic form in which it must be possible to represent all the data of the positive law (Kelsen 1934: 58).
- 13.
To be clear, I am reticent to apply the adjectives “true” or “false” to all but the most obvious and intellectually trivial statements about what the law “is.” I know the United States Code and the language of Restatement of Contracts (Second) § 90(1) in Georgia (it was codified) are law as an empirical matter, but any proposition of law seems to me to be not so much meaningless as sterile without its application to something in the world. The closest view to my own is Dennis Patterson’s (1999) conception of law as argumentation—what lawyers do. That is, worrying about whether a proposition of law is true is largely a waste of time. Patterson’s assessment largely concerns itself with the usual stuff of jurisprudence, constitutions, statutes, and judicial decisions, and not the private law the parties create for themselves in a contract. In the spirit of a Kantian analysis, I suggest that what lawyers do when they create private law or when they argue to a judge is to use reason to make demands upon experience—they are either applying theoretical reason to construct a model of experience or possible experience (ie, drafting a contract) or practical reason to determine or argue what it is that somebody ought to do.
- 14.
Getting to the operative expression of the law for purposes of the important modus ponens inference may take some unpeeling. For example, suppose a claimant contended that a promisor committed himself legally by a series of eye blinks. Under the rules in the Restatement (Second) of Contracts, we might have the following progression. It is a contract under § 1 if there was a promise for the breach of which the law provides a remedy. But was it a promise? Section 2 tells us a promise is a manifestation of an intention to act in a specified way so made as to justify a promisee in understanding that a commitment has been made. There is no definition in the Restatement of a “manifestation” or a “commitment.” But one of the issues may be whether the eye blinking constituted a manifestation or a commitment justifiably so understood by another. At some point, there will be a determination in the following form: If A, then B; A; therefore B. If there was a physical movement having a sensible pattern, then it is a manifestation. There was such a physical movement. Therefore, there was a manifestation. There is no getting around the infinite regress of meaning, but at each level it is a modus ponens exercise. As to the inevitability of the infinite regress, see Stumpff (2013).
- 15.
This is consistent with the dictum in Holmes (1881) about the relationship of logic and experience to the life of the law (“The life of the law has not been logic: it has been experience” (Holmes 1881: 1)). However, Holmes is aware that the mechanism of the law is indeed logic. He concludes his derivation of the modern law of civil liability with this observation:
The foregoing history…illustrates the paradox of form and substance in the development of law. In form its growth is logical. The official theory is that each new decision follows syllogistically from existing precedents. But…precedents survive in the law long after the use they once served is at an end and the reason for them has been forgotten. The result of following them must often be failure and confusion from the merely logical point of view (Holmes 1881: 35).
How the rules themselves develop and adapt is indeed a posteriori, a matter of experience. But their final expression as rules maintains the syllogistic form.
- 16.
Michael Steven Green (2003: 379) has captured this relationship, perhaps more articulately than I, as one in which the form of legal sentences provide the underlying logic that links the antecedent conditions and the legal consequence, but the content of the sentences is contingent on social facts that provide “primitive legal meaning.”
- 17.
I am fairly sure that I came to this reading of Allegheny College independently, but I have since discovered that Konefsky (1987) anticipated me in large part by about 20 years. I believe Professor Konefsky was correct from stem to stern in his unraveling of Cardozo’s supposedly elliptical, convoluted, and incomprehensible opinion. My approach follows his in spirit though it varies in technique, and I credit Judge Kellogg’s dissent somewhat more affirmatively than he did.
- 18.
“The law of charitable subscriptions has been a prolific source of controversy in this state and elsewhere. We have held that a promise of that order is unenforceable like any other if made without consideration” (Allegheny, 159 N.E. at 174).
- 19.
The best Cardozo could come up with was the notion that, absent the promise, the college might have simply applied the funds to purposes specified under its charter, and not have created a special fund that would only become sufficient to make the scholarship if others contributed to it after Mrs. Johnston’s death (Allegheny, 159 N.E. at 177).
- 20.
“A bilateral agreement may exist though one of the mutual promises be a promise ‘implied in fact,’ an inference from conduct as opposed to an inference from words.…The fair implication to be gathered from the whole transaction is assent to the condition and the assumption of a duty to go forward with performance” (Allegheny, 159 N.E. at 176).
- 21.
Compare the definition of “promise” in Restatement of the Law Second, Contracts § 2 (“A promise is a manifestation of intention to act or refrain from acting in a specified way, so made as to justify a promisee in understanding that a commitment has been made”) with the definition of offer in § 24 (“An offer is the manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it”). See also Hogg et al. (2008: 148–149).
- 22.
Restatement of the Law Second, Contracts §§ 38, 50. See also Hogg et al. (2008: 154).
- 23.
Restatement of the Law Second, Contracts § 30(1) (“An offer may invite or require acceptance to be made by an affirmative answer in words, or by performing or refraining from performing a specified act, or may empower the offeree to make a selection of terms in his acceptance.”).
- 24.
Id . § 30(2) (1981) (“Unless otherwise indicated by the language or the circumstances, an offer invites acceptance in any manner and by any medium reasonable in the circumstances.”).
- 25.
Restatement of the Law Second, Contracts § 42 (“An offeree’s power of acceptance is terminated when the offeree receives from the offeror a manifestation of an intention not to enter into the proposed contract.”)
- 26.
There is the question of the $1000 Mrs. Johnston paid on account before she died. Judge Cardozo cites this as evidence a bilateral contract had been previously formed, and that by accepting it, the college was saying implicitly that it would fulfill its promise to name the scholarship fund after her. (Allegheny, 159 N.E. at 176–177). Judge Kellogg must have considered the $1000 as a gratuity, given that Allegheny College had not yet performed the act invited in the offer.
- 27.
An example is IBP, Inc. v. Tyson Foods, 789 A.2d 14 (Del. Ch. 2001).
- 28.
Judge Cardozo also wrote two of the iconic opinions on this subject. In Wood v. Lucy, Lady Duff-Gordon, 222 N.Y. 88, 118 N.E. 214 (1917), he held that an exclusive marketing agent had an obligation to use reasonable efforts when he did not so commit either expressly or “in so many words.” In Jacob & Youngs v. Kent, 230 N.Y. 239, 129 N.E. 889 (1921), the issue was the extent to which one party had to perform in order to trigger the other party’s obligation. Judge Cardozo held that, “where the significant of the default is grievously out of proportion to the oppression of the forfeiture” (Jacob & Youngs, 230 N.Y. at 243–44), the implied in law condition was substantial, not perfect performance.
- 29.
Bloomgarden v. Coyer, 479 F.2d 201, 208 (D.C. Cir. 1973) (“An implied-in-fact contract is a true contract, containing all necessary elements of a binding agreement; it differs from other contracts only in that it has not been committed to writing or stated orally in express terms, but rather is inferred from the conduct of the parties in the milieu in which they dealt.”).
- 30.
Making one’s way through the Transcendental Deduction is notoriously difficult, but Michael Steven Green’s (2003: 389–395) synopsis is very good.
- 31.
Professor Wilson delivered a devastating critique of Kelsen’s analogy between “imputation” (in German, Zurechnung) and Kant’s categories (Wilson 1986: 54–58). She then proceeded to a discussion of the difficulties in Kelsen’s attempts to ground the science of law in Kant’s insights as they pertain to the kind of systematic knowledge that we would call science (as opposed to mere perception) (Wilson 1986: 58–61). I think her primary point was that, tracking what Kelsen wrote over the years, Zurechnung was a moving target, at least in the analogy to causality. Professor Wilson touched briefly, however, on what I am saying more fully here: Kant’s categories may be the a priori faculties by which the human mind puts any order at all to sensible intuition, but they “are not co-ordinating concepts…in the way some scientific concepts are” (Wilson 1986: 61, quoting Walsh 1975: 42). In short, if we really want to talk about contract law in Kantian terms, then we need to be focusing on reason and not cognition.
- 32.
Professor Wilson (Wilson 1986: 38–45) also delivered a devastating critique of Kelsen’s adherence (or lack thereof) to the “is-ought” distinction, namely that in Kant’s practical philosophy, a rational being’s “ought” implies freedom from compulsion or constraint of the natural world, and Kelsen seems to adopt a kind of moral determinism.
- 33.
I suspect it is precisely this regress that leads many to conclude pursuing it is a waste of time, to abjure the smell of metaphysics, and to turn to sociology (read: Hart).
- 34.
A nice summary consists of the essays collected in connection with the Fordham Law Review’s 2006 symposium, and introduced by Benjamin Zipursky (2006). Richard Holton (1998) made a brief and prescient remark at the end of his essay on the seeming schizophrenia of legal positivism. Referring to the semantic thesis of legal positivism, ie that “the sense of normative terms in legal claims is different from their sense in moral claims” (Holton 1998: 609) he asked why it should be the case that to have a legal system (in Hartian terms) it is even necessary to have participants who take the internal point of view. And, assuming that it is necessary, why is the internal point of view so central? Holton answers his own question:
I suspect the answer lies in the role that we want the notion of law to play in our account of practical reasoning. We want to explain the distinctive way that the law guides action; and we want to explain the kinds of pressures that lead practitioners to reform the law (Holton 1998: 625).
