377 F.3d 272
Antwun ECHOLS, an individual
v.
Arthur PELULLO, an individual;
Banner Promotions, Inc., a
Delaware Corporation, Appellants
No. 03-2740.
United States Court of Appeals, Third Circuit.
Argued February 24, 2004.
Filed: July 30, 2004.
QUINONEZ, dissenting.
The majority in painstakingly overreaching to find a living contract when there is none has delivered a knockout to a boxer already sprawled in the canvas, battered and bruised. In insisting validity out of a non-contract, it dealt a killer blow to the cautionary tales conjured in Don King Prods., Inc. v. Douglas, 742 F.Supp. 741 (S.D.N.Y.1990) and perpetrated the ghastly spectacle of boxing promoters preying upon hungry struggling pugilists. Along with the critical blow, the majority made adverse back-pedalling in the progress made by jurisprudence in the realms of contract formation, contract interpretation and remedies for contractual breaches. The majority presided on a no-contest, forced the exchange of blows and roped the emaciated combatant for being, well, gaunt and helpless.
The majority should have taken note with much thought that the pseudo-contract of exclusive promotional agreement between Antwun Echols and Banner Promotions, Inc. is open ended and crucial provisions thereof require further negotiations. In large measure, the relationship between the boxer and the promoter in this respect was at most a preliminary commitment which needs formalization and finalization should the condition annexed arise. Critical terms of the agreement—the minimum price structure after a loss at the core—are left to future negotiations. This alone prevents the actualization of the contract; abates its becoming into a final, formal and completed agreement.
Quite certainly, the agreement by its uncertainty as to price structure fails to pass muster the restrictive requirement in the formation of contracts that consideration is elemental and constitutive of the pact. Further, the agreement is unenforceable because it sought to negotiate future agreements without even specifying its material and essential price terms. The District Court insisted on this finding and this should be sustained. On the other hand and more tellingly, the majority fumbled on its stilted enunciation that price is not an essential element in this regard. Boxing is not a jab at vanity nor could it ever be; it is a bloody sport and its participants enter the ring not so much for vainglory as it is for money. No self-respecting pugilist would shatter the jaw of his counterpart just for the blood splattered in the canvas. It is an income raiser and those who climb the ring are in it for the money. No exclusive promotion agreement can ever be forged without the promise and the prospect of a payoff to the boxer. A boxer would not enter into such a pact if he is not entitled to a sum nor would he continue trading fists without the prospect of a take-home pay.
The majority should also take to heart that a typical exclusive promotional agreement is a contract of adhesion. It is a contract that does not allow for negotiation as the adhering party is left to take or leave the concord completely. There exists a prior supposition that the parties negotiated the terms in unequal grounds and the one who adheres is all the time left to pick up the crumbs. In the extant relationship, the boxer is in no position to negotiate the standard terms of the contracts; the promoter laid down the scrawny buffet table for him to partake of or to get hungrier. Courts of law should enforce standard form contracts. On one hand, they undeniably fulfill an important efficiency role in society. Standard form contracting reduces transaction costs substantially by precluding the need by the parties to negotiate the many details of contract each time a service is bartered. On the other hand, there is the potential for inefficient, and even unjust, terms to be accepted by those signing these contracts. Such terms might be seen as unjust if they allow the seller to avoid all liability or unilaterally modify terms or terminate the contract.
The judicial weighing scale should be tilted in favor of the adhering party for the following reasons:
Lengthy boilerplate terms are often in small print and written in complicated legal language which often seems irrelevant. The prospect of a buyer finding any useful information from reading such terms is correspondingly low. Even if such information is discovered, the consumer is in no position to bargain as the contract is presented on a “take it or leave it” basis. Coupled with the often large amount of time needed to read the terms, the expected payoff from reading the contract is low and few people would be expected to read it.
Often the document being signed is not the full contract; the purchaser is told that the rest of the terms are in another location. This reduces the likelihood of the terms being read and in some situations, such as software end user license agreements, can only be read after they have been notionally accepted by purchasing the good.
The most important terms to purchasers of a good are generally the price and the quality, which are generally understood before the contract of adhesion is signed. Terms relating to events which have very small probabilities of occurring or which refer to particular statutes or legal rules do not seem important to the purchaser. This further lowers the chance of such terms being read and also means they are likely to be ignored even if they are read.
Standard form contracts are signed at a point when the main details of the transaction have either been negotiated or explained. Social pressure to conclude the bargain at that point may come from a number of sources. The salesperson may imply that the purchaser is being unreasonable if they read or question the terms, saying that they are "just something the lawyers want us to do" or that they are wasting their time reading them. If the purchaser is at the front of a queue (for example at an airport car rental desk) there is additional pressure to sign quickly. Finally, if there has been negotiation over price or particular details, then concessions given by the salesperson may be seen as a gift which socially obliges the purchaser to respond by being co-operative and concluding the transaction.
If the good which is being sold using a contract of adhesion is one which is essential or very important for the purchaser to buy (such as a rental property or a needed medical item) then the purchaser might feel they have no choice but to accept the terms. This problem may be mitigated if there are many suppliers of the good who can potentially offer different terms.”
The promotional contract in dispute should be read in such a way that it gives necessary concession to the adhering party. To read it otherwise as what the majority did in favor of the promoter is to give away all things deemed unjust and unfair. It should not clearly be the case for Antwun Echols.
