Quid Pro Quo

JED LEWINSOHN
Paid on Both Sides: Quid Pro Quo Exchange and the

Doctrine of Consideration
abstract. I scratch your back, you scratch mine—how must these services relate in order
to constitute a quid pro quo exchange? In the ordinary quid pro quo exchange, each party agrees to
do their part in order to get the other party to do theirs; each conditions their own willingness to
perform on the willingness of the other; and each regards the other as obligated to do their part in
light of their agreement. But not all exchanges are ordinary, and a proper analysis is of considerable
practical and theoretical significance. In the law alone, quid pro quo figures prominently in a wide
range of contexts—civil as well as criminal, public as well as private—and lies at the core of a num-
ber of raging controversies concerning official corruption, insider trading, and other matters. This
Article offers the first philosophical analysis of quid pro quo exchange in the Anglophone tradi-
tion.
This analysis is framed by an investigation of the doctrine of consideration in contract, the
site of the law’s most influential treatment of quid pro quo. The textbook definition of considera-
tion relies on a conception of exchange—first elaborated by Oliver Wendell Holmes, Jr.—that is
couched in the motivational terms of reciprocal inducement. On this motivational conception, a
quid pro quo is defined in terms of the instrumental motives that typically animate it, where each
service is rendered as a means of bringing about the other. This Article argues against the motiva-
tional account of exchange and offers an original account in its place. This account takes as a start-
ing point the traditional common-law definition of exchange as reciprocal payment. On the recip-
rocal payment account of exchange that emerges, two performances constitute a quid pro
quo when the parties regard those performances as satisfying two conditions: first, that each per-
formance satisfies the debt incurred by the other, and second, that after the sequence of perfor-
mances neither party shall owe the other anything on account of the other’s performance. To-
gether, these conditions imply that, in the wake of the performances, the parties will be “all paid
up” as far as the performances are concerned. Finally, this Article offers an alternative consideration
rule that incorporates its definition of reciprocal payment. This alternative rule locates the required
element of bargain or exchange within the apparent terms of the agreement, and not in the mo-
tives—actual or apparent—that led the parties to assent to those terms. The reciprocal payment
conception of consideration is superior to the textbook definition at the levels of both justification
and fit, and sidesteps the problems that have made the doctrine an object of pillory in so many
quarters.
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author. Assistant Professor of Philosophy, University of Pittsburgh. In writing this article, I

learned a great deal about debt, not least by incurring so much of it. For extensive discussion or
comments on this article or ancestors of it, I am considerably grateful to James Brandt, Kevin Da-
vis, Rowan Dorin, Ben Eidelson, David Enoch, Noah Feldman, Charles Fried, John Goldberg, Eli
Hirsch, Marcel Kahan, Madhav Khosla, Gregory Klass, Daniel Markovits, Lev Menand, Richard
Moran, Liam Murphy, David Owens, Ketan Ramakrishnan, Arthur Ripstein, Tim Scanlon, Sam-
uel Scheffler, Kieran Setiya, James Shaw, Emile Simpson, Henry Smith, Martin Stone, Nandi
Theunissen, Megan E. Vincent, Fred Wilmot-Smith, and David Wishnick, as well as to audiences
at NAWPLT, NYU School of Law, Hebrew University, and the Harvard Society of Fellows. Special
thanks to Jonathan Sarnoff and the other editors at the Yale Law Journal for superb, tireless editing
and for razor-sharp comments and suggestions. Finally, the Harvard Society of Fellows provided
the ideal community in which to write this article, and I owe an immense debt to the nourishing
support of staff and fellows alike.
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the yale law journal 129:690 2020
article contents
introduction 693
i. langdell’s folly 704
ii. quid pro quo exchange: a philosophical account 715

A. The Motivational Theory of Exchange: A Critique 720
B. Remuneration Theory of Exchange: A Defense 724
iii. two doctrines of consideration 739

A. The Remuneration Theory of Consideration 739
B. Testing the Theories 741
1. Conditional Gift Promises 741
2. Contract Modifications 744
3. The Rationale of the Consideration Requirement 752
conclusion 768
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introduction
Under the common law, contractual liability attaches to commitments made

to others. Unlike the law of property, which lays down not only the legal conse-
quences of the various forms of ownership but also the conditions of ownership
itself, the common law of contract piggybacks on an independent social practice
that it does not purport to create or define—namely, the practice of committing
to courses of conduct by making promises or entering into agreements.1 Since
interpersonal commitments are pervasive features of social life—they are made
in all contexts in which humans interact cooperatively and in every medium in
which they communicate—the most basic task confronting this body of law is to
demarcate the sphere of legally enforceable commitments and thereby to deter-
mine the domain of the contractual. In the common-law tradition, the broadest
and most visible line separating enforceable and unenforceable commitments is
drawn by the doctrine of consideration, a fact that explains the doctrine’s endur-
ing position in the law-school curriculum. Like the doctrines of first possession
in property, assault in tort, and nondelegation in administrative law, considera-
tion’s prominence is due not to the frequency with which it arises in litigation
but to the fundamental position it purports to occupy in the structure of a major
area of law.
Notwithstanding these pretensions, it cannot be said that the doctrine of
consideration, in its modern form, has performed this basic demarcating func-
tion in a consistent or principled manner. At least since the late nineteenth cen-
tury, and quite likely since its origins in the sixteenth, the doctrine of considera-
tion in contract law has been understood to rest on a distinction between
exchange transactions (i.e., bargains) and gratuitous transactions, and to limit
the legal enforcement of promises and agreements, unless under seal, to those
belonging to the former category.2 This general conception of consideration—
1. To draw out the contrast a little further, we may note that a deeds-registration system of land
management, for example, does not constitute an independent social practice but one that is
established and maintained by law. This contrasts with the case of contracts, where a practice
of interpersonal commitments is presupposed and endowed with legal significance. Thus, the
Second Restatement of Contracts defines “contract” as “a promise or a set of promises for the
breach of which the law gives a remedy, or the performance of which the law in some way
recognizes as a duty,” RESTATEMENT (SECOND) OF CONTRACTS § 1 (AM. LAW INST. 1981), and
defines “promise” as “a manifestation of intention to act or refrain from acting in a specified
way, so made as to justify a promisee in understanding that a commitment has been made,” id.
§ 2 (emphasis added).
2. For historical background concerning the doctrine of consideration (and the common law of
contracts more generally) I rely primarily on the work of J.H. Baker, D.J. Ibbetson, and A.W.B.
Simpson. See generally JOHN BAKER, AN INTRODUCTION TO ENGLISH LEGAL HISTORY 338-85
693
what is known as the bargain theory of consideration—has been reduced in mod-

ern times to a more specific rule, which can be traced to Christopher Columbus
Langdell’s textbook definition of consideration as “the thing given or done by
the promisee in exchange for the promise.”3 This modern consideration rule, re-
quiring as a condition of contractual validity that the promisor receive something
in exchange for her promise, has been handed down to at least four generations
of students together with a number of well-known problems that continue to
hamper the doctrine, both in theory and in practice.4 These problems include
certain undesirable or counterintuitive applications of the rule (in areas such as
conditional gift promises, contract modifications, option contracts, guarantee
agreements, and social and domestic agreements) as well as a failure to identify
a plausible rationale that can be used to make sense of it. As a result of these
problems, many have called for the wholesale eradication of the bargain require-
ment.5 The principal aim of this Article is to open up space between the general
conception and the specific rule and to show that many of the familiar difficulties
with consideration result from the specific rule rather than from the general con-
ception. My purpose is not so much to defend the bargain requirement as it is to
render it intelligible; only then will we be able to ask whether consideration is a
doctrine worth keeping and what, if anything, might take its place.
By claiming that the modern rule badly implements the bargain requirement,
I mean more than that the rule emphasizes the wrong aspects of a bargain, or
takes too narrow a view of the range of objects whose exchange would satisfy the
requirement. Rather, my claim is that the modern rule implicitly relies on a se-
ductive but altogether mistaken conception of what a bargain or exchange is.
(5th ed. 2019) [hereinafter BAKER, ENGLISH LEGAL HISTORY]; D.J. IBBETSON, A HISTORICAL
INTRODUCTION TO THE LAW OF OBLIGATIONS 24-38, 71-94, 126-51, 202-61 (1999) [hereinafter
IBBETSON, A HISTORICAL INTRODUCTION]; A.W.B. SIMPSON, A HISTORY OF THE COMMON LAW
OF CONTRACT: THE RISE OF THE ACTION OF ASSUMPSIT 199-488 (1975); J.H. Baker, Origins of
the “Doctrine” of Consideration, 1535-1585, in ON THE LAWS AND CUSTOMS OF ENGLAND: ESSAYS
IN HONOR OF SAMUEL E. THORNE 336 (Morris S. Arnold et al. eds., 1981) [hereinafter Baker,
Origins of Consideration]; David J. Ibbetson, Consideration and the Theory of Contract in Six-
teenth Century Common Law, in TOWARDS A GENERAL LAW OF CONTRACT 67 (John Barton ed.,
1990) [hereinafter Ibbetson, Consideration and the Theory of Contract].
3. C.C. LANGDELL, A SELECTION OF CASES ON THE LAW OF CONTRACTS WITH A SUMMARY OF THE
TOPICS COVERED BY THE CASES 1011 (Boston, Little, Brown, & Co. 2d ed. 1879) (emphasis
added).
4. This is not to say that the consideration rule has not changed during this time. Most notably,
this period includes, in the United States, the rise and fall of the benefit-detriment require-
ment conceived of as independent of the exchange requirement. See E. ALLAN FARNSWORTH,
CONTRACTS § 2.2, at 47 (4th ed. 2004).
5. See, e.g., ANDREW BURROWS, UNDERSTANDING THE LAW OF OBLIGATIONS 197 (1998).
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While this conception was implicit in Langdell’s definition, it was rendered ex-
plicit the following year by Oliver Wendell Holmes, Jr., and later codified (and
slightly modified) in the Second Restatement of Contracts.6 Thus, in its boldest
formulation, my claim is that two giants of the common law, Langdell and
Holmes, mangled a central doctrine of contract law by severing the link between
the doctrine of consideration and the proper conception of a bargain. This error,
in my view, spawned confusion that has impeded contract law to this day. Given
a better understanding of the notion of bargain or exchange and a doctrine of
consideration refashioned so as to make contact with it, many of the problems
associated with the modern rule can be resolved.7
Quite apart from consideration, there is ample independent reason to want
an adequate account of quid pro quo exchange, and it is another central aim of
this Article to use the doctrine of consideration to develop and anchor such an
account. Quid pro quo exchange is one of the basic modes of giving and receiving
benefits, and it is both broader and narrower than is sometimes supposed. On
the one hand, the category includes more than narrowly economic activity (such
as the sale and barter of the marketplace or wage labor arrangements in the
workplace), and embraces transactions as varied as plea bargains, prisoner ex-
changes, and bribes. On the other hand, while quid pro quo is a species of reci-
procity (that is, of “returning kindness with kindness”), it should not be con-
flated with the more general category. There are many ways in which two
individuals can confer benefits upon one another without carrying out a quid
pro quo. For example, when, without any discussion of reward, an individual in
distress receives help from a sympathetic passerby, the recipient may later be
moved to send a gift (for instance, chocolate or wine) to the helper in a gesture
of gratitude. Although each person has given something to the other, in the form
of goods or services, no quid pro quo has occurred, and it would be incorrect
(and not merely cynical) to say that the help was given in exchange for the gift,
and vice versa.8
The theoretical challenge, then, is to identify the species of reciprocity that
constitutes an exchange. This is a task well worth pursuing, as it is difficult to
overstate the practical and theoretical significance of the exchange form. In the
6. See infra notes 28-50 and accompanying text.

7. Despite the specificity of these allegations, I hasten to clarify that my central concerns are
conceptual, not historical. If Langdell and Holmes had precursors, my charges would apply
to them as well. However, regardless of what was original to them, there is no denying Lang-
dell and Holmes’s massive influence in the modern development of this body of law.
8. Thus, if the helper had been a public official acting in an official capacity, accepting the gift in
such a situation might amount to an unlawful gratuity, but—if the help was genuinely ren-
dered gratuitously and not on the understanding that the gift would follow—it would not
constitute bribery.
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law alone, quid pro quo figures prominently in a wide range of legal contexts—
civil as well as criminal, public as well as private—and lies at the heart of a variety
of raging legal controversies concerning official corruption, insider trading, and
other matters. Although quid pro quo is a transsubstantive concept in the law,
we find the law’s most developed and influential account of it in the context of
the doctrine of consideration. Indeed, one finds in the legal literature surround-
ing this doctrine two fundamentally different conceptions of quid pro quo. De-
veloping these accounts and subjecting them to critical scrutiny will allow us to
produce an adequate theory that captures the essential elements of the exchange
form.
In keeping with the norms of the law-review genre, the remainder of the
introduction summarizes, in broad outline, the arguments that follow. As we
have seen, Langdell’s definition of consideration insists on an exchange relation
between the consideration and the promisor’s promise (rather than the promised
performance). But this exclusive focus on the commitment itself as the object of
exchange places it in tension with the traditional common-law conception of
bargain or exchange, according to which the objects of an exchange are given in
payment, or remuneration, for each other. For, on the one hand, the modern
consideration rule is satisfied only if the parties’ acts of assent themselves stand
in an exchange relation to one another.9 And yet, on the other hand, there are
many valid contracts—for example, ordinary sales contracts contemplating the
transfer of goods for money—where neither the parties themselves nor outside
observers would regard the parties’ acts of assent (in contrast with their ensuing
performances) as constituting payment or remuneration for anything. The mod-
ern consideration rule thus required the development of a new conception of
exchange, which was rendered explicit first by Holmes and then in the Second
Restatement. According to this account, classifying two performances as a quid
pro quo is a way of characterizing the apparent motives of the parties rendering
those performances. Specifically, to subsume two acts (promissory or otherwise)
under the exchange concept is to describe each one as rendered with the apparent
9. This is because it is not enough that a promise was made in the hope or expectation of getting
something in exchange for it; rather, a promise satisfies the modern consideration require-
ment just in case the promisor actually does receive something in exchange for making it.
Since all agree that the formation of any valid contract is coterminous with the acceptance of
the offer, the consideration the promisor receives must be given when the offer is accepted. It
follows that in a bilateral contract (where the offer is accepted by a counterpromise) the mod-
ern consideration requirement is satisfied just in case each promise is given in exchange for
the other, while in a unilateral contract (where the offer is accepted by a nonpromissory act)
it is satisfied just in case the act which constitutes the acceptance of the offer stands in an
exchange relation to the promise. For a characterization of the distinction between unilateral
and bilateral contracts, see infra note 29.
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aim of inducing the other.10 Combining Langdell’s definition with this account
of exchange, which I will call the reciprocal-inducement account, allows us to
reformulate the modern consideration rule: for an agreement to satisfy the rule,
the offer must be made with the apparent aim of inducing the acceptance
(whether counterpromise or performance) and the acceptance must be extended
with the apparent aim of binding the offeror to her terms.11
Although there is evidently some connection between doing A in exchange for
B and doing A in order to get B, this motivational account of exchange is both
overinclusive and underinclusive. Counterexamples to the theory will be dis-
cussed in Part II, but we may observe at the outset that its conditions are fre-
quently satisfied by plans to coordinate activities between friends and family
10. I am here using “acts” in its broad sense to refer to courses of conduct that might consist in
some combination of acts or omissions.
11. In saying that the modern rule requires an alternative conception of exchange (other than the
payment conception), I am of course assuming that the parties themselves, and outside ob-
servers, would be correct in denying that the acts of assent in typical sales contracts (among
other valid contracts) stand in payment relations to each other. Although I will argue for this
assumption below—as I will show in Part I, the relevant intuitions have considerable force,
and I am aware of no plausible explanation for them other than that they reflect correct appli-
cations of our concept of payment—I hasten to clarify that none of the main claims of this
Article rely on it. Accordingly, if one is unwilling to be guided by ordinary usage (however
firm), one may say that the modern rule requires an alternative conception of payment (differ-
ent than the one implicit in the reported intuitions) rather than an alternative conception of
exchange (different than the payment conception). And if one were to take this course, one
may then view Part II of my paper as an elaboration and evaluation of competing conceptions
of payment (instead of just competing conceptions of exchange), and Part III as the elabora-
tion of a non-Langdellian consideration rule fashioned out of my preferred conception of pay-
ment. Additionally, I fully acknowledge that some writers who have adopted the modern rule
have attempted to preserve the connection between consideration and payment by substitut-
ing “price” for “exchange” in the Langdellian formula. Most prominently, in the first of the
editions of Pollock’s influential Principles of Contract to follow the publication of Langdell’s
definition (i.e., Pollock’s third edition, published in 1881), Pollock adopts Langdell’s defini-
tion but substitutes “price” for “exchange”: “An act or forbearance of the one party, present
or promised, i[s] the price for which the promise of the other is bought, and the promise thus
given for value is enforceable.” FREDERICK POLLOCK, PRINCIPLES OF CONTRACT 179 (London,
Stevens & Sons 3d ed. 1881). And Samuel Williston adopted the same terminology in his in-
fluential treatise. See, e.g., 1 SAMUEL WILLISTON, THE LAW OF CONTRACTS § 574, at 1097-98
(1st ed. 1920). However, calling a tail a leg does not make it one, and it is instructive that the
most distinguished students of the subject have demonstrated discomfort with Pollock’s ter-
minology. Patrick Atiyah, for example, occasionally paraphrases Pollock’s definition, but, si-
lently and without comment, consistently places the term “price” within scare quotes so as to
signal the incorrect usage. See, e.g., P.S. ATIYAH, Consideration: A Restatement, in ESSAYS ON
CONTRACT 179, 207 (1990) (“[C]onsideration, in short, is the ‘price’ of the promise.”). See
also Atiyah’s earlier use of the same quotation mark in an uncited formulation in the same
paper. Id. at 181.
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members (indeed, between members of preexisting cooperative units more gen-

erally) even when neither the parties themselves nor outside observers would
regard such plans, or their execution, as constituting a quid pro quo. This is
worth highlighting since it bears considerably on the challenge of identifying a
plausible rationale for the consideration rule. As I will argue in Part III, its most
plausible justifications regard its distinction between the bargained-for and the
gratuitous as a legally tractable (albeit rough and ready) way of capturing an
important distinction between social contexts or spheres. Consideration, accord-
ing to this family of views, serves chiefly to exempt promises and agreements
formed in certain social contexts from legal enforcement. Such explanations are
not available to proponents of the modern rule, however, since its conditions are
satisfied pervasively by agreements lying on both sides of any relevant social di-
vide (such as that between personal and impersonal domains). By obscuring
these explanations, the modern rule fairly exposes the doctrine to the charge,
frequently made, that it is a senseless historical anachronism.12
The philosophical mistake at the heart of the modern consideration rule is
also the source of many of the well-known problems concerning concrete cases.
Some of these difficulties relate to counterintuitive results: given that it embod-
ies a mistaken conception of bargain, the modern rule unsurprisingly treats
transactions that are patently gratuitous as though they were bargains, and vice
versa. For example, if a genuine bargain requirement rules out anything at all, it
surely rules out informal donative promises—that is, commitments to give
someone a gift or do someone a favor without expectation of payment—as can-
didates for legal enforcement.13 However, as I will show, the modern rule is sat-
isfied by many genuinely donative promises, namely, those involving conditions
imposed by a donor who is eager to donate (for instance, a parent, eager to help
a child pursue some project, promises to gift a thousand dollars provided the
child agrees not to spend any of it on wine). Another perennial problem for the
doctrine concerns “fair and equitable” modifications of contractual terms, such
as a promise to pay more for a service than the price originally agreed upon due
to an unanticipated rise in the cost of providing that service. In such cases of
12. This was indeed Holmes’s own take on the matter. See OLIVER WENDELL HOLMES, JR., THE
COMMON LAW 228-47 (Belknap Press of Harvard Univ. Press 2009) (1881). For another prom-
inent expression of the historical-anachronism view, see Chief Judge Cardozo’s opinion in
Allegheny College v. National Chautauqua County Bank, 159 N.E. 173 (N.Y. 1927).
13. I follow many others in marking a distinction between the broader category of the gratuitous
promise (that is, of a promise that does not belong to a bargain) and the narrower category
of the gift (donative) promise (that is, the promise to give a gift or perform an unremunerated
favor). See, e.g., Edwin W. Patterson, An Apology for Consideration, 58 COLUM. L. REV. 929, 933
n.24 (1958).
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preexisting duties, a strict application of the modern rule often fails to find con-
sideration. Courts have reasoned, for example, that the promise to pay a higher
price could not be made in exchange for the promise to perform the service be-
cause the latter promise had already been bargained for and secured in the initial
contract.14 This outcome is both a counterintuitive application of a bargain re-
quirement—after all, the transaction clearly remains a quid pro quo exchange of
money for a service after the modification of the terms—and a target of heavy
criticism on policy grounds.15 Other well-known problem cases include garden-
variety commercial agreements that would not qualify as bargains on any char-
acterization, such as firm offers (that is, commitments not to rescind a particular
offer) or guarantee agreements (that is, commitments to another’s creditor to
serve as the debtor’s guarantor). The Second Restatement makes an exception
of these cases, but cannot explain the special treatment on principled grounds.16
14. See, e.g., Davis & Co. v. Morgan, 43 S.E. 732, 732 (Ga. 1903) (“[The evidence] proved a prom-
ise to give more than was due, and to pay extra for what one was already legally bound to
perform. The employer, therefore, received no consideration for his promise to give the addi-
tional money at the end of the year.”).
15. To be sure, grounding the preexisting-duty rule in the consideration doctrine predates the
publication of Langdell’s treatise, and is usually traced to Lord Ellenborough’s (somewhat
notorious) opinion in Stilk v. Myrick (1809) 170 Eng. Rep. 1168; 2 Camp. 317. However, Lord
Ellenborough’s sparse remarks do not include a definition of consideration, and it would be
rash to impute to him Langdell’s definition. (Too many alternative definitions of considera-
tion are consistent with the holding; in particular, it might derive solely from a commitment
to some version of a “legal benefit-detriment” requirement.) In any event, it is worth noting
that Ellenborough’s consideration analysis marked a deviation from prior common-law prac-
tice of deciding preexisting duty cases solely under the rubric of public policy (and not con-
sideration). For a classic analysis, critical of Ellenborough’s deviation, see James Barr Ames,
Two Theories of Consideration: I. Unilateral Contracts, 12 HARV. L. REV. 515, 521, 524-25 (1899)
[hereinafter Ames, Unilateral Contracts] (“[T]he [preexisting-duty] rule is commonly
thought to be a corollary of the doctrine of consideration. But this is a total misconception.
The rule is older than the doctrine of consideration and is simply the survival of a bit of formal
logic of the mediӕval lawyers. . . . Lord Ellenborough, unaware of the true origin of the rule
and unacquainted with [the relevant] cases of the seventeenth century, put forward the novel
view that the rule was based upon the doctrine of consideration. . . .This [position of] Lord
Ellenborough, false gloss though it be, has been generally followed by the courts, and is re-
sponsible for the greater part of the objectionable applications of the doctrine of consideration,
whereby the reasonable expectations of business men have been disappointed.”). See generally
Ames, Unilateral Contracts, supra; James Barr Ames, Two Theories of Consideration: II. Bilateral
Contracts, 13 HARV. L. REV. 29 (1899) [hereinafter Ames, Bilateral Contracts].
16. In the case of firm offers (option contracts) the Second Restatement still requires the recita-
tion of “a purported consideration.” RESTATEMENT (SECOND) OF CONTRACTS § 87 (AM. LAW
INST. 1981). But it makes an exception of the consideration rule both in recognizing that nom-
inal consideration is “regularly held sufficient” and in holding that “the option agreement is
not invalidated by proof that the recited consideration was not in fact given.” Id. § 87 cmts. b
& c.
699
Gestures are made in the direction of Lon Fuller’s functional explanation—ap-

pealing to the alleged evidentiary, cautionary, and channeling functions of the
bargain requirement—with the intimation that, bargains or not, these functions
are anyway served by the agreements in question.17 However, as I demonstrate
in Part III, Fuller’s functional explanation is not only unconvincing, but also un-
available to proponents of the modern rule. For, although it is not immediately
apparent, Fuller’s account also relies on the idea that the distinction between the
bargained-for and the gratuitous tracks an important divide between social con-
texts, a view that cannot be accommodated by a motivational account—such as
the modern reciprocal-inducement account—whose conditions lack any sensi-
tivity to social distinctions. Accordingly, in the absence of any plausible rationale,
the Restatement’s exceptional treatment can only be viewed as ad hoc.
The defects of the modern consideration rule can be traced to the defective
conception or bargain lying at its core. Formulating a better rule is possible, but
doing so requires a better grasp of the concept of bargain or exchange. The ven-
erable common-law definition of bargain or exchange as reciprocal payment or
remuneration, according to which two performances constitute a quid pro quo
exchange if each performance serves as payment or remuneration for the other,
provides the basis of this better account. The traditional authorities left the cru-
cial notion of payment undefined, however, which has allowed the law to lose its
handle on the exchange concept. Accordingly, Part II provides an original theory
of quid pro quo exchange that doubles as a theory of reciprocal payment. On this
reciprocal-remuneration account, classifying performances as an exchange is a
way of characterizing the normative significance of the performances, and not
the motives of the parties. More precisely, according to this view, two perfor-
mances constitute a quid pro quo when the parties regard those performances as
satisfying two conditions: first, that each performance satisfies the debt incurred
by the other, and second, that after the sequence of performances neither party
shall owe the other anything on account of the other’s performance. Together,
these conditions imply that, in the wake of the sequence of performances, the
parties will be “all paid up” as far as the performances are concerned.
The first condition makes reference to the notion of debt, a species of obli-
gation. While the English language distinguishes between debt and nondebt ob-
ligations (one’s obligation to repay a loan is a debt, while one’s obligation to
ensure that one’s child has lunch money before leaving the house is not), there
has been, as far as I am aware, no substantial effort by theorists to identify debt’s
17. See Lon L. Fuller, Consideration and Form, 41 COLUM. L. REV. 779, 800-01 (1941).
700
paid on both sides
distinctive features.18 Without a proper understanding of debt, however, it is not

possible to differentiate quid pro quo exchanges from the broader class of “I will
if you will” agreements or mutually beneficial collaboration more generally. Part
II, accordingly, provides an account of debt in service of its account of exchange.
According to this account, the mark of a debt is that performance—for example,
paying a creditor the sum of money owed on account of a particular loan—does
not guarantee satisfaction. For example, one may pay a creditor the exact sum
that one owes without discharging one’s debt, as when one’s payment is for the
purchase of additional merchandise sold by the same creditor. What is needed
to satisfy a particular debt is not merely a rendition of the required performance,
but a rendition in satisfaction of that specific debt (and not some other one). This,
in turn, raises the question of how one succeeds in matching particular perfor-
mances with particular obligations, and the answer may lie in either conven-
tional rules or the mutual understanding of the parties. This distinguishing fea-
ture of debt explains both the possibility of accumulating multiple debts (each
calling for its own rendition of the same type of performance) and widely ob-
served strictures against “double counting.”
The second condition adds to the first that following the performances each
party emerges with no lingering obligations arising from the other’s perfor-
mance. In particular, this condition rules out lingering debts of gratitude and
duties to reciprocate, unless these arise from aspects of the transaction that are
distinct from the required performance.
This account of exchange can be used as the basis of a bargain requirement
that avoids many of the well-known defects that plague the prevailing account.
According to the remuneration theory of consideration, a promise satisfies the
consideration requirement if it can be inferred that the parties regard either the
promised performance, or the promise itself, as standing in a relation of recip-
rocal payment (that is, in an exchange relation) to either the performance, or the
promise, of the promisee.19 This formulation, while registering that a promise
18. Alexander Douglas’s The Philosophy of Debt does not squarely address the question of how to
understand the distinction between those obligations that are, and those that are not, charac-
terized in terms of debt, instead focusing, inter alia, on “what we should do about the many
things we call debt in each of many various sorts of circumstance.” ALEXANDER DOUGLAS, THE
PHILOSOPHY OF DEBT, at xiii (2016). Moreover, Douglas’s rich discussion in Part I concerning
the relation between a debt and a duty to pay consistently fails to distinguish between the
conceptual and normative questions. See id. at 1-25.
19. This formulation of the doctrine of consideration is intended to incorporate the account I have
given of the relationship of reciprocal payment. Thus, although some advocates of the modern
rule continue to regard the reciprocal-inducement account of consideration as describing a
species of payment, see supra note 11, and might therefore view this statement of my position,
701
can be exchanged—as it arguably is when an insurance policy, or a bond, is issued

for value20—also reflects that it is often the contemplated performances, rather
than the promises themselves, that lend the transaction the character of an ex-
change.21 This version of the consideration rule does not result in treating bar-
gains as though they were gratuitous transactions or vice versa. Conditional don-
ative promises (when genuinely donative) do not satisfy the consideration test,
since the donee’s fulfillment of the condition does not stand in a (reciprocal)
payment relation to the donor’s gift (or commitment to give it). Likewise, the
doctrine of consideration poses no obstacle for contract modifications: when two
parties agree to alter the price of a particular service, they do not thereby dislodge
its status as an exchange. What is contemplated, before and after the modifica-
tion, is a quid pro quo exchange—money for a service.
The remuneration theory of consideration also has an intelligible rationale—
one that enjoys substantial historical corroboration and that provides a princi-
pled basis for the traditional exceptions in cases such as firm offers and guarantee
agreements. As many have observed, friends and family members tend to shy
away from the quid pro quo form in favor of other modes of reciprocity when
conferring and receiving benefits among themselves.22 This empirical observa-
tion receives support from the remuneration theory of exchange, which exposes
the reasons friends and family sometimes have to avoid the exchange form.23 This
observed tendency, together with the contestable, but plausible, normative as-
sumption that the law ought not to enforce promises between intimates unless
those intimates expressly enlist the law, typically by invoking legal formalities at
the time of formation, provides a rationale for the bargain requirement. On this
on its own, as consistent with their views, the analysis I will give of reciprocal payment does
present a genuine alternative to the orthodox view of consideration.
20. As I will explain below, it is possible to characterize these transactions differently, such that
what is purchased is a conditional performance rather than a promise to perform if a condition
is met. See infra note 92. If such alternative characterizations are correct, a nondisjunctive
statement of the consideration rule is possible. According to the nondisjunctive version, a
promise satisfies the consideration requirement if it can be inferred that the parties regard
their performances as standing in a relation of reciprocal payment (that is, in an exchange
relation) to each other. That said, I see no problem with the disjunctive formulation, which
is, despite appearances, simpler and less restrictive than the nondisjunctive version. After all,
the disjunctive formulation may be reformulated as follows: if the apparent terms of an agree-
ment contemplate an exchange between the parties, then that is sufficient.
21. Of course, this does not mean that the performances need to be carried out for the agreement
to satisfy the consideration requirement. Rather, it is enough that an objective interpretation
of the agreement construes the performances not merely as required, but required as payment
for the other.
22. See infra note 137.
23. It also explains the exceptions to the observed tendency by exposing the reasons they some-
times have to use the form.
702
paid on both sides
interpretation, the consideration rule does not identify conditions that give the
law reason to enforce a promise. That is, the rule does not rest on the normative
position that a promise ought to be enforced because of its relation to a bargain.
Rather, the point of the bargain requirement is to identify (however roughly) a
class of promises—informal promises in social and domestic contexts—that the
law has reason not to enforce, either because the law’s general reasons for enforc-
ing agreements do not apply in these contexts or because features of these con-
texts override the law’s general reasons in favor of enforcement. This rationale
not only renders the rule intelligible, but also explains why the law draws (and
should draw) exceptions for forms of commercial commitment that, while not
belonging to an exchange, tend not to be used by intimates. As I have said, the
rationale also receives significant historical corroboration. I have already ob-
served that the modern rule of consideration is not sensitive to social context,
and so not up to the task of screening for informal social and domestic agree-
ments. Accordingly, if the rationale is correct, one would expect that the adop-
tion of the modern rule by legal authorities would lead to the introduction or
invocation of some other doctrinal mechanism to perform this function. When
we consult the historical record, this is indeed what we find. In particular, the
legal-intent requirement (requiring an intent to establish legal relations as a con-
dition of liability), or some variation of it, has been consistently wheeled in by
legal authorities in both England and America to avoid enforcement of informal
social and domestic agreements as soon as the modern consideration rule was
adopted.
This Article proceeds as follows. Part I addresses in more detail the relation
between the textbook definition of consideration and the textbook specification
of that definition in the motivational terms of reciprocal inducement. It demon-
strates that by insisting, in all cases, upon an exchange relation between the con-
sideration and the promisor’s promise (rather than his or her performance), the
textbook definition of consideration commits the theorist to rejecting this tradi-
tional definition of bargain or exchange and to embracing instead the motiva-
tional alternative (in terms of reciprocal inducement). Part II criticizes the mo-
tivational theory of quid pro quo exchange and provides in its place an original
philosophical account that doubles as a theory of reciprocal payment. Analyzing
quid pro quo exchange requires analyzing in turn the notion of debt, which, like
quid pro quo exchange, is as socially important as it has been philosophically
neglected. Finally, Part III shows that the conception of exchange as reciprocal
payment can be used to fashion an alternative consideration rule, one that avoids
many of the well-known difficulties associated with the prevailing rule, and that
can be rendered intelligible by a plausible, historically compelling rationale.
703
i. langdell’s folly
The doctrine of consideration conditions a promisor’s liability on some suit-

ably related, ostensibly desired course of conduct on the part of the promisee. In
so doing, it enshrines a form of mutuality or reciprocity at the heart of the com-
mon law of contracts. But there are many forms of mutuality and reciprocity, and
not all can lay claim to an association with the doctrine of consideration. Alt-
hough a sequence of good turns between neighbors or the alternating, synchro-
nized movements of rowers attempting to reach a distant shore may be paradig-
matic examples of reciprocity and mutuality, neither one falls within the ambit
of the doctrine. At least since the late nineteenth century, and quite probably
from the doctrine’s origins in the sixteenth century, the requirement of consid-
eration has been understood to rule out informal, gratuitous promises or agree-
ments as candidates for legal enforcement.24 On this understanding, the form of
reciprocity singled out by the doctrine of consideration is the doing or giving of
something in exchange for something else, also known as quid pro quo ex-
change.
To say that the doctrine of consideration imposes some exchange (alterna-
tively, bargain) requirement on enforceable promises marks no departure from
prevailing understandings. There is perhaps no single definition in all of contract
law—perhaps all of private law—more familiar to law students than the Second
Restatement’s definition of consideration, which is couched plainly in terms of
exchange.25 And while there has been considerable debate among historians con-
cerning whether, at its advent, the doctrine of consideration had anything to do
with reciprocity at all, both sides of that debate take for granted that, if the early
24. The restriction to informal promises reflects the traditional rule that “[a] gratuitous promise
becomes legally binding if it is made under seal or if it is made in exchange for ‘nominal’
consideration, such as a peppercorn or £1.” STEPHEN SMITH, CONTRACT THEORY 217 (2004).
Of course, when such formalities are not recognized in a given jurisdiction—as they are not
in the majority of American jurisdictions, see FARNSWORTH, supra note 4, § 2.11, at 72, §§ 2.16-
.17, at 86-88—the practical significance of this limitation becomes nil. In modern times, prom-
issory estoppel has also been used to enforce certain promises absent consideration. However,
the nature and content of the estoppel principle, as well as its relation to the consideration
doctrine, have been greatly debated and lie beyond the scope of the present inquiry. For one
conception of the estoppel doctrine that is fully compatible with the theory of consideration
elaborated in this paper, see Daniel A. Farber & John H. Matheson, Beyond Promissory Estoppel:
Contract Law and the “Invisible Handshake,” 52 U. CHI. L. REV. 903 (1985).
25. RESTATEMENT (SECOND) OF CONTRACTS § 71 (AM. LAW INST. 1981) (“(1) To constitute con-
sideration, a performance or a return promise must be bargained for. (2) A performance or
return promise is bargained for if it is sought by the promisor in exchange for his promise and
is given by the promisee in exchange for that promise.”).
704
paid on both sides
doctrine was related to any form of reciprocity, it was to quid pro quo exchange.26
Nevertheless, if it is a commonplace that the line drawn by the doctrine of con-
sideration is drawn around exchange, it is, I believe, one that has not been suffi-
ciently borne in mind by those pursuing either positive or normative analysis. As
I will show, many of the well-known difficulties that have become associated
with the doctrine are due to a failure to reckon with the notion of exchange that
lies at the core of the rule.27
The modern understanding of the consideration requirement may largely be
traced to the definition of consideration put forth by Christopher Columbus
Langdell in 1879 in the summary appended to the second edition of his famous
26. Although his view is not widely accepted—for some prominent dissents, see generally BAKER,
ENGLISH LEGAL HISTORY, supra note 2; IBBETSON, A HISTORICAL INTRODUCTION, supra note 2;
Baker, Origins of Consideration, supra note 2; and Ibbetson, Consideration and the Theory of Con-
tract, supra note 2—Simpson has argued at length that the requirement of consideration, prior
to the late nineteenth century, had little to do with reciprocity at all, but was rather a means
of ensuring that the law would enforce only those promises made for “good reasons”—to en-
sure, in other words, that the considerations which motivate enforceable promises are in some
sense worthy. In so arguing, Simpson expressly sets himself in opposition to the “bargain
theory” that he attributes to Holmes’s followers, who are accused of “link[ing] their theories
about the modern law to their account of the history of the subject.” SIMPSON, supra note 2, at
417 n.1.
27. This is not to suggest that no one has recognized the importance, for the study of the law of
consideration, of providing such an account of exchange. In his seminal paper Consideration
and Form, Lon Fuller observes that
[i]n the executory bilateral contract . . . the element of exchange stands largely
alone as a basis of liability and its definition becomes crucial. Various definitions
are possible. . . . The problem of choosing among these varying conceptions may
seem remote and unimportant, yet it underlies some of the most familiar problems
of contract law.
Fuller, supra note 17, at 817 (footnote omitted). Unfortunately, while recognizing the problem,
Fuller makes no serious effort to provide an analysis of the pivotal concept. The “[v]arious
definitions” he canvasses are marked by their vagueness and imprecision, and Fuller unfortu-
nately makes no attempt to improve upon them:
We may define exchange vaguely as a transaction from which each participant de-
rives a benefit, or, more restrictively, as a transaction in which the motives of the
parties are primarily economic rather than sentimental. Following Adam Smith, we
may say that it is a transaction which, directly or indirectly, conduces to the division
of labor. Or we may take Demogue’s notion that the most important characteristic
of exchange is that it is a situation in which the interests of the transacting parties
are opposed, so that the social utility of the contract is guaranteed in some degree
by the fact that it emerges as a compromise of those conflicting interests.
Id.
705
casebook: “The consideration of a promise is a thing given or done by the prom-

isee in exchange for the promise.”28 According to this definition, which remains
the textbook formulation to this day, the consideration that supports a promise
(consideration that is comprised of the promisee’s performance, when the con-
tract is unilateral, and the promisee’s counterpromise, when bilateral) stands,
necessarily and in all cases, in an exchange relation to the promise itself.29 Lang-
dell’s definition quickly took root in the legal establishment, and by 1899, James
Barr Ames, Langdell’s successor as dean of Harvard Law School, could correctly
assert in the pages of the Harvard Law Review that “[E]veryone will concede that
the consideration for every promise must be some act [including a counter-
promise] or forbearance given in exchange for the promise.”30
And yet, despite this reception, there is surprisingly little precedent for Lang-
dell’s definition of consideration, either in case law or secondary sources on ei-
ther side of the Atlantic.31 More importantly, and quite apart from the historical
28. LANGDELL, supra note 3, at 1011.

29. I am helping myself to the traditional distinction between unilateral and bilateral contracts,
even though the Second Restatement has abandoned these terms on account of “doubt as to
the utility of the distinction.” RESTATEMENT (SECOND) OF CONTRACTS § 1, reporter’s note to
cmt. f. As Farnsworth observes, “[E]ven the Restatement Second recognizes that an offeror
may make an offer that ‘invites an offeree to accept by rendering a performance and does not
invite a promissory acceptance.’” FARNSWORTH, supra note 4, § 3.4, at 206 (quoting RESTATE-
MENT (SECOND) OF CONTRACTS § 45). I will follow Farnsworth and use the term “unilateral
contracts” to refer to those that are formed by such nonpromissory acceptances, and “bilateral
contracts” to refer to those formed by promissory acceptances.
30. Ames, Bilateral Contracts, supra note 15, at 31.
31. Williston, although an early champion of Langdell’s definition, acknowledged its uncertain
relation to the history of the doctrine: “No doubt, during its development consideration
meant something more or different than something given by the promisee in exchange for the
promise, but that is the end to which it gradually tended, and which it now may be held to
have reached.” Samuel Williston, Successive Promises of the Same Performance, 8 HARV. L. REV.
27, 33 (1894).
It is crucial to avoid being misled by those earlier definitions that identify consideration
with the causa or cause of the civil law. For example, Powell, who frankly acknowledged in his
note to the reader that “many of the observations and general remarks here submitted for [the
reader’s] consideration, have been taken . . . from the civil law writers,” 1 JOHN JOSEPH POW-
ELL, ESSAY UPON THE LAW OF CONTRACTS AND AGREEMENTS, at xii (London, J. Johnston & T.
Whieldon 1790), defines consideration as “the material cause of a contract or agreement; or
that, in expectation of which, each party is induced to give his assent to what is stipulated
reciprocally between both parties,” id. at 330. While the posited motivational relation is a re-
lation between the consideration and the promise, there is no reason to interpret this relation
as a relation of quid pro quo exchange. As Pollock and other bargain theorists of consideration
have pointed out, the civilian causa (or cause) embraces many kinds of gratuitous agreements.
FREDERICK POLLOCK, PRINCIPLES OF CONTRACT AT LAW AND IN EQUITY 118-19 (London, Ste-
vens & Sons 1st ed. 1876) (describing how, in Roman law, “[i]nformal agreements (pacta)
706
paid on both sides
did not give any right of action without the presence of something more than the mere fact of
the agreement. This something more was called causa. Practically the term covers a somewhat
wider ground than our ‘consideration executed’”); id. at 148 (explaining, in comparing con-
sideration with the modern French causa, that “nothing would at first sight seem more natural
to an English lawyer than simply to translate cause by consideration. But let him turn to a French
commentary on the Code, and he finds no distinct and comprehensive definition of cause as a
legal term of art, but a scholastic discussion of efficient, final, and impulsive causes. Going on
to see what is in fact included in the cause of the French law, we find it wider than our Con-
sideration in one way and narrower in another. On the one hand the existence of a natural [i.e.
moral] obligation, or even of a real or supposed duty in point of honour only, may be quite
enough. Nay, the deliberate intention of conferring a gratuitous benefit, where such intention
exists, is a sufficient foundation for a binding unilateral promise.”).
The clearest historical antecedent to Langdell of which I am aware is in the opinion of
Eagan v. Call, 34 Pa. 236, 237 (1859) (“Want of consideration can only be, where the promissee
parts with nothing in exchange for the promise. The consideration fails, when the promissor
does not get that which the promissee agreed to give, as a motive for the promise.”) Three
points are in order. First, there is no evidence, as far as I know, that this definition had any
impact on the development of the law or on Langdell. (It is perhaps relevant that, somewhat
notoriously, the only cases included in Langdell’s casebook come from England, Massachu-
setts, and New York.) Second, assuming the second quoted sentence from Eagan is a refor-
mulation of the preceding one, it corroborates my argument, offered below, that Langdell’s
definition relies on a motivational conception of exchange. See infra text accompanying note
38. Third, Eagan concerned a sales case where payment was tendered using a bill. 34 Pa. at
236. As I discuss below, all accounts of exchange could agree that in a case like that it is the
promise (merged with the bill) that is given in exchange for the performance. See infra note
92 and accompanying text. Thus, although these sentences use general terms, it is possible
that the definition should be implicitly restricted to the facts of the case (i.e., that it should be
read, “want of consideration [in cases like this] can only be . . .”).
Finally, one must not be misled by the well-worn phrase, used to describe unexecuted
bilateral contracts, that “mutual promises are consideration for each other,” the proper import
of which was well captured by Henry Ballantine many years ago:
When the [contractual] action of assumpsit was first introduced in the sixteenth
century, the only consideration recognized was an executed consideration, value ac-
tually given or detriment incurred. To extend the action to [wholly unexecuted]
bilateral contracts without appearance of change, it was said that “mutual promises
are consideration for each other,” and this became the language of pleading and of
the courts. But the courts have never stopped to analyze what they meant by “prom-
ise.” They simply meant that executory consideration was sufficient. It is therefore
not necessary to take this loose and uncritical language of the judges and pleaders
literally. . . . Like many legal mottoes and catch phrases, the easy and time-honored
formula that promise is consideration for promise is but a legal “bromide,” which
is ordinarily used as a substitute for thought, to disguise a lack of analysis under
vague and specious words.
Henry Winthrop Ballantine, Mutuality and Consideration, 28 HARV. L. REV. 121, 125-26 (1914).
Admittedly, there is one pocket of early English law—namely, the doctrine of independ-
ency as it related to the purely executory contract—that might conceivably be taken as prece-
dent for Langdell’s position, insofar as the cases explicating that doctrine appear to put to
707
question whether it constituted an innovation, Langdell’s definition is as a purely

conceptual matter in tension with the traditional common-law conception of
bargain or exchange as reciprocal remuneration (alternatively, recompense), a
conception that figures repeatedly in discussions of the doctrine of consideration
from the sixteenth century until Langdell’s definition took root.32 This tradi-
tional conception of bargain or exchange is well articulated by Edmund
Plowden, in what Frederick Pollock characterized as “the first full discussion of
Consideration by that name,”33 a case report of Sharington v. Strotton.34 Accord-
work the idea that mutual promises are given for one another. Here, too, though, there is con-
siderable room for doubt. After all, the doctrine regarding mutual promises may well have
resulted from a decision to extend to contract the relevant principles governing mutual cove-
nants rather than from a commitment to Langdell’s later conception of consideration. As S.J.
Stoljar explains,
[S]tarting with the principle that mutual covenants were independent unless ex-
press words of condition made one covenanted performance dependent upon, or
prior to, the other, the courts had no other method of construction . . . . The law
[of contracts] . . . took as its model not the sale by mutual grants where concur-
rency was the natural solution, but the mutual covenants for service where concur-
rent performance was impossible; the law followed the latter analogy because, ex-
ecutory agreements being by covenant, “covenant” thus appeared to map out the
area of relevant precedent.
S.J. Stoljar, Dependent and Independent Promises: A Study of the History of Contract, 2 SYDNEY L.
REV. 217, 220-21 (1957). In any case, if the doctrine of independence indeed reflected an early
commitment to Langdell’s conception of consideration, the law’s subsequent movement away
from independency and toward concurrency can perhaps be conceived of as a move away from
that conception.
32. By way of contrast, three years before the publication of Langdell’s definition, in the first edi-
tion of arguably the first systemic treatise of the common law of contract, Frederick Pollock
approvingly quoted the definition of the Exchequer Chamber: “A valuable consideration, in
the sense of the law, may consist either in some right, interest, profit, or benefit accruing to
the one party, or some forbearance, detriment, loss, or responsibility, given, suffered, or un-
dertaken by the other.” POLLOCK, supra note 31, at 147 (quoting Currie v. Misa (1875) 10 LR
Exch. 153 at 162 (Lush J)). While this has been correctly understood to express a bargain con-
ception of consideration, the definition neither says nor implies that the valuable considera-
tion stands in an exchange relation with the promise it supports (as opposed to the promised
performance). As I discuss below, Pollock does not adopt (a variant of) Langdell’s definition
until the 1881 edition of his treatise. See infra notes 153-155 and accompanying text. Similarly,
the definition of consideration given in the 1879 edition of Anson’s important treatise does
not say or imply that the bargained-for benefit is given in exchange for the promise: “Consid-
eration [is] some gain to the party making the promise, arising from the act or forbearance,
given or promised, of the promisee.” WILLIAM R. ANSON, PRINCIPLES OF THE ENGLISH LAW OF
CONTRACT 29 (Oxford, Clarendon Press 1879).
33. POLLOCK, supra note 31, at 151.
34. Sharington v. Strotton (1565) 75 Eng. Rep. 454; 1 Plowden 298.
708
paid on both sides
ing to Plowden, “a bargain . . . is, when a recompense is given by both the par-
ties, as if a man bargains his land for money, here the land is a recompense to the
one for the money, and the money is recompense to the other for the land, and
this is properly a bargain and sale.”35 According to this definition—advanced not
only by Plowden, but also by other preeminent authorities such as Christopher
St. German and William Blackstone—reciprocal transfers of goods or services
constitute a bargain or exchange just in case each transfer is viewed as payment
for the other.36
This definition of exchange is incompatible with Langdell’s definition of
consideration. More precisely, if the promisee’s performance (in the unilateral
contract) or counterpromise (in the bilateral contract) stands always in an ex-
change relation to the promisor’s promise, then, if ordinary usage is any guide,
the exchange relation cannot be identified with the relation of reciprocal pay-
ment or remuneration.37 This can be seen most easily by considering ordinary
sales contracts (an agreement to transfer goods for money), paradigm cases of
contracts with good consideration. Let us start with the unilateral case: a seller
of goods makes an offer to Jones to deliver certain goods if Jones pays the seller
35. Id. at 461; 1 Plowden at 303. Commenting on this definition, Simpson notes that “[t]hough
contemporaries did not call an agreement to build a house for money (for example) a bargain,
but a covenant, the same analysis will fit such a transaction.” SIMPSON, supra note 2, at 416-
17. While Simpson recognizes that bargain or exchange agreements satisfy the sixteenth-cen-
tury consideration requirement, he nevertheless insists that the requirement can be satisfied
in other ways as well, and so concludes that consideration should not be characterized as a
doctrine that requires bargain as a condition of enforcement. See id. at 417-24.
36. 2 WILLIAM BLACKSTONE, COMMENTARIES *446 (“Sale or exchange is a transmutation of prop-
erty from one man to another, in consideration of some recompense in value: for there is no
sale without a recompense; there must be quid pro quo.”); cf. CHRISTOPHER ST. GERMAN,
DOCTOR AND STUDENT 228 (T.F.T. Plucknett & J.L. Barton eds., Selden Society 1974) (1530)
(“[S]uche bargaynes and sales be called contractes/ & be made by assent of the partyes vppon
agrement betwene theym of goodes or landes for money or for other recompence . . . .”). In
addition to identifying bargain or exchange with reciprocal recompense (i.e., payment), St.
German and Blackstone, in the same chapters, also treat consideration as equivalent with rec-
ompense. See 2 BLACKSTONE, supra, at *441 (“[H]e did it without any consideration or recom-
pence . . . .”); id. at *444-45; ST. GERMAN, supra, at 228 (“[A] nude contracte is where a man
maketh a bargayne or sale of his goodes or landes wythout any recompence appoynted for yt.
As yf I saye to a nother I sell the all my lande or all my goodes & nothynge is assygned that
the other shall gyue or paye for yt/ that ys a nude contracte/ and as I take yt: it ys voyde in
the lawe and conscyence . . . .”).
37. On my use of the traditional distinction between unilateral and bilateral contracts, see supra
note 29 and accompanying text. As discussed earlier, the modern consideration rule requires
that the promisor receive something in exchange for the promise, which implies that, in the
case of bilateral contracts, the relevant exchange relation is that between promise and counter-
promise (rather than promise and performance). For further discussion, see supra note 9.
709
fifty dollars. Jones pays the money and the goods are delivered as promised.
Now, we may ask, does Jones’s transfer of funds constitute remuneration for the
transfer of the goods or for the promise to transfer them? No one whose under-
standing has not been distorted by confused doctrines of consideration would
have any difficulty answering that, in the usual case, the payment is for the goods
and not the promise to give them. Since the payment, in this example, does, for
Langdell, constitute consideration for the promise, it follows, on pain of incon-
sistency, that Langdell’s definition relies on an alternative sense of exchange. The
same result is even more clearly reached in the case of ordinary bilateral sales
agreements. As long as the agreement remains unexecuted on both sides—that
is, before either the goods or the money has changed hands—no one who aims
to be speaking proper English would say that a payment (much less two of them)
has already been made merely on account of the handshake.38
Although Langdell himself did not articulate the alternative conception of
exchange upon which he implicitly relied, strides were made the following year,
1880, in Oliver Wendell Holmes’s seminal lectures on the common law. Holmes
put forward a definition of consideration that purported to precisely specify the
relation between promise and consideration in terms of motivational concepts:
[I]t is the essence of a consideration, that, by the terms of the agreement,

it is given and accepted as the motive or inducement of the promise. Con-
versely, the promise must be made and accepted as the conventional mo-
tive or inducement for furnishing the consideration. The root of the
whole matter is the relation of reciprocal conventional inducement, each
for the other, between consideration and promise.39
It is important to grasp the precise meaning of Holmes’s definition. X is a

“motive or inducement” for Y if X is done with the aim, though not necessarily
the sole or exclusive one, of producing Y; X and Y are reciprocal inducements if
each is done with the aim of producing the other.40 In the terms of contract law’s
theory of offer and acceptance, an acceptance serves to bind the offeror and
thereby serves to transform the offer into a binding promise. Returning to the
38. As I have acknowledged, some may question the significance of ordinary usage on these is-
sues. As I have discussed, such skepticism has little bearing on the overall claims of this article.
See supra note 11. In Part II, however, I offer a theory of reciprocal remuneration that vindicates
the ordinary linguistic intuitions, thereby showing the incompatibility of Langdell’s defini-
tion with a conception of consideration as reciprocal payment.
39. HOLMES, supra note 12, at 265. The lectures were delivered in the fall of 1880, and the contract
lectures were drafted in the summer of 1880. See Patrick J. Kelley, A Critical Analysis of Holmes’s
Theory of Contract, 75 NOTRE DAME L. REV. 1681, 1682 (2000).
40. Instead of “with the aim of,” I could have written “as a means of” or “in order to.” These are
equivalent formulations.
710
paid on both sides
earlier example of the unilateral sale, in which the seller’s offer is accepted by
means of the buyer’s payment, the seller’s promise stands in a relation of recip-
rocal inducement to the payment if the offer is made in order to induce the pay-
ment and the payment is made with the aim of binding the seller. Likewise, in
the bilateral case, where the offer is accepted by the counterpromise, the offer
and acceptance stand in a relation of reciprocal inducement if each is made with
the aim of binding the other party to the deal.
Holmes’s definition of consideration does not require that the parties actu-
ally possess the motives that would satisfy a so-called subjective reciprocal-in-
ducement condition. One would instead expect, given his well-known views
about mental-state requirements in the law, a so-called objective construal of the
condition: that is, one would expect him to say that the promisor must merely
manifest the aim of inducing the consideration, while the promisee must merely
manifest the reciprocal aim of binding the promisor. But he does not say this;
rather, by invoking what Grant Gilmore has rightly called a “mysterious
phrase”41—that is, “reciprocal conventional inducement”—Holmes replaces an
objective motive requirement with a “conventional” one, which can be satisfied
by the “terms of the agreement” even when objective manifestations are absent.
It is clear from the context that Holmes avoided offering the objective construal
only to accommodate the traditional allowance for nominal consideration.42 As-
suming, as Holmes did, that the allowance was to follow from the definition of
consideration, some such accommodation was clearly necessary: when someone
“sells” their nephew the family farm for a dollar, it is abundantly manifest that
they do not hand over the keys (or commit to doing so) as a means of obtaining
the dollar (or the commitment to give it). Accordingly, for one who is prepared
either to disallow nominal consideration, or to recognize it as an exception to,
rather than a fulfillment of, the requirement of consideration, there would be no
reason to go beyond the objective construal of the requirement.
Although Holmes offers this motivational account of the relation between
promise and consideration, he stops just shy of explicitly identifying the relation
of “reciprocal conventional inducement” with the relation of exchange. How-
ever, in the previous lecture, he explicitly identified “our peculiar and most im-
portant doctrine . . . [of] consideration” with “the rule . . . that there must be
quid pro quo.”43 It is, perhaps, possible that Holmes intended to put forward “re-
ciprocal conventional inducement” only as a sufficient condition of exchange,
41. GRANT GILMORE, THE DEATH OF CONTRACT 22 (Ronald K.L. Collins ed., 1995).
42. In the sentence immediately preceding the quoted definition, he says, “A consideration may
be given and accepted, in fact, solely for the purpose of making a promise binding.” HOLMES,
supra note 12, at 265.
43. Id. at 234; see also id. at 243 (“Wherever consideration was mentioned, it was as quid pro quo,
as what the contractor was to have for his contract.”).
711
and not as a complete analysis. However, this possibility is remote enough that
we may safely say that Holmes’s theory of consideration is an application of a
general theory of quid pro quo exchange. This interpretation gains further sup-
port from, first, its hand-in-glove fit with Langdell’s definition of considera-
tion—it supplies the definition of “exchange” that appears to substantiate Lang-
dell’s view of the matter—and, second, the air of plausibility that reciprocal
inducement enjoys as a theory of quid pro quo exchange. After all, when parties
sell or trade goods or services, it is at least usually the case that each gives (partly)
in order to receive, or at least appears to do so. And, in any case, even if Holmes
stopped just short of explicitly identifying the relation of “reciprocal conven-
tional inducement” with the exchange relation, the drafters of the Second Re-
statement had no such qualms. Putting two and two together, they both adopted
Langdell’s definition of consideration, cast in terms of exchange, and repackaged
Holmes’s motivational definition of consideration as a definition of exchange.44
This was made fully explicit in the comments:
Consideration requires that a performance or return promise be “bar-

gained for” in exchange for a promise; this means that the promisor must
manifest an intention to induce the performance or return promise and
to be induced by it, and that the promisee must manifest an intention to
induce the making of the promise and to be induced by it.45
44. They employed the objective rather than conventional variant of reciprocal inducement, re-
flecting their reversal on nominal consideration.
45. RESTATEMENT (SECOND) OF CONTRACTS § 81 cmt. a (AM. LAW INST. 1981). For an especially
full-throated statement of the Holmesian theory, see RESTATEMENT (SECOND) OF CONTRACTS
§ 75 cmt. b (AM. LAW INST., Preliminary Draft No. 2, 1961) (“‘Bargained for and given in
exchange.’ In the typical bargain, the consideration and the promise bear a reciprocal relation
of motive or inducement: the consideration induces the making of the promise and the prom-
ise induces the furnishing of the consideration. Here, as in the matter of mutual assent, the
law is concerned with the external manifestation rather than the undisclosed mental state: it
is enough that one party manifests an intention to induce the other’s response and to be in-
duced by it and that the other responds in accordance with the inducement. . . . But it is not
enough that the promise induces the conduct of the promisee or that the conduct of the prom-
isee induces the making of the promise; both elements must be present, or there is no bar-
gain.”). The story of what happened between Holmes’s seminal lectures and the Second Re-
statement’s adoption of his definition is an interesting one involving the Holmesian theory of
exchange “working itself pure.” The simplified version is that Williston, the chief Reporter of
the First Restatement, wanted to have it both ways, holding both that consideration is always
given in exchange for the promise and that the exchange relation is a relation of reciprocal
payment. That he was serious about the latter proposition is clear not only from his repeated
statements that consideration is the “price” or “payment” of the promise; more importantly,
he had a good enough grip on the concept of payment to use it to explain, as we shall see in
Part III, the unenforceability of informal social and domestic arrangements that plainly satisfy
712
paid on both sides
In a well-known discussion, Gilmore called Holmes’s “bargain theory” of

consideration “revolutionary doctrine” and maintained that in propounding it
Holmes “was not in the least interested in stating or restating the common law
as it was.”46 Yet Gilmore did not capture the nature of the revolution he set out
to describe. If he was referring merely to a new technical definition of a consid-
eration requirement cast in the terms of reciprocal inducement, then his claims
were overstated, as this alone hardly amounts to “a revolutionary change in legal
thought.”47 If, alternatively, he was suggesting that, in Holmes’s hands, the con-
sideration doctrine came to embody, for the first time, a requirement of bargain,
he faces the powerful arguments to the contrary offered by some of our most
distinguished historians of the common law, such as J.H. Baker, D.J. Ibbetson
and others. What truly did amount to a revolutionary change in legal thought,
however, was the silent substitution of one conception of bargain or exchange
for another, a revolution so silent that it has evaded detection by historians of
even Baker’s and Ibbetson’s stature, who have, I believe, read Langdell’s concep-
tion back into the older sources.48 And this “new day dawned” not “with
reciprocal inducement. See infra notes 133-135 and accompanying text. The story of these in-
tervening years also involves the rise and fall of the “benefit-detriment” requirement, con-
ceived of as an independent requirement that serves to supplement the exchange requirement.
Although I will not argue the point here, this too should be seen as the natural culmination of
Holmesian theory of exchange. In this light it is significant, and unsurprising, that the benefit-
detriment rule met its demise in a 1918 Corbin paper, see Arthur L. Corbin, Does a Pre-Existing
Duty Defeat Consideration?—Recent Noteworthy Decisions, 27 YALE L.J. 362 (1918), and was ex-
plicitly negated in the Second Restatement, see RESTATEMENT (SECOND) OF CONTRACTS § 79
cmt. a (AM. LAW INST. 1981).
46. GILMORE, supra note 41, at 22.
47. Id. at 122 n.36 (quoting 2 MARK DEWOLFE HOWE, JUSTICE OLIVER WENDELL HOLMES: THE
PROVING YEARS: 1870-1882, at 245 (1963)).
48. In saying this, I am not relying on the more general claim that Langdell’s definition marked
an innovation. Rather, my present claim is the narrower one that some of our best historians
have read Langdell’s definition of consideration (a definition that characterizes consideration
as that which is given in exchange for the promise) into particular earlier sources that neither
said nor implied it. Thus, Baker offers the following gloss on a fifteenth-century report: “One
of the clerks of the King’s Bench actually described the payment for the promise as quid pro
quo.” Baker, Origins of Consideration, supra note 2, at 355. Baker cites to Simpson’s transcription,
which reads as follows: “BROWN (the second clerk): If a man prepays any sum of money
that a house be built for him etcetera and he does not do it, now he will have an action of
trespass on his case because the defendant has quid pro quo and so the plaintiff is damaged.
And this was privately denied to him, etc.” SIMPSON, supra note 2, at 626. As far as I can see,
nothing in this quotation says or implies that the prepayment was payment for the promise
and not the house. Moreover, Baker’s general descriptions of sixteenth-century developments
bear the same marks of Langdell’s influence: “Consideration, like cause, was a conveniently
ambiguous word to choose for the purpose. On the one hand, the consideration for a promise
could mean that which was given in return for it . . . .” BAKER, ENGLISH LEGAL HISTORY, supra
713
Holmes,” but with Langdell, and culminated in the work of Arthur Corbin and
the Second Restatement Reporters.49 All revolutions have their casualties. In this
case, as I will show in Part III, the casualty was nothing less than the intelligibil-
ity of the doctrine of consideration. Armed with an account of exchange that es-
chews Holmes’s motivational focus and instead analyzes the notion of payment
central to the older definition of bargain, we will be in a position to take up, also
in Part III, the constructive task of formulating a new doctrine of consideration.
The revised doctrine will allow us to place the consideration requirement in its
best light by ascribing to it a rationale that is both intelligible and historically
compelling, and to avoid the unfortunate doctrinal results associated with the
prevailing theory. Before reaching these doctrinal issues, however, we must con-
sider and evaluate the alternative theories of exchange on their own terms. In
note 2, at 361 (emphasis added). As far as I can discern, none of the sources he goes on to
discuss in the passage justifies the choice to use this variant of the Langdellian formula in a
general characterization of sixteenth-century law. Similarly, in summarizing his defense of the
bargain theory as a historical theory of consideration, Ibbetson writes that “[i]n developed
law [of the sixteenth century and beyond] the idea behind . . . consideration was . . . the prin-
ciple of mutuality: A’s promise had been given in exchange for the performance of some act
by B,” adopting Langdell’s formula even when no single source quoted in that article com-
pelled him to do so. Ibbetson, Consideration and the Theory of Contract, supra note 2, at 69.
Likewise, in his important book on the history of the law of obligations, Ibbetson remarks, in
the context of a discussion of Lord Gilbert’s early eighteenth-century contracts treatise, that
“[Gilbert] gave ‘consideration’ its orthodox [c]ommon-law meaning of something given in
exchange for the promise.” IBBETSON, A HISTORICAL INTRODUCTION, supra note 2, at 237. Alt-
hough Ibbetson once again invokes the Langdellian formula, Gilbert’s treatise does not quite
have the meaning he ascribes to it. The definition referred to states that “consideration is de-
fined by the lawyers [to be] a cause or occasion meritorious that requires a mutual recompence
in fact or in law.” 1 Lord Chief Baron Gilbert, A Collection of Manuscript Law Tracts 77 (early
18th century) (British Library Hargrave MS No. 265 fol. 40r) (scanned copy on file with au-
thor). It is not just that this definition neither says nor implies that consideration stands in an
exchange relation to the promise it supports; more significantly, Gilbert’s definition is cast in
the traditional terms of reciprocal remuneration that, as a purely conceptual matter, are at
odds with Langdell’s formulation. I am grateful to Michael Lobban and David Ibbetson for
their help in researching this matter. Gilbert’s formulation also appears in JOHN DODERIDGE,
THE ENGLISH LAWYER 131 (photo. reprt. 2005) (London, Assigns of I. More 1631). Finally,
even Simpson, who bases many of his arguments against the bargain theory on the claim that
certain enforceable promises can’t be construed as promises to remunerate, occasionally slips
into the Langdellian mode: “By recognizing the rule that a promise was enforceable if given in
return for [money] payment or some other recompense the common law came to enforce bargains—
two-sided agreements in which performance by one party is paid for by the other party, and
vice versa. In such bargains things of value are exchanged—land for money, chattels for
money, services for money, and so forth.” SIMPSON, supra note 2, at 416 (emphasis added).
Simpson does not seem to recognize that the (italicized) Langdellian gloss is inconsistent with
the sentences that immediately follow, which go on to characterize the payment relation as
holding between the performances, rather than the promises to perform.
49. GILMORE, supra note 41, at 21.
714
paid on both sides
particular, if the history uncovered in this Part (a history of conceptual appro-

priation) teaches us anything, it is that it is not enough to define bargain or quid
pro quo in terms of reciprocal payment if the latter term is as in need of definition
as the former.50
ii. quid pro quo exchange: a philosophical account
It is, in some ways, no surprise that the law of consideration has been tainted
by a failure to reckon with its leading concept, quid pro quo exchange. For de-
spite its immense practical and theoretical significance, quid pro quo exchange
is perhaps the least understood of the most basic modes of human interaction.
To be sure, it can hardly be doubted that exchange involves the mutual provision
of goods or services among discrete individuals or groups. Yet the bilateral per-
formance of ostensibly desired services no more establishes that an exchange has
occurred (rather than a pair of good turns, say) than does the utterance of a sen-
tence in the indicative mood establish that an assertion has been made (rather
than a guess or a joke, say). And while one who wishes to understand what en-
dows an utterance with assertoric force has recourse to a vast philosophical liter-
ature, the determinants of exchange, over and above the bilateral provision of
goods or services, remain shrouded in darkness. As with the speech act, we may
expect individual motives, shared understandings, and normative practices to
50. Although I have just observed the incompatibility between the notion of reciprocal payment
and the sense of “exchange” that figures in Langdell’s definition, one may reasonably wonder
whether there are any other candidates, besides reciprocal inducement, that might fit the
Langdellian bill. The challenge is to identify some other sense of “exchange” that holds both
between promise and counterpromise and between the ensuing performances in the typical
bilateral sales contract, as no one would wish to deny that the money and the goods typically
stand in an exchange relation. (Williston makes this explicit. See infra note 66.) The recipro-
cal-inducement theory of exchange, as I will develop it in Part II, meets this criterion, which
is precisely what makes it such a good companion for Langdell’s definition. I may further note
that an otherwise tempting “I will if you will” account of exchange—specifically, one that
identifies two acts as standing in an exchange relation just in case they together fulfill an “I
will if you will” agreement—does not seem to meet the stated criterion, since it would not
seem to apply to the relation between the commitments themselves in the typical case. Nev-
ertheless, since some might be attracted to such an “I will if you will” theory of exchange
irrespective of its compatibility with Langdell’s definition, I will note here, and again in Part
II (where relevant), that several of the counterexamples that I will put forward against recip-
rocal inducement are also effective against the “I will if you will” theory of exchange. Finally,
it is noteworthy that an “I will if you will” theory of exchange, unlike both the reciprocal-
inducement and reciprocal-payment theories, cannot explain the conceptual connection be-
tween exchange and instrumental motivation.
715
figure centrally in an account of exchange. Yet the contents of these motives, un-
derstandings, and practices, as well as their configuration in an explanation of
the transactional form, remain utterly obscure.51
If the exchange form has received less than its due from philosophers, it is
not because it is lacking in either practical or theoretical significance. In the prac-
tical realm, legal and social norms lean heavily on the concept of exchange. It is
not just the doctrine of consideration; in the United States, at the time of this
writing, legal rules governing situations as varied as the receipt of benefits by
public officials,52 the regulation of campaign contributions,53 the recourse of vic-
tims of theft or fraud to the assets of the perpetrators ahead of competing credi-
tors,54 the deduction of taxable income,55 and even the trading of financial secu-
rities on the basis of inside information56 all prominently invoke the notion of
exchange, such that legal outcomes frequently turn on whether or not something
was done or given in exchange for something else. Additionally, most legal re-
gimes in the world, including both common- and civil-law regimes, define “gift”
51. One of the only discussions of exchange—certainly the most interesting and significant—in
contemporary Anglophone philosophy is A.J. Julius’s The Possibility of Exchange, 12 POL. PHIL.
& ECON. 361 (2013). However, the closest Julius comes to a general characterization of the
exchange form is his claim that exchange is “a pair of services each performed because its
author takes it to bear some important relation to the other.” Id. at 365. Moreover, in my view,
the final sections of that paper ought to be recharacterized: Julius’s hopeful appeal to joint
agency is better seen, not as a form of morally legitimate exchange, but rather as a proposal
for how we can get some of the same benefits of exchange through other (less problematic,
by his lights) modes of collaboration. See id. at 369-72.
52. McDonnell v. United States, 136 S. Ct. 2355, 2372 (2016) (“Section 201 prohibits quid pro quo
corruption—the exchange of a thing of value for an ‘official act.’”).
53. Citizens United v. FEC, 558 U.S. 310, 359 (2010) (“When Buckley identified a sufficiently im-
portant governmental interest in preventing corruption or the appearance of corruption, that
interest was limited to quid pro quo corruption.” (citing McConnell v. FEC, 540 U.S. 93, 296-
98 (2003) (Kennedy, J., concurring in the judgment in part and dissenting in part with respect
to BCRA Titles I and II))).
54. RESTATEMENT (THIRD) OF RESTITUTION AND UNJUST ENRICHMENT § 58 cmt. a (AM. LAW
INST. 2011) (“Subsections (1) and (2) describe features of the common law of property that
yield the transitivity of ownership rights. If A has a right to restitution of X in the hands of B,
and B obtains Y in exchange for X, A has the same rights in the substitute as in the original.”).
55. Comm’r v. Duberstein, 363 U.S. 278, 285 (1960) (“[W]here the payment is in return for ser-
vices rendered, it is irrelevant that the donor derives no economic benefit from it.” (quoting
Robertson v. United States, 343 U.S. 711, 714 (1952)).
56. Salman v. United States, 137 S. Ct. 420, 423 (2016) (describing how insider trading liability
may be found “where the tipper receives something of value in exchange for the tip”); Dirks
v. SEC, 463 U.S. 646, 664 (1983) (holding that a breach of duty may be inferred from “a
relationship between the insider and the recipient that suggests a quid pro quo from the lat-
ter”).
716
paid on both sides
partly in terms of quid pro quo, lending conceptual priority to the latter. This is
typically achieved by a requirement of gratuitousness, which is in turn usually
defined as a lack of quid pro quo or consideration.57 Similarly, because widely
held social norms make the proper deployment of the exchange form to a con-
siderable degree dependent on social context, the choice of whether to deploy
the form is often used as an opportunity to clarify the context. For example, in
the context of friendship (and also philanthropy) we often take pains to resist
characterizing even our reciprocated services in exchange terms, while commer-
cial actors who want to establish their arm’s length relationships often take pains
to do the opposite.
In the realm of theory, exchange figures explicitly in the standard textbook
definitions of two of the most important concepts for socioeconomic theorizing:
market and commodity. Debra Satz aims to capture the common understanding
when she characterizes markets as “institutions in which exchanges take place be-
tween parties who voluntarily undertake them.”58 And as Friedrich Engels fa-
mously wrote, “[T]o become a commodity, the product must be transferred to
57. See RICHARD HYLAND, GIFTS: A STUDY IN COMPARATIVE LAW 129-32 (2009). I am indebted to
Hyland’s monumental work, but would like to register a minor, but important, quibble with
his suggestion that the anthropological definition of gift is different from the legal one. More
specifically, he says that if the law were to have adopted the anthropological definition it may
have defined gift as “the transfer of an object in the context of a relationship that implies ob-
ligations to give, to receive, and to reciprocate.” Id. at 128. He is of course referring to Marcel
Mauss’s classic work, but Mauss is clear that he was describing a conceptual scheme that
didn’t differentiate, as ours does, between the notions of gift and quid pro quo exchange. In
other words, notwithstanding the title of his work, Mauss is admirably clear, as we would put
it today, that the practices he describes do not reflect a different conception of our concept of
gift, but rather a different concept altogether. See MARCEL MAUSS, THE GIFT: THE FORM AND
REASON FOR EXCHANGE IN ARCHAIC SOCIETIES 93 (W.D. Halls trans., Routledge Classics
2002) (1950) (“The terms that we have used—present and gift—are not themselves entirely
exact. We shall, however, find no others. [The] concepts of law and economics that it pleases
us to contrast . . . it would be good to put them into the melting pot once more. We can only
give the merest indications on this subject. Let us choose, for example, the Trobriand Islands.
There they still have a complex notion that inspires all the economic acts we have described.
Yet this notion is neither that of the free, purely gratuitous rendering of . . . services, nor that
of production and exchange purely interested in what is useful. It is a sort of hybrid that flour-
ished.”).
58. DEBRA SATZ, WHY SOME THINGS SHOULD NOT BE FOR SALE: THE MORAL LIMITS OF MARKETS
15 (2010) (emphasis added) (citing Samuel Bowles, What Markets Can—and Cannot—Do,
CHALLENGE, July/Aug. 1991, at 11). Defining markets in terms of exchange is prevalent. See,
e.g., JASON BRENNAN & PETER M. JAWORSKI, MARKETS WITHOUT LIMITS: MORAL VIRTUES AND
COMMERCIAL INTERESTS 4 (2016) (“A market is a relationship where the mode of interaction
is consensual exchange. Broadly speaking, a market is the voluntary exchange of goods and
services for valuable consideration.” (footnote omitted)).
717
the other person, for whom it serves as a use-value, through the medium of ex-
change.”59 And yet the concept of exchange itself has received practically no at-
tention from theorists working on these topics, an omission that has not only
rendered our theoretical grasp of markets and commodities deficient, but that
has also stood in the way of efforts to settle the normative question of whether
or not certain goods and services ought to be for sale. In particular, while partic-
ipants in debates about market structures—either writ large or concerning the
commodification of specific, controversial goods and services—often take for
granted a close connection between exchange and instrumental motivation, the
nature of the relation is never articulated or clarified, and certainly never argued
for, making it difficult to determine whether certain objections presuppose fea-
tures of exchange that are merely contingent aspects of contemporary markets,
or whether the objections run deeper.60
Thus, notwithstanding its great theoretical and practical significance, it re-
mains obscure what it takes to subsume two performances under the exchange
concept such that we may truly say of each that it was done in exchange for the
other. In what follows, I will fill this gap by providing an account of quid pro
quo exchange that seeks to characterize the relation between the two perfor-
mances (or, in other words, that seeks to elucidate the middle term of the quid
pro quo formula). On this view, quid pro quo is a normative concept that makes
essential appeal to the notion of debt. In brief, acts stand in an exchange relation,
according to this account, when the parties regard those acts as satisfying two
conditions61: first, that each satisfies the debt incurred by the other, and, second,
that after the sequence of acts neither party shall owe the other anything on ac-
count of the other’s act. That is, two acts constitute an exchange when it belongs
to the mutual understanding of the parties that they will each be “all paid up” as
far as those acts are concerned once they are completed. I will call the first con-
dition “Reciprocal Debt Satisfaction,” and the second condition “No Residue.”
59. 1 KARL MARX, CAPITAL 131 (Ben Fowkes trans., Penguin Classics 1990) (1867) (definition in-
serted by Engels).
60. For recent criticism of markets (whether markets generally, or only in specific goods) that
emphasizes the role of instrumental motives in exchange, see especially ELIZABETH ANDER-
SON, VALUE IN ETHICS AND ECONOMICS (1993); G.A. COHEN, WHY NOT SOCIALISM? (2009);
and MICHAEL J. SANDEL, WHAT MONEY CAN’T BUY: THE MORAL LIMITS OF MARKETS (2012).
Brennan and Jaworski base their defense of markets on the contingency of certain of the ob-
jectionable features of markets, but rest their case partly on the testimony of historical anthro-
pologists rather than on a philosophical account of exchange. BRENNAN & JAWORSKI, supra
note 58.
61. Once again, I am here using “acts” in its broad sense to refer to courses of conduct that might
consist of some combination of acts or omissions. I will dispense with this disclaimer hence-
forth, allowing context to clarify when this sense is intended.
718
paid on both sides
These conditions are individually necessary and jointly sufficient for the relation
of reciprocal remuneration, the traditional conception of a bargain. The appeal
to debt in the first condition supplies me with motive and opportunity to provide
an account of that most interesting species of obligation, every bit as important
and neglected as exchange itself. Although the significance of debt obligations
transcends the narrower context of exchange, it is, I believe, our failure to come
to terms with the former that has stood in the way of an adequate understanding
of the latter.
Although this account is chiefly motivated by the counterexamples to com-
peting theories, it is reinforced and illuminated by a particular genealogical ex-
planation, elaborated elsewhere at greater length,62 that sees the quid pro quo
exchange form as an attempt to provide a practical solution to a practical prob-
lem. I am not the first to explain the exchange form by appeal to a problem it
was in some sense designed to solve. David Hume and Adam Smith, for exam-
ple, employed a similar strategy.63 For these thinkers of the Scottish Enlighten-
ment, exchange solves the problem of how to extract services from nonintimates
who, bereft of the care and concern that might otherwise provide a motive, lack
sufficient incentive to lift a finger. Quid pro quo exchange solves this problem by
furnishing others with an incentive to serve—namely, by sweetening the deal—
and it is this function that, on the Scottish Enlightenment conception, explains
its features.64 Although it is of course true that we commonly resort to offers of
exchange to extract services from those who require an incentive, this is not par-
ticularly illuminating as an explanation of the distinctive features of the exchange
form. For one thing, we may often care a great deal about the fates of people who
lie beyond our narrow circle and yet reasonably insist on getting something in
exchange for our services to them. More importantly, quid pro quo exchange is
hardly distinctive in being a form or norm of reciprocity that can be used, given
the right circumstances, to extract services from those who are not disposed to
help out of affection for the beneficiary or other benevolent motives. As I have
noted, quid pro quo exchange is a distinctive species of reciprocity, and it is
62. Jed Lewinsohn, Quid Pro Quo: A Theory of Exchange (Nov. 2019) (unpublished manuscript)
(on file with author).
63. See DAVID HUME, A TREATISE OF HUMAN NATURE 331-37 (David Fate Norton & Mary J. Norton
eds., Oxford Univ. Press 2000) (1739-40); ADAM SMITH, AN INQUIRY INTO THE NATURE AND
CAUSES OF THE WEALTH OF NATIONS 14-15 (Edwin Cannan ed., The Modern Library 1994)
(1776).
64. See HUME, supra note 63; SMITH, supra note 63, at 15 (“Whoever offers to another a bargain of
any kind, proposes to do this. Give me that which I want, and you shall have this which you
want, is the meaning of every such offer; and it is in this manner that we obtain from one
another the far greater part of those good offices which we stand in need of.”).
719
hardly the only one that can be used to help elicit favors from self-interested
strangers—a fact made vivid by the distinctive intertribal transactional practices
brought to light by Marcel Mauss, as well as by the manifestly nonaltruistic, yet
occasionally effective, adoption of tit-for-tat policies in certain iterated game sce-
narios.65
While the problem singled out by Hume’s and Smith’s accounts does not
illuminate the distinctive nature of quid pro quo exchange, there is another prob-
lem that does. This problem, which is not only solved by exchange but also ex-
plains its distinctive features, is that of facilitating the giving and taking of ben-
eficial services without incurring lasting bonds and responsibilities—duties that
might otherwise be generated if services were provided gratuitously. In this view,
it is the applicability of expressions such as “we’re good” or “we’re done” in the
wake of the performances that is the hallmark of exchange, not the inducement
of services from those who are indifferent to our wishes or welfare. This function
explains, most obviously, the significance of the second condition of the account,
No Residue, as that condition explicitly states, as an element required if the par-
ties’ understanding is to constitute an exchange agreement, that in the aftermath
of both performances there will be no remaining obligations owing to either per-
formance. It also sheds light on the first condition, Reciprocal Debt Satisfaction,
for when services are rendered in the course of an exchange, the debts of grati-
tude that otherwise might arise if the services had been gratuitously rendered are
displaced by payment obligations that are reciprocally satisfied.
A. The Motivational Theory of Exchange: A Critique
Before introducing and defending the remuneration theory of exchange, I

will consider and reject the reciprocal-inducement alternative. As we have seen,
the prevailing doctrinal orthodoxy (reflected in the Second Restatement) ap-
peals to the reciprocal-inducement theory of exchange as the basis of the recip-
rocal-inducement account of consideration: if a promise must stand in an ex-
change relation to the promisee’s act (whether counterpromise or performance),
and the exchange relation is equivalent to the relation of reciprocal inducement,
then it follows that the promise must stand in the relation of reciprocal induce-
ment to the promisee’s act. Thus, while I will, in the next Part, offer reasons to
reject reciprocal inducement as a theory of consideration on grounds of justifi-
cation and fit, this Section’s rejection of reciprocal inducement as a theory of
exchange will serve to undermine the textbook derivation of the corresponding
theory of consideration.
65. See ROBERT AXELROD, THE EVOLUTION OF COOPERATION (2d ed. 2006); MAUSS, supra note 57.
720
paid on both sides
I will first state the motivational theory in its strongest form by refining a
rudimentary but intuitive formulation into a more sophisticated and plausible
one. According to the simplest version, B’s act X and A’s act Y stand in a quid
pro quo relation if each is done with the aim—at least the partial aim, as there
may be other motivating reasons too—of bringing about the other. Note that this
simplified definition is subjective, in the sense that satisfying it requires actually
possessing the relevant motives. The first modification will be to recast the con-
dition objectively—to require the manifestation, rather than the possession, of
the motives in question. The reason to prefer the objective version is simply that
it better accords with our intuitions about the cases. No one would deny that in
an ordinary sale of goods for money, the transfer of the goods and payment of
the money stand in a quid pro quo relation.66 And yet it is not difficult to conjure
cases where the actual presence of the relevant motives is lacking. For example,
B might order something from A’s store solely because she knows A could use
the money and will not accept handouts. In this case, the delivery of the goods
(goods that B disposes of as soon as they arrive) is a side effect, not an aim, of
B’s transfer of the money. If the goods had gotten lost in the mail, none of B’s
aims would have been frustrated. Hence the modification to an objective formu-
lation.
To motivate the second modification, let us consider bilateral sales agree-
ments that specify, as they often do, the sequence of performances (such as pay-
ment upon delivery). Supposing that performance X (delivery of the goods)
comes before performance Y (payment of the money), we cannot say that the
latter was done in order to bring about the former. After all, the goods had al-
ready been received by the time payment was tendered. It is not difficult to mod-
ify the theory in light of such cases; the key is to realize that although Y was not
done with the aim of bringing about X, it was done knowingly in fulfillment of
66. Even Williston—whose dual commitments to Langdell’s definition of consideration and the
remuneration conception of exchange led him to the tortured position that each promise in a
bilateral sales contract is payment for the other—did not deny that the fulfillments of those
promises also typically stand in payment relations to each other:
Doubtless it is almost universally true that the performance promised by one party
to a bilateral agreement is intended as the consideration for the performance on the
other side. A double exchange is contemplated. Promise is the price or exchange for
promise and later performance for performance, but this is not always true.
Samuel Williston, Consideration in Bilateral Contracts, 27 HARV. L. REV. 503, 504 n.2 (1914).
Williston’s caveat is designed to accommodate those contracts, such as insurance or surety
contracts, in which a party will be called upon to perform only given some further condition
that may not come to pass. See id. (“If A. promises B. to guarantee a debt of one hundred
dollars due B. from X. in return for B.’s promise to A. to guarantee payment of five hundred
dollars due A. from Y., the performances are in no sense in exchange for one another, or the
consideration of one another, and yet there is a contract.”); see also infra note 92 and accom-
panying text.
721
an obligation that was itself assumed in order to bring about X. Accordingly, we

