Toward an Economic Understanding of Touch and Concern

Abstract

what men dare do! What men may do! 'What men daily do, not knowing what they do!' t This Article applies established economic concepts to a narrow corner of the law that has caused substantial confusion and resisted coherent explanation. Cf C. CLARK, REAL COVENANTS AND OTHER INTERESTS WHICH "RUN WITH LAND" 208 (2d ed. 1947) (Judge Clark uses the phrase "so narrow a corner of the law"). I thank Henry Manne for some of the basic economic training reflected in this paper. I also thank Judge Richard Posner, and

Decomposition of property rights

“…According to one extensive examination of American cases, Stake (1988), the element can be understood as a mechanism for efficiently allocating the burden and the benefit of the promise. If the benefit of the promise is likely to be enjoyed more by the successor than the original promisee, the court will find that the benefit touches and concerns.…”

“…Reichman (1978) defended the touch and concern element on the ground that tying to land the sorts of promises that do not touch and concern to land could reduce efficiency, democracy, or personal freedom. Stake (1988) developed a justification of the touch and concern element that focussed on the asymmetrical costs of rectifying judicial mistakes. The effect of the touch and concern element is to keep promises from running to successors.…”

“…Both economists and lawyers have, in a positive vein, tried to explain and predict behavior of individuals and, in a normative vein, criticized the law and proposed reforms based on those predicted behaviors (for example, Epstein, 1982;Hirsch, 1983). Second, in a nonstandard application, economically oriented analysis has occasionally (Posner, 1998;Krier, 1974;and Stake, 1988) been used by lawyers to explain the legal behavior of judges in a way that makes the law more predictable, clarifying the law where the legal rules have previously had vague content. The latter is not an application of Public Choice theory, although the two have similar goals.…”