Contrary to the results reached in such cases, Atiyah has argued that when institutions, corporate bodies and the like announce their decisions ‘the line between a mere statement of intent and a promise becomes somewhatblurred.Apublicannouncementintheform“TheCommittee[Board, Government, etc.] has decided …” is much closer to being a promise than a comparable statement by a private individual.’204 Atiyah’s explanation for the view that statements by such bodies as to their decisions are more likely to be promises is that ‘decisions of this character are usually more trustworthy than declarations of intent by a single individual’,205 but that seems an entirely impressionistic assertion which finds little, if any, support from the case law.

(e)  A genuine unilateral promissory intention

It is rarely suggested that a letter of intent may be a simple, unilateral promise. However, if, as some courts have suggested, what may be called a letter of intent is capable of being a contractual offer, then in theory there would be nothing to prevent a letter of intent being, in the alternative, a promise, if that were the objectively determinable intention of the party issuing the letter. However, as most letters of intent are issued in a commercial context in which the issuer of the letter expects to receive something in return, it is unlikely that, if any binding obligation was intended at all, a unilateral promise will have been intended. In Scotland, with a separate obligation of unilateral promise, what case law there has been on the matter has not favoured a promissory analysis of letters of intent,206 though of course everything turns on the intention of the specific party issuing the letter in any case.

8.  Error in formation of contract

Error is commonly considered a difficult or troubling part of the law of contract.207 The difficulty or trouble for legal systems lies in deciding first what types of error the consideration of justice mandates correcting, and second in developing a classification which accurately achieves the mandated outcome when applied to the facts of individual cases. Too often legal systems appear not to have reflected sufficiently on either the first

204 Atiyah, Promises, Morals and Law, p. 152. 205 Ibid., p. 152.

206Ritchie v. Cowan and Kinghorn (1901) 3 F 1071.

207Pollock summed up the matter well: ‘The whole topic is surrounded with a great deal of confusion in our books’ (Pollock, Principles of Contract, p. 357).

or second of these matters. As to the first, unless one has decided when the requirements of justice mandate the correction of error, any classification will be hopelessly confused; as to the second, even if there is an underlying sense of what justice requires, the classification chosen, unless based on consistent criteria, may not properly reflect the policies said to be favoured by the system and will certainly be harder to apply in practice.

(a)  Choosing the policies which inform the rules on error

As to the first question, legal systems typically build corrective policies concerning error upon a preferred approach to a number of common issues. Foremost, there is the fundamental consideration of whether to give priority to the actual, subjective intentions of parties (the promises they in fact intended) or rather to the objectively manifested consent of the parties (the promises they appeared, to a reasonable person in the other party’s shoes, to have made). A preference for the former over the latter will tend to allow a much wider field of relevant errors to be pled. The choice between subjectivity or objectivity is likely to be determined by the underlying contract theory favoured by a system, although what approach the chosen theory mandates is a moot question. Thus, while a strong preference for will (or promissory) theory has been said by some to favour a preference for subjectivity in the approach to error, other will theorists would argue that the will cannot be divorced from its external manifestation, so that a preference for objective declarations of the will should be favoured, with a consequently narrower field of relevant error. Reliance theorists will naturally have a preference for an objective approach, given that what matters is said to be the effect (the reliance) produced on one party by the manifested behaviour of the other. Apart from underlying contractual theory, other considerations can affect a preference for objectivity or subjectivity. Thus, a preference for commercial certainty and for not disturbing settled transactions will tend towards the choice of an objective approach. A preference for consumer protection may perhaps favour a variable approach, with a focus on subjective intention when it is the consumer’s behaviour which is in question but objectively manifested intention when it is the commercial party’s behaviour which is in issue.

Apart from the objective/subjective debate, another approach to constructing a legal system’s policy on error is to focus on the culpability of the error. On this approach, a general preference is often made for treating induced errors rather than uninduced (or unilateral) errors as relevant.

Such an approach does of course raise the tricky question of discerning the cause of a contractual error, that is what precisely persuaded a party to contract. Because error describes a psychological state of a contracting party, the question of whether an inducement to contract was or was not operative comes down to an attempt to analyse the thought processes of that party: what made the party decide to contract? That is evidently a difficult question: not only is it hard to separate out different possible reasons why parties contract, but there is the question of whether or not one believes the reasons alleged for the decision to contract. Though this is a difficult question, systems with a developed doctrine of misrepresentation would likely argue that it is a not insurmountable one, and that such an approach reflects an intuitive sense that parties should accept the risk of their own mistaken assumptions but not assumptions based upon false information or impressions for which the other party was responsible.

A further policy question, though one which tends not to be given such prominence as the ones above, is the question of the extent to which contracts are viewed purely as private acts, or as having a public aspect to them. If the former view prevails, then it will seem more acceptable to allow parties who share an erroneous assumption (such as the meaning of a word) to adhere to that mistake, given the private nature of their contract, even if this flies in the face of the commonly understood meaning of a word; if the latter, then such parties may be governed by the objective meaning of their agreement, even if neither would wish such an interpretation to prevail. If third parties are affected by a contract, or if the contract is to be registered in a public register, then there is evidently stronger pressure upon a legal system to hold there to be (at least in some cases) a public, rather than a purely private, aspect to the parties’ contract. A preference for a view that contracts have a public aspect also makes it easier for courts to justify application of external community norms such as fairness or good faith when analysing the process of formation or the contents of the contract.

If legal systems were to choose just one of the above policy considerations as the guiding principle for constructing classifications of error, a classification giving effect to such a policy would theoretically be relatively easy to construct, given the single division it would create between types of case. Thus, a simple preference for induced errors over unilateral errors could lead to a classification of error which held that where a contracting party had been affected to any extent by misleading information provided by the other this would result in the contract being challengeable, but not otherwise. However, legal systems usually wish to give some effect to more