must say that act X stands in a relation of reciprocal inducement to act Y if each
is done with either the apparent aim of bringing about the other or (knowingly)
in fulfillment of a commitment which was itself undertaken with the apparent
aim of bringing about the other.
Further questions arise for the reciprocal-inducement theory of exchange,
most importantly whether it is a necessary condition of exchange that either or
both parties be (apparently) willing to perform only if they expect to get some-
thing in return. But we need not address this further question of whether a threat
to withhold performance unless payment is rendered is a necessary feature of an
exchange in order to offer decisive counterexamples to the theory. Indeed, the
theory provides neither necessary nor sufficient conditions for quid pro quo ex-
change (with or without this extra condition). I will begin by challenging the
sufficiency claim, showing that the theory is too weak (in that it is overinclusive).
Consider, first, the case of two individuals who are considering whether to
enlist in the armed forces. A and B are close friends, and each would rather enlist
in the army (enroll in the club, jump off the cliff, etc.) than not enlist at all, pro-
vided that the other enlists as well; but each would also rather not enlist than enlist
if the other does not. In such circumstances, each might commit to enlisting so
long as the other does—a commitment manifested by a firm handshake after a
series of “I will if you will” pronouncements. They execute the plan, and each
enlists. I assume that no one, least of all A and B, would say that their respective
enlistments constitute a quid pro quo—that is, were done in exchange for the
other. And yet the reciprocal-inducement conditions are plainly satisfied, as
would be the further condition that each would not have enlisted absent the ex-
pectation that the other would too.
For another important example, consider a loving aunt who, wishing to en-
courage her nephew’s growing interest in fine art, offers to gift him thousands
of dollars provided that he promises to use the money to purchase art (and not
wine, diapers, or other things). The nephew accepts the generous offer by mak-
ing the promise, and the two proceed to follow through on their commitments:
the aunt transfers the money, and the nephew uses it to enhance his collection.
The question to consider is whether the conditions of reciprocal inducement
have been satisfied by what is patently a gift transaction. Now, there are certainly
cases where someone makes a conditional gift offer in the avowed hope that it
will be rejected. (For instance, “I’d prefer if you found someone else to help you;
however, I’ll do it if you want me to, so long as you promise to hold the ladder
while I’m up there.”) In such cases of reluctant gift offers, the offeror manifestly
lacks the aim of inducing acceptance. But there are also cases where a gift offer is
made eagerly—that is, with the hope and aim of getting the offeree to accept—
and we may suppose that the aunt’s promise to her nephew belongs to this class.
722
paid on both sides
More exactly, the aunt makes the promise with the aim of getting her nephew to
buy art, and goes on to transfer the money for the same reason (and also in ful-
fillment of her promise). Turning to the nephew, his purchase of the art is made
in fulfillment of a promise that was itself made with the aim of getting his aunt
to transfer the money. So the money transfer and the nephew’s purchase satisfy
the conditions of the reciprocal-inducement theory of exchange. And yet the ex-
ecution of this agreement does not involve a bargain or quid pro quo exchange
by ordinary lights, and thus the case serves as another counterexample revealing
reciprocal inducement to be too weak.67
Turning to the necessity claim, the reciprocal-inducement theory of ex-
change is also too strong (in that it is underinclusive). A student looking for
bookshelves frequents a Vitra store to purchase the iconic midcentury design. He
makes several inquiries to the store manager, whose enthusiasm diminishes with
every question. Eyeing the student, he reaches the conclusion that the student is
unlikely to be able to afford the exorbitantly priced item. Allowing his annoyance
to get the better of him, he taunts the student, revealing his incredulity in explicit
terms. Indeed, the manager is so sure of the student’s modest financial position
that he commits to selling the piece to the student at a significantly discounted
rate, feeling certain that the student will be unable to purchase the item, even at
the lower rate, before the offer expires. As it happens, the student’s appearance
is not reflective of his financial condition. Reaching into the pockets of his
(stained) pants, he produces the money and, with relish, accepts the offer. The
manager is bound and must deliver the shelves at the lower rate (even if it will
cost him his job). A sale has occurred, and the ensuing delivery of the shelves
and payment of the money constitute a quid pro quo. Yet the manager performed
only because he was bound by a commitment that he manifestly undertook for
reasons other than a wish to receive the student’s money. Indeed, his aims, actual
and apparent, were frustrated when the student accepted the reckless offer.68 The
67. I digress to observe that each of the previous two cases also serve as counterexamples to the
weaker, and less plausible, “I will if you will” theory of exchange—discussed supra note 50—
according to which two acts stand in an exchange relation just in case they are executions of
an “I will if you will” agreement. Indeed, even the reluctant gift offer case constitutes a coun-
terexample to the “I will if you will” theory, even though it can be handled by reciprocal in-
ducement. On the other hand, the next counterexample is effective only against reciprocal
inducement, and not against the “I will if you will” account.
68. Observe the difference between this case and the case of so-called nominal or sham consider-
ation. When you “buy” the family farm for a dollar, the scare quotes are entirely appropriate.
In this case, by contrast, there is nothing problematic about saying that the student bought
the bookshelves at a steep discount, and scare quotes are neither necessary nor proper. Indeed,
any legal regime’s allowance of nominal consideration must be seen as an exception to, rather
723
conditions of reciprocal inducement are not met and are therefore too strong,
ruling out genuine instances of exchange.69
B. Remuneration Theory of Exchange: A Defense
By contrast, the remuneration theory of quid pro quo locates the dispositive
element of exchange in the (perceived) normative significance of the perfor-
mances, not in the actual or apparent motives that led the parties to perform
them. Specifically, two acts constitute an exchange when the parties regard each
act as payment for the other. The task that remains is to explain this relation of
reciprocal payment. Again, I believe that it is our failure to articulate the distinc-
tion between debt and nondebt obligations that has been the source of our diffi-
culty isolating and articulating the relevant element of exchange. For as we have
seen, the mere presence of obligations, even mutual ones, is not sufficient to dif-
ferentiate quid pro quo exchanges from the broader class of “I will if you will”
agreements. Armed with the more fine-grained notion of debt obligation, how-
ever, we will at last be able to cordon off exchanges.
The first element of quid pro quo, Reciprocal Debt Satisfaction, invokes the
notion of debt obligations. The category of debt is reflected in our ordinary lan-
guage, which reserves the language of “debt” and “indebtedness” for some obli-
gations (e.g., the obligation to repay incurred upon borrowing or upon negli-
gently damaging another’s property) while withholding it from others (e.g., the
obligation to provide incurred upon procreating or to go home for the holidays
than a fulfillment of, a consideration, justified, if at all, by the manifested intentions to be

legally bound.
69. A more important class of cases that could be used to establish the same point (the underin-
clusivity of the motivational conception of exchange) is the class of so-called “prove me
wrong” contracts, where sellers of goods or services demonstrate their faith in their product
by offering to provide something of value to anyone who can detect some particular flaw.
Here, too, the offerors may be serious but are manifestly not aiming for acceptance. For a final
counterexample, showing that the conditions of reciprocal inducement are too strong, con-
sider an independently wealthy artist who finds the idea of selling art disgusting. Notwith-
standing these views, the artist puts a painting on auction because he believes that it will only
garner critical attention if enough people commit to buying it at a high price. This is a com-
promise for him, and so, in the wake of the auction, he executes a prior, publicly broadcasted
plan and flushes the money down the drain as soon as the highest bidder’s check clears. Here,
too, receipt of the money was only a side effect, and not an aim (actual or apparent), of the
artist’s prior commitment to give the art to the highest bidder. If the check had not cleared,
the artist’s apparent aims would not have been frustrated in the slightest. While the artist’s
promise to transfer the art was made with the apparent aim of inducing the counterpromise,
it was not made with the apparent aim of inducing the performance of that counterpromise
(i.e., receiving the payment). And yet, when the money and the painting are transferred, they
stand in an exchange relation.
724
paid on both sides
upon giving assurance to a nagging parent). More significantly, debt obligations

are distinguished by a logical structure that can be given precise articulation.
To understand the mark of debt, we must distinguish between an obliga-
tion’s performance, fulfillment, and extinguishment conditions. An obligation’s
performance condition, in my terminology, designates the element in common
between two outstanding debts, each requiring payment of five dollars to the
same individual. Intuitively, we may say that an obligation’s performance condi-
tion specifies the course of conduct called for by the obligation. An obligation’s
fulfillment conditions are the necessary and sufficient conditions for fulfilling
the obligation. When obligations are fulfilled, they are typically extinguished—
that is, they cease to exist. But fulfillment is not the only way to eliminate an
obligation. Just as the desire for food may be extinguished either by eating or by
getting punched in the stomach, so too are there other ways of eliminating an
obligation beyond fulfilling it. Some that are especially relevant in the context of
debt are forgiveness (that is, waiver), set-off, death, and discharge in bank-
ruptcy.70
Armed with these distinctions, we may state the distinguishing mark of debt
obligations. In brief, what serves to differentiate debts from other obligations is
that satisfaction of a debt’s performance conditions does not guarantee the debt’s
fulfillment (herein, the debt’s satisfaction). Suppose, for example, that B has an
outstanding debt in the amount of five dollars due to A on account of a loan. We
cannot infer, merely from B’s payment of five dollars to A (that is, merely from
the satisfaction of the performance conditions), that B has satisfied the debt. Af-
ter all, B may be paying the purchase price to acquire additional merchandise
from A, or B may be satisfying some other preexisting debt owed to A (or to
some third party who directed payment to A). This, of course, raises the question
of just what is needed, beyond performance, to satisfy a debt. What is needed to
fulfill a debt obligation is not just performance, but performance in satisfaction
of that particular obligation and not some other debt. This distinguishing feature
of debt—that is, the distinctive mode of self-reference that figures in the fulfill-
ment conditions—furnishes the possibility of accumulating multiple debts, each
calling for the same conduct, and explains ordinary strictures against double
counting (for instance, that a single payment of five dollars cannot satisfy two
five-dollar debts). This, in turn, raises the question of how one performs in sat-
isfaction of some particular obligation. But before we address this question, let
us first consider the contrasting case of nondebt obligations, as well as an im-
portant objection to my position.
70. I do not mean to suggest that these are always possibilities—whether they are will depend on
the subject matter as well as on the rules of customary or legal regimes. But when they are
possible, they are alternative ways, distinct from fulfillment, of extinguishing obligations.
725
Although gratuitous promises or assurances can, I believe, generate debts,

they often do not, and so we may look to them for illuminating, contrasting ex-
amples. In these cases, there is usually no distinction between an obligation’s
performance and fulfillment conditions. This is because there is typically no self-
referring element in the obligation’s fulfillment condition—that is, no reference
to “that particular obligation” within the conditions of fulfillment—which means
that there will be no question raised about double counting, and no possibility
of stacking one such obligation on top of another.71 If I gratuitously assure some-
one that I will be present at a certain event, or that I will sing a certain song at a
karaoke party, or that some child will have lunch money in their pocket before
setting off for school, whether I have done these things is usually all we need to
know to determine whether I have fulfilled the obligation. Of course, this is not
to say that the reasons for which I followed through (or, more to the point, my
conception of my own performance) are utterly irrelevant in such cases—they
will be most relevant for an assessment of my character and will indicate, in par-
ticular, whether I take my obligations seriously. (Additionally, depending on the
case, my motivating reasons for conforming may also cast light on my level of
care and concern for the people who have reasonably relied on me.) But these are
distinct from the question whether I have fulfilled the obligation to perform that
I incurred when I gave someone my word, and, in particular, these matters will
not raise the question whether I need to perform again in order to conform to
the understanding that had been reached when I gave my word.72
In order to get a better grasp on the conceptual structure of debt, and in order
to consider an objection to my account of quid pro quo exchange, we must in-
troduce a distinction between performance conditions that are repeatable and
those that are not. Repeatable performance conditions are ones that can, in prin-
ciple, be satisfied more than once. Transferring a certain sum of money to a cer-
tain person is a ready example, but repeatable performances are not limited to
money payments. I may owe you five (generic) bushels of corn or one hundred
push-ups, and these too are examples of obligations with repeatable perfor-
mance conditions. By contrast, if I am obligated to do something that can be
done only once (for instance, destroy some particular idol or remove this pile of
snow from this driveway on this occasion), this would be an example of an obli-
gation with a nonrepeatable performance condition. Given this distinction, some
might be tempted to deny that the normative concept that I have identified as
71. Of course, in particular cases one may build the self-referring element into the content of a
gratuitous promise or assurance. This would be a way of generating a debt by a gratuitous
commitment, and I certainly do not mean to suggest that no such gratuitous commitments
give rise to debts.
72. For a powerful statement of this general position regarding obligations in general, see T.M.
SCANLON, MORAL DIMENSIONS: PERMISSIBILITY, MEANING, BLAME (2010).
726
paid on both sides
the concept of debt can apply at all to obligations with nonrepeatable perfor-
mance conditions. After all, they might argue, the distinction between debt and
nondebt obligations that I have drawn has practical import only where it is pos-
sible to accumulate, and satisfy, multiple debts, each one calling for its own ren-
dition of the same type of performance. And since this is only possible with re-
spect to obligations with repeatable performance conditions, the class of debt
obligations ought to be viewed as limited accordingly.
Such a view of the scope of debt obligations certainly would be incompatible
with my account of quid pro quo exchange: after all, the possible objects of ex-
change are surely not limited to repeatable acts (for instance, you may offer me
a sum of money to smash some particular idol to smithereens, and we may com-
plete the exchange). However, such a position regarding the scope of debt takes
too narrow a view of the practical significance of an obligation’s classification as
debt and should be rejected. To be sure, the advantages of being able to create
debt obligations are particularly salient in cases involving repeatable perfor-
mance conditions: when multiple debts of this kind are accumulated, each one
can receive its own separate rendition of the same repeatable performance.73 But,
as I will show, this by no means trivializes the significance of the distinction be-
tween debt and nondebt obligations when the performance conditions are non-
repeatable. On the contrary, reflection on exchanges involving obligations with
nonrepeatable performance conditions shows not merely that determining such
obligations to be debts carries practical significance; stronger still, our intuitions
concerning such cases can only be explained on the assumption that the relevant
obligations, despite having nonrepeatable performance conditions, are genuine
debts. Thus, consideration of these cases does not merely serve to rebut an ob-
jection against my position but also constitutes a positive argument in favor of
the thesis that all quid pro quo exchanges (whether involving repeatable perfor-
mances or not) fulfill Reciprocal Debt Satisfaction.
My analysis of such cases relies on a final distinction between species of debt.
I have said that in order to satisfy a particular debt obligation one must satisfy
the obligation’s performance conditions in satisfaction of that particular obliga-
tion and not in satisfaction of any other debt. “Any other debt” in this formula is
susceptible to two interpretations, corresponding to two different species of
debt. On the weak reading, “any other debt” means any other debt owed to the
same creditor. On the strong reading, “any other debt” means any other debt tout
73. Indeed, this is presumably why the language of “debt” is most naturally invoked in reference
to those debts with repeatable performance conditions. In my view, however, this should be
seen as a superficial, if understandable, feature of the language, on par with the general ten-
dency to restrict usage of the term “payment” to remunerative acts consisting of money pay-
ments (rather than the transfer of goods, say).
727
court, whether owed to the same creditor or another one. There is no reason to
think that all debts fit the same mold, and it will be a function of the understand-
ing of the parties—at least when the debts are the product of consensual agree-
ment—whether the debt is a strong or a weak one.74
With this distinction in view, I will proceed to demonstrate the significance
of the distinction between debt and nondebt obligations even in cases involving
nonrepeatable performance conditions. Let us begin with a case. Suppose that
B, a shop owner, has an interest in having snow removed from a common lot
that her customers use for parking when frequenting her shop. B calls A, who
has a private snow-removal business, and expresses an interest in hiring him to
do the job. A quotes B his rate (listed on his website), and B, agreeing to pay at
that rate, hires A to do the (nonrepeatable) job. A proceeds to do the job and
sends B the bill. Before paying the bill, however, B learns that C, another store-
keeper in the neighborhood with a similar, independent interest in having the
snow removed from the same particular lot, had independently hired A to do the
same job and had already paid the bill that he, too, had been sent. The question,
then, is whether B must pay A, or whether she can say, as a valid defense, “you’ve
already been paid.” Opinions will differ, but I speculate that many will say that
the latter is a valid defense against A.75 Rather than offering an opinion about
whether B ought to pay, my present claim is merely that “you’ve already been
paid” can be a valid defense in this case only given two conditions. First, each of
A’s commitments, made to B and to C, must have been the undertaking of a debt
obligation to remove the snow from the particular lot. Second, A’s commitment
to B must have been the undertaking not just of a debt obligation, but of a strong
debt obligation. Given this understanding of A’s commitments, A cannot fulfill
both debt obligations by the single act of removing the snow from the lot, since
a strong debt obligation cannot be fulfilled by an act performed in satisfaction of
a different debt obligation. Accordingly, having already collected payment from
C on account of completing his end of the deal (by removing the snow from the
lot), A cannot also claim to have fulfilled the obligation owed to B, and hence
cannot demand payment from B for having done so. This, in turn, shows the
significance of understanding the obligation to perform as a debt even when the
performance condition is nonrepeatable.
Defending the claim that B has a valid defense only if A’s obligation to her
was a strong debt requires eliminating a competing explanation: the alternative
theory that B has a valid defense because, before entering into the agreement
74. Whether a tortfeasor’s obligation to compensate a victim is a strong or a weak debt will be a
function of either the practice (of the tort regime) or of the moral principles underlying the
practice.
75. Notice, though, that this verdict still leaves open the question whether B owes anything to C.
728
paid on both sides
with B, A was anyway planning to do the job to fulfill a previous commitment.

This competing explanation can be rejected on two grounds. First, the original
description of the case, while specifying that C was first to pay the bill, was silent
about the sequence of contracting; accordingly, we may enrich the description of
the case and specify that B was first to contract with A, even though C was first
to pay. When we enrich the description in this way, the earlier intuition, I sub-
mit, loses none of its force. Second, we may establish the same point by intro-
ducing a variation of the original case. In this variation, before paying the bill B
learns not that C, who has an independent interest in A’s doing the job, had
already paid the bill that was sent to him but rather that A (or A’s agent) had,
prior to A’s contracting with B, already gratuitously committed to C that A
would do the job. In this case, opinions might differ as to whether A is a scoun-
drel for not informing B about his prior plans and commitments (if A was, in-
deed, aware of them at the time of contracting with B). But what is clear enough
is that B is obligated to pay A, notwithstanding A’s prior commitment. Whereas
“you’ve already been paid” has considerable force as a defense, “you didn’t tell
me you were going to do it anyway” does not.
As I stated, not everyone will share the judgment that B has a valid defense
in the original case. Even those who resist this judgment, though, cannot plau-
sibly deny either that A’s obligation is a debt or that this fact carries normative
significance; rather, their judgment that the defense is not valid depends on the
view that A’s obligation is a weak debt rather than a strong one. To see this, we
need only consider another variant of the original case, in which C is not some
other storekeeper with an independent interest in clearing the lot but rather is
B’s agent (perhaps the store manager). Due to a failure of coordination (perhaps
owing to the snowstorm), B and C each call A and separately enter into agree-
ments with him to clear the lot. After doing the job, A sends bills to their separate
addresses. Sometime after C has paid the bill that was sent to him but before B
has paid the bill that was sent to her, they confer and become apprised of the
situation. Surely in this case, “you’ve already been paid by my agent” is a valid
defense. But this could only be explained if A’s obligation is understood as a
debt, albeit a weak one.76 If it were not, the prospect of “double counting” would
76. These intuitions do not depend on A’s fraudulent misrepresentations: they do not change if
we suppose that one of the contracts was conducted by A’s agent, who likewise suffered from
a failure of communication with his principal, so that no fraudulent misrepresentations oc-
curred. Likewise, we must not think that the intuitions can be explained by positing that only
a single agreement was forged, despite the two job orders. It is untenable to say that there was
only one “agreement in fact,” for the agreements have different properties (e.g., they occurred
at different times). Indeed, in analogous cases involving repeatable performances—for exam-
ple, when a failure of communication leads both a principal and her agent to each purchase
729
raise no concerns, and A would be able to claim that he has performed his side
of each of the two agreements. Only if the obligations are debts could B resist
paying on the grounds that A cannot fulfill each of the two agreements with a
single performance.77
Having established the significance of classifying an obligation as a debt,
even when the performance conditions are nonrepeatable, we are nearly done
with our treatment of Reciprocal Debt Satisfaction, the first element of quid pro
quo exchange. We are left only with the question of how to interpret the self-
referential component in the definition of debt—that is, to determine what is
needed to perform in satisfaction of this debt (and not some other one). We may
immediately reject, as too demanding, a view that would require, as a condition
of satisfying a particular debt obligation, that the performance be rendered with
the aim of satisfying that particular obligation. After all, a debt could surely be
satisfied when its satisfaction is just a foreseen side effect, rather than an aim, of
the performance. (My aim, suppose, is solely that you have five dollars in your
pocket on a given day, and I know that you do not accept handouts.) It is tempt-
ing, therefore, to retreat to a knowledge requirement, according to which the
the same fungible commodity on Amazon, even though only one is needed—there is no im-
pulse to say that only a single agreement had been forged with Amazon. (Even if the mistake
entitles them to money back—and it is by no means clear that it does—the explanation for
this would not be that only one agreement had been forged; rather, the explanation would be
that they had intended to forge only one such agreement.)
77. There are many other cases of quid pro quo exchanges involving weak debt. One such case,
important for contract law, involves three-party versions of “preexisting duty” cases, which
are discussed in their two-party versions in Section III.B.2 infra. In such three-party preexist-
ing-duty cases, discussed infra note 121, a promisor enters into an agreement to pay for a per-
formance that the promisee has already contracted with a third party to provide. In some such
cases, the promisor is aware of the promisee’s outstanding obligation before making the com-
mitment, but promises to pay for the performance, usually as a result of the promisee’s cred-
ible threat not to fulfill the preexisting duty unless he gets more than what was originally
promised by the third party. Sometimes such threats will be “fair and equitable,” as when the
cost of performance has, unforeseeably, risen considerably. With respect to the “fair and eq-
uitable” cases, the promisor surely cannot use the “you’ve already been paid” defense to avoid
making the additional payment, as she was apprised of the preexisting debt in advance. Since
this defense is not available, we cannot say that the promisee’s second promise to perform
created a strong debt. But even in this case, we must conceive of the promisee’s obligation as
a weak debt rather than a nondebt obligation. After all, here too, if the promisor’s agent had—
due to a failure to communicate with his principal—gone on to make the same deal with the
same promisee (the one threatening not to do the job unless he received more), the promisee
would not be entitled to collect from both the agent and the principal after completing the
job. (And here, too, we needn’t suppose that the explanation of our intuitions has anything
to do with fraud or misrepresentation. After all, let us suppose that one of the renegotiations
was conducted with the promisee’s agent, who likewise suffered from a failure of communica-
tion with his principal.)
730
paid on both sides
performance must be accompanied by an understanding—perhaps a manifested

one—that in performing, the debtor is satisfying this obligation (and not some
other debt). This might be right—and, if it is, it would be perfectly consistent
with everything else I say in this Article. However, I believe that even this re-
quirement is too demanding. It must be recalled that the motivation for differ-
entiating debts from the broader class of obligations is not a concern with
whether the agent has more virtuous mental states when fulfilling a particular
class of obligations. Rather, the motivation is to explain why, in some circum-
stances, double counting of obligations is ruled out—that is, why multiple dis-
tinct obligations cannot always be discharged by a single performance.78 Accord-
ingly, I suggest that we should simply interpret the “in satisfaction” clause of the
fulfillment conditions as weakly as possible while meeting this motivating con-
cern. Thus, if a debtor has only one outstanding debt with a given performance
condition, then performance is sufficient for satisfaction of the debt, provided
the debtor does not specify that his or her performance is not rendered in satis-
faction of the debt (for instance, as when he specifies that the performance is the
creditor’s birthday gift or for some new merchandise). It is only when the debtor
has multiple debts calling for the same performance that specification (that is,
an expression of an understanding that one’s performance is satisfying a partic-
ular obligation) might be required. Even here, acts of specification may not be
needed when custom or law dictates which performance pays off which debt.79
Before turning to the second element, one more observation is in order. It is,
I have said, a necessary condition of quid pro quo exchanges that the parties un-
derstand their performances as satisfying Reciprocal Debt Satisfaction, a relation
I have tried to explicate. But it does not follow from any of this that the law’s
decision regarding the legal rights and obligations that result from such under-
standings must perfectly hug the contours of the understandings themselves.
For the law might have its own reasons for deviating from the parties’ own un-
derstanding even in cases when it requires that understanding as a condition of
enforcement.80 So, for example, if the distinction between strong debt and weak
78. Very roughly, this double counting will be a relevant concern when the obligated performance
is seen as in some sense a substitute for what the other party gave (in the case of contractual
debts) or gave up (in the case of torts).
79. For example, a custom might adopt a first-in, first-out rule on which a given performance
satisfies the oldest debt calling for a particular kind of performance if multiple such debts
exist.
80. Even Seana Shiffrin, who has prominently criticized the law of contracts for allowing diver-
gences between contractual obligations and promissory ones, acknowledges that divergence
may be acceptable when there are “distinctively law-regarding grounds [for the divergence],
such as the difficulty and expense of” enforcing the promise in a given case. Seana Valentine
Shiffrin, The Divergence of Contract and Promise, 120 HARV. L. REV. 708, 733 (2007). I argue
731
debt is too refined to be easily ascertained, the law can treat all debt like weak
debt.
Reciprocal Debt Satisfaction serves to explain why the nondonative collabo-
rative agreements considered earlier (such as “I’ll enlist, if you enlist”) do not
qualify as quid pro quo exchanges. When friends or members of preexisting co-
operative units commit to plans involving the coordination of their activities, the
ensuing obligations are not typically regarded as debts, and so do not typically
give rise to problems related to double counting or to the possibility of stacking.
While this first element states a necessary condition of exchange, however, it is
not sufficient. The second element, as I have indicated earlier, specifies that the
parties understand that, following the sequence of performance, no outstanding
obligations (debt or otherwise) will remain on account of either performance.
This second condition is not only motivated by the theoretical considerations
regarding the function of the quid pro quo transactional form considered at the
outset of this Part; it is also motivated, more concretely, by intuitions about par-
ticular cases.
One may show that the first condition is not sufficient by considering trans-
actions that satisfy it even though one of the performances is mutually under-
stood by the parties to constitute a gift. One sort of example involves nominal
consideration (in jurisdictions that recognize such consideration). As I have al-
ready observed, when, merely in order to make a contract binding in law, one
“sells” the family farm to a nephew for a dollar, the scare quotes are in order
because there has been no genuine quid pro quo.81 However, even in such a case,
the parties may regard their performances as satisfying Reciprocal Debt Satis-
faction. After all, it may be important to the donor that the transaction satisfies
the prerequisites for legal recognition, which may include payment to the donor
of the nominal amount agreed upon. Other conditional gift arrangements might
illustrate the same point more vividly, as when a promise to give someone exclu-
sive access to a huge tract of valuable land is made conditional only on the prom-
isee’s promise to reimburse the owner for the costs generated by the former’s
activities on the property (such as reimbursement for electricity bills). Depend-
ing on the context, the parties may reasonably insist that a quid pro quo has not
transpired, even though the respective obligations would seem to stand in recip-
rocal debt relations. The promisee must make the reimbursement payments,
and, in doing so, all strictures against double counting would seem to apply.
Again, the common feature of these examples is that one of the performances in
each case is regarded by the parties as a gift. On ordinary social understandings
against Shiffrin’s position in Jed Lewinsohn, “By Convention Alone”: Assignable Rights, Dis-
chargeable Debts, and the Distinctiveness of the Commercial Sphere (Nov. 2019) (un-
published manuscript) (on file with author).
81. See supra note 68.
732
paid on both sides
(and I do not mean nor need to defend these widespread understandings), gifts
are precisely the sorts of transactions that generate lasting normative bonds—in
particular, debts of gratitude or duties to reciprocate. Accordingly, No Residue is
able to explain why such transactions are not genuine quid pro quo exchanges in
spite of the debt relations.82 More generally, No Residue ensures that in quid pro
quo agreements, the exchanged performances are understood by the parties to
give rise to no persisting debts of gratitude or duties to reciprocate.83
According to the remuneration theory, performances constitute a quid pro
quo because the parties to the agreement understand those performances to sat-
isfy Reciprocal Debt Satisfaction and No Residue. But on what basis do the par-
ties reach this understanding? In the case of the first condition, we might say
that they understand their agreement itself to be the explanatory ground of the
debts contemplated therein. That is, the reciprocal debt obligations that the par-
ties recognize are the product of mutual assent to stipulated terms. In other
words, the terms describe reciprocal debt obligations that the parties take to ob-
tain in virtue of their assent. The more difficult question is how they reach the
understanding captured by No Residue—namely, that no debts of gratitude per-
sist in the aftermath of the performances. The reason this question is difficult is
that debts of gratitude can be contested (with such phrases as “oh, it was noth-
ing,” “it was a pleasure,” “I was planning to do it anyway”), but they cannot be
created by fiat or eliminated by waiver.84 So if it belongs to the parties’ under-
standing that the ensuing performances give rise to no such debts, it must also
82. While I have emphasized that the donee’s obligation can have the character of a debt, I am
also assuming that the obligation undertaken by the donor can also have that character. Sup-
pose that Smith, the owner of a valuable tract of land (Blackacre), agrees to gift to her friend
Jones exclusive use rights to Blackacre (rights that have a high market value), on the occasion
of Jones’s wedding, provided only that Jones agrees to reimburse Smith for any taxes that
accrue from the transfer. Jones gratefully agrees, but, before performing, Smith incurs a debt
(debt2), owed either to Jones or to a third party, which can be satisfied by transferring to Jones
the use rights over Blackacre (absent any commitment to reimburse for the taxes). If Smith
transfers Blackacre to Jones in satisfaction of debt2 she cannot also claim to have fulfilled her
wedding day commitment, and, accordingly, cannot demand reimbursement payments from
Jones for the taxes.
83. We may also note that fulfillment of No Residue does not entail fulfillment of Reciprocal Debt
Satisfaction. To see this, consider again the case of the two friends who agree to enlist together
in the army, and then subsequently carry out the plan. Here, debts of gratitude do not arise
and No Residue is satisfied. The same may be true of many genuinely shared, mutually ben-
eficial activities, like the execution of a plan to play tennis on a certain occasion.
84. This was recently emphasized by Barbara Herman. See Barbara Herman, Being Helped and
Being Grateful: Imperfect Duties, the Ethics of Possession, and the Unity of Morality, 109 J. PHIL.
391 (2012). In conversation, Ben Eidelson has suggested to me a plausible explanation for the
nonwaivability of debts of gratitude: the gratuitous waiving of such a debt would be pointless,
since it would simply result in the creation of a new debt of gratitude, this time incurred by
733
belong to their understanding that there are features connected with either the
performances themselves, or their agreement to perform them, that preclude
those debts from existing.
But what are these vitiating features? The mere fact that each party stands to
gain from the execution of the agreement cannot be enough. To see this, consider
two friends, F and G. F helps G edit G’s long article one weekend, while G helps
F research wedding venues the following weekend. While the reciprocity these
friends exhibit is hardly an insignificant feature of their relationship, the parties
will not typically walk away from this sequence with no debts of gratitude; ra-
ther, at least in many cases, they will walk away with two. These debts, unlike
commercial ones, are not only impervious to waiver but also unsusceptible to
elimination via set-off. We may note that nothing changes at all if we add the
fact that the parties agreed to this plan in advance. That is, the parties agreed to
a plan involving two favors on successive weekends, provided that they do not
adopt the plan with the understandings that constitute a quid pro quo agree-
ment. And they may have subsumed the favors under a single plan for many
reasons other than an understanding that each one is payment for the other. For
example, subsuming both favors within a single plan may have been the only
way to coordinate busy schedules or may have merely reflected anxiety that the
friendship was becoming too imbalanced. In many such cases, the friends will
each walk away feeling appropriately grateful on account of the other’s perfor-
mance. Accordingly, we have not yet located the bases upon which the parties
reach the understanding that satisfies No Residue.
This problem, I believe, explains the connection between quid pro quo ex-
change and instrumental motives—that is, between doing X in exchange for Y
and doing X in order to get Y. The connection runs very deep. One of the oldest
surviving records of the oldest-known Greek script (Linear B) is a report of an
exchange transaction (“[fourteen female] slaves of the priestess” in exchange for
“sacred gold”), and the term for “exchange” that is used (transliterated as “e-ne-
ka,” typically translated as “on account of”) is a motivational one.85 There are
also common-law authorities within our purview that refer, albeit loosely, to the
“price” and “motive” of a contract in a single breath, thereby drawing a connec-
tion between the notion of remuneration and that of inducement.86 At the very
the preceding waiver. Of course, this supposes that the waived debt and the new debt would
be identical in magnitude, an assumption that may be contested.
85. COLIN RENFREW, ARCHAEOLOGY & LANGUAGE: THE PUZZLE OF INDO-EUROPEAN ORIGINS 61
(1988) (“At Pylos: slaves of the priestess on account of [eneka] sacred gold: 14 women.”).
86. For example, Blackstone remarks that “[t]he civilians hold, that in all contracts, either express
or implied, there must be something given in exchange, something that is mutual or recipro-
cal. This thing, which is the price or motive of the contract, we call the consideration.” BLACK-
STONE, supra note 36, at *446.
734
paid on both sides
least, no one would deny that there is a strong empirical generalization linking
the exchange form and the apparent motives picked out by reciprocal induce-
ment—that is, many or most exchanging parties in fact appear to perform or
commit to perform partly in order to induce the counterparty’s performance. But
I believe that the connection is even stronger and of a conceptual nature. Alt-
hough, as we have seen, the apparent motives that reciprocal inducement picks
out are neither necessary nor sufficient for quid pro quo exchange, I submit that
they often serve as the basis of the parties’ understanding that satisfies No Res-
idue. After all, on standard conceptions of gratitude, debts of gratitude are sen-
sitive to the motives and attitudes that move a benefactor to confer the benefits.
Accordingly, in many cases it is precisely each party’s conception of the instru-
mental, nonaltruistic motives of their counterparty that supports their common
understanding concerning the absence of debts of gratitude. In these cases, par-
ties who understand themselves to be “all paid up” following the sequence of
beneficial performances also understand themselves, rightly or wrongly, to pos-
sess these instrumental motives and attitudes.
Several further observations are in order. First, the instrumental motives in
question are not the only possible vitiating factors that can support the parties’
understanding concerning the absence of debts of gratitude. Indeed, the earlier
example of the student in the Vitra store is a case in point. The sale in that case
demonstrated that reciprocal inducement is not a necessary condition of quid pro
quo exchange. But notice that there are other features of that case to which the
parties could readily appeal in reaching their understanding concerning the ab-
sence of debts of gratitude. Most obviously, it is not just that the manager was
not trying, or expecting, to benefit the student or to satisfy his wishes; stronger
still, what the manager was aiming for, and expecting, was to embarrass or ex-
pose the student by making an attractive offer he would be unable to accept.87
Second, while these imputed motives are strong enough to vitiate a debt of
gratitude, they are weak enough to coexist alongside the noninstrumental valu-
ing of one’s service and one’s counterparty, and do not entail or presuppose an
87. When the apparent motives picked out by reciprocal inducement do serve as vitiating factors,
these apparent motives must correspond to the strengthened version of that theory, consid-
ered earlier, on which each performance would not have been given but for the fact that it
would induce a reciprocal performance. This is because a debt of gratitude would still arise
were a desired service rendered with the partial aim of promoting the provider’s own inde-
pendent ends unless the provider would not have performed the service had it not been expected
to promote his or her independent ends. This is defended at length in my book-length treat-
ment of quid pro quo, see Lewinsohn, supra note 62, and is related to similar claims made by
Seneca, see LUCIUS ANNAEUS SENECA, ON BENEFITS (Miriam Griffin & Brad Inwood trans.,
Univ. of Chi. Press 2011) (c. 60 C.E.), and Hume, see HUME, supra note 63, at 225-27, 331-37.
In applying this to the case of exchange, some finesse is needed on the plausible assumption
that not every exchange offer is represented as a final offer.
735
attitude of indifference toward either the service or the counterparty. For exam-
ple, a sculptor (or even a banker) may insist on receiving payment from a be-
loved customer only because she needs to support her own family or because she
does not wish to treat her customers differently on the basis of her affections,
not because she treats either the customer or her own sculpture with indiffer-
ence.
Although this completes the elaboration of the remuneration theory of quid
pro quo, we may briefly consider a class of potential counterexamples. I have in
mind cases involving quid pro quo transactions that nonetheless give rise to
debts of gratitude. Some examples might include: a seller who gratuitously of-
fers someone the opportunity to purchase something (at market rates) before
offering the product to an eager public, or one who offers an individualized dis-
count, or an editor’s acquisition of a fledgling writer’s first novel after all the
other editors have passed. These cases can be dealt with in either of two ways. In
some cases, we can distinguish between the performance under the contract and
some other element of the transaction that gives rise to the debt of gratitude.
This is obviously true, for instance, with respect to offers of first refusal—that
they are distinct from the performance is evidenced by the fact that rights of first
refusal can be separately purchased. In such cases, what we are grateful for is
getting the first crack at the apple, which is given gratuitously apart from any
quid pro quo, not for the subsequent quid pro quo transfer of merchandise at
market rates. And No Residue speaks only to the performance proper. I submit
that this strategy will serve to neutralize most putative counterexamples.
Nevertheless, I am prepared to accept that there may be cases where a debt
of gratitude is generated by a performance in a quid pro quo exchange, even
when the service provider would not have performed if he did not stand to gain.
These cases will be fewer in number than we might at first think, especially once
we take pains to distinguish between apt or intelligible gratitude, on the one
hand, and gratitude that is in some sense required (on pain of rendering one
liable to a charge of ingratitude), on the other, since only the latter could consti-
tute a counterexample to my theory. Perhaps the case of the editor would be one
example, though it seems that even here the recognition of talent in a writer, by
way of making an offer to publish the work, would be distinguishable from the
editor’s performance under the ensuing contract—or the services of a brilliant
surgeon or psychotherapist who changes the life of his or her patient for the bet-
ter. In other words, perhaps in cases like these the service provided (that is, the
service that is owed and not something above and beyond the call of duty) is so
meaningful to the recipient that it will generate a debt of gratitude even when
the provider would not have provided those services if the recipient had not paid
for them.
736
paid on both sides
In some of these cases (if there are any), the recipient of the meaningful ser-
vice may not have recognized, at the time the agreement was made, the debt they
would come to incur. Such cases, too, pose little difficulty for No Residue, since
it is the understandings at the time the agreement is made that are dispositive.
But perhaps there are cases where, even at the time the agreement is made, the
parties know, at least on some level, that a debt of gratitude will persist after the
performances. What I would say about such cases is that they are only genuine
instances of quid pro quo exchanges if the parties, at the time the agreement is
made, look past the relevant debts in the way conversing adults sometimes look
past disagreeable odors or sounds, choosing not to acknowledge what is blowing
in the wind. In such cases, there may be a discrepancy between the official ledger,
constitutive of the parties’ shared understanding, and what they know but
choose not to acknowledge—that is, they may act as though no debt of gratitude
exists even if they know that it does. And, in such cases of discrepancy, the ac-
count I have offered follows the official ledger. To be sure, what I am calling the
official ledger is in some sense a social and conventional artifact; but, then again,
so are transactional forms.88
Although I have claimed that Hume and Smith were wrong to view the ex-
traction of services from strangers as the most basic feature of exchange,89 they
were right to see quid pro quo exchange as in some way alien to the sphere of
friendship—a judgment that, I believe, is confirmed by prevailing social norms.
The remuneration theory is able to render these norms intelligible, explaining
why intimates have reason to be reluctant to resort to quid pro quo in their deal-
ings with each another, even if such reasons can be overridden in appropriate
contexts. In particular, several aspects of quid pro quo exchange are prima facie
at odds with the values of friendship. These aspects warrant a fuller discussion
than I am able to give on this occasion, so I will simply articulate the elements of
the transactional form that might be the source of concern, leaving it for another
time to explain exactly why.
88. The form of pretense at issue in this paragraph (one that occurs at the time the agreement is
forged) is related to, and interacts in complex ways with, another familiar form of pretense
involving exchange. It is an important social fact that parties to explicit exchange agreements
sometimes attempt to obscure, or look past, the quid pro quo (“transactional”) character of
their relationship, not when the agreement is formed, but rather in the course of the ensuing
performances. This is especially recognizable in the context of care professions, as well as so-
called professions of higher calling, and might have understandable causes as well as mixed
results.
89. See supra text accompanying notes 63-64.
737
First, in cases where there is nothing else around that could vitiate debts of
gratitude, the exchange form would only be available to friends who could im-
pute to one another the motives picked out by the strengthened version of recip-
rocal inducement. That is, the parties must be able to impute to each other not
only the instrumental aims of serving partly in order to be served; more strongly,
they must understand one another as conditioning their willingness to help on
this occasion on the prospect of getting something in return.90 Moreover, the
distinguishing feature of quid pro quo, as I have described it, is that it allows the
transacting parties to give and receive benefits without incurring lasting duties
to reciprocate and debts of gratitude. But if friends see these residual obligations
to one another as more than mere liabilities, but instead as positive, albeit con-
straining, contributions to their valuable relationship, this would give them rea-
son to choose a different transactional form when one is available. Finally, if the
genealogical explanation I have suggested is on the right track, then quid pro
quo is a transactional form that came into the world to facilitate a certain kind of
arm’s-length noninvolvement that would otherwise be difficult to achieve
among givers and takers of wanted services. If this explanation is correct, it is
little wonder that friends, whose lasting bonds and ties are a source of meaning
and value, would want to employ a different form in their distribution of goods
and services to one another.
The account I have offered is also well positioned to explain the exceptional
cases in which friends appropriately employ the form in their dealings with one
another. Many of these cases involve transactions that, for one reason or another,
guarantee continued involvement and lingering debts. This is true, for example,
of transactions involving gratuitous offers of first refusal or of special discounts
extended to individuals on the basis of friendship. In such cases, even if the ex-
changed performances themselves do not give rise to lasting debts of gratitude,
the gratuitous elements of the transaction do, and the reasons friends have to
avoid the form will be correspondingly diminished. In other cases, friends use
the form to avoid debts that their friendship cannot bear. It is an interesting
question why friends calibrate the degree of favors they are comfortable receiving
to the strength of their bond, but it is undeniable that they do. When a friend-
ship cannot bear the weight of a particular debt—for example, I would not feel
comfortable accepting an offer from many of my friends for a rent-free sublease
of their house or apartment, even if they are not in need and will be away for the
year—the account that I have offered explains why the resort to exchange might
be acceptable. For in cases like these, it is important to the friendship that the
debt be avoided, and exchange provides the means of achieving that desirable
90. To be clear, I do not mean to suggest that this is necessarily inimical to the values of friendship,
only that it might bear on such values, depending on the context.
738
paid on both sides
outcome. Of course, even in cases such as these, we will often prefer to get the
service from a stranger (for example, by consulting Craigslist or the Yellow
Pages) rather than from an exchange agreement with a friend. This common
preference likely owes to many factors, but one of them might be the wish to
avoid having to communicate one’s views about the limits of what the friendship
can bear.
iii. two doctrines of consideration
In Part II, I articulated and defended a theory of exchange as reciprocal pay-

ment (or remuneration), distinct from the relation of reciprocal inducement
(objectively construed). The present Part begins to make the case that a remu-
neration theory of exchange provides the materials for a consideration doctrine
far superior along the dimensions of both fit and justification. Before discussing
the problems with the orthodox approach, I will first introduce the alternative
remuneration theory of consideration, which will enable us to compare the two
versions of the consideration rule.
A. The Remuneration Theory of Consideration
The basic idea behind the remuneration theory is that fulfillment of the con-
sideration requirement is, in the first instance, a function of the terms of the agree-
ment (objectively interpreted)—and not of what may have induced the promisor,
actually or apparently, to assent to those terms.91 Specifically, as long as the par-
91. In constructing this theory, I stand on the shoulders of the almost-forgotten Henry Ballantine.
In a pair of extremely insightful law review articles from 1913 and 1914, Ballantine, a former
student of Williston at Harvard who would go on to become a professor of law at Berkeley,
bucked the emerging orthodoxy and maintained, as I do, that the consideration requirement
governs the “terms of the bargain”—claiming, in other words, “[T]he rule of consideration is
a mere test of the nature of the agreement, and the element of consideration may exist from
the start in the nature of the agreement as a bargain.” Henry Winthrop Ballantine, Is the Doc-
trine of Consideration Senseless and Illogical?, 11 MICH. L. REV. 423, 432 (1913); see also Ballantine,
supra note 31, at 132-33. Despite a brilliant paradigm shift and several forceful arguments
against the orthodoxy of his (and our) day, Ballantine’s articles, while garnering responses
from the leading contract scholars of his day, had no significant impact on the development
of the law. This poor reception was not entirely unearned, however, as Ballantine was unable
to articulate the relevant feature of the terms or substance of the agreement in virtue of which
it would qualify as a bargain and pass the consideration test. He frequently refers to “mutual-
ity” and “reciprocity” as the essential elements—reflected in the title of his Harvard Law Re-
view article, Mutuality and Consideration. For example, he says that “the doctrine of consider-
ation is a not very successful attempt to generalize and reduce to a rule of thumb that
739
ties assent to an agreement that appears to contemplate reciprocal payment rela-

tions, relations which may, in turn, be understood in terms of Reciprocal Debt
Satisfaction and No Residue, the agreement satisfies the consideration require-
ment, regardless of what seems to have motivated the parties to lend their assent.
Furthermore, the element of exchange in virtue of which an agreement satisfies
the consideration rule may be found in the contemplated relation between the
promised performances. In a typical bilateral sales contract, for example, the par-
ties each assent to an agreement that not only requires the seller’s delivery of the
goods and the buyer’s transfer of the money, but that requires each performance
as payment for the other, with all the implications of this designation (such as
those involving strictures against double counting) that were laid out in Part II.
It follows from this that, so long as the agreement to which the parties assent
contemplates payment relations, the consideration rule may be satisfied long be-
fore any payment has actually been made. So far as the consideration rule is con-
cerned, what matters is that the parties have agreed to an exchange, not that an
exchange has occurred.
Of course, nothing in the remuneration theory rules out the possibility that
the parties may, on occasion, regard the promise itself—that is, the undertaking
of an obligation—as constituting one side of the relevant exchange relation.
When I buy an insurance policy, for example, my payment is arguably for the
insurer’s incurring an obligation to reimburse in the event of some accident, not
for any recovery that may or may not ever be made.92 And the same is arguably
reciprocity which must exist in an agreement to make non-performance a legal wrong on the
part of the promisor,” Ballantine, supra, at 424, and that “[i]t would seem to be a sound prin-
ciple of law which demands some mutuality or reciprocity of engagement as the basis of a
contract,” Ballantine, supra note 31, at 132. When pressed to identify the species of mutuality
or reciprocity, however, the best he could come up with was that “[a]ny mutual promises
which contemplate the possibility of a required performance on each side constitute a contract,
since they involve mutuality or reciprocity in the things promised.” Id. at 126. Contrary to
Ballantine’s intentions, this definition severs the link between consideration and bargain al-
together, since, as I have already shown, the condition it states would be satisfied by all “I will
if you will” agreements, including those commitments to plans that few would categorize as
bargains. See supra Section II.A. Having recovered the concept of quid pro quo exchange, we
are in a position to improve on Ballantine’s account by offering a precise statement of the
features of the (apparent) terms of an agreement that must be present in order to satisfy the
consideration test.
92. Some might wish to resist this characterization and instead construe the insurer’s promised
performance conditionally: that is, the insured pays the premium, and in exchange the insurer
pays out coverage if a covered event occurs. (According to this construal, the insurer performs
even if the covered event never occurs.) Adopting this alternative characterization would in
turn allow us to replace the disjunctive definition of consideration, see infra text accompanying
note 93, with the following nondisjunctive version: A promise is supported by sufficient consid-
eration if it can be inferred that the parties regard the promised performance as standing in a relation
740
paid on both sides
true of other classes of contracts, such as the issuance of bonds (or other nego-
tiable instruments) for value. The lesson here is that just as it is a mistake to
single out the relation between the acts of assent as the exclusive site of exchange
(in virtue of which an agreement may pass a bargain test), so too is it a mistake
to focus exclusively on the relation between the promised performances.
With this in mind, we may advance the following statement of the consider-
ation rule: a promise is supported by sufficient consideration if it can be inferred
that the parties regard either the promised performance, or the promise itself, as
standing in a relation of reciprocal payment to either the performance, or the
promise, of the promisee.93 This can be restated using the language of quid pro
quo exchange: a promise is supported by adequate consideration if it can be in-
ferred that the parties regard either the promised performance, or the promise
itself, as standing in a quid pro quo relation to either the performance, or the
promise, of the promisee.94
B. Testing the Theories
I will briefly postpone discussion of the rationale for the consideration rule,
cast in terms of reciprocal remuneration, in order to consider several doctrinal
difficulties facing the reciprocal-inducement account (that is, the modern rule).
We have already demonstrated, in Part II, that the modern rule embodies a
flawed conception of a bargain or exchange. Accordingly, it comes as no surprise
to learn that the modern rule treats some patently gratuitous agreements as
though they belong to an exchange, and vice versa. I will proceed by giving two
well-known examples of such difficulties, followed in each case by a demonstra-
tion of how the remuneration conception of consideration avoids the problem.
1. Conditional Gift Promises
The first such difficulty relates to whether the modern rule is compatible
with the view, universally held, that donative promises—promises to give a gift
of reciprocal payment to the performance of the promisee. However, despite appearances, there is
no reason to think that the nondisjunctive version is simpler. See supra note 20.
93. The phrase “it can be inferred” is meant to capture the fact that the definition is “objective”
and does not require the actual subjective understandings. Also, I reiterate that the disjunctive
formulation can be replaced with a nondisjunctive one if one is willing to accept a conditional
performance account. See supra note 92.
94. This way of restating the test assumes that if the parties mutually understand their acts as
satisfying the two conditions of reciprocal remuneration, then they also mutually understand
one another as so regarding their acts. None of my substantive claims rely on this assumption.
741
to, or perform an unpaid favor for, the promisee—fail to satisfy the consideration
requirement.95 The problem is easiest to grasp in the context of conditional gift
promises, where the offeror conditions a gift promise on receipt of a return
promise from the offeree. The example involving the loving aunt will serve us
again here,96 though we will now shift our focus to the relation between the mu-
tual promises of the aunt and her nephew. The beneficent aunt promises to gift
her nephew a sum of money if the nephew agrees to spend the money on art
(and not on alcohol), and the nephew agrees. The aunt’s offer was made eagerly,
in the sense that it was made with the aim of inducing her nephew’s acceptance
of the offer (and subsequent purchase of the art), and the nephew accepted with
the aim of satisfying the condition of his aunt’s commitment (and receiving the
funds). Whereas we previously observed that the motivational account of quid
pro quo (erroneously) classifies the ensuing performances as standing in a quid
pro quo relation, we may now observe that the modern rule cannot avoid finding
consideration in this agreement: each party’s promise was made for the apparent
purpose of inducing the other promise, which is precisely the relation that, by
the lights of reciprocal inducement, must exist between the two promises them-
selves for consideration to be present.97
95. Atiyah, describing that view, notes that “orthodoxy insists that a promise to make a gift is not
enforceable as a contract at all. The fact that the promise is conditional does not, according to
orthodox doctrine, render the promise enforceable.” ATIYAH, supra note 11, at 210. Atiyah goes
on to challenge the orthodoxy, but his grounds for doing so are not relevant here, as the case
under consideration involves no detrimental reliance.
96. See supra Section II.A.
97. Peter Benson has recently proposed an “independence” condition that, he says, will do the job
of explaining at least some of the conditional gift cases. Peter Benson, The Idea of Consideration,
61 U. TORONTO L.J. 241, 250-51 (2011). On his view,
consideration must be independent of the first promise in the following way: it
must be possible to construe the content of the consideration as something that
genuinely originates with the promisee, not the promisor, and that is not simply
reducible to an aspect, condition, or effect of the first promise. It must be some-
thing that is, as it were, initially on the promisee’s side and that is, therefore, not
produced by the promisor. Even if the consideration is, in fact, given after the promise,
there must be no reason in principle why it could not possibly have initiated the interac-
tion and so have come first.
Id. at 250 (second emphasis added). Now, if there were such a requirement, perhaps it could
explain why the sort of conditional gift promise under discussion (involving the loving aunt
and her nephew) does not pass the consideration test, even when it satisfies reciprocal in-
ducement. However, any requirement strong enough to yield this result is also too strong to
be an element of the consideration rule, as it would also rule out agreements that are un-
doubtedly supported by consideration. For instance, if a violin collector offers to loan a tal-
ented violinist a different Stradivarius each month provided that the violinist promises to use
742
paid on both sides
If contract law were strictly an intellectual exercise and not also a practical
affair, then the failure to explain cases involving conditional-gift promises would
be a knock-down argument against the orthodox theory of consideration. For if
there is ironclad consensus on any one proposition concerning the consideration
requirement, it is that it is not satisfied by donative promises, including condi-
tional ones.98 One can hold on to the judgment that the aunt’s promise is sup-
ported by consideration only at the cost of abandoning all pretense that the mod-
ern consideration rule is an expression of a quid pro quo exchange requirement,
or by making believe that the aunt’s promise is not genuinely donative. In the
absence of a better rule of consideration, however, it is no surprise that the draft-
ers of the Second Restatement, committed as they are to the bargain require-
ment, have, in the face of counterexample, chosen to grin and bear it, resorting
to subterfuge and obfuscation.99 The remuneration theory of consideration pro-
vides that better rule and thereby obviates the need for subterfuge. In the case
we have considered, neither the nephew’s acceptance of his aunt’s condition, nor
his subsequent fulfillment of it, constitutes payment either for the aunt’s gift or
that violin in a monthly private concert for the collector and her friends, the resulting agree-
ment may surely qualify as a bargain and satisfy the consideration requirement, even though
it appears to fail Benson’s independence test. And if, for whatever reason, it would not fail
Benson’s test, then neither would the aunt’s gift promise to her nephew, as the two cases share all
relevant features: in each case, the promisee promises to do something with that which the
promisor promises to give (whether money or violins). I may also note that Benson’s formu-
lation of his test, in the italicized sentence, seems to overlook the fact that it is the promisee’s
counterpromise (rather than subsequent performance) that is the consideration in bilateral
contracts. After all, Benson explicitly intends his test to rule out the offer to give a gift that is
made conditional on the promisee’s promise to accept the gift. However, there is no reason
in principle why the sequence of promises in such a case could not have been reversed: that is,
there is no reason that the donee could not have first made a promise to accept a certain gift
conditional on the donor’s counterpromise to give the gift. Accordingly, Benson must intend
for the independence requirement to apply to the promisee’s (promised) performance (even
in the bilateral case).
98. See supra note 95 and accompanying text.
99. The Second Restatement does not deal with this difficulty in its most general form. However,
the comments do discuss the specific (and somewhat arcane) class of cases involving promises
to give a gift that are made conditional on the offeree’s return promise to accept the gift, some-
thing sometimes done (as the drafters observe) when the gift carries substantial burdens and
responsibilities (e.g., a transfer of real estate):
[A] promise to make a gift is not made a bargain by the promise of the prospective
donee to accept the gift, or by his acceptance of part of it. This may be true even
though the terms of gift impose a burden on the donee as well as the donor. In such
cases the distinction between bargain and gift may be a fine one, depending on the
motives manifested by the parties.
RESTATEMENT (SECOND) OF CONTRACTS § 71 cmt. c (AM. LAW INST. 1981) (citation omitted).
This treatment sheds no light whatsoever on the problem.
743
her promise to give it. This is true by the lights of our ordinary intuitions and is
borne out by the theory of exchange that was put forward in the previous Part.
Indeed, neither condition of the reciprocal-payment account of exchange is ful-
filled in this case. The nephew’s purchase of art with the funds received from his
aunt fulfills an obligation owed to his aunt, but it does not constitute the satis-
faction of a debt.100 And, more obviously, since the aunt’s transfer of money is a
gift, a debt of gratitude survives the transaction.
2. Contract Modifications
I will now consider an example of an exchange that is wrongly classified as a