That is precisely the kind of answer, unsatisfying as it may be, I am trying to provide here.
- 35.
Understanding is incapable of anything other than this meager performance because it lacks autonomy, and its mechanical nature is inseparable from the abstractness of its results. Routinely and automatically, understanding applies the twelve categories to the given manifold (Neiman 1994, 59).
- 36.
[W]ithout conceptual principles (whose domain is the field of what Kant calls ‘the understanding’) there would be no public language, no ‘nature,’ regarded as the concatenation of things and happenings, nor any ‘pure science’… (Buchdahl 1969: 476).
- 37.
As Michael Steven Green points out, Kelsen did not think primitive legal meaning, as the analog to mere cognition, was the end of the story. “Kelsen’s goal is instead to show how the primitive meanings can be conjoined, through rules of imputation, to generate complex legal meanings or sanctionability conditions” (Green 2003: 379). My argument, however, is that we cannot be true to Kant without assessing the role of reason in generating those meanings.
- 38.
Buchdahl (1967: 210) suggests the notion that the categories of the understanding supply a justification for science, rather than merely the basis for a public language for reporting on events in the real world, arises from concentration on the Transcendental Aesthetic and Transcendental in the Critique of Pure Reason rather than the Transcendental Dialectic and its “Appendix” wherein Kant explains the role of reason in providing foundations for scientific laws.
- 39.
It is not so different, in a far less sophisticated way, than observing that microwave radiation at far ends of the cosmos is uniform, despite the theory that that universe was already so big when the radiation was released that there was insufficient time for the ends of the cosmos to communicate with each other. So despite the absence of evidence and the apparently implausibility of the hypothesis, Alan Guth suggested in 1980 there was a period of “inflation” when the universe expanded faster than the speed of light. Other scientists first observed empirical evidence consistent with the inflation theory in 2014 (Overbye 2014).
- 40.
It is easy to miss. In the 1998 Guyer and Wood translation of the Critique of Pure Reason, Kant’s exposition of the problems created by the exercise of pure reason—the “transcendental dialectic”—runs 205 pages. Kant relegated his discussion of the appropriate use of reason in science, however, to a mere 33 pages in an “appendix to the transcendental dialectic” (Kant 1781: 384–623).
- 41.
Buchdahl (1969: 495–506) also offers a detailed account of Kant’s distinction between mere cognition of nature and theorization by way of reason.
- 42.
Larry Solum (2014: 84) has recently published an insightful essay on this point. The meaning of a legal text created by a group of individuals has, in his coinage, artificial meaning, ie, a meaning that is something other than the natural meaning we would impute to speech uttered by a natural person. Professor Solum focuses on public law—the text of constitutions, statutes, regulations, and ordinances—but the point applies equally to the text of a negotiated contract. Indeed, consider the following insight as applied to the putative “mutual intention of the parties ” that courts regularly invoke as the goal of contract interpretation and enforcement:
Legal interpretation is (usually) the parsing of artificial meanings. Grasping these meanings is not a matter of inferring the mental states of a particular individual or group of individuals. When it comes to group agents, mental states play a role in the production of artificial meanings, but the meanings themselves cannot be reduced to those mental states.
- 43.
Pure Reason, as a practical faculty, i.e., as the faculty of determining the free use of our causality by Ideas (pure rational concepts), not only comprises in the moral law a regulative principle of our actions, but supplies us at the same time with a subjective constitutive principle in the concept of an Object which Reason alone can think, and which is to be actualised by our actions in the world according to that law. The Idea of a final purpose in the employment of freedom according to moral laws has therefore subjective practical reality (Kant 1790: 227).
- 44.
But a final purpose is merely a concept of our practical Reason , and can be inferred from no data of experience for the theoretical judging of nature, nor can it be applied to the cognition of nature (Kant 1790: 228).
- 45.
…[T]here must then have preceded a rationalising subtlety which only sportively introduces the concept of purpose into the nature of things, but which does not derive it from Objects or from their empirical cognition. To this latter it is of more service to make nature comprehensible according to analogy with the subjective ground of the connexion of our representations, than to cognise it from objective grounds (Kant 1790: 153).
- 46.
Alida Wilson (1986: 49–50) suggests that Kelsen’s commitment to the idea of law as an “ideal reality” was fleeting. As she correctly points out, the first line of both versions of the introduction to the Critique of Pure Reason is Kant’s statement to the effect that all cognition begins with experience.
