Research Paper Number
Contracts; Corporate theory; Legal Pluralism; nexus-of-contracts; relational contract theory; shareholder primacy; stakeholder theory of the corporation; takeovers; Transnational law
The authors discuss the decision of the Supreme Court of Canada to approve a plan of arrangement privatizing BCE Inc. over the objections of bondholders. Summarizing the arguments for "shareholder primacy" and debenture covenants delimiting contractual rights against boards and management, they argue that an expanded conception of relational contract theory is useful in analyzing the competing claims in the BCE deal and litigation. This approach requires that broader contextual factors are necessary to consider in the functioning of the corporation, especially by after-the-fact decision-makers.
Zumbansen, Peer and Archer, S. B., "The BCE Decision: Reflections on the Firm as a Contractual Organization" (2008). Comparative Research in Law & Political Economy. Research Paper No. 17/2008.