gratuitous agreement under the modern rule—one-sided contract modifications
and the preexisting-duty rule. The question raised by these cases is whether the
promise to do a thing, or the actual doing of it, may be a good consideration if
the party is already bound to do that thing in virtue of a prior contract with the
other party. More specifically, where B threatens not to fulfill an obligation ex-
isting under a prior contract with A unless A promises to make some additional
payment that the original agreement did not require, the question is whether A’s
promise to pay the higher rate is supported by consideration.101 I will limit my
focus to “fair and equitable” modifications called for in light of circumstances
“not anticipated by the parties when the contract was made.”102 To take a stock
example, suppose B had a preexisting duty to construct a house for A, but due
to an unanticipated rise in the price of building material, performance of that
duty (at the original contract price) would be extremely costly and might even
place B’s business in peril. If A values B’s performance more highly than she does
a right of action against B, or for some other reason, A may well agree to pay
more than the rate originally agreed upon in order to secure B’s performance.
Satisfied with the modified terms, B goes on to build the house, and the question
100. Consider that his aunt would have no legitimate grievance if he had previously promised a
collector, in exchange for some pieces of art, that he would thereafter spend all his disposable
income on the purchase of art. That his obligation to his aunt may be discharged by a perfor-
mance that also discharges the (debt) obligation to the collector indicates that the former ob-
ligation is not a (strong) debt obligation.
101. This formulation is meant to include cases where B says she won’t perform, and A responds
by sweetening the deal if B performs.
102. RESTATEMENT (SECOND) OF CONTRACTS § 89(a).
744
paid on both sides
left to consider is whether A’s promise to pay the higher rate is legally enforcea-
ble.103
Following the opinion of Lord Ellenborough in 1809 in Stilk v. Myrick, and
for many years after, the doctrine of consideration was wielded to deny enforce-
ment of the second promise, as A received no more, as a result of her promise,
than what was originally owed to her.104 This holding gradually came to be
viewed as unjustified, as it was both contrary to commercial needs and unsup-
ported by higher moral values. As one commentator has put it, “[T]his rule is,
on the whole, that adjunct of the doctrine of consideration which has done most
to give it a bad reputation.”105 Wishing to spare the law this embarrassment, the
drafters of the Second Restatement, while affirming the preexisting-duty rule,106
put forward an exception to that rule that would allow for “fair and equitable”
contract modifications.107 The Restatement explicitly treats its allowance of such
modifications as an exception not only to the preexisting-duty rule, but also to
the consideration requirement, and accordingly places the relevant rule under
the topic “Contracts Without Consideration.”108 The comments rationalize the
exceptional treatment by cursory appeal to the functional justification of the con-
sideration doctrine offered by Lon Fuller—functions that, the Reporters claim,
are served in the modification cases at issue.109 As I will show below, however,
103. The history of such cases is extremely complicated. For one slice of this history, see Kevin M.
Teeven, Development of Reform of the Preexisting Duty Rule and Its Persistent Survival, 47 ALA. L.
REV. 387 (1996).
104. Stilk v. Myrick (1809) 170 Eng. Rep. 1168; 2 Camp. 317. As explained earlier, there is no reason
to infer from Ellenborough’s brief remarks that he espoused Langdell’s definition of consid-
eration. See supra note 15.
105. Patterson, supra note 13, at 936. Of course, the critics of the preexisting-duty rule have never
disputed that the law needs a way of screening off those promises to pay a higher price that
have been induced by coercive or exploitative threats not to perform at the original rate. Ra-
ther, the critics maintain that the bargain requirement is too blunt a tool for the task, as using
it to deal with the coercive cases would also bar the fair and equitable ones. See, e.g., id. at 937
(“However, not all second bargains are induced by coercion; and it would be better (I submit)
in the long run to drop the rule as to a preexisting contractual duty and decide the grounds
for avoidance of each second bargain on its facts, i.e., by reference to coercion, deception, or
lack of good faith in cases where a special relation between the parties imposes such an obli-
gation.”).
106. RESTATEMENT (SECOND) OF CONTRACTS § 73.
107. Id. § 89.
108. Id. ch. 4, topic 2.
109. “As in cases governed by § 84, [the modification’s] relation to a bargain tends to satisfy the
cautionary and channeling functions of legal formalities.” Id. § 89 cmt. a; cf. id. § 72 cmt. c
(describing the cautionary and channeling justifications of the doctrine of consideration).
745
Fuller’s functional argument is not just implausible as a justification of the doc-

trine of consideration, but, more importantly for present purposes, it is incom-
patible with the prevailing reciprocal-inducement conception of the rule.
Although the Restatement adopts the position that one-sided modifications
are unsupported by consideration, the Reporters record a contrary view, writing
that the allowance of fair and equitable modifications is “sometimes reached on
the ground that the original contract was ‘rescinded’ by mutual agreement and
that new promises were then made which furnished consideration for each
other.”110 The Reporters’ implicit reference here is to a position taken by Ames,
who had influentially argued, many years earlier, that a consideration require-
ment cast solely in terms of exchange poses no obstacle to fair and equitable
modifications, provided that the modification is characterized as a rescission.111
On this characterization, when the parties assent to the modification, they agree
to substitute a new contract (reflecting the higher, renegotiated rate) for the
original one, thereby rescinding the first contract and forming the second in a
single showing of mutual assent. The Reporters rejected the rescission charac-
terization (though it is by no means obvious that they were correct to do so).112
110. Id. § 89 cmt. b.

111. Ames, Unilateral Contracts, supra note 15, at 528-29.
112. Following Williston, the Second Restatement rejected the rescission characterization of the
modification on the ground that the theory “is fictitious when the ‘rescission’ and new agree-
ment are simultaneous.” RESTATEMENT (SECOND) OF CONTRACTS § 89 cmt. b. This charge of
fiction is hardly convincing, at least if the only alternative characterization is the one consid-
ered by Williston. This alternative involves conceiving of the modification agreement as the
formation of a second, bonus contract that would supplement, but not replace, the original
contract, binding the promisor to pay a bonus if the original contract, still intact, is fulfilled
by the promisee. See Williston, supra note 31, at 31 (describing the modification agreement as
a promise of “something additional” to “induce” the performance of the original contract).
While Williston endorsed this bonus characterization of modifications (and in doing so
sought to defend the preexisting-duty rule), he provided no reason why it is any more realistic
a construal of the parties’ intentions than the rescission characterization. Indeed, there are
modifications that are plainly incompatible with the bonus characterization. For such a char-
acterization is not possible unless paying the total renegotiated rate involves making (but go-
ing beyond) the payment that was originally required. However, this condition will not al-
ways hold. If, for example, the original agreement required payment of a certain quantity of
cultured pearls, and the renegotiated term required, instead, transfer of the same quantity of
natural pearls, Williston’s alternative “bonus” characterization would not be possible.
It is also worth noting that there is another alternative to the rescission characterization
that neither Williston nor Ames considered (as far as I am aware). On the alternative amend-
ment characterization, the modification changes the terms of the original contract without ei-
ther replacing or supplementing it. The failure to consider this alternative perhaps reflected a
shared assumption (on the part of Williston and Ames) that a contract cannot survive a ma-
terial change in its terms. I will not separately discuss the amendment characterization in the
746
paid on both sides
But they took no clear stand on the question of whether a rescission characteri-
zation of the modification entails, as Ames thought it did, that such modifica-
tions satisfy the consideration requirement after all.
Once the effort is made to apply the (Second Restatement’s) reciprocal-
inducement theory, however, it becomes clear that such a characterization of
modification only supports Ames’s conclusions (finding consideration in all such
modifications) when the second agreement is unilateral; when the second agree-
ment is bilateral, applying the theory often reaches the contrary result.113
Let us begin with the unilateral case. Suppose B announces that, due to a
price hike in building materials, she is planning to breach; A responds by offer-
ing to pay a higher rate if B finishes the job; satisfied with the higher rate, B
finishes the job and demands payment. As I have said, the reciprocal-inducement
account reaches the right result in this case. The promise to pay the higher rate
is made in order to induce the performance, which is in turn rendered in order
to obligate the promisor to pay at the higher rate.
In the case of bilateral contracts, the analysis comes out differently. Here, it
is not enough that A’s promise to pay the higher rate is made with the ultimate
aim of inducing the performance. Rather, according to the orthodox account of
consideration, each party’s promise in a bilateral contract is exchanged for the
other’s promise, so in order to satisfy the reciprocal-inducement account, A’s
promise to pay the higher rate must be made with the more immediate aim of
procuring B’s promise to perform. The difficulty with ascribing the latter aim to
A’s assent to the modification, however, is that, at the moment immediately prior
to that act of assent, A already has B’s promise to perform: B promised to perform
in the original agreement, and the continued existence of the obligations and
claim rights that resulted from that agreement were (by hypothesis) never called
into question. Since B is already on the hook immediately prior to A’s promise
text, as all of my arguments concerning the rescission characterization apply, mutatis mutandis,
to the amendment characterization.
113. In making this argument, I am siding with Williston, who took issue with Ames’s conclusions
concerning the significance of a rescission characterization of the modification, on the ground
that “calling an agreement an agreement for rescission does not do away with the necessity of
consideration.” Williston, supra note 66, at 516. In reaching their respective views on the mat-
ter, neither Ames nor Williston engaged with the reciprocal-inducement conception of ex-
change. Ames spoke only of an exchange requirement, but, while using the Langdellian for-
mula, left the notion of exchange unanalyzed, never mentioning inducement. See Ames,
Bilateral Contracts, supra note 15, at 42 (“It is not yet too late to abandon this modern invention
and to return to the simple doctrine of the fathers, who found a consideration in the mere fact
of a bargain, in other words, in any act of forbearance given in exchange for a promise.”).
747
to pay at the higher rate, we cannot say that such a promise is made with the aim
(actual or apparent) of getting B on the hook.114
What the foregoing analysis reveals is that proponents of the reciprocal-
inducement account can uphold the validity of one-sided contract modifications
only by either misapplying their definition of consideration or by drawing a
largely unprincipled exception to the consideration requirement.115 Given these
choices, it is little wonder that many jurisdictions have refused to follow Section
89 of the Restatement, while others have relied on legislative intervention to ac-
complish what could not be achieved otherwise. While treatise writers have long
proclaimed that “[t]he pre-existing duty rule is undergoing a slow erosion and,
as a general rule, is destined to be overturned,”116 the rule stubbornly persists in
many jurisdictions.117 It also persists, more widely, in specialized contexts, such
114. It is worth noting that a divergence between social and legal norms, regarding the effect of
the unanticipated event that precipitated the modification, would complicate the analysis. For
example, if by the lights of prevailing social norms such events have the effect of extinguishing
the contractor’s obligation (i.e., if she wouldn’t be criticized for breaching in such conditions),
then the contractor’s recommitment might sensibly be sought after as a means of ensuring
performance. Additionally, Kevin Davis has suggested to me that parties might enter into a
modification agreement (at t0) that contemplates a two-stage, sequentially ordered process,
under which the rescission of the original contract (at t1) precedes the formation of the second
(at t2). Since, in this version, the modification agreement contemplates a time where the
promisor has lost the original claim right but has not yet acquired the new one, one might
think that the promisor can enter into such an agreement with the aim of getting the claim
right back at t2. However ingenious, I do not think that such a restructuring of the agreement
would bypass the difficulty, as the assent to such an agreement would still occur at a time (t0)
when the promisor still has the original claim right, which he would not risk losing if he were
to decline to enter into the modification agreement. By way of analogy, if A were looking for
reasons to loan his bike to B for a day, we would not say (in the typical case) that A should
loan B the bike in order to get the bike back the following day. Getting the bike back is a con-
dition, not an aim, of the loan.
115. I set aside alternative bases of liability, such as reliance.
116. 2 JOSEPH M. PERILLO & HELEN HADJIYANNAKIS BENDER, CORBIN ON CONTRACTS § 7.1, at 342
(rev. ed. 1995) (emphases added). According to a more recent study, “[s]ome courts, in states
like Alabama, Minnesota, Mississippi, New Hampshire, and Wisconsin, have become so dis-
enchanted with the [preexisting-duty] rule that they have abandoned its application alto-
gether. Further, [only] five other states, California, Michigan, New York, Oklahoma, and
South Dakota, have effectively abolished by statute the pre-existing duty rule by providing
that a promise or agreement modifying a contract need not be supported by consideration, so
long as the modification is in writing.” Corneill A. Stephens, Abandoning the Pre-Existing Duty
Rule: Eliminating the Unnecessary, 8 HOUS. BUS. & TAX L.J. 355, 362-63 (2008) (emphases
added).
117. The Supreme Court of the United Kingdom has recently clarified, in dicta, that the preexist-
ing-duty rule articulated in Foakes v. Beer [1884] UKHL 1, 9 App. Cas. (HL) 605 (appeal taken
from Eng.) remains valid, though it is “probably ripe for re-examination.” Rock Advert. Ltd.
v. MWB Bus. Exch. Ctrs. Ltd. [2018] UKSC 24, [18], [2019] AC 119 at 131 (appeal taken from
748
paid on both sides
as the modification of at-will employment contracts by employers.118 In stark

contrast with the reciprocal-inducement theory of consideration, the remunera-
tion theory easily reaches the desired outcome in these cases.119 For, according
to that theory, the element of consideration is found within the terms of the
agreement and not in the apparent motives that lead the parties to assent to those
terms. By providing their mutual assent to the change of terms, the parties assent
both to the rescission of one contract and the formation of another.120 Since the
new one is, according to its terms, an exchange contract requiring payment for a
performance, it does not matter that the party undertaking the obligation to pay
at the higher rate lacks the aim of inducing the counterparty to assume an al-
ready-existing obligation. Mutual assent to an agreement that by dint of its
terms qualifies as a bargain is sufficient.121
Eng.). Various jurisdictions in the United States continue to apply the preexisting-duty rule.
See, e.g., Johnson v. Seacor Marine Corp., 404 F.3d 871, 875 (5th Cir. 2005) (recognizing the
existence of the preexisting-duty rule in two-party cases); Airlines Reporting Corp. v. S & N
Travel, Inc., 58 F.3d 857, 864 (2d Cir. 1995) (noting that the performance of a preexisting duty
“cannot suffice as consideration for a valid agreement”); United States ex rel. Youngstown
Welding & Eng’g Co. v. Travelers Indem. Co., 802 F.2d 1164, 1167 (9th Cir. 1986) (“[I]n Ari-
zona, performance of a preexisting legal duty is not sufficient consideration.”). See generally 3
SAMUEL WILLISTON & RICHARD A. LORD, WILLISTON ON CONTRACTS § 7:36 n.1, at 664-70
(4th ed. 2008) (citing these and other cases).
118. For a general treatment, see Rachel Arnow-Richman, Modifying At-Will Employment Contracts,
57 B.C. L. REV. 427 (2016).
119. It should be clear, particularly in the case of modifications of at-will employment contracts,
that what is desirable is that the promises at issue be scrutinized only for fairness and volun-
tariness, not for consideration.
120. Although this formulation assumes the rescission characterization to be the correct one, the
remuneration theory does not rely on it. On the alternative amendment characterization, the
sole contract is an exchange contract both before and after the amendment of the term.
121. In addition to contract modifications involving two parties, there has been considerable de-
bate about the application of the preexisting-duty rule to situations involving three parties. In
three-party cases, a promisor enters into an agreement to pay for a performance that the
promisee has already contracted with a third party to provide. In some such cases, the afore-
mentioned promisor was the intended beneficiary of the original agreement, who (on the
prevailing view of the legal rights of intended third-party beneficiaries) already acquired a
claim-right from the original agreement and who is therefore agreeing to pay more for a ser-
vice he is already owed. In a recent, stimulating article, Nico Cornell has argued at length that
we can only make sense of the authorities that find consideration in such three-party cases by
positing a distinction between having a claim-right and being the party to whom an obligation
is owed. Nicolas Cornell, The Puzzle of the Beneficiary’s Bargain, 90 TUL. L. REV. 75 (2015). In
Cornell’s view, while an intended third-party beneficiary of a contract is owed an obligation,
in that he would be wronged (and would have a cause of action) upon breach, he does not
acquire a claim right. Id. at 117-20. The remuneration theory of consideration, however, can
easily accommodate the holdings in question without resorting to such strained formalism.
In all three-party cases, as in the two-party variations considered above, the second agreement
749
satisfies the consideration requirement just in case it is an agreement that contemplates an

exchange. As far as consideration is concerned, it makes no difference whether the promisor
in question already had a preexisting claim-right to the service.
Cornell also misconceives the significance of a relational conception of promissory obli-
gation for this body of law. There has been great development in the law concerning three-
party cases, which, in this country, has traveled roughly in the same direction as in the two-
party cases. While late nineteenth- and early twentieth-century American courts (unlike their
English counterparts) held that such performances, or promises to perform, would not qualify
as sufficient consideration, the tide (at least among elites) began to turn after Judge Cardozo’s
influential opinion in De Cicco v. Schweizer, 117 N.E. 807 (N.Y. 1917), and Corbin’s influential
article the following year, Corbin, supra note 45. Cornell accounts for these developments as
follows:
The central reason for this shift is a new understanding of rights and duties in a
relational way. Whereas the earlier rule [holding that the performance of, or
promise to perform, a preexisting duty does not count as good consideration for
a counterpromise, even in three-party cases] was based on the idea that the party
in question was under a [preexisting] duty to perform the promised act, the new
rule [finding consideration in such three-party cases] is based on the idea that
the party in question is . . . under a [preexisting] duty to the other party to perform
the promised act. In other words, once one shifts from focusing on merely
whether the party in question is under a duty [simpliciter] and focuses instead
on whether the party is under a duty to the other party, the modern rule seems
much more natural. The new promise, even if it is redundant with regard to what
is required of the promisor, makes the requirement personal to the promisee in a
way that it was not before.
Cornell, supra, at 95 (omitting a “not” in the original text that is, in context, clearly an erra-
tum).
Cornell gives credit for this “new understanding” to Wesley Newcomb Hohfeld’s land-
mark work on legal relations: “This shift in perspectives may be considered Hohfeldian. As
already noted, it is no coincidence that the change in rules corresponds with the emergence of
Hohfeld’s work.” Id. at 96. See generally Wesley Newcomb Hohfeld, Some Fundamental Legal
Conceptions as Applied in Judicial Reasoning, 23 YALE L.J. 16 (1913) (introducing a highly influ-
ential theory of rights, duties, and other legal relations). Cornell’s account is at odds with my
understanding of the developments. As Cornell himself recounted in an earlier section, long
before Hohfeld’s seminal papers, as early as the late 1870s, Langdell and Pollock prominently
held that the promise to perform a preexisting duty counts as good consideration for a coun-
terpromise (i.e., in the bilateral case) even though the actual performance of that preexisting
duty would not (i.e., in the unilateral case). Cornell, supra, at 88-90. Their position in the
bilateral case was based explicitly on the relational idea that the second promise to perform
creates a new legal relation with the promisee, a relation that could qualify as a detriment
precisely because it was distinct from, and not entailed by, the relation created by the first
promise to a different promisee. Id. As Cornell puts it, “Discussing the case in which a party
promises to do what he has already promised another he will do, Pollock argued that the sec-
ond promise would be consideration because ‘[i]t purports to create a new and distinct right,
which must always be of some value in law.’” Id. at 89 (alteration in original) (quoting FRED-
ERICK POLLOCK, PRINCIPLES OF CONTRACT AT LAW AND IN EQUITY 163 (Cincinnati, Robert
Clarke & Co. 1881) (1876)).
750
paid on both sides
Moreover, Langdell and Pollock’s position was rejected by Williston (the leading propo-
nent of the pre-1917 rule denying that consideration is given in three-party cases, whether
bilateral or unilateral) not because of any doubts about the relational claim (i.e., that the
promise to perform the preexisting duty, if valid, would create a new legal relation, distinct
from the first, because owing to a different party) but because of the disparate treatment ac-
corded by Langdell and Pollock to unilateral and bilateral contracts: Williston thought it was
“intrinsically unreasonable that a promise of an act should ever be regarded as greater value
by the law than actual performance of that very act.” Williston, supra note 66, at 524. Whatever
its merits, this position plainly had nothing to do with a failure to perceive that the legal rela-
tions contemplated by the second promise were not equivalent to those created by the first
promise and thus had nothing to do with a failure to grasp the relational character of promis-
sory obligations. (We may surmise that it stemmed from Williston’s doomed effort to at once
retain the idea that consideration (always) stands in an exchange relation to the promise, and
that the exchange relation is a relation of reciprocal payment. See supra note 45. For, without
taking a position on the matter, it does seem at least odd to say that a promise to do some-
thing could be acceptable payment when actually doing it could not be—such a position
would seem to imply, as Williston observes, that “a bird in the hand is worth less than [the
same] bird in the bush.” Williston, supra note 66, at 525 (alteration in original) (quoting Bal-
lantine, supra note 91, at 427, although the metaphor was in fact first used in this context by
Ames, Bilateral Contracts, supra note 15, at 40).)
Finally, I may observe that the only element that is clearly owing to Hohfeld in Corbin's
argument that consideration is present in three-party preexisting-duty cases—a debt Corbin
himself records—has little to do with the relational character of promissory obligations, and
is also the weakest part of Corbin’s influential argument in support of the modern rule. See
Corbin, supra note 45, at 371 & n.16. Williston had claimed, with Langdell and Pollock, that
performance of a preexisting duty does not count as good consideration on the ground that
such performance does not constitute a legal detriment. See Williston, supra note 31, at 27.
Corbin argued for the opposing view (i.e., that performance of a duty does constitute a detri-
ment to the performer) on the ground that such performance entails a surrender of two “legal
powers,” a power to wrongfully breach a contract (a “power” one surrenders on the ground
that one can no longer wrongfully breach a promise that one has already fulfilled) and a power
to make an offer of rescission to the promissee (since one cannot ask the promisee to waive a
promissory obligation one has already fulfilled). Corbin, supra note 45, at 371-72. The first
“power” rests on Hohfeld’s overly broad characterization of legal power as a mere ability to
do something that would affect one’s legal relations with another. See Hohfeld, supra, at 44.
Those otherwise attracted to Hohfeld’s scheme have recognized that this is too loose and deny
that a promisor has a power to wrongfully breach. See, e.g., Joseph Raz, Voluntary Obligations
and Normative Powers, 46 PROC. ARISTOTELIAN SOC’Y 79, 80-81 (1972). The second idea, like
the first, is not just risible but mistaken even by the lights of a proper Hohfeldian analysis. For
in many cases, when performance must be rendered at a given time, one would lose this power
to offer rescission at that time regardless of whether one performs or breaches. (For example,
if A has contracted with B to wash B’s car at a given time, and A breaches, A cannot then
proceed to offer rescission.) And if one would lose the relevant power regardless of whether
one performs, we cannot say of one’s performance that it constitutes a legal detriment on ac-
count of the power one has lost.
751
3. The Rationale of the Consideration Requirement
As I have said, the Second Restatement endorses Fuller’s functional justifi-

cation for the consideration doctrine and appeals to those functions to justify the
exceptions it recognizes. I will criticize this approach by showing that Fuller’s
justification is not open to proponents of the reciprocal-inducement view, and in
the course of doing so, I will also cast doubt on that justification more gener-
ally.122 I am, of course, hardly alone in failing to be convinced by prominent ex-
tant justifications of the rule; indeed, the doctrine has come under much fire for
lacking any plausible rationale whatsoever. In an important paper, T.M. Scanlon
argues that the grounds that confer legitimacy on the practice of enforcing con-
tracts “provide[] no moral basis for the idea that [consideration] is always re-
quired.”123 And in a seminal discussion, Charles Fried accuses the doctrine of
being “internally inconsistent” on the grounds that it abstains from regulating
the adequacy of contract terms, thereby “affirm[ing] the liberal principle that
the free arrangements of rational persons should be respected,” but it restricts
the class of enforceable promises to bargain promises, thereby “hold[ing] that
individual self-determination is not a sufficient ground of legal obligation.”124
And suffice it to say that the evaluation of the doctrine by legal economists has
been similarly grim.125 All the opprobrium is, I believe, well-earned when
heaped at the modern conception of consideration as reciprocal inducement.
However, following my discussion of Fuller, I will show that the remuneration
theory can do substantially better on this score insofar as it can be rationalized
122. For additional criticism of Fuller, see Andrew Kull, Reconsidering Gratuitous Promises, 21 J. LE-
GAL STUD. 39 (1992).
123. T.M. Scanlon, Promises and Contracts, in THE THEORY OF CONTRACT LAW: NEW ESSAYS 86, 107
(Peter Benson ed., 2001).
124. CHARLES FRIED, CONTRACTS AS PROMISES: A THEORY OF CONTRACTUAL OBLIGATION 35 (1981).
125. As a recent handbook chapter by leading figures in the field puts it:
Although its grounding in exchange would seem to suggest a close connection be-
tween the consideration doctrine and the promotion of economic welfare, the doc-
trine would seem to diverge from simple efficiency in at least two respects. First,
many nonexchange promises also enhance economic welfare. A donor’s commit-
ment to make a gift, for example, enables the beneficiary to engage in specific an-
ticipatory investment, thus lowering the donor’s cost of providing the beneficiary
with any given level of utility. Second, the lawyer’s understanding of what counts
as an exchange [in the context of the law of consideration] is narrower in practice
than an economist’s would be.
Benjamin E. Hermalin, Avery W. Katz & Richard Craswell, Contract Law, in 1 HANDBOOK OF
LAW AND ECONOMICS 3, 50 (A. Mitchell Polinsky & Steven Shavell eds., 2007) (citations omit-
ted).
752
paid on both sides
by an intelligible, historically compelling functional explanation that the domi-

