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Reproduced with permission of 40 American Journal of Comparative Law (1992) 683-697

Unification, Harmonization, Restatement, Codification,
and Reform in International Commercial Law

Arthur Rosett [*]

  1. The Harmonization of International Commercial Law
  2. The Limits of Unification by Codification
  3. The Example of Restatements and Uniform Laws
  4. The Engines Driving Harmonization

This conference is a tribute to the variety of efforts in nations around the world, in regional organizations, and in agencies such as UNIDROIT and UNCITRAL to bring the commercial law of the world together. As the title of this essay suggests, these efforts bear a number of labels and the general assumption is that all of them are desirable, consistent elements of a coherent plan to support economic transactions with a legal structure that encourages enterprise and reduces costs. We hope that the paths to unification, harmonization, codification and reform run in parallel directions. but this is not necessarily so. Recent experience suggests that unification does not always produce harmonization, and that codification can be the enemy of reform and substantive improvement in the quality of justice. My goal is not to criticize the many splendid projects represented on today's program, but to suggest that our agenda for the future should emphasize additional and different aspects of the task and not merely be designed to produce a new edition of old codes.

The primary function of commercial law is to provide tools for economic and social enterprise. Viewed functionally in an international context, harmonization of results, that is, general consistency in substantive outcomes, will allow those who, engage in transactions a higher level of confidence in a worldwide market. The UNIDROIT Principles support this goal, but will be of limited impact. I urge that we not lose sight of the importance of reform and renovation to enable the law to better reflect changing commercial realities and to embody emerging values of fair and appropriate commercial practice.

We should be flexible in our commitments to such techniques as codification, scholarly restatement, and judicial case development. I know that some of these techniques, particularly uniform and model laws and restatements, now are of special interest to Europeans. I do not deny their usefulness, particularly as a way to inform different parts of the legal community about the practices and jurisprudence of other parts. They also serve as monuments to indicate the [page 683] substantive harmonization that has already occurred. They support harmonization and reform by providing convenient sources of information and by promoting the spread of legal change.

Nevertheless. I do not think that uniform laws and restatements have been the major driving force for harmonization of the civil and commercial law of the United States. Implicit in this statement is the view that unification and codification by international conventions and uniform laws are not central goals for their own sake. We legal scholars would be well-advised to worry less about codifying and promoting our conceptual commitments and should rather focus our attention on a shared legal culture in which harmonious legal principles will develop and will reflect our values.

The wonderful virtue of seeking to achieve harmonization without resorting to unification or codification is that we are betting on a sure winner. Harmonization will occur for reasons exogenous to the law. Our efforts to draft unified laws are symptoms and indications of the process of unification, not their cause. The political and economic engines powering convergence in the law operate quite independently of our scholarly efforts. At the end of this short paper I will suggest several alternative approaches that may serve us well in the years ahead. First. I want to make some very general observations about the processes of harmonization, unification, codification, and reform based on American experience and recent world experience with commercial law. The motivation for these legal changes is certainly economic, but the engine driving harmonization is essentially political and cultural. I plan to use the U.S. experience with the restatements, uniform laws, and the Uniform Commercial Code as examples.

I. THE HARMONIZATION OF INTERNATIONAL COMMERCIAL LAW

During the past two generations there has been a remarkable degree of harmonization among nations in the law applicable in international commercial transactions. Indeed, today it is difficult to identify any examples of persistent, significant, and substantial divergence that produce important and predictable differences in the outcome of commercial disputes. It seems likely that a few such instances must exist, although none come to mind. My inquiries of expert colleagues have produced no examples and lead me to doubt that such examples as may exist are earthshaking. That does not mean that there are not important differences in principle, doctrine, and approach among the laws of various nations. But such theoretical differences often are offset in practice by a countervailing rule that usually brings the result back in general harmony.

