Document Type
Symposium
Publication Date
2006
Abstract
This Article is structured as follows. Part I compares the terms and conditions in the purchase orders of the Original Equipment Manufacturers (OEMs) and highlights important differences in the substance of these boilerplate provisions. It argues that these differences cannot be easily reconciled with the prediction that sophisticated parties draft the most efficient boilerplate terms. Part II examines how these forms are drafted, how their terms are negotiated, and how the OEMs guard their terms from erosion. It provides some insight on how tailoring occurs and how the internal organization of a party to a deal affects the terms that this party can secure. Part III focuses on the role of economic power. There, we examine how power is harnessed to administer and modify contracts. This analysis revisits the claims made on the basis of the GM–Fisher Body deal and argues that some of these claims are not valid. We demonstrate the subtle ways in which hold up and renegotiation are curtailed. Finally, Part IV examines ways in which a less powerful party can nevertheless get favorable contract terms.
Recommended Citation
Ben-Shahar, Omri "Boilerplate and Economic Power in Auto Manufacturing Contracts." James J. White, co-author. Mich. L. Rev. 104, no. 5 (2006): 953-82.
Included in
Commercial Law Commons, Contracts Commons, Law and Economics Commons, Transportation Law Commons