nance of the reciprocal-inducement conception has obscured.
In a classic paper, Fuller argued that the bargain requirement serves three
rationalizing functions, which it shares with legal formalities such as a seal: an
evidentiary function, insofar as commitments made in the course of an exchange
are more likely than other kinds of commitments to leave an evidentiary trail in
their wake; a cautionary function, insofar as commitments made in the course
of an exchange are less likely than others to be made rashly or imprudently; and
a channeling function, insofar as we can infer from the exchange context that the
parties intended to create legally binding relations.126 The conception of ex-
change that underwrites Fuller’s functional claims does not seem to have been
made explicit, but it is one of a voluntary, cooperative arrangement between in-
dividuals who do not trust each other, in the sense that neither can assume that
the other is solicitous of his interests or disposed to honor promises in the ab-
sence of external incentive.127 Such individuals would enter into a cooperative
scheme most guardedly, only after scrutinizing the terms and taking precautions
to provide the other party with self-interested reasons to conform to the deal.
For these reasons, the thought must go, they will exercise caution before com-
mitting (cautionary), keep records of the agreed-upon terms (evidentiary), and
recruit a coercive enforcement mechanism to supply the necessary incentive
(channeling). The grounds, in turn, for ascribing these attitudes of mistrust to
the exchanging parties is that the resort to bargain as a mode of performing ben-
eficial services (whereby I condition my willingness to serve you on the prospect
of receiving something in return) itself indicates the absence of robust social or
affective ties that are prerequisites for the relevant species of trust.
Fuller’s functional justification is hardly convincing. Whatever truth there
once was to the claim that we do not record our nonexchange commitments
(e.g., our commitments to plans, or our promises to give gifts or perform fa-
vors), this no longer holds in our age of electronic communication. Moreover,
the idea that we do not enter into exchange agreements imprudently is given the
lie by a moment’s reflection on consumer contracts, where it is precisely the al-
lure of a tempting product or experience that leads so many of us to incur debts
126. Fuller, supra note 17, at 800-01. For a more recent elaboration and defense of Fuller’s func-
tional explanation, see Melvin Aron Eisenberg, Donative Promises, 47 U. CHI. L. REV. 1 (1979);
and Melvin Aron Eisenberg, Principles of Consideration, 67 CORNELL L. REV. 640 (1982) [here-
inafter Eisenberg, Principles of Consideration].
127. It will not be lost on readers that such a conception coheres very nicely with the genealogical
account of exchange offered by Hume and Smith, considered (and rejected) above. See supra
notes 63-64 and accompanying text.
753
that we would be better off avoiding. Finally, setting aside nominal considera-
tion, it is difficult to seriously defend the view that we can infer (even to the
extent necessary to support an empirical generalization) an intent to establish
legal relations merely from one’s participation in an exchange transaction. In
particular, the idea that parties to an exchange transaction would not, in general,
rely on one another and so would not enter into exchange relations with one
another, absent a belief that their agreement could be legally enforced, is at odds
with a growing mountain of evidence testifying to alternative bases of commer-
cial trust.128
Quite apart from these general difficulties, however, there are special reasons
that bar proponents of the reciprocal-inducement account from appealing to
Fuller’s justifications. For the agreements and commitments that satisfy the con-
ditions of reciprocal inducement apply to a very wide range of agreements made
in personal (that is, social and domestic) contexts, as well as among members of
preexisting cooperative units more generally (whether business or domestic), all
of which enjoy the kind of ties that are at odds with the attitudes of mistrust that
Fuller’s account relies on. We have already observed that (conditional) gift
promises would often satisfy those conditions, but this is the least of what I have
in mind. In order to glimpse the problem, we need only reflect on the many oc-
casions friendship and family life afford for collaboration and coordination.
Many of these involve commitments to mutually beneficial plans of action. In
many of these cases (particularly those involving games with multiple equilibria,
to adopt a different parlance) the commitments will be made conditionally, via
the familiar process of offer and acceptance, and will also satisfy the reciprocal-
inducement condition, insofar as each party commits in part as a means of get-
ting the other party to commit to the mutually beneficial plan. Many significant
plans regarding the divvying up of resources or labor would fit the bill, at least
in cases where coordination between the parties is desired. So, too, would com-
mitments to coordinate significant activities, including ones we have already
considered in Part II. Recall the two close friends, A and B, who are entertaining
the prospect of enlisting in the army. Each would rather enlist in the army to-
gether than not enlist at all; but each would also rather not enlist than enlist
without the other. In such circumstances, the two may well commit to a plan
128. See, for example, the literatures spawned by Lisa Bernstein, Opting out of the Legal System:
Extralegal Contractual Relations in the Diamond Industry, 21 J. LEGAL STUD. 115 (1992); and
Stewart Macaulay, Non-Contractual Relations in Business: A Preliminary Study, 28 AM. SOC.
REV. 55 (1963). See generally ROBERT C. ELLICKSON, ORDER WITHOUT LAW: HOW NEIGHBORS
SETTLE DISPUTES (1994).
754
paid on both sides
according to which each will enlist.129 If we are to say that such commitments
are supported by consideration, as any proponent of the reciprocal-inducement
account must, this rules out, even prima facie, the empirical generalizations that
Fuller makes to justify the doctrine.130 For these reasons, conceptualizing con-
sideration as reciprocal inducement deprives the consideration requirement of a
rationale and renders the exceptions to it ad hoc.131
129. To be clear, I need not say (as some philosophers would) that the adoption of every joint,
mutually beneficial plan is accompanied by an implicit or explicit commitment to abide by its
terms, only that many are. In recent times, Margaret Gilbert has prominently analyzed shared
agency in terms of commitments on the part of the parties. See MARGARET GILBERT, What Is
It for Us to Intend?, in SOCIALITY AND RESPONSIBILITY: NEW ESSAYS IN PLURAL SUBJECT THEORY
14, 19-22 (2000). Michael Bratman, who has provided an alternative analysis of shared agency,
nonetheless explicitly maintains that such commitments are often made, implicitly or explic-
itly. See MICHAEL BRATMAN, SHARED AGENCY: A PLANNING THEORY OF ACTING TOGETHER
107-20 (2014). We would expect commitments when the stakes, as well as the costs of chang-
ing plans midcourse, are sufficiently high.
130. I take it that Fuller would not have seen this as an objection to his view, because, as far as I
know, he did not endorse reciprocal inducement as an account of exchange.
131. Daniel Markovits has recently offered a defense of the received consideration doctrine. See
Daniel Markovits, Contract and Collaboration, 113 YALE L.J. 1417, 1477-91 (2004). I said earlier
that normative (like positive) analyses of the consideration doctrine have suffered from a fail-
ure to stay trained on the central notion of exchange, and Markovits’s brave effort at justifying
the unpopular doctrine is, I believe, an instructive example. After arguing that “the morality
of contract derives from the value of the collaborative community that contracts engender”—
more fully, that it derives from the fact that “[c]ontracts establish relations in which persons
do not just negatively refrain from using each other merely as means but also, and affirma-
tively, treat each other as ends in themselves”—Markovits aims to leverage this analysis to
explain the consideration requirement. Id. at 1482. Although he recognizes that this aim re-
quires him to distinguish between bargain promises and gratuitous ones on collaborative
grounds, I submit that the account of collaboration he offers does not allow him to do so, as
the relevant species of collaboration does not cleave to only one side of the line dividing ex-
change agreements and gratuitous promises. Quoting James Penner, Markovits observes that
“bargains are bilateral” in the sense that they relate to “mutual decisions—that is, decisions
made by more than one person—and they each concern ‘joint’ projects or concerns of some
kind where the parties each participate to some extent in whatever the agreement contem-
plates.” Id. at 1482-83 (quoting J.E. Penner, Voluntary Obligations and the Scope of the Law of
Contract, 2 LEGAL THEORY 325, 329 (1996)). Even if Markovits were to embrace the conclusion
that the nondonative collaborative agreements highlighted above (e.g., “I’ll enlist if you’ll en-
list”) satisfy the consideration requirement, he would presumably not dispute that gift prom-
ises (including promises to do the promisee a favor) fail the consideration test. But if Mar-
kovits’s (previously quoted) characterization of bargains does not apply to all gift promises,
it at least applies to the very many of them that result from the acceptance of offers to, or
requests for, help, and that concern a joint activity (e.g., when you agree to pick me up from
the airport or to help me move my house next Saturday after I ask for your help). Moreover,
once such a commitment has been made, it gives rise to a “scheme of interlocking intentions,”
underwritten by an assumed obligation, that should invoke Markovits’s “collaborative ideal”
755
Once the traditional conception of bargain is recovered, however, and the

consideration requirement is accordingly revised, an intelligible rationale quickly
emerges. The point of the consideration rule, properly conceived, is to keep con-
tract in its place; more specifically, the function is to invalidate promises and
commitments made in personal, intimate contexts when the parties to such
agreements have not expressly manifested an intention to establish legal rela-
tions.132 Although this function is, I believe, the most intelligible and historically
compelling rationale for the doctrine of consideration that can be offered, it rests
on a number of controversial premises that I do not mean to defend, only to
reveal.
I begin with the connection drawn by Samuel Williston between the consid-
eration requirement and the requirement of intent to establish legal relations:
In a system of law which makes no requirement of consideration, it may

well be desirable to limit enforceable promises to those where a legal
bond was contemplated, but in a system of law which does not enforce
no less than the case of valid enforceable contracts. Id. at 1483. Furthermore, no less than bar-
gains, such gratuitous commitments “are in their nature wanted by, and invoke the intentions
of, all participants”—after all, barring undue pressure (a possibility that does not distinguish
gratuitous from bargain promises), why would the favor have been offered (or requested) and
accepted if it was not wanted by the participants? Id. To be sure, it is not true of all gift prom-
ises that they give rise to mutual obligations, that is, that “[e]ach party to a bargain expressly
intends to give the other authority to require performance, and [that] each party expressly
intends to exercise the authority that she enjoys in this connection.” Id. However, as we have
seen in the case of the aunt and the art-collecting nephew, many conditional gift promises do
involve mutual obligations. Moreover, on the traditional analysis, unilateral (exchange) con-
tracts (for example, a contract that is formed by a payment of ten dollars that is made in ac-
ceptance of a prior offer to serve the payor a sandwich upon receipt of ten dollars) are equally
marked by a one-sided relation of obligation, yet satisfy the consideration requirement. (In-
deed, it is partly on account of such unilateral contracts that modern commentators have re-
jected a “mutuality of obligation” requirement. See 2 PERILLO & BENDER, supra note 116, § 6.1,
at 196-212.)
132. I allude to Stephen Hedley’s important article, Keeping Contract in Its Place—Balfour v. Balfour
and the Enforceability of Informal Agreements, 5 OXFORD J. LEGAL STUD. 391 (1985). Hedley ar-
gues persuasively that the entire function (as well as operational content) of the English legal-
intent requirement is to bar enforcement of (informal) social and domestic promises. Alt-
hough it serves to corroborate his account, Hedley fails to notice the role played by the doc-
trine of consideration in the development of the legal-intent requirement. As I explain below,
the English did not adopt the legal-intent requirement until (Pollock’s version of) Langdell’s
definition of consideration took root, at which point consideration could no longer fulfill the
relevant function. Hedley’s account of the legal-intent requirement is echoed by Stephen
Smith in the latter’s justification of the legal-intent requirement. SMITH, supra note 24, at 213-
15.
756
paid on both sides
promises unless some [consideration] has been asked [for] and given,
there is no propriety in such a limitation.133
In a post-Fullerian age, it is all too easy to read these remarks as reflecting the
position that consideration serves as a proxy for a promisor’s intent to establish
legal relations, and that this justifies the doctrine. However, as a matter of inter-
pretation, this would be a mistake, for Williston clarifies that it would be “un-
fortunate” to let the validity of a promise “depend upon the accident of the prom-
isor’s reflection on his legal situation.”134 In any case, Fuller’s proxy claim is, as
I have already observed, unconvincing. But there is a better argument in the vi-
cinity, one that is suggested by Williston’s remarks. The rationale that I ascribe
to the doctrine of consideration assumes the background legal regime that Wil-
liston describes: specifically, it assumes that an intent to be legally bound is not
required as a condition of contractual liability, even if manifested intentions not
to be legally bound will be effective. By stating that the rationale for considera-
tion assumes this rule, I do not mean that I assume such a rule to be defensible—
again, as with the other assumptions that I will go on to discuss, I take no stand
on the matter. Rather, I mean only that the most plausible and attractive rationale
for the consideration requirement takes the background rule for granted.135
The explanation I put forward conceives of the consideration doctrine as a
proxy rule and rests on the general view that the transactional forms that we
employ when performing beneficial services to others are profoundly sensitive
to social context and relationship type.136 More specifically, it rests on the empir-
ical and sociological claim that we tend not to resort to quid pro quo transactions
in personal, intimate contexts. In the context of friendship and family, we tend
to resort to other modes of reciprocity and mutuality. Although there are modes
133. 1 WILLISTON, supra note 11, § 21, at 21-22. Williston is here drawing from a footnote in his
earlier 1914 paper. Williston, supra note 66, at 506-07 n.13. His substitution of “propriety” for
the earlier “necessity” is most revealing.
134. 1 WILLISTON, supra note 11, § 21, at 22.
135. There are two further remarks worth making. First, we may surmise that this is why Scanlon
was unable to find more to say on behalf of the consideration requirement, see supra note 123
and accompanying text, for his discussion explicitly assumes a scheme of contract law that
imposes a legal-intent requirement. Scanlon, supra note 123, at 104. Second, it is perhaps
worth emphasizing that the “English rule” requiring legal intent is, according to our leading
historians, a late nineteenth-century phenomenon that wasn’t accepted by the English courts
until 1919. See, e.g., IBBETSON, A HISTORICAL INTRODUCTION, supra note 2, at 233 (“It did not,
however, reach the doctrinal heartland until it was borrowed by Pollock from Savigny and
incorporated in his textbook in 1876.”).
136. This general view has been influentially propounded by Viviana Zelizer. See VIVIANA A.
ZELIZER, THE PURCHASE OF INTIMACY (2005).
757
of exchange that are characteristically “friendly” (e.g., individualized discounts,

or offers of first refusal, extended to friends as favors), friends are generally re-
luctant to characterize their services to one another in quid pro quo terms, and
it would often be galling to respond to a favor request from a friend with a quid
pro quo counteroffer, even in contexts when it would be acceptable to refuse the
request outright.
It is worth contrasting this sociological claim—an empirical generalization—
with a similar one familiar from the economic literature on donative promising.
Several classic papers in the law and economics tradition have suggested that the
law might assume that donative promises are generally confined to intimate con-
texts and that this might explain the law’s reluctance to enforce such promises,
given the availability of less costly extralegal enforcement mechanisms.137 The
empirical proposition I rely on is subtly, yet importantly, different. Rather than
attributing to the law the view that gratuitous promises (that is, nonexchange
commitments, whether donative or not) tend to occur only among intimates, I
am attributing to it the view that quid pro quo exchanges tend not to occur
among intimates.138 Moreover, although I put this forward as an empirical and
137. Richard Posner, for example, has surmised that “the real reason for the law’s generally not
enforcing gratuitous promises is . . . an empirical hunch that gratuitous promises tend . . . to
be made in family settings where there are economically superior alternatives to legal enforce-
ment.” Richard A. Posner, Gratuitous Promises in Economics and Law, 6 J. LEGAL STUD. 411, 417
(1977). Similarly, Charles Goetz and Robert Scott have put forward the view that “[e]xtra-
legal sanctions are likely to be effective in the donative context because promisors generally
care about the welfare of promisees. In contemplating a promise, the promisor may regard
costs suffered by the promisee as equivalent to costs suffered by himself.” Charles J. Goetz &
Robert E. Scott, Enforcing Promises: An Examination of the Basis of Contract, 89 YALE L.J. 1261,
1304 (1980). The empirical claim is also sometimes put forward by those outside the law and
economics tradition. See, for example, Eisenberg’s observation that “[a]n inquiry into ingrat-
itude involves the measurement of a maelstrom, because many or most donative promises
arise in an intimate context in which emotions, motives, and cues are invariably complex and
highly interrelated.” Eisenberg, Principles of Consideration, supra note 126, at 662. Similarly,
Mindy Chen-Wishart has recently offered a defense of consideration centered around the
claim that “[g]ratuitous promises are normally embedded in a framework of ongoing [per-
sonal] relationships with normative implications, which provide the code for interpreting the
significance of acts and omissions.” Mindy Chen-Wishart, In Defence of Consideration, 13 OX-
FORD U. COMMONWEALTH L.J. 209, 223 (2013).
138. It is likely that the economists are tacitly assuming my empirical generalization as well. At the
very least, if our exchange promises to friends and family were to swamp our donative ones,
then even if their empirical thesis about donative promises were correct, it would not be clear
that the administrative costs of applying a bar against donative promises would outweigh the
savings to which they refer. See supra note 137. Relatedly, it would seem that anyone endorsing
the Fullerian proxy discussed earlier also presupposes my empirical claim. For the assumption
on which that proxy rests—as discussed previously—seems to fail most obviously in intimate
contexts, contexts which are of course chock-full of commitments.
758
paid on both sides
sociological generalization, susceptible to falsification and contingent upon val-

ues that might not be endorsed universally, I do not merely offer it as an “empir-
ical hunch.”139 The theory of quid pro quo exchange that was put forward in Part
II went some of the way toward explaining why friends and family often have
reason to be squeamish about quid pro quo exchange notwithstanding its great
potential to distribute goods and services in mutually beneficial ways.
I will not attempt to define the notion of personal, intimate relationship to
which I have appealed. Indeed, it is in part because the notion (unlike the some-
what more restrictive “family”) does not lend itself to ready definition that the
law might have reason to prefer a proxy rule.140 Two other factors would appear
to weigh in favor of using a proxy rule instead of a more direct one. First, alt-
hough I will not argue the point, the burdens that a more direct rule would place
on courts in determining, and on individuals in clarifying, the nature and quality
of personal relationships would seem to count in favor of a proxy. Second, and
more importantly, a more direct rule that invoked the notions of friend and fam-
ily would have greater difficulty bracketing off those occasions, not necessarily
infrequent, where friends and family members confront one another, appropri-
ately, at arm’s length in the marketplace. In other words, it would have greater
difficulty restricting the rule to those instances where family and friends are not
merely engaging with one another but doing so as family and friends. Indeed,
although I do not myself go so far as to endorse the claim, some might see the
use of the exchange form as not merely indicative, but also partly constitutive, of
a nonintimate context. To the extent that one does hold such a view, the bargain
rule would amount to more than a proxy that merely tracks, however inexactly,
important social divides; on such a view, the rule could be viewed instead as one
that carves up our social world directly at the joints.
Given the foregoing, I submit that the reasons that justify, or at least explain,
the consideration rule are the same as the apparent reasons we have to effectively
replace the background rule regarding legal intent with the contrary rule (one
that requires the manifestation of legal intent as a condition of liability) when it
139. Posner, supra note 137, at 417.

140. It is worth noting that the Supreme Court, in Salman v. United States, 137 S. Ct. 420 (2016),
has recently adopted a rule in the law of insider trading that turns on whether the recipient of
a tip from an insider (i.e., “tippee”) is a “trading relative or friend,” thereby using a direct
nonproxy rule to demarcate the personal, intimate space. Id. at 427-28. However, it is note-
worthy that there has been considerable uncertainty about how this term will or ought to be
construed. In particular, although the Court, in Salman, extensively discussed a recent Second
Circuit decision, United States v. Newman, it conspicuously failed to express a view about how
its holding would apply to the facts in that case, involving tips by insiders to fellow congre-
gants of a church as well as to professional acquaintances. See Salman, 137 S. Ct. at 425 (citing
United States v. Newman, 773 F.3d 438 (2d Cir. 2014)).
759
comes to those promises and agreements made in personal, intimate contexts.

That is, the consideration requirement rests on the view that commitments made
in these contexts should not be legally enforceable when the parties do not ex-
pressly manifest a contrary intent. I will not argue for such a view, except to say
that I do not believe that its appeal derives only, or even primarily, from consid-
erations such as the availability of cheaper enforcement mechanisms or the dif-
ficulties involved when outsiders must interpret the agreements of intimates.141
Furthermore, it is worth emphasizing that the opt-out provision—which gives
intimates a meaningful opportunity to voluntarily assume legal obligations to
one another if and when they choose to do so—is an important element of the
justification. To once again quote Williston, “It is something, it seems to me,
that a person ought to be able to do, if he wishes to do it—to create a legal obli-
gation to make a gift. Why not? . . . I don’t see why a man should not be able to
make himself liable if he wishes to do so.”142 The force of these words does not
diminish in the slightest when applied to the personal domain. Moreover, the
costs of adopting a proxy rule rather than a direct one—in particular, the effects
of this design choice on gratuitous commitments (donative and nondonative
alike) that are made outside of personal contexts—are mitigated substantially by
provisions allowing individuals to legally bind themselves if and when they
choose to do so. In this connection, it is worth highlighting that the considera-
tion rule has historically always operated alongside the availability of formalities
(such the seal or nominal consideration) that allow individuals easy and afford-
able ways to voluntarily assume legal obligations.143 To the extent that the wide-
spread ban on nominal consideration in the United States (but not elsewhere in
the common-law world), together with the fairly recent abolishment of the seal
141. While I will not make the case, other obvious factors to consider include our distinct interests
in the reasons for which commitments are honored in this domain, as well as the much more
vexed question concerning the domain’s appropriate and desirable degree of insulation from
state interference. Mindy Chen-Wishart has recently argued in favor of this special treatment
of agreements in the private domain. See Chen-Wishart, supra note 137. The view has also
been subjected to a feminist critique, in connection with the English requirement of legal in-
tent, in Mary Keyes & Kylie Burns, Contract and the Family: Whither Intention?, 26 MELB. U. L.
REV. 577, 585-87 (2002). It is worth noting that the feminist critique (of the legal-intent re-
quirement) is often centered around cases of quid pro quo exchanges between spouses. Since
these agreements would satisfy the doctrine of consideration, such considerations provide ad-
ditional reason for preferring the proxy rule.
142. SAMUEL WILLISTON, HANDBOOK OF THE NATIONAL CONFERENCE OF COMMISSIONERS ON UNI-
FORM STATE LAWS AND PROCEEDINGS 194 (1925).
143. From its sixteenth-century origins, the consideration requirement only applied to simple con-
tracts (i.e., those not under seal). As Simpson has explained, using the seal at that time was
as easy and cheap as fixing a signature to a document is today. See SIMPSON, supra note 2, at
90.
760
paid on both sides
in many jurisdictions, has effectively eliminated this possibility, the rationale I

have ascribed to the doctrine provides the basis for a criticism of these develop-
ments and a call for reform.144
A second way of mitigating the costs of using a proxy to demarcate spheres
of interaction involves allowing exceptions, and the rationale I have offered for
the doctrine allows us to do so on a principled basis. That rationale does not
extend to those types of commitments that, while strictly gratuitous, are both
infrequently used by friends and family in their dealings with one another and
describable in general terms that do not directly invoke the notions of friends or
family. A case in point concerns the law’s treatment of innovative mercantile and
banking transactions, such as the bill of exchange in the seventeenth century.145
Once we appreciate the rationale of the consideration rule, we can recognize the
law’s willingness to enforce such transactions for what it is: a principled excep-
tion to the consideration rule rather than an unprincipled concession owing to
pressures from the commercial class or the economic needs of the hour. The same
rationale can also be used to explain the validity of a promise to serve as a surety
or guarantor for a debtor. Such guarantee agreements often involve genuine ex-
changes (as when, in exchange for the guarantee, the creditor agrees to extend
funds or to forbear from suing the debtor), but when they do not they may still
be enforced on the assumption that the relationship between surety and creditor
(as opposed to surety and debtor) is rarely an intimate one. Finally, a principled
exception can also be drawn for ancillary or collateral commitments, such as firm
offers involving an offeror’s promise not to rescind his or her exchange offer for
a given time, on the ground that such commitments inherit the relevant proper-
ties of the underlying exchange offer—in other words, if an offer is unlikely to
be made in a personal context, then so is the promise not to rescind such an
offer.146
144. On the seal and nominal consideration in U.S. jurisdictions, see GREGORY KLASS, CONTRACT
LAW IN THE UNITED STATES 74-75, 88-89 (2d ed. 2012).
145. See IBBETSON, A HISTORICAL INTRODUCTION, supra note 2, at 204 (“The bill of exchange nor-
mally arose in the following situation: X owed money to Y; X gave to Y a bill drawn on Z; Y
took the bill to Z, who accepted it thereby agreeing that he would pay it. If Z refused subse-
quently to pay, Y would wish to bring an action against him. So long as X had been acting as
Z’s agent, this form of transaction created no difficulty: the acceptance of the bill did no more
than concretize the obligation that already existed. The problem arose if there was no such
agency relationship, for it could be objected that the acceptor, Z, had not received any consid-
eration. From the early years of the seventeenth century actions in assumpsit are found against
such acceptors in this type of case . . . .” (footnote omitted)).
146. Of course, this is just put forward as an empirical generalization compatible with occasional
exceptions.
761
Similarly, the rationale allows us to respond to the claim that the bargain
theory, at least as an interpretation of the historical doctrine, “leads to a strained
emphasis upon the commercial element in contract law (for not all important
contracts are commercial).”147 Elaborating on this idea, A.W.B. Simpson argues
as follows:
It is natural to seek, behind the rules of law, for some general explanation
in terms of contemporary social conditions or ideas, and this is right.
Hence it has been suggested, notably by Mr. Fifoot, that the evolution of
the doctrine of consideration reflects the idea that the courts should only
hold commercial agreements actionable, and concern themselves with
the bargains of businessmen . . . . Direct evidence for his view is not to
be found, and indirect evidence hardly supports it; it hardly seems to be
the sort of idea which sixteenth-century men would find appealing. The
courts dealt with cases involving commerce, though the contractual in-
strument of the commercial world was the bond, not the informal prom-
ise . . . . More radically, the view that the law of contract is the handmaid
of commerce seems to me to be mistaken if it is opposed to the view that
the law of contract expresses, in a form thought appropriate (bearing in
mind the practicalities of litigation), moral ideas. For commerce, like
other areas of life, must be conducted morally if the general good is to be
furthered, and there is no special set of principles of commercial moral-
ity.148
The rationale of the bargain theory that I have offered renders it immune to
these charges, since it purports to justify the doctrine not by appeal to commer-
cial needs or interests, but rather to the significance of valuable personal rela-
tionships. Nevertheless, despite (or precisely because of) this overarching justi-
fication, the doctrine also serves to explain why certain commercial transactions
that do not meet the letter of the rule should nevertheless receive exceptional
treatment.149
Finally, this functional explanation allows us to answer Fried’s charge, noted
above, concerning the doctrine’s internal consistency. The reason the doctrine
147. SIMPSON, supra note 2, at 417.

