Our Own Little Secret

The New Yorker magazine recently had a piece about how hotel and casino magnate Steve Wynn put his elbow with a Picasso painting that was worth $40 million. Thankfully for him he owned the painting. But he was in the process of selling it. There were already promises on the table from Wynn to sell and from the purchaser to buy. But that's not the interesting part of this article, as it's clear that the buyer would has a remedy to get out of the contract. Here is the interesting part:

A few hours later, they all met for dinner (Wynn and his friend who witnessed the accidental destruction of the painting), and Wynn was in a cheