4 ms·

A bunch of replies to your comment, but none have (clearly) pointed out that this isn't actually an example of "wiggle room" in action. The mistake was correct

by comex 8y ago

A bunch of replies to your comment, but none have (clearly) pointed out that this isn't actually an example of "wiggle room" in action. The mistake was corrected because both parties agreed to change the contract. If they hadn't agreed and the issue had been brought to court, the $400 million number almost certainly would have been enforced. In cases where contract text is ambiguous, unclear, or just self-evidently illogical, the legal system does grant some wiggle room for a judge to try to tease out the intent. But a mere disagreement between the text and some email(s), AFAIK, wouldn't meet that standard. On the other hand, even on the blockchain it's not hard to make a contract amendable with unanimous consent.

Drdrdrq 8y ago
> On the other hand, even on the blockchain it's not hard to make a contract amendable with unanimous consent. This. Both proponents and critics of blockchain often seem to forget that it's just technology. Entities trading on it and performing other actions are still subjects to applicable laws, whether they like it or not.
Radle 8y ago
After the last email said $425 million? Probably only in America.
bunderbunder 8y ago
> even on the blockchain it's not hard to make a contract amendable with unanimous consent. Unanimous consent is nice when it happens, but we typically want the ability to make amendments without unanimous consent, too. Concrete examples: I wouldn't want to use an electronic payment card that doesn't have some sort of chargeback mechanism. My mutual funds want the exchanges they operate on to have some mechanism for busting erroneous trades, and I'm glad that they do. When I check in at a hotel, they want a credit card on file, so that they can charge me if I steal the towels. All of these mechanisms involve retroactively altering the financial terms of a contract in a way that causes one person to lose some money without their consent. For the most part, people agree that this is just and desirable, because they also value fairness. That said, I agree on the point at hand -- I don't think that the example from the story is particularly relevant here.
- scott_s 8y ago
  I don't think these examples retroactively alter the financial terms of a contract. Rather, I think they invoke the contract to retroactively alter the financial terms of the transaction. But I do agree we want to be able to do that, and mediums that disallow it are less useful.
- atomical 8y ago
  Chargebacks can be settled by arbitration with the merchant in the case of a purchase. That's actually more in line with the dispute resolution pushed by sharing economy services that people are familiar with like Uber, Lyft, Airbnb, etc.
  - mcguire 8y ago
    ...where the arbitrator works for the merchant.
    - atomical 8y ago
      Amazon has more of a vested interest in resolving a dispute with a customer than say Uber resolving a dispute with a rider. Even if the rider stops using the service Uber still has the business of the driver. Consumers, knowingly or not, have shown that they are okay with this model. I think arbitration would likely be seen as an acceptable option.
- ball_of_lint 8y ago
  All of those examples are just passing off the risk of a bad deal from one person or business to another. The article is specifically about how the wording of a contract doesn't matter when both people are happy with it and want it to work. If you want chargebacks and etc in Bitcoin that's perfectly possible but it's going to end up working the same way. There's always risk in dealing with a stranger.
mcguire 8y ago
How hard is "not hard"? The example is the sort of thing where you strike through a number on the contract, write a new one, and everybody initials it.
donkeyd 8y ago
> If they hadn't agreed and the issue had been brought to court, the $400 million number almost certainly would have been enforced. In the Netherlands, I wouldn't be so sure about that. Law says that the person signing the contract needs to be fully aware of what they're signing. If they can show an e-mail which shows they were expecting 425, it's completely up to the lawyer and will depend on context of the e-mail etc.
comex 8y ago
Replying to self since I can't edit. I may have been a bit too confident about whether the text would have been enforced. It actually is possible (in the United States) for a court to alter the terms based on evidence of a clerical error, if the evidence is strong enough. https://www.robinskaplan.com/~/media/pdfs/its%20a%20mistake%20correcting%20scriveners%20errors%20in%20insurance%20contracts.pdf?la=en https://www.robinskaplan.com/~/media/pdfs/its%20a%20mistake%... https://chicagounbound.uchicago.edu/cgi/viewcontent.cgi?article=2771&context=journal_articles https://chicagounbound.uchicago.edu/cgi/viewcontent.cgi?arti... To summarize, there's something called the "parol evidence rule" which boils down to: if you have a final written agreement, and the text of the agreement is clear, you usually can't introduce extrinsic evidence (e.g. from the negotiation process) that the parties' intent was something other than what was written. However, there are a number of exceptions to that rule, and one of them is that you can introduce extrinsic evidence to try to prove the existence of a "mutual mistake", which can be grounds for "reformation" of a contract (i.e. correcting the mistake). A "mutual mistake" is when both parties are mistaken; on the other hand, a "unilateral mistake" (by one party) generally will not be corrected, unless there's also an element of fraud. Mutual mistake must be proven by the high standard of "clear and convincing evidence", as opposed to the normal standard in civil cases of "preponderance of the evidence", and in general there's a heavy presumption that the text reflects the parties' intent. But "scrivener's error" is often a valid basis for showing a mutual mistake. It depends on the quality of the evidence; also, the standards vary somewhat by jurisdiction.

by comex 8y ago

Drdrdrq 8y ago

> On the other hand, even on the blockchain it's not hard to make a contract amendable with unanimous consent. This. Both proponents and critics of blockchain often seem to forget that it's just technology. Entities trading on it and performing other actions are still subjects to applicable laws, whether they like it or not.

