Distributive Justice in the Enforcement of Contracts

Abstract

The paper discusses the relationship between a rule and its exception. In our case the rule regarding enforcement as the principal remedy for breaking a contract and the exception whereby the remedy of enforcement is denied on the ground of justice and the injured party is to be remedied through damages. Enforcement as a primary remedy is basically predicated on a moral principle, based on autonomy and trust. What should be the underlying principles behind the justice exception? Among the Aristotelian notions of justice - corrective, distributive, retributive - the last two constitute the contents of corrective justice in the present context. In fact denial of enforcement creates a forced sale of the injured party's entitlement to the party in breach. Such a move is based on distributive justice. No definitive theory stands behind the complex notion of distributive justice. The suggested theories are based on dignity, fairness, wealth-maximization, effort, investment, personal choice and need. Distributive elements of morality should take into account also retributive elements, such as fault and deterrence, so that retributive justice is actually a factor in the application of distributive justice in enforcement. The elements composing distributive justice may be grossly grouped into two categories reflecting, again, morality and efficiency, and the claim of the paper is that a commitment to the supremacy of enforcement should also lead to the supremacy of morality in the application of distributive justice to enforcement, with efficiency as a second role player. Some case-law classics serve as illustrations. The paper concludes with a brief survey demonstrating how Israeli case law - holding a declared commitment to the supremacy of enforcement - coped with cases of building a construction incompatible with the terms of the contract. A comparison is made with property rule, and the cases are scrutinized according to considerations of distributive justice which were actually applied and those that should have applied to preserve the original entitlement of the injured party and the supremacy of enforcement.