Antwun ECHOLS, an individual
v.
Arthur PELULLO, an individual;
Banner Promotions, Inc., a
Delaware Corporation, Appellants
No. 03-2740.
United States Court of Appeals, Third Circuit.
Argued February 24, 2004.
Filed: July 30, 2004.
QUINONEZ, dissenting.
The majority in painstakingly overreaching to find a living contract when there is none has delivered a knockout to a boxer already sprawled in the canvas, battered and bruised. In insisting validity out of a non-contract, it dealt a killer blow to the cautionary tales conjured in Don King Prods., Inc. v. Douglas, 742 F.Supp. 741 (S.D.N.Y.1990) and perpetrated the ghastly spectacle of boxing promoters preying upon hungry struggling pugilists. Along with the critical blow, the majority made adverse back-pedalling in the progress made by jurisprudence in the realms of contract formation, contract interpretation and remedies for contractual breaches. The majority presided on a no-contest, forced the exchange of blows and roped the emaciated combatant for being, well, gaunt and helpless.
The majority should have taken note with much thought that the pseudo-contract of exclusive promotional agreement between Antwun Echols and Banner Promotions, Inc. is open ended and crucial provisions thereof require further negotiations. In large measure, the relationship between the boxer and the promoter in this respect was at most a preliminary commitment which needs formalization and finalization should the condition annexed arise. Critical terms of the agreement—the minimum price structure after a loss at the core—are left to future negotiations. This alone prevents the actualization of the contract; abates its becoming into a final, formal and completed agreement.
Quite certainly, the agreement by its uncertainty as to price structure fails to pass muster the restrictive requirement in the formation of contracts that consideration is elemental and constitutive of the pact. Further, the agreement is unenforceable because it sought to negotiate future agreements without even specifying its material and essential price terms. The District Court insisted on this finding and this should be sustained. On the other hand and more tellingly, the majority fumbled on its stilted enunciation that price is not an essential element in this regard. Boxing is not a jab at vanity nor could it ever be; it is a bloody sport and its participants enter the ring not so much for vainglory as it is for money. No self-respecting pugilist would shatter the jaw of his counterpart just for the blood splattered in the canvas. It is an income raiser and those who climb the ring are in it for the money. No exclusive promotion agreement can ever be forged without the promise and the prospect of a payoff to the boxer. A boxer would not enter into such a pact if he is not entitled to a sum nor would he continue trading fists without the prospect of a take-home pay.
The majority should also take to heart that a typical exclusive promotional agreement is a contract of adhesion. It is a contract that does not allow for negotiation as the adhering party is left to take or leave the concord completely. There exists a prior supposition that the parties negotiated the terms in unequal grounds and the one who adheres is all the time left to pick up the crumbs. In the extant relationship, the boxer is in no position to negotiate the standard terms of the contracts; the promoter laid down the scrawny buffet table for him to partake of or to get hungrier. Courts of law should enforce standard form contracts. On one hand, they undeniably fulfill an important efficiency role in society. Standard form contracting reduces transaction costs substantially by precluding the need by the parties to negotiate the many details of contract each time a service is bartered. On the other hand, there is the potential for inefficient, and even unjust, terms to be accepted by those signing these contracts. Such terms might be seen as unjust if they allow the seller to avoid all liability or unilaterally modify terms or terminate the contract.
The judicial weighing scale should be tilted in favor of the adhering party for the following reasons:
Lengthy boilerplate terms are often in small print and written in complicated legal language which often seems irrelevant. The prospect of a buyer finding any useful information from reading such terms is correspondingly low. Even if such information is discovered, the consumer is in no position to bargain as the contract is presented on a “take it or leave it” basis. Coupled with the often large amount of time needed to read the terms, the expected payoff from reading the contract is low and few people would be expected to read it.
Often the document being signed is not the full contract; the purchaser is told that the rest of the terms are in another location. This reduces the likelihood of the terms being read and in some situations, such as software end user license agreements, can only be read after they have been notionally accepted by purchasing the good.
The most important terms to purchasers of a good are generally the price and the quality, which are generally understood before the contract of adhesion is signed. Terms relating to events which have very small probabilities of occurring or which refer to particular statutes or legal rules do not seem important to the purchaser. This further lowers the chance of such terms being read and also means they are likely to be ignored even if they are read.
Standard form contracts are signed at a point when the main details of the transaction have either been negotiated or explained. Social pressure to conclude the bargain at that point may come from a number of sources. The salesperson may imply that the purchaser is being unreasonable if they read or question the terms, saying that they are "just something the lawyers want us to do" or that they are wasting their time reading them. If the purchaser is at the front of a queue (for example at an airport car rental desk) there is additional pressure to sign quickly. Finally, if there has been negotiation over price or particular details, then concessions given by the salesperson may be seen as a gift which socially obliges the purchaser to respond by being co-operative and concluding the transaction.
If the good which is being sold using a contract of adhesion is one which is essential or very important for the purchaser to buy (such as a rental property or a needed medical item) then the purchaser might feel they have no choice but to accept the terms. This problem may be mitigated if there are many suppliers of the good who can potentially offer different terms.”
The promotional contract in dispute should be read in such a way that it gives necessary concession to the adhering party. To read it otherwise as what the majority did in favor of the promoter is to give away all things deemed unjust and unfair. It should not clearly be the case for Antwun Echols.
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