The existence of this degree of harmonization would provide a wonderful occasion for lawyerly self-congratulation but for two [page 684] circumstances. First, the existence of harmonious law in international transactions is not new. Trade for many centuries was the province of merchant clans: Phoenicians, Jews, and Lombards in the West, who operated with confidence on the basis of special rules that were effectively binding upon them without the sanction of any particular nation state. Common law and continental courts both long respected these rules as what they were, an element of some ill-defined lex mercatoria, or a derivative of some 'natural law' that was absorbed into local law. Second, most of the successful modern harmonization of international commercial law has not been the work of lawyers and legislators. It has been the result of private rulemaking, universally accepted through contract and custom, that only belatedly and imperfectly finds its way into formal national and international law. Good examples are the Banker's Rules dealing with documentary letters of credit.[1]

The motive force for the recent changes is easy to identify: local economic markets during the past two generations have been enlarged to national and international markets. Trade among nations has multiplied more than ten-fold. Barriers to trade; while still significant, are very small in comparison to the historic past. The new ease of communication and transportation has supported the creation of world markets for many kinds of goods and services. These commercial changes have created a competitive climate for legal rules and have fed the convergence of legal practices in trade transactions.

Harmonization and Reform. In the United States, the process of harmonization, has moved parallel to the process of law reform. When I started law school thirty-eight years ago, I learned from casebooks whose table of contents their predecessors of a century earlier with few obvious discrepancies. I will not be so unfair as to suggest that the same could be said about the professor's lecture notes, but the fact was that much of the private law retained, with little modification, traditional forms and content inherited from an earlier society. Today that is certainly no longer the case. American law has been transformed in content and approach in ways that reflect and promote larger contemporary social and political changes.

The process of substantive reform is essentially a political redistribution of power between the parties to the transactions. When property law is reformed, power is redistributed between husbands and wives, between landlords and tenants. Commercial law reform establishes new power relationships between manufacturers and consumers. Corporate law reform adjusts the balance between [page 685] shareholders and corporate managers. The process is not merely a technical reorganization, driven by the rules of formal logic internal to the legal profession. Indeed, as Max Weber taught, the more logical the legal order is, the less likely it will be to approximate what folk justice or business practice dictates. In this sense, substantive reform is driven by forces exogenous to the law, as Lawrence Friedman teaches us:

"The [drafters] of the Uniform Commercial Code were lawyers; as such they were not particularly sensitive to social behavior that never crossed their legal experience. They undoubtedly believed that their work had valuable impacts on the real world of commerce and finance. If they were wrong, it was simply their knowledge that failed. But lawyers often act as if uniformity and technical craft were ends in themselves, even when they might be aware that 'reform' means little to the outside world. They may, however, feel that the more elegant and systematic legal system carries with it, in the long run, important values for society. Such a feeling is said to be particularly strong among 'academicians from a legal system where theory tends to dominate the work of the academic community' -- that is, in the legal systems of Europe and Latin America, together with their spheres of influence. In England and the United States, however, the academicians are just as much dominated by 'theory' as the continentals, though their 'theory' is far less systematic and abstract. They are obsessed with [craft] and convinced of a long-run, mysterious connection between technical perfection in the law and the health of the nation. The fact is that technical law reform, whether or not it fills any general social needs, fills an important need of the profession, and in this lies its magic."[2]

Alongside substantive reform there has been a remarkable degree of harmonization of the law. As a student, I was taught common law doctrine in terms of rules that were said to be "majority" rules, "minority" rules, the "Massachusetts" or "New York" Rule, etc.[3] Such terminology has largely disappeared from the literature and the classroom. There are occasional instances of idiosyncratic local rules and minor differences in emphasis that are likely to mark different regions or distinguish between urban or rural states, but these are unusual enough to be remarkable by their presence. The variations in private law from state to state in America today are [page 686] small and quite insignificant. The claimed autonomy and individuality of each state legal system increasingly is a fiction of jurisdictional technicality. Our commerce, our legal profession, and our people are so knit together that it is hard to imagine that any state might fundamentally revise its civil and commercial law without taking into account the impact of those changes on the other states.

