THE GREAT CASE OF CUTTER V. POWELL

Abstract

Although its practical importance has largely been lost due to legislative modification and detailed labour contracts and collective bargaining, this article focuses on Cutter v. Powell. The author examines a deeper conflict he believes to be crystallized by the case, the one between contract notions pertaining to debt and more modern notions that must underlie the legal adjustment of collapsed bargains. Part one describes the judgment in detail and part two examines the nature of the legal rules governing the rights of parties where their bargain collapses because of incomplete performance. In part three the author argues that a consistent theory underlying the adjustment of bargains is needed, and formulates such a theory based on removal of the debt-fallacy in contract. Part four examines this suggestion in relation to the doctrine of entirety of consideration, and part five considers the connection between the problem under discussion and the scenario where a servant wilfully refuses to complete performance.