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The classical ideal of free contract depended upon an abstract, and obviously unrealistic, model of contract formation. According to that model, only a voluntary exchange of promises (the traditional offer and acceptance) gave rise to contractual obligations. At the moment of exchange (and not a second sooner), a right of expectation sprang into being. The right was violated if either party failed to perform according to the agreed-upon terms. This was, of course, precisely the model so critical to classical American legal thought: Unless judges could claim to be enforcing the will of the parties, they could be accused of arbitrarily and retroactively creating new legal obligations, an obvious invasion of the defendant's sphere of legally protected autonomy. Conversely, a judge's failure fully to compensate contractual breach would constitute a refusal. equally arbitrary and irresponsible to protect the plaintiff's right of expectation. a right necessarily deemed no less “real” than the rights defining each party's initial sphere of individual freedom. Reliance Theories that explain contractual obligation as an effort to protect a promisee's reliance on the promises of others have the apparent virtue of explaining why persons may be bound by the common meaning of their words regardless of their intentions. Thus, it has become increasingly fashionable to assert that contractual obligation is created by reliance on a promise. Relational contract theory has helped to bring home two of the fundamental weaknesses of classical contract law. its static character, and the flawed nature of its implicit empirical premise that most contracts are discrete. Relational contract theory has also greatly illuminated the economics and sociology of contracting. Finally, relational contract theory has excelled in its treatment of specific types of contracts, like franchise agreements, and specific types of express or implied terms, like best-efforts provisions. As a result of all these contributions, relational contract theory has been a highly important factor in the formulation of modern contract law. I believe, however, that a version of relational contract theory can have real influence as a counterweight to the still-powerful discrete, maximizing tendencies of neoclassical contract law. If we think of doctrine as a structure of argument rather than a set of rules, then it becomes clear that neoclassical contract and relational contract generate competing general accounts of the sources and nature of obligation in contract law.