There certainly are many instances today in which the law of American states is in a state of flux, where rules and values are changing and there is disagreement within society about what the proper rule should be. I can think of fewer instances where a state persists over time in applying a widely variant version of the law. The process of harmonization has gone far, although the way the law is stated differs from state to state, moreover, the process of legal development proceeds with a high degree of legislative independence and at different speeds in the many states. The result is substantive harmony without uniformity.

II. THE LIMITS OF UNIFICATION BY CODIFICATION

It may well be possible to create a situation in which the text that expresses the rules of international commercial law will be identical everywhere. But to suggest that this would unify the law ignores the extent to which legal rules opertate in a very particular social and political setting. If one focuses too hard on the unity of the text, one is quite likely to lose sight of the disparity of result that is produced when that text is applied in different systems.

This point may become clearer when we focus on unification of the law by codification, the creation of a comprehensive statement of axiomatic principles and rules from which the appropriate result in any case is to be derived. I think many of us are becoming increasingly sensitive to the extent that codification of commercial law has not proven to be the most desirable goal. Codification has always involved the division of commercial law between domestic law and special international rules for some transactions. Thus codification tends to separate the rules of international transactions from those that generally govern other commercial transactions. This division has created vexacious and essentially insoluable problems, both because any division between domestic and international transactions in the contemporary commercial world is artificial and because the search for "autonomous legal principles" has proven, to be an illusory quest.[4] Whatever sense this may have made fifty years ago, it makes no sense today. It is the fact of world unification of markets that motivates these codifications. To organize them in ways that [page 687] split off international transactions as special creatures denies that fact.

Moreover, the drafters of these codifications tend to look on harmonization as an event that happens once and for all. They see their codes as monuments that will stand without change, that will be self-executing in a unified way throughout the world. This static, monumental quality is most mischievous. As times change and the law does not, codification becomes the enemy of substantive reform. In todays world, any code that does not build a process for prompt and sustained reconsideration into its structure becomes part of the problem, not part of the solution.

Even more pernicious is the tendancy for unification by codification to undermine ongoing legal growth. Codes are not just collections of discrete rules. If they are, they provide little help in deciding the case for which there is no given rule. If codes are more than just rules, if they offer a basis for deductive reasoning from principle to specific decision, then they must reflect a coherent and shared set of values and priorities. In the modern context, commercial codification can be obtained only at the expense of substance. Practice is much more unified than principle. We are all ready to recognize and respect the law-making force of longstanding trade usage, commercial practice, and custom. We are much less likely to surrender the grand principles upon which our diverse legal cultures claim to be based. If "that is the way Bankers everywhere do it," we will accept the result, but if it is inconsistent with what we learned as young students in law school, we will not dishonor the principle.

To some extent, the problem is that principles are not shared. To some extent it is simply a matter of language and the tricky misunderstandings that arise when we translate in a literal manner thoughts that have been expressed in another language we think we understand. The weakness of codification also reflects the difficulties of drafting by committee, particularly an international committee. There are overpowering temptations during the process of negotiation to adopt procrustean solutions that cut off the dangling ends or stretch out what is too short to fill the assigned part. It also is tempting to adopt "diplomatic" solutions and use words that we know mean different things to different people or in different languages. The simple truth is that unless there is shared meaning and value, codification is unlikely to lead to uniformity of result.

As a child of the American realist tradition, I must also confess my belief that codification is unlikely to promote the certainty of result that our consumers and the business people who engage in transactions value so highly. Outcome uncertainty is often a different matter than legal uncertainty. You may be quite unsure how to state the legal principle, but quite confident how the case will be [page 688] decided. Clear statements of principle do not always create certainty of outcome. We were taught a long time ago that most uncertainty regarding outcome grows more out of doubts about the relevant facts and their interpretation than out of uncertainty regarding the legal norm.[5]

III. THE EXAMPLE OF RESTATEMENTS AND UNIFORM LAWS

Restatements, model laws and uniform laws have grown as important forms of lawmaking in the United States out of the work of two institutions that have common roots and have grown together as they have developed. Beginning in the first quarter of the twentieth century, the American Law Institute and the Commissioners on Uniform State Laws embarked on several remarkable restatement projects to harmonize and unify the common law and to bring together the tangle of state statutory law by uniform acts. Many of the same persons were active in both bodies.

The early products of these institutions were among the most successful. Restatements were undertaken of the law of Contracts, Torts, Property, Restitution, Agency, Suretyship, Judgments, and Conflict of Laws. A wide variety of uniform acts were proposed during these early years. Few knowledgeable observers would deny the significance of the first Restatement of Contracts or of the early Uniform Sales Act, although some observers would be less enthusiastic about the restatements of the seven other topics and the other uniform acts. These early efforts certainly promoted the convergence of state law on these topics. Undoubtedly, that influence was enhanced by the stature of those who authored the early restatements and uniform acts: a generation of self-confident and highly talented systematizers.

The aim of the uniform acts always included both legal harmonization and law reform. The new statutes were to be substantive improvements on the pre-existing law. Reform by restatement has remained troublesome for some members of the American Law Institute. In their view, the restatements are supposed to say what the law is, not what it should be. Inevitably, when stating the law in terms of how a court will decide an issue, one is led to choose the better of two competing rules, and the rejection of the irrational and undesirable is likely.

Uniform and Model Laws. Fifty years ago these tensions between restatement and reform contributed to a notable shift in the work of the American Law Institute that has been reflected in reduced emphasis by the Institute on restatements and greater emphasis [page 689] on model laws. Uniform laws are designed for state legislative adoption. Indeed, when a state begins to tamper with the text of the uniform act, it generally produces mischief apart from the threat to uniformity. Model laws differ from uniform laws in that they seek merely to inform and to provide a model for state legislatures to consider but do not produce a statute designed to be adopted without change. A classic example is the monumental Model Penal Code, which appears to have been adopted in toto in only two states, but whose influence is clearly visible in the last generation of penal code reform in most states. In reviewing the history of uniform laws, I am impressed by the large number of such acts that have been adopted by few, if any, states. In some cases, it seems likely that the uniform law simply has not been influential. But in other cases, the uniform law certainly has been very influential in many states that have borrowed from it selectively, although there have been few adoptions of the whole text.

The problem with uniform acts in practice is that the adoption process has been anything but uniform. Only a few of the largest states in the United States have a professionally staffed legislature able to draft well-conceived laws on private law subjects. Nor are most state governments likely to have a civil, servant "ministry" able to fill this function. Uniform acts provide the legislators in such states with a ready model of a well-considered and workable law to deal with a particular problem. In some states there are close relations between the Commissioner on Uniform State Laws and the political leadership in the legislature. Each year the new group of uniform acts receives a sympathetic hearing and often is adopted as a package.

In other states the legislative process and the relations between the Commissioners on Uniform State Laws and the legislative leadership are quite different. In such states the legislature is likely to be very selective in considering proposed uniform laws and extremely independent. Uniform laws are amended, redrafted, and occasionally turned inside out.[6] The result may be a better law, or certainly one that more closely reflects the social and political attitudes of the dominant forces in the state legislature. But it is not likely to be either uniform or harmonious with the version adopted in other states.

The Uniform Commercial Code is perhlaps the best example of both the potential and the problems with uniform laws. This code was imposed on a field of law that was already marked by a high level of harmonization in legal and commercial practice. Its central drafter, Professor Karl Llewellyn, brilliantly cut through old and troublesome practical and conceptual problems. The product has [page 690] been of tremendous significance in reforming the law, although its impact on maintaining harmony in the law of the ciifferent states is less clearcut. Many states have adopted versions of the UCC that contain a number of unique minor substantive variations.