David Gray Carlson (2009: 23–24) has made a similar point regarding H.L.A. Hart’s expression of positivism—one that has largely crowded out Kelsen’s in Anglo-American jurisprudence. Professor Carlson’s thesis is (a) the core of Hart’s positivism is to take the official’s internal point of view—her acknowledgment that something is law according to the rule of recognition —as empirically present in the world; (b) making a judgment from an internal (and subjective) point of view is never, in Kantian terms, an empirical matter, but rather “a matter of belief, as licensed by theoretical reason ; (c) the Hartian internal point of view is morality—ie the exercise of reason with respect to the question “what to do”—from a Kantian perspective; and (d) therefore Hart’s separation thesis (of law from morality) fails.
- 47.
Per one of the leading philosophers of business in the twentieth century, John F. Welch, Jr., the former chairman and CEO of General Electric: “Face reality as it is, not as it was or as you wish it to be” (Welch).
- 48.
Even Quine and Ullian, while rejecting synthetic a priori knowledge as a helpful concept, thought there were five “virtues” underlying hypotheses: conservatism, modesty, simplicity, generality, and refutability. “Hypothesis, where successful, is a two-way street, extending back to explain the past and forward to predict the future. What we try to do in framing hypotheses is to explain some otherwise unexplained happenings by inventing a plausible story, a plausible description or history of portions of the world.” (Quine and Ullian (1998: 405).
- 49.
It is fashionable now to criticize Langdell (1871: vi–vii) , but his statement of purpose in the first contracts casebook still resonates with me as an apt description of law as the product of reason, whether applied descriptively or normatively:
Law, considered as a science, consists of certain principles or doctrines. To have such a mastery of these as to be able to apply them with constant facility and certainty to the ever-tangled skein of human affairs, is what constitutes a true lawyer; and hence to acquire that mastery should be the business of every earnest student of law.…[T]he number of fundamental legal doctrines is much less than is commonly supposed.…If these doctrines could be so classified and arranged that each should be found in its proper place, and nowhere else, they would cease to be formidable in their number.
- 50.
Robin Kar has recently undertaken a thoughtful and original attempt at a unified theory (as well as a summary of the extant descriptive and normative theories) of contract law (Kar 2014). The paper proposes to respond to the observation of Professors Schwartz and Scott that there is no “complete” descriptive or normative theory. What is interesting to me, beyond the specifics of Professor Kar’s very interesting take on the philosophical underpinnings of contract law, is the question why we feel the need, as he suggests in the introduction, to “harmonize certain core areas of doctrine,” to “provide[] unified answers,” or why it is a problem that contract law has no complete descriptive or normative theory, or that the theories “fail to offer a unified understanding of…seemingly disparate features of contract law.” As I have made clear here, I believe the answer to that question has less to do with contract law than with our seemingly hardwired inclination to teleology : that there are unified explanations, that doctrine ought to be harmonized, that the world ought to be seen as coherent.
- 51.
It is the assumption required “at first” because it is possible that the cases may not be reconcilable. “Hence, in your matching of cases, you may, as a last resort when unable to make the cases fit together, fall back upon the answer: here there is a conflict; these cases represent two different points of view” (Llewellyn 2012: 51).
- 52.
One of the difficulties with Ronald Dworkin’s (1996) critique of positivism is the fact that he seems to tap into precisely this kind of noumena as justification for single correct answers in hard cases. Hence, Dworkin seems to believe that single correct answers are possible because we can know objective moral facts (Lipshaw 2006: 991–993).
- 53.
In other words, I do not believe contract and business lawyering is only an exercise in practical reason , at least in the Kantian sense. I acknowledge there is a long history of jurisprudential debate about law as the product of practical reason or theoretical reason ; it should be obvious by this point that I believe it is the product of human reason of some kind, but it is no more or less “real” on either account. For a brief overview of this particular issue, see Burton (1988).
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Acknowledgments
This essay is a contribution to Hans Kelsen in America, a conference sponsored by the Valparaiso University Law School, supported by a grant from the Botstiber Institute for Austrian-American Studies, and held in Chicago on June 27–28, 2014. I am indebted to Jeremy Telman for the invitation to participate, and to conversation from and with the participants and observers. Thanks to Patrick Shin and Brian Bix for incisive comments on an early draft of the introduction, to Alexander Somek for encouragement about the approach, and to Pierre Schlag and David Gray Carlson for their insights. Finally, I nod gratefully to Michael Steven Green, one of whose articles introduced me to Kelsen, and who influenced my thinking in connection with this essay.
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Lipshaw, J.M. (2016). Cognition and Reason: Rethinking Kelsen in the Context of Contract and Business Law. In: Telman, D. (eds) Hans Kelsen in America - Selective Affinities and the Mysteries of Academic Influence. Law and Philosophy Library, vol 116. Springer, Cham. https://doi.org/10.1007/978-3-319-33130-0_14
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