Radle 8y ago

After the last email said $425 million? Probably only in America.

bunderbunder 8y ago

> even on the blockchain it's not hard to make a contract amendable with unanimous consent. Unanimous consent is nice when it happens, but we typically want the ability to make amendments without unanimous consent, too. Concrete examples: I wouldn't want to use an electronic payment card that doesn't have some sort of chargeback mechanism. My mutual funds want the exchanges they operate on to have some mechanism for busting erroneous trades, and I'm glad that they do. When I check in at a hotel, they want a credit card on file, so that they can charge me if I steal the towels. All of these mechanisms involve retroactively altering the financial terms of a contract in a way that causes one person to lose some money without their consent. For the most part, people agree that this is just and desirable, because they also value fairness. That said, I agree on the point at hand -- I don't think that the example from the story is particularly relevant here.

scott_s 8y ago
I don't think these examples retroactively alter the financial terms of a contract. Rather, I think they invoke the contract to retroactively alter the financial terms of the transaction. But I do agree we want to be able to do that, and mediums that disallow it are less useful.
atomical 8y ago
Chargebacks can be settled by arbitration with the merchant in the case of a purchase. That's actually more in line with the dispute resolution pushed by sharing economy services that people are familiar with like Uber, Lyft, Airbnb, etc.
- mcguire 8y ago
  ...where the arbitrator works for the merchant.
  - atomical 8y ago
    Amazon has more of a vested interest in resolving a dispute with a customer than say Uber resolving a dispute with a rider. Even if the rider stops using the service Uber still has the business of the driver. Consumers, knowingly or not, have shown that they are okay with this model. I think arbitration would likely be seen as an acceptable option.
ball_of_lint 8y ago
All of those examples are just passing off the risk of a bad deal from one person or business to another. The article is specifically about how the wording of a contract doesn't matter when both people are happy with it and want it to work. If you want chargebacks and etc in Bitcoin that's perfectly possible but it's going to end up working the same way. There's always risk in dealing with a stranger.

mcguire 8y ago

How hard is "not hard"? The example is the sort of thing where you strike through a number on the contract, write a new one, and everybody initials it.

donkeyd 8y ago

> If they hadn't agreed and the issue had been brought to court, the $400 million number almost certainly would have been enforced. In the Netherlands, I wouldn't be so sure about that. Law says that the person signing the contract needs to be fully aware of what they're signing. If they can show an e-mail which shows they were expecting 425, it's completely up to the lawyer and will depend on context of the e-mail etc.

comex 8y ago

Replying to self since I can't edit. I may have been a bit too confident about whether the text would have been enforced. It actually is possible (in the United States) for a court to alter the terms based on evidence of a clerical error, if the evidence is strong enough. https://www.robinskaplan.com/~/media/pdfs/its%20a%20mistake%20correcting%20scriveners%20errors%20in%20insurance%20contracts.pdf?la=en https://www.robinskaplan.com/~/media/pdfs/its%20a%20mistake%... https://chicagounbound.uchicago.edu/cgi/viewcontent.cgi?article=2771&context=journal_articles https://chicagounbound.uchicago.edu/cgi/viewcontent.cgi?arti... To summarize, there's something called the "parol evidence rule" which boils down to: if you have a final written agreement, and the text of the agreement is clear, you usually can't introduce extrinsic evidence (e.g. from the negotiation process) that the parties' intent was something other than what was written. However, there are a number of exceptions to that rule, and one of them is that you can introduce extrinsic evidence to try to prove the existence of a "mutual mistake", which can be grounds for "reformation" of a contract (i.e. correcting the mistake). A "mutual mistake" is when both parties are mistaken; on the other hand, a "unilateral mistake" (by one party) generally will not be corrected, unless there's also an element of fraud. Mutual mistake must be proven by the high standard of "clear and convincing evidence", as opposed to the normal standard in civil cases of "preponderance of the evidence", and in general there's a heavy presumption that the text reflects the parties' intent. But "scrivener's error" is often a valid basis for showing a mutual mistake. It depends on the quality of the evidence; also, the standards vary somewhat by jurisdiction.