Not all variations arise as a result of the legislature's actions. Laws speedily become obsolete but are slowly revised. Experience indicates that the cycle from initiation of research to adoption by most states is likely to exceed twenty years. It is an ongoing process, and there are always revisions adopted in some states but not in many others. The Commissioners on Uniform State Laws have created a Permanent Advisory Committee that is charged with rolling reform, periodically revising each of the nine articles of the Code. Without such a mechanism, the code quickly would have become obsolete in a changing commercial and technological environment. There are now revisions awaiting state adoption that create new articles (e.g. equipment leasing), propose the abolition of other articles (bulk sales), and make deep revisions in others. Revisions for every article of the original code are now underway. A good friend, who is active in one of these major revisions, has expressed. to me the expectation that we will be well into the next century before the current cycle of revisions will be widely adopted by the states. For the next 20 years there will be little uniformity in the Uniform Commercial Code.

A good example of this rolling process is the Code's Article Nine, which deals with security interests. The original Article Nine was the work of Professor Karl Llewellyn in the 1950s. It was one of the most important harmonizations and reforms of what had been an impossibly confusing area of idiosyncratic local law. The original version of Article Nine was brilliant in concept, but like many true innovations, it was deeply flawed in some of its practical specifics. Before the process of state adoption of the code had proceeded very far, the Permanent Editorial Advisory Committee was at work revising it. The new version was completed in 1972 and it has taken 15 years to gain general state adoption of the revisions. In the meantime, two quite different versions and a number of local variations have been in force.

Restatements. Restatements of the common law are closely connected to the practice that grew up during the last quarter of the nineteenth century of reporting and publishing large numbers of state court decisions. For many centuries, common law judges have arrogated to themselves the power to determine and announce the law in areas that were not the subject of statute. There were relatively few courts and fewer published reports of decisions before the nineteenth century. In 1810 there were 18 volumes of American case reports. By 1848 the number had grown to 800, and this exponential [page 691] rate of growth produced 3,800 volumes by 1885.[7] The appearance of these full-text decisions in a well-indexed form by late in the nineteenth century raised serious questions concerning the meaning of the common law. Now conflicts between courts became clearer. The publication of full texts of opinions, rather than an index or precis, focused attention on the extent that the authority of a court decision depended on its persuasive power. The desire for an orderly statement of the case jurisprudence came together early in the twentieth century, with a view of legal science built on the assumption of ordered rationality.

The problem of coherently stating the common law was seen by the founders of the American Law Institute as one of logical analysis and organization by reason. If the best legal minds could be brought together and were encouraged to talk the problems out, they could be expected to select the best result (which, of course, would also be the most logical result). This way of thinking blended together concerns for rationality, harmony, and the reformer's goal of progress.

The first generation of restatement scholars were undeniably giants. Whether writing a restatement or a uniform law, a Williston or a Wigmore brought a self-confident command and organizing power that could detect a pattern and a path where others might see only jungle. But styles in intellectual activity change as surely as those that govern the width of men's ties and the length of women's skirts. The current generation of scholars is likely to be less certain that the answer they prefer is necessarily the most logical and the most effective.

After its initial great successes, the process of restating the law has continued with mixed results. The early topics restated (Contracts and Torts) proved the most adaptable to this literary genre. Some of the later topics restated (e.g., Security and Restitution) proved less suitable. Many important legal topics simply do not fit comfortably into the pattern of restatement (labor relations, and other personal relations come to mind). Controversial and rapidly developing areas of law prove difficult to restate, and the dynamics of the Institute process tends to favor the lowest common denominator. I recall the painful process leading to the Second Restatement of Conflict of Laws, the attempts to deal with emerging product liability questions in the Restatement Second of Torts, the debacle of criminal procedure projects, and the current battles over rules for Corporate Governance. The Institute simply is not an organization designed for democratic decisionmaking; it seeks the views of the [page 692] "best" minds. It can record a preexisting consensus, but possesses no reliable process to bring that consensus about.

