Document Type

Article

Publication Date

7-3-2025

Abstract

The Restatement of Consumer Contracts, at § 4(d), states that ""standard contract terms are interpreted in a manner that effectuates the reasonable expectations of the consumer."" As the Reporters note, this language derives from the Restatement (Second) of Contracts § 211, itself largely pulled from the insurance context. As § 211 was until recently thought to be nearly dead-letter, the Consumer Restatement's interest in revitalizing the reasonable expectations rule (for interpretation and elsewhere in the document) is of particular interest. The Reporters offer a helpfully capacious definition of what consumers reasonably expect: a ""totality of the circumstances, "" test ""in consideration of the ordinary behavior and perspective of consumers engaged in the type of transaction at issue and their interaction with the business, including the representations made to them, the typical purpose of such transactions, and the preservation of value of the nonstandard or core terms of the deal."" But it's fair to worry that judges will be unable to reliably make this kind of holistic determination in individual cases, as they lack information about consumers' ordinary practices. In this Essay I summarize the available evidence of what consumers have in mind when they interpret contracts, and the methodological options judges have before them in making reasoned determinations. Contrary to advocates' hopes, § 4(d)'s interpretation principle will be-even if adopted-unlikely to produce uniformly pro-consumer outcomes.

Keywords

contract, ChatGPT, interpretation, formalism, consumer protection, restatement, consumer contract

Publication Title

Harvard Business Law Review

Publication Citation

15 Harv. Bus. L. Rev. 43 (2025)

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