Sixth, utilitarianism seems to be at odds with certain fundamental values of society and legal systems. Most evidently, it is at odds with trust, and therefore with good faith in human relationships. The utilitarian lack of concern for keeping one’s word as a matter of normative principle must inevitably erode trust and fundamentally undermine the good faith which is said increasingly to be an inherent part of promises and contracts.

Some criticisms of utilitarianism seem, however, less robust. For instance, Atiyah’s point that, if a promisee knows a promisor is a utilitarian, the promisee will not rely on the promise because he will realise that the promisor may not keep it, and, by extension, if everyone were then utilitarian there would be no promises because no one would rely on them, seems an argument constructed upon a fanciful world in which everyone has adopted a utilitarian worldview.124 This sort of legal theoretical argument divorced from the real world does not address the institution of promising at it operates in reality. In practice, most people place a high value on a promise, and will continue to do so. Atiyah’s concern is a phantom one.

The utilitarian view of the moral worth of promising seems subjective, arbitrary and antagonistic to core values of human societies, quite apart from not reflecting the attitude of many promisors and promisees to the value of the promissory act. It will not do as an explanation of promising.

(v)  Reliance theory

Reliance theory, popularised largely in the twentieth century,125 and advocated in different forms by Atiyah and MacCormick, among others, is based on the view that promising is moral because a promise generates reliance in others, in particular reliance which would be productive of detrimental results for the party acting in reliance if the promise were not upheld. Promises are only morally (and indeed legally) worthy of

124See Atiyah, Promises, Morals and Law, pp. 49–50.

125There are however earlier manifestations of a reliance approach to promises, often focusing on the idea of the expectations (a form of reliance) engendered by the giving of a promise. Adam Smith, for instance, stated that a ‘promise is a declaration of your desire that the person for whom you promise should depend on you for the performance of it’, such dependence evidently being reliance by another name (Smith, Lectures on Jurisprudence, ‘Of Contract’, p. 472). In his Lectures, Smith mentions the reasonable expectations engendered by contract at various points, as for instance when he comments of contract that ‘[t]he origin of this right is the expectation raisen in him to whom the promise was made that the promiser will perform what he has undertaken. Thus if one promises to give an other five pounds, this naturally creates an expectation that he will receive five pounds from him at the time promised’ (p. 12); see further references by Smith to the expectations engendered by promises in his Lectures, pp. 87, 89, 400.

being kept on a reliance approach when such reliance is generated; where it is not, it would not be immoral for the promisor to fail to adhere to the promise. Some theorists locate the source of the obligation squarely in the presence of such reliance, while others locate it in an intention of the promisor that reliance be generated (and therefore do not insist that actual reliance be present).126 It might seem that adoption of the latter view is in reality a modified kind of will theory, given that what is crucial is an act of will of the promisor that reliance be generated; as, however, what the promisor must will is not the obligation itself, but merely the reliance of the promisee, such an approach is not really a variant of will theory.

The reliance theory, conceiving of reliance as the central explanatory force of the value of promises, goes much further than the natural law or will theories of promise. Though such theories accord a role to the idea of reliance in explaining certain types of outcome (such as remedies in cases of induced errors), reliance is in such theories merely an extraordinary, additional consideration which can affect the finding of liability in certain circumstances, but it does not explain the worth of promises in general. Genuine reliance theorists hold that it is the very presence of the reliance which generates the moral obligation: a promisor is responsible for doing what he said he would because he has created a dependency by the promisee on his actions, such dependency being a source of moral duty (much as other types of dependency, such as that of a child upon a parent, can create moral duties).

Reliance theorists have laid claim to the central importance of reliance to contractual liability. Thus Atiyah has very grandiosely claimed that

[f]ew would today deny that, in a broad and general sort of way, the fact that promises tend to be relied upon, that they positively invite reliance, is one of the chief grounds for the rule that promises should be kept, and that contracts should be legally enforced.127

Many would in fact deny any such thing, though they might concede that reliance is important in explaining the outcome in certain types of case. Reliance theorists like Atiyah have a tendency to repeat such broad, generalised statements about reliance theory, but such statements crucially do not reflect the law as it exists and is applied by the courts, certainly

126MacCormick argues that it is the intention of the promisor to generate such reliance which is the source of the obligation: see ‘Voluntary Obligations and Normative Powers I’, p. 66.

127Atiyah, Promises, Morals and Law, p. 36.

individuals, whose decisions are worthy of respect, not just as cogs in the macro-economic machine, only significant if in receipt of a benefit or the victim of a harm.

Fourthly, reliance theory undervalues truthfulness, honesty and trust. Why is this so? Reliance theory focuses on the result produced by promising. It says that the morality of promising arises from certain effects (the conferral of a benefit, or detrimental reliance) which may result from a promise. If, however, such effects do not result, the promisor is excused from liability and can renege on his promise; though the promisor said he was binding himself to do something, it turns out he was not. The ability to renege on a promise without any adverse consequences would have the potential for undermining truthfulness, honesty and trustworthiness generally in society. Perversely, by reliance theory’s focus on detriment in individual cases, a wider detrimental effect would be produced through the failure to enforce promises in which reliance was absent.

Lastly, there is the concern that reliance theory would create uncertainty and confusion if adopted by the courts. The problem is that, under reliance theory, a promisor will not know whether he is bound to an obligation until such moment, if it occurs at all, that the promisee receives a benefit under the promise or relies upon it to his detriment. Any such moment of detrimental reliance may well be unknown to, or unknowable by, the promisor; even if it is, it may be challenged by a promisor who wishes to escape from the promise on the ground that no actual detriment has been suffered. Moreover, even assuming one knows that reliance has taken place, the idea of reliance does not assist in determining the nature of the right conferred. Thus, for instance, the mere fact of reliance cannot tell you whether a third party has a right which is that of an assignee or that of a third party under a stipulatio alteri: only the intention of the original contracting parties allows that determination to be made.

Disputes caused by debates about reliance would create unnecessary litigation and be difficult for courts to adjudicate. The danger of uncertainty which reliance theory creates is well illustrated in this comment of the reliance theorist Páll Árdal:

The promiser in many cases ceases to have any obligation when he comes to know that the promisee could not care less whether the promise is kept or not … Similarly our obligation tends to be stronger the more important the content of the promise is to the promisee.134

134  Árdal, ‘And That’s a Promise’, p. 234.