The problems of the restatements have paralleled those with uniform laws. The process of obsolescence has been speedy, but the cycle of revision slow and uncertain. Without opportunities for frequent periodic revision, the restatement fixes the law in the views of a former generation and becomes the enemy of substantive reform. There is also a persistent tension between restatement of what the law has been and a statement of what the law should be. This tension is most insistent when the difficulty is not merely technical, and there is a real disagreement on values between important groups within society. The restatement is born, in part, from that American longing for "black letter law," a rule that is so clear and definite that it can be stated in a few sentences in large bold type. Recent attempts at restatement have encountered all the troubles faced by those who seek systematics and dogmatics in an uncertain age. The current generation of restaters has modified its style somewhat from the dogmatic assertion of doctrine to a more balanced emphasis on reasoned exposition of a position supported by notes and comments that complete the picture. Of course, if carried too far, this tendency forces the finished product to lose the simple clarity that was its initial justification. The more recent restatements have tended either to equivocate in times of stress or to seek refuge in rather cloudy abstractions. When the restatement has been bold and pushed for change before the ground has been prepared by court decisions exploring the path of change in a particular direction, the consequences have been controversial and even devisive. The clearest case of this was 402A of the Restatement Second of Torts dealing with consumer product liability.

The tone of the preceding paragraphs is cooler than I would wish. The restatements still are useful and are often referred to by courts as a convenient way of summing up noncontroversial bodies of accepted jurisprudence. In these placid pools of law, harmony already reigns. The restatement restates, but does not create it. The restatement is much less often the source of successful reform and in many fields no longer marks the cutting ledge of the law.

IV. THE ENGINES DRIVING HARMONIZATION

What has driven this process of legal harmonization in the United States? First, we should eliminate some of the familiar suspects. Harmony has not been accomplishedd by codification. The early attempts at codification of American civil law in the nineteenth century were, by and large, failures. The codes, drafted by David Dudley Field for New York, never were adopted there, although the Civil Code and other drafts were brought to California [page 693] and other western states. The California Civil Code still bears signs of its civilian origins, and every now and then a court will interpret it in somewhat the way that people are accustomed to use when applying a code, but these instances are rare. By and large, the California Civil Code and its sisters in other western states are treated the way that lawyers from a common law system treat any statute and, therefore, have been a weak source of new law.

Nor has harmonization been driven primarily by the nationalization of commercial law and the promulgation of a unified set of laws by the federal government. Commercial and civil laws are predominantly matters of state, rather than national legislative competence. State law is applied by both the state and federal courts in such cases as a combination of statutory and common law rules. During the early stages of commercial development in the nineteenth century, the Supreme Court of the United States held that federal courts were to apply a common body of federal law in most commercial cases that arose before them, and this doctrine certainly had some peripheral influence on the evolution of state law. Ironically, this doctrine was declared unconstitutional and abandoned during the same period of the 1930s that new institutions of national economic law were arriving on the scene. The New Deal response to the collapse of the early 1930s included major assumptions of national responsibility over the economy, as reflected in comprehensive national legislation on income taxation, securities regulation, labor relations, banking, arbitration, competition regulation, bankruptcy and intellectual property. But Congress then, as now, saw its role primarily as interstitial and supportive of state legislation on private law matters.

Similarly, reform efforts during the 1960s and early 1970s produced statutes that modified state commercial law to provide consumer product warranty, safety and credit protection. The law on these subjects continues to change rapidly and is uncertain on a number of points. It appears, however, that the center of gravity on both reform and harmonization of such subjects has shifted back to the states. We thus continue to share a large body of national commercial statute-based law that grew out of the revolutions of the New Deal in the 1930s. Nonetheless, when the opportunity presented itself in the 1960s, Congress declined to adopt the Uniform Commercial Code on a national basis, and the more recent steps toward national harmonization by Congressional statute have been very limited.

