This paper focuses on one type of ex-ante effect of the battle of the forms: the incentive to draft reasonable boilerplate terms. It argues that the experience with the battle-of-the-forms rule under the CISG reinforces what we already know, that existing legal solutions do not provide any incentive for the parties to draft reasonable forms. The paper suggests that the goal of inducing parties to draft reasonable terms can be significantly promoted by a third rule, a variant of the “best-shot” rule proposed by Victor Goldberg. Under the version labeled the “reasonable-shot” rule, the court would resolve the battle of the forms by choosing the form that contains the more efficient terms. The paper proposes some guidelines how the “reasonable shot” could be identified by the court, and argues that there are good reasons to expect that this regime would give parties the incentive to draft reasonable terms. In fact, it is plausible that under this rule the parties’ forms would converge and the battle of the forms would cease to exist.


Contracts | Law and Economics

Date of this Version

October 2004