Why Do We Keep Promises?

“Why Keep Promises? Why do people ordinarily fulfill their contractual obligations? Why the high rate of performance? No doubt the fear of legal sanction helps deter breach. But the matter surely goes beyond mere fear of the law. Indeed the fear of officially imposed sanctions (e.g. a judgment for damages) may be a relatively minor deterrent in many situations. One thinks for example of the great Law Merchant tradition of the late medieval period, out of which much of our modern commercial law developed. The merchants themselves administered a remarkably effective system which did not depend upon state enforcement mechanisms or procedures, but relied upon private sanctions such as refusal to deal or boycott.

Obviously, it is often in one’s self-interest to keep promises. If one is to have credibility for the future, one must perform one’s promises today. Finally, most people believe that promises ought to be kept because it is the right thing to do. It is part of the way an honest person behaves.”

However, what do we do when we finally meet a dishonest person? How do we then get the contract performance we bargained for? How do we get paid for the contract work we have done?