148. Id. at 487-88.
149. By the same token, it justifies the Uniform Commercial Code’s willingness to discard the con-
sideration requirement altogether. See, e.g., U.C.C. § 2-205 (AM. LAW INST. & UNIF. LAW
COMM’N 2017) (“An offer by a merchant to buy or sell goods in a signed writing which by its
terms gives assurance that it will be held open is not revocable, for lack of considera-
tion . . . .”). Since the U.C.C. applies only in commercial contexts, it has no need for a require-
ment meant to screen off social and domestic agreements. See id. § 2-102.
762
paid on both sides
requires the existence of a bargain, but does not police the adequacy of its terms,
is simply that its motivating rationale—in particular, the empirical generalization
at its heart—concerns the parties’ mere utilization of the bargain form and not
the adequacy of the terms of the agreement.150
I do not claim originality for the rationale I have proposed. Although I do
not know of anyone who has explicitly offered it exactly as I have, I believe, as I
have said, that it is the best interpretation of Williston, and that it is also closely
related to explanations of the doctrine recently put forward by Douglas Baird
and Mindy Chen-Wishart.151 What has not been noticed, however, is that, for
reasons we have already considered, this justification is not available to propo-
nents of the reciprocal-inducement theory of consideration (a company that in-
cludes Baird).152 As we have seen, the reciprocal-inducement theory of consid-
eration rules out the justification for the rule by rendering the empirical claim at
its heart totally implausible. For if reciprocal inducement supplies the content of
the consideration requirement, then that requirement, as I have explained, does
not serve to screen off the personal domain, a domain marked by collaboration
150. To be sure, people sometimes engage in “mixed transactions” in intimate contexts, as when
sellers give their friends or family a gift in the form of an individualized discount. But even if
we were to set aside the judicial burdens of having to determine, in every case, whether the
terms of a bargain reflect such a discount, the rationale I have assigned would not support
barring such mixed transactions unless the existence of a discount were a sufficiently reliable
sign that the transaction had occurred in a personal context. But the claim that such discounts
are a reliable sign of a friendship between buyer and seller is highly doubtful, as there are
ample legitimate reasons that discounts are given outside the contexts of friendship and fam-
ily.
151. See DOUGLAS G. BAIRD, RECONSTRUCTING CONTRACTS 29 (2013) (“A bargain must exist for a
promise to be legally enforceable. Inside the family, explicit bargains are the exception. Hence,
most intrafamilial promises are, in this world, not legally enforceable. Hamer is an exception
that proves the rule.”). Aside from the restriction to the family, attention should be drawn to
the qualification in “explicit bargain.” Id. (emphasis added). Since the law enforces implicit
bargains, as well as explicit ones, the qualification mars the analysis; in any case, I do not
believe it is needed. The reason that intimates are uncomfortable with explicit bargains is that
they are uncomfortable with bargains. As I have already noted, Chen-Wishart’s justification
rests on the (dubious) empirical claim that gratuitous promises are generally confined to the
personal domain. See Chen-Wishart, supra note 137, at 211.
152. Baird explicitly endorses the reciprocal-inducement theory of consideration. See BAIRD, supra
note 151, at 26-27 (“There just has to be an exchange. A legally enforceable promise could not
exist in the absence of a bargain. As Holmes put it, ‘. . . . The root of the whole matter is the
relation of reciprocal conventional inducement . . . .’ Legal enforceability turns on whether
there was consideration, and this, in turn, requires a bargained-for exchange.” (omission
added) (footnote omitted) (quoting O.W. HOLMES JR., THE COMMON LAW 293-94 (Boston,
Little, Brown, & Co. 1881)).
763
and coordination of the sort that commonly results in joint commitments to mu-
tually beneficial plans of action that satisfy the conditions of reciprocal induce-
ment. Indeed, this incompatibility between the justification and the modern the-
ory has led to a historical development of contract law that both corroborates the
functional explanation for consideration that I have put forward and serves as
basis for a further substantial criticism of both the English system of contract
law and the approach of the Second Restatement. In both cases, the positions on
the doctrine of consideration and the legal-intent requirement have developed in
uncanny parallel. In particular, the acceptance of a motivational conception of
consideration results in the adoption of a legal-intent requirement that serves
the screening function that a distorted doctrine of consideration is no longer able
to serve.
I will begin with the English case, with which I shall be brief. Frederick Pol-
lock published two editions of his influential contracts treatise prior to Lang-
dell’s publication of his definition of consideration. In each of these editions (of
1876 and 1878), Pollock adopted Savigny’s rule, derived from his Kantian Will
Theory, requiring legal intent as a condition of liability.153 However, neither of
those editions contained any trace of Langdell’s definition of consideration. In
the third edition of his treatise (1881), published after, and in light of, both Lang-
dell’s Summary and Holmes’s lectures, Pollock incorporated a version of Lang-
dell’s formula that, as we have seen, effectively entails Holmes’s motivational
construal.154 In the very same edition, Pollock puts forward a new argument in
support of the rule requiring legal intent as a condition of liability: he claims that
only “Savigny’s view” requiring legal intent can explain the legal invalidity of
social and domestic agreements.155 This sequence is fully explicable in light of
the fact that the motivational conception of consideration entailed by Langdell’s
formula, in contrast with the remuneration conception, is unable to rule out all
the humdrum social and domestic agreements that satisfy the conditions of re-
ciprocal inducement. Accordingly, before Pollock adopted Langdell’s formula-
tion of the consideration rule, this argument in favor of Savigny’s rule was not
153. POLLOCK, supra note 31, at 1-2; FREDERICK POLLOCK, PRINCIPLES OF CONTRACT AT LAW AND IN
EQUITY 1-2 (London, Stevens & Sons 2d ed. 1878). In the first two editions, general credit is
given to Savigny, see, e.g., POLLOCK, supra note 31, at 2 n.b, while the intent requirement is
referred to as “Savigny’s view” in the third edition, POLLOCK, supra note 11, at 2 n.a.
154. POLLOCK, supra note 11, at 179; see supra note 11 and accompanying text (analyzing the defini-
tion given in Pollock’s third edition). I am, once again, assuming that a weaker, and less plau-
sible, “I will if you will” theory of exchange is not available. See supra note 50. None of my
arguments in this section depends on this view, however.
155. POLLOCK, supra note 11, at 2 n.a.
764
paid on both sides
available to him. The English courts, meanwhile, did not adopt (Pollock’s ver-
sion of) Langdell’s definition until 1915.156 Up until then, the English courts,
apparently unmoved by Pollock’s embrace of Savigny, also declined to adopt the
rule requiring legal intent as a condition of enforcement. However, only four
years after adopting Langdell’s definition, they went on to adopt the legal-intent
requirement. And they did so in Balfour v. Balfour, which involved a domestic
agreement lacking consideration according to the remuneration conception of
exchange, but satisfying the consideration requirement by the lights of the mod-
ern conception.157
Let us now consider the (American) case of the Restatement. As we have
seen, the remuneration theory of consideration has little difficulty ruling out in-
formal social and domestic agreements; when two friends commit to a dinner
engagement, neither their commitments nor their fulfillments stand in payment
relations to each other. Indeed, it is precisely on this basis that Williston argued,
against Pollock, that the doctrine of consideration was up to the task of excluding
these commitments, a view reflected in the silence of the First Restatement (over
which Williston presided as Chief Reporter) on the matter.158 Corbin, however,
grasped the fact that Langdell’s definition (with its implicit motivational con-
ception of exchange) plainly gets the wrong result in these social and domestic
cases, necessitating a workaround. Accordingly, in his treatise, in what might be
seen as a rather unabashed display of his legal-realist orientation, Corbin seeks
to reach the right result by introducing a “rule” that says, simply, that the cases
156. Specifically, Pollock’s version of Langdell’s formula was adopted by Lord Dunedin in Dunlop
Pneumatic Tire Co. v. Selfridge & Co. [1915] UKHL 1, [1915] AC 847 (HL) 855 (Lord Dunedin)
(appeal taken from Eng.).
157. Lord Justice Atkin clearly implies that the agreement at issue in Balfour is supported by con-
sideration. In Balfour, the lower court had held in favor of the plaintiff, Mrs. Balfour, on the
ground that her husband’s promise was supported by consideration. Balfour v. Balfour (1919)
35 TLR 476 (KB) (Eng.). Lord Justices Warrington, Duke, and Atkin of the Court of Appeal
reversed unanimously. After observing that “it constantly happens” that agreements between
spouses satisfy the consideration requirement even when the spouses “did not intend that
they should be attended by legal consequences” and that such agreements “are not contracts
because the parties did not intend that they should be attended by legal consequences,” Lord
Justice Atkin goes on to say that “[t]he only question in this case is whether or not this promise
was of such a class [of promises made without legal intent] or not.” Balfour v. Balfour [1919]
2 KB 571 (CA) 578-79 (Atkin LJ) (Eng.) (emphasis added).
158. 1 WILLISTON, supra note 11, § 21, at 24 n.19 (“[T]he promise of the guest to attend the dinner
is not given or asked for as the price of the host’s promise.”); see also Gregory Klass, Intent to
Contract, 95 VA. L. REV. 1437, 1489 (2009) (describing Williston’s treatment of social and do-
mestic agreements in the First Restatement). Recall that Williston took seriously the payment
conception of exchange, while also, inconsistently, adopting the Langdellian definition of con-
sideration. See supra note 45.
765
in this domain should be decided as they have always been decided. More exactly,
the rule he offers says that “[i]f the subject matter and terms are not such as
customarily have affected legal relations, the transaction is not legally operative
unless the expressions of the parties indicate an intention to make it so.”159 This,
of course, is a retreat from principled explanation insofar as it does not articulate
the basis of the decisions that constitute the custom.160
If the remuneration theory is correct, those past decisions (the ones that con-
stitute the custom) are to be explained by appeal to the doctrine of consideration.
Since Corbin was unable to appeal to consideration to explain these cases (given
his commitment to Langdell’s definition), he was forced to look elsewhere. Pol-
lock, as we have seen, explained the results in question by reversing the legal-
intent rule across the board (requiring legal intent in all cases), but Corbin, re-
flecting American opinion, was unwilling to follow suit. Accordingly, the natural
place for him to look was to a direct (that is, nonproxy) rule that would replace
the background rule in what I have been calling personal and intimate contexts.
But Corbin, perhaps to his credit, did not attempt to define such contexts and so
settled on his appeal to past practice.161
The drafters of the Second Restatement added a comment to Section 21 on
“social engagements and domestic arrangements” that reflects Corbin’s position
but avoids the appeal to custom: “In some situations the normal understanding
is that no legal obligation arises, and some unusual manifestation of intention is
necessary to create a contract. Traditional examples are social engagements and
agreements within a family group.”162 Gregory Klass has surmised that they may
have changed the formulation because of the explanatory shortcomings of
Corbin’s appeal to custom.163 In light of the open-ended appeal to “normal [ju-
dicial] understanding,” however, there is little reason to credit the new formula-
tion as marking an improvement in this respect.164 In any case, there is a better
explanation available for the change in formulation. Corbin’s rule, instructing
courts to carry on doing what they have been doing all along, presumably implies
159. 1 ARTHUR LINTON CORBIN, CORBIN ON CONTRACTS § 34, at 138 (2d ed. 1963) (emphasis
added).
160. In a discussion to which I am indebted, Gregory Klass says that Corbin’s rule is “arguably
circular.” Klass, supra note 158, at 1490. I do not think circularity is the best charge here, since
I do not think Corbin implied, or meant to imply, that this rule was what accounted for the
previous decisions. But it is a retreat from principle, insofar as Corbin does not articulate a
principle that can be used to distinguish the classes.
161. 1 CORBIN, supra note 159, § 34, at 141.
162. RESTATEMENT (SECOND) OF CONTRACTS § 21 cmt. c (AM. LAW INST. 1981).
163. Klass, supra note 160, at 1490.
164. RESTATEMENT (SECOND) OF CONTRACTS § 21 cmt. c.
766
paid on both sides
that well-established cases like Hamer v. Sidway,165 which involved a genuine

quid pro quo exchange in a personal context, should not be overruled. Although
this is a result that accords with the remuneration theory and with the justifica-
tion I have offered for it—on the grounds, at the very least, that the proxy rule
is, by definition, an approximation that does not perfectly capture the target class
of social and domestic agreements—it is not a position available to the Second
Restatement, for the simple reason that the Restatement lacks the resources to
cordon off the relevant class of cases. That is, it lacks the resources to distinguish
cases like Hamer, involving genuine exchanges, from those involving social and
domestic agreements that are not genuine exchanges, but which nevertheless
satisfy the conditions of reciprocal inducement. Accordingly, the Reporters
opted for consistency and adopted a direct (i.e., nonproxy) rule which, I believe,
clearly implies that Hamer should be reversed. They did this by resorting to the
blanket description of “social engagements and agreements within a family
group,” a formulation that effectively leaves it to judges to determine not
whether there was legal intent in a given case, but whether the nature and quality
of the relation in a given case are sufficiently personal so as to fall under the de-
scription.166
The remuneration theory elaborated here allows us to use the consideration
doctrine as an alternative to leaving this determination in the hands of judges.
But even setting aside the advantages of applying a sufficiently reliable proxy in
lieu of such a case-by-case judicial determination, we may marvel at what Corbin
and the drafters have wrought. If my justification of the consideration rule is
correct, even at the level of explanation, they have added a direct (nonproxy)
rule without eliminating the antecedent proxy rule of consideration, and have,
in turn, distorted that antecedent proxy rule beyond recognition. These mistakes
could be avoided by discarding a defective theory of bargain, as well as a defini-
tion of consideration that effectively entailed it.167
165. 27 N.E. 256 (N.Y. 1891).

166. Although very little turns on it, I do not believe that the comment’s appeal to “normal under-
standing” can refer to the understanding of the general population. For there is certainly no
reason to think that laymen possess the “normal understanding” that the so-called “English
rule” (requiring a showing of legal intent across the board) does not obtain on these shores.
Indeed, in my experience, many people are surprised to learn that legal intent is not a condi-
tion of liability. Thus, the “normal understanding,” if it is to track the relevant distinction
between spheres, must refer to the understanding of judges.
167. See supra note 50. It follows from the arguments given in this Section that if a legal regime
(such as England’s) is wedded to a legal-intent requirement, then such a regime has no com-
pelling grounds for upholding a consideration requirement.
767
conclusion
In offering the foregoing account of consideration, I have attempted to strike

a path between two diametrically opposed modes of doctrinal analysis. On the
one hand, I have eschewed a prominent “realist” understanding of the doctrine.
On the other hand, I have avoided treating the doctrine as an embodiment of
noncontingent principles of right. According to the realist understanding, a ju-
dicial finding concerning consideration amounts to no more than the statement
of a conclusion—namely, that the agreement at issue is either enforceable or
not—reached not by the application of an independently specifiable bargain re-
quirement, but rather by the exercise of a broad discretionary power based on an
open-ended list of factors such as good faith, reliance, and substantive fair-
ness.168 While there is little doubt that the term “consideration” has been
stretched beyond the province of bargain (on any conception of the form) to
embrace gratuitous promises that judges, rightly or wrongly, have wished to en-
force, the proper theoretical (and pedagogic) response to this is to make the ex-
ceptional character explicit and not to leap to a premature conclusion that the
exception has swallowed the rule.169 Of course, exceptions can swallow rules, or
168. For an influential statement of this position, see ATIYAH, supra note 11. Atiyah was avowedly
influenced by Corbin, whose realism is evidenced throughout his influential writings on con-
sideration. For example, in an important discussion, Corbin urges his contemporaries to quit
trying to square the validity of bilateral contracts with the legal-detriment requirement, not
because it cannot be done, but rather because the basis of liability lies elsewhere and does not
need to clear any bar created by technical rules.
Mutual promises create a legal obligation because—in English-speaking coun-
tries, at least—the customary notions of honor and well-being cause men to per-
form as they have promised, and the lawmaking powers have decreed that in such
cases promise-breakers shall make compensation. Our prevailing credit system
in business requires such a rule. The basis for the enforcement of bilateral con-
tracts lies in mutual assent and fair dealing.
Corbin, supra note 45, at 375-76. Although, in this passage, he urges us to dispense with the
legal-detriment requirement, the reasoning applies more generally to any technical bargain
requirement. The familiar empirical and normative criticisms of the realist position—namely,
that courts rarely invent or ignore consideration in a manner inconsistent with the literal ap-
plication of the technical bargain requirement, and that the open-ended discretionary power
is at odds with the rule of law—are carefully rehearsed by Stephen Smith. See SMITH, supra
note 24, at 227-32.
169. This has long been a standard way of analyzing judicial language concerning the validity of
the seal. Pollock, for example, explained that although
we are now accustomed to bring contracts under seal within the terms of the
condition by saying that where a contract is under seal the consideration is pre-
sumed. . . . [T]his is a transparent fiction. . . . The ancient reason why a deed
768
paid on both sides
indicate an absence of commitment to them, but whether they do is a function

not just of the amount of flesh left on the bone after the cuts have been made,
but whether the reasons for the exceptions are compatible with the underlying
reasons or principles for adopting the rule in the first place. The deepest har-
mony between a rule and its exception is achieved when the very reasons for
adopting the rule also count in favor of recognizing the exception (as when the
reasons for the rule do not apply to a class of cases that are accordingly treated
exceptionally). When the exceptions are drawn on this basis, they do not
threaten the integrity of the rule even when the ground that they cover is quite
vast; for this reason, one cannot infer from a willingness to draw exceptions that
a rule is not taken seriously. This is precisely the situation with regard to many
of the traditional exceptions to the bargain requirement: as we have seen, alt-
hough the exceptions are substantial, they align perfectly with the functional ra-
tionale I have ascribed. Of course, if one is (as Patrick Atiyah and Corbin were)
caught in the grip of a conception of the bargain requirement that obscures the
underlying rationale—indeed, a conception of the requirement that does not en-
joy the benefit of any rationale—one may then understandably infer from the
breadth of the exceptions that they have been drawn without regard for the (so-
called) requirement. But this serves only to underscore the importance of ob-
taining a tighter grip on our central concepts in law—none more central or sig-
nificant than bargain, or quid pro quo exchange.
In differentiating my position from the realist one, I risk overstating the sig-
nificance of the functional rationale for the overall account I have provided. Even
if one were to reject, or supplement, the rationale I have given, the account of
bargain or exchange would survive. So would the reconceptualization of consid-
eration that incorporates it and, in so doing, avoids the traditional difficulties
related to conditional gift promises and preexisting duties. Indeed, those who
are inclined to view the central doctrines of common law as embodiments of
noncontingent principles of right (Kantian or otherwise) might view my efforts
as a preliminary purification: by purging the doctrine of its Holmesian dross,
and exposing its crystalline structure, perhaps consideration is now ripe for a
treatment revealing that it, too, is a corollary of an abstract principle of right.
This is not the course I have taken, and I embrace the contingency that is
woven into my analysis. According to my account, the bargain performs a func-
tion that, while open to challenge, is widely perceived as important: namely, en-
suring that the commitments made in personal, intimate contexts are not en-
forceable absent a manifest intent to be legally bound. Even if we take this goal
for granted, the contingency of the rule derives from the fact that there are other
could be sued upon lay not in a consideration in our present sense of the word
being presumed from the solemnity of the transaction, but in the solemnity itself.
POLLOCK, supra note 31, at 116.
769
ways of achieving it. If the legal system has reasons for choosing this way of
achieving the goal rather than some other way (for example, rather than impos-
ing a direct, nonproxy rule requiring, as a condition of liability, a showing of
legal intent in social and domestic agreements) these are reasons that might
change over time, ungrounded in the inherent promissory rights of the parties
to the agreement. Recognizing this contingency strikes me as an appropriate po-
sition to adopt, and not only for the familiar reason that other legal systems with
their own distinct ways of achieving similar functions do not seem to be suscep-
tible to a rights-based criticism on those grounds alone.170 More fundamentally,
the line separating (unexecuted) exchange agreements from gratuitous promises
does not seem to possess the kind of intrinsic significance that could directly jus-
tify their differential treatment within contract law. Perhaps I am wrong and fail
to grasp the full potential of the account I have offered. Perhaps the reciprocal-
payment relation that I have identified possesses just the kind of significance that
could justify the requirement without appeal to other factors. I am open to that
possibility but have not yet seen how the case can be made. In any event, the line
between exchange and gratuitous agreements does have considerable social sig-
nificance; indeed, it bears a very close relation—whether indicative or constitu-
tive—to social distinctions that, it is widely believed, the law of contracts has
reason to heed. And so I conclude that it is these social lines that are the objects
of the law’s concerns when it imposes a bargain requirement. The resulting ac-
count is, to be sure, a functional one, assigning the doctrine the independently
specifiable goal of screening off informal social and domestic agreements. But
we must not think that such an explanation in any way denigrates the doc-
trine.171 I would say that to harbor such a thought is to commit the error of treat-
ing the common law as though it were divine law; however, even divine law fre-
quently receives a functional justification from even its most devoted
adherents.172
In closing, I would like to gesture, however inadequately, toward a final re-
spect in which the doctrine serves its function only contingently. A bargain re-
quirement is a sensible way of marking off the distinction between the personal
170. For comparative approaches that emphasize the functional commonalities between the diverse
systems, see THE ENFORCEABILITY OF PROMISES IN EUROPEAN CONTRACT LAW (James Gordley
ed., 2001); and Arthur T. von Mehren, Civil-Law Analogues to Consideration: An Exercise in
Comparative Analysis, 72 HARV. L. REV. 1009 (1959).
171. This is especially true when we consider that the goal is not restricted to the satisfaction of
preferences but rather relates to the noninstrumental value of personal relationships.
172. For example, the Babylonian Talmud records the view that the prohibition concerning the
consumption of wine produced by non-Jews is to be explained by the rabbinic policy of dis-
couraging intermarriage. See KOREN TALMUD BALVI, NOÉ EDITION: AVODA ZARA & HORAYOT
191 (Tzvi Hersh Weinreb & Joshua Schreier eds., Koren Publishers Jerusalem 2018) (c. 3d-6th
centuries C.E.).
770
paid on both sides
and nonpersonal domains only insofar as the exchange form is widely used in
the nonpersonal domain. It is one thing to derive exceptions to a bargain re-
quirement for discrete kinds of nonexchange transactions in the commercial
realm (such as surety agreements); it would be quite another to apply a bargain
requirement to screen for social contexts if bargains had fallen out of use entirely.
Of course, quid pro quo exchange is at no risk of extinction, and this is not to be
lamented. However, once the nature of exchange has been exposed—and Recip-
rocal Debt Satisfaction and No Residue articulated—we can appreciate that the
appeal of the form depends on both the desirability and availability of the species
of closure that it promises. And it is important to see that background norms
and collective decisions can make an impact on each of these things. This is eas-
iest to observe by considering the extreme cases. Where individuals (or groups)
take themselves to be without normative constraints in their interactions with
strangers, the prospect of leaving unsettled the status quo ante with particular
strangers might be a frightening one, and people living in such conditions might
generally welcome modes of service that establish lasting ties. At the other ex-
treme, where a strict egalitarianism of resources prevails, and everyone must end
up with an even share at the end of the day, many exchanges are rendered futile,
subject to unwinding at day’s end.173 Just as Rawls, following Hume, identified
“circumstances of justice” in which human cooperation is both possible and de-
sirable (indeed, necessary)—namely, limited altruism, moderate scarcity of re-
sources, and a rough equality in mental and physical capacities174—so too are
there circumstances of exchange, yet to be identified.
Beyond its role in hastening or preventing the extreme cases, the law may
otherwise impact the desirability of exchange by limiting the degree of closure
that may be produced by the transactional form. The infamous 1842 decision of
Winterbottom v. Wright,175 as well as the subsequent development of the law of
negligence, is a case in point, and a fitting close to this Article. In Winterbottom,
the injured driver of a defective coach (owned by the driver’s employer, the Eng-
lish postmaster) sued the coach’s manufacturer, and the Exchequer of Pleas dis-
missed the suit for lack of “privity” between the driver and the manufacturer.
What is interesting, for our purposes, is the analysis of Lord Chief Baron
Abinger:
173. This is related to Robert Nozick’s well-known Wilt Chamberlain example. See ROBERT
NOZICK, ANARCHY, STATE, AND UTOPIA 160-61 (1974).
174. See HUME, supra note 63, at 317-18; JOHN RAWLS, A THEORY OF JUSTICE 109-10 (rev. ed. 1999).
175. Winterbottom v. Wright (1842) 152 Eng. Rep. 402; 10 M&W 109.
771
By permitting this action, we should be working this injustice, that after

the defendant had done everything to the satisfaction of [the postmas-
ter], and after all matters between them had been adjusted, and all accounts
settled on the footing of their contract, we should subject them to be ripped
open by this action of tort being brought against him.176
Chief Baron Abinger grasped that parties to exchange agreements regard

each performance as discharging the duties generated by the other, and con-
cluded (questionably) that a finding of liability would be at odds with this
understanding.177 However, Chief Baron Abinger drew the wrong conclu-
sion about the legal significance of the parties’ understandings, and seventy-
five years later a tort duty grounded in foreseeability of harm was firmly es-
tablished by Judge Cardozo in his opinion for the New York Court of Ap-
peals in MacPherson v. Buick Motor Co.178 Judge Cardozo explained the
court’s rejection of the privity rule as follows:
We have put aside the notion that the duty to safeguard life and
limb, when the consequences of negligence may be foreseen, grows
out of contract and nothing else. We have put the source of the ob-
ligation where it ought to be. We have put its source in the law.179
While Judge Cardozo’s decision is justly celebrated (and Chief Baron

Abinger’s rightly maligned), we must also give Chief Baron Abinger his due
by recognizing that locating such a duty of care “in the law” does, to some
extent (however justifiably), interfere with the ability of exchange to facili-
tate the redistribution of goods and services in such a way that leaves the
parties’ rights and duties in all other respects undisturbed. Corresponding
with the law’s recognition of the responsibilities owed towards the strangers
with whom we interact is a diminishment in the appeal of a particular trans-
actional form—the exchange agreement—that allows us to remain at arm’s
length in those interactions.
176. Id. at 405, 10 M&W at 115 (Abinger CB) (emphasis added).

177. I say this conclusion is questionable, given that the plaintiff was a third-party stranger to the
exchange. On my account, each party to an exchange regards their performance as discharging
all duties owed to the other party on account of the other party’s performance, and this under-
standing is not strictly incompatible with a duty owed to a third party on account of one’s
own performance.
178. 111 N.E. 1050 (N.Y. 1916).
179. Id. at 1053.
772

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JED LEWINSOHN

Paid on Both Sides: Quid Pro Quo Exchange and the

author. Assistant Professor of Philosophy, University of Pittsburgh. In writing this article, I

i. langdell’s folly 704

ii. quid pro quo exchange: a philosophical account 715

iii. two doctrines of consideration 739

Under the common law, contractual liability attaches to commitments made

what is known as the bargain theory of consideration—has been reduced in mod-

6. See infra notes 28-50 and accompanying text.

members (indeed, between members of preexisting cooperative units more gen-

Gestures are made in the direction of Lon Fuller’s functional explanation—ap-

distinctive features.18 Without a proper understanding of debt, however, it is not

can be exchanged—as it arguably is when an insurance policy, or a bond, is issued

The doctrine of consideration conditions a promisor’s liability on some suit-

casebook: “The consideration of a promise is a thing given or done by the prom-

28. LANGDELL, supra note 3, at 1011.

question whether it constituted an innovation, Langdell’s deﬁnition is as a purely

[I]t is the essence of a consideration, that, by the terms of the agreement,

It is important to grasp the precise meaning of Holmes’s deﬁnition. X is a

Consideration requires that a performance or return promise be “bar-

In a well-known discussion, Gilmore called Holmes’s “bargain theory” of

particular, if the history uncovered in this Part (a history of conceptual appro-

ii. quid pro quo exchange: a philosophical account

A. The Motivational Theory of Exchange: A Critique

Before introducing and defending the remuneration theory of exchange, I

an obligation that was itself assumed in order to bring about X. Accordingly, we

B. Remuneration Theory of Exchange: A Defense

than a fulﬁllment of, a consideration, justiﬁed, if at all, by the manifested intentions to be

upon giving assurance to a nagging parent). More signiﬁcantly, debt obligations

Although gratuitous promises or assurances can, I believe, generate debts,

with B, A was anyway planning to do the job to fulﬁll a previous commitment.

performance must be accompanied by an understanding—perhaps a manifested

iii. two doctrines of consideration

In Part II, I articulated and defended a theory of exchange as reciprocal pay-

A. The Remuneration Theory of Consideration

ties assent to an agreement that appears to contemplate reciprocal payment rela-

B. Testing the Theories

1. Conditional Gift Promises

I will now consider an example of an exchange that is wrongly classiﬁed as a

Fuller’s functional argument is not just implausible as a justiﬁcation of the doc-

110. Id. § 89 cmt. b.

as the modiﬁcation of at-will employment contracts by employers.118 In stark

satisﬁes the consideration requirement just in case it is an agreement that contemplates an

3. The Rationale of the Consideration Requirement

As I have said, the Second Restatement endorses Fuller’s functional justiﬁ-

by an intelligible, historically compelling functional explanation that the domi-

Once the traditional conception of bargain is recovered, however, and the

In a system of law which makes no requirement of consideration, it may

of exchange that are characteristically “friendly” (e.g., individualized discounts,

sociological generalization, susceptible to falsiﬁcation and contingent upon val-

139. Posner, supra note 137, at 417.

comes to those promises and agreements made in personal, intimate contexts.

in many jurisdictions, has effectively eliminated this possibility, the rationale I

147. SIMPSON, supra note 2, at 417.

that well-established cases like Hamer v. Sidway,165 which involved a genuine

165. 27 N.E. 256 (N.Y. 1891).

In offering the foregoing account of consideration, I have attempted to strike

indicate an absence of commitment to them, but whether they do is a function

By permitting this action, we should be working this injustice, that after

Chief Baron Abinger grasped that parties to exchange agreements regard