Shared Commercial Culture. In fact, the major engine driving the process of harmonization of law in America has been our common national economic market and the high degree of physical mobility of our population. There is a tendency for lawyers to behave [page 694] as though they are the ones who decide whether law is unified, harmonious, or conflicting. To some extent they do, but harmonization is primarily driven by business practice, not by the grand theoretical structures by legal scholars. It was the grand vision of the commerce clause of the Constitution of the United States that it was the building and a national market, not the details of uniform or national legislation that would ensure eventual legal harmonization. Similarly, it is the vision of the Treaty of Rome that guarantees the eventual success of efforts to harmonize European commercial and civil law. Indeed, one must ask whether this process has not already been largely accomplished.

From this perspective, lawyers might be compared to the workers who come along with brooms and shovels after the parade has passed and clean up what the elephants and horses have left behind in their triumphant procession. One beauty of this perspective is that it means that we lawyers have set for ourselves a goal we shall surely reach. Whatever we do, the process of harmonization appears inexorable, precisely because of the power of the forces for expansion and coordination of commercial markets within our nations, our regions, and around the world.

An important part of a shared commercial culture is a shared legal profession. As businesspeople move more freely from place to place around the globe, their lawyers are sure to follow. In the United States, the local cast of the legal profession has already been substantially diluted. Despite lingering efforts by local professional cartels to keep out the "foreigners" from other states, being a lawyer in America increasingly means membership in a competitive national profession, whose members practice quite comfortably from coast to coast. A profession long typified by sole practitioners or work units consisting of a few practitioners operating as partners or sharing office space, is now dominated by gargantuan law firms employing hundreds of lawyers with offices in most of the major metropolitan areas of the American continent and often in Europe and Asia as well. The impact of these changes on the convergence of law and practice is bound to be tremendous.

Shared Legal Literature and Legal Education. From the beginning, most Americans have shared a common legal culture. The original 13 colonies were predominantly English; their lawyers learned the law by reading the same few law books, and spoke the same language. Many western states were devoid of elaborate legal systems until English law arrived with the first pioneers. Spanish law was shoved aside in the southwest and Califonria despite treaty obligations to respect it.

This feature was amplified during the last part of the nineteenth century when the university law school became the dominant [page 695] institution for legal education. The university law school was a fertile site for notions of legal science that understood law in universal and systematic terms. Local variations were deemphasized as national law schools developed. Students were taught general principles of law that were assumed to apply in every locality. Over time, the elite of the profession increasingly were drawn from graduates of a few such law schools. The professoriat at all law schools for several generations has been dominated by graduates of these same law schools. Today, admission to the profession is increasingly based on state bar examinations that examine exclusively on "national, general principles of common law" rather than the law of any locality.

Perhaps the single most influential factor in the harmonization of American private law also occurred during the last quarter of the nineteenth century when a commercial publisher, the West Publishing Company, devised a system for reporting and indexing the court decisions from all the states in an economical and accessible way. This has created a shared national literature of the common law that dominates the way American lawyers think about the law. Since the full text of court opinions is reported, the system depends very heavily on an ingenious indexing system, known as key numbers, that enables an attorney quickly to find cases on a particular point of law from any jurisdiction. Courts and lawyers had cited the decisions of other states before this development, but as opinions have become more available, courts increasingly look around the nation for persuasive authority upon which to decide a difficult point. The key number system has become a matrix engraved on the mind of American lawyers. It establishes categories, suggests how to analyze a problem, and in some cases makes lawyers the prisoners of flaws in its structure.[8] If there is no key nunber, there is no way to categorize the problem or to find the cases. In recent years, the system increasingly has fallen victim to its own success, technological innovation, and the financial incentives that gave it birth. The volume of case law has multiplied and swamped the capacity of the most diligent researcher. There are many millions of case reports in the literature. The estimate of one knowledgable observer is that the West Publishing system alone adds 130,000 opinions and memorandum decisions each year.[9] Authorities on even the most obscure point multiply, and the key number system may have become unmanageable. The system chokes on its own product. In the past twenty years, computer databases have arrived on the scene. These use an indexing concordance that in the blink of an eye will find [page 696] hundreds of cases. The indexing method carries substantial costs and ultimately may prove too unreliable, since it will find the case only if the judge writing the decision uses the precise word that the lawyer is using as the basis for the search.[l0] These problems will have to be resolved as experience with the new technology grows. Nevertheless, the availability of this mass of information throughout the nation provides a firm foundation for the ongoing harmonized approach to emerging legal problems. Common law is formed by the gradual accumulation of case decisions, and the maintenance of a harmonized common law depends heavily on communication among jurisdictions as the new law is forming.

