More on threats : LUSENET : Lessig's Contracts : One Thread

Our discussion of coercion has had me thinking about the issue for some time. I'm still not comfortable with how we're treating the reliance issue.

One of the questions I still have revolves around the temporal nature of a threat. Today in class, we were talking as if a threat is made once, prior to reliance by the other (unknowing) party to the contract. That may happen in some instances, but I see a different story in most cases:

We're in Seattle. The Russian mafia, having established itself as the Microsoft of illegal activities (unless, of course, you count Microsoft as holding that position already...) is in a position to benefit Russian immigrants without those immigrants even knowing it. The idea is to secure their neighbors' places in America, then explain what influences brought them to their current state of prosperity, and suggest that a little quid pro quo might be in order.

So how do they go about doing this? Very simple: mafia heavies visit local sources of capital and employment and threaten their staff with physical harm. The staff, generally comprised of coffee-drinking waifs, capitulates to the heavies' demands. The demands are that the bank, landlord, employer offer sweetheart deals to these immigrants. The coercees do so, the immigrants rely, and the contract--apparently--is valid.

Now the issue that was brought up today was that since the coercees--I'm just going to keep pretending that's a word--since the coercees could have refused, the contract was only voidable, not completely invalid. Implicit in that conclusion, however, is a failure to remember that--at least when you're dealing with the Russian mafia--the threat remains in force throughout the life of the contract, and often afterward. We were talking in class about the ability of the coercee, between the time of agreement and the time of reliance, to renege. But if you tried to void a contract with the Russian mafia before their intended beneficiary relied, you'd get to play roulette with them. Or something.

My point is that it seems, in the real world, as if the coercee gets thoroughly trampled by this scheme. Obviously, the immigrants aren't at fault, and it doesn't seem fair to penalize them for participating in a contract that they had no way of knowing was the result of duress. And I can see that, if they wanted to be federally protected witnesses, coercees could seek the aid of law enforcement. But suppose that the heavies just hang around in the coercee's office, out of sight of everyone but their victim, until the deal is closed. Doesn't the coercee have any recourse from fulfilling a contract that was obviously concluded under extreme duress? Did any of that make sense? Were you expecting a better story? Is that what I am to you, a story machine?

Answers to the first question, at least, would be greatly appreciated. Paul

-- Anonymous, October 14, 1998

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