In sum, there are several specific implications of this experience that suggest an agenda for those who apply themselves to the task of bringing world law together in the future. First, the emphasis should be on encouraging the growth of a common legal culture throughout the world. International and comparative-lawyers should seek opportunities to support that shared culture by common training, building a common literature, creating occasions for the exchange and transfer of common experience. This emphasis is likely to result in less attention to comprehensive codes and more attention directed to the alternative solutions that may be already in use to commonly encountered problems. The aim should be to harmonize outcomes and to expand the occasions for lawyers from different legal cultures to see a problem from a comparable, if not a shared. perspective.

My second suggested emphasis may seem paradoxical, for it recognizes the extent to which progress in international commercial law has grown from private, specific, and contextual developments rather than from shared culture. In a diverse and fast changing world, party autonomy and choice will play a large role, displacing systematic positive codes and conventions. Parties already are permitted to displace positive law and to chose the rules that govern their dealings. Those who seek to shape those rules must be prepared to compete with alternative norms. Instead of imposing grand formulations as mandatory substitutes for local and industry specific practices, we would do better emphasizing choices that parties are likely to select because the solutions offered. provide a superior answer to the concrete problems they face. Revision projects that consciously seek to compete will place more emphasis on explanation and less on the elegance of the text or its crystalline theoretical coherence. The prospects are exciting. I look forward to the prospect of scholars from around the world working together. [page 697]


FOOTNOTES

* Arthur Rosett is Professor of Law, University of California, Los Angeles member, Board of Editors.

1. Uniform Customs and Practice for Documentary Credits, issued by the International Chamber of Commerce Commission on Banking Technique and Practice. The current edition, the fifth, was promulgated in 1983.

2. Lawrence Friedman, "Law Reform in Historical Perspective, " 13 St. Louis U. L. Q. 351, 356-57 (1969).

3. Strangely, I do not remember a single instance in those days when my East Coast professors showed any sign that they cared what the "California Rule" was.

4. The unsatisfactory nature of the definitions of international sales taken in ULIS and CISG illustrate this point.

5. Judge Jerome Frank claimed that "perhaps nine-tenths of legal uncertainty is caused by uncertainty as to what courts will find, on conflicting evidence, to be the facts of cases." Zell v. American Seating Co., 138 F.2d 641, 648 (2d Cir. 1943).

6. Crozan v. Director, Missouri Dept. of Health, 497 U.S. 261 (1990).

7. Woxland, "Forever Associated with the Practice of Law: The Early Years of the West Publishing Company," 5 Legal Reference Services Quarterly 115 (1985).

8. Berring, "Legal Research and Legal Concepts: Where Form Molds Substance," 75 Calif L. Rev. 15 (1987).

9. Id., at fn. 38.

10. Herring, "Full-Text Databases and Legal Research: Backing into the Future," 1 High Tech. L. Rev. 27 (1986).


Pace Law School Institute of International Commercial Law - Last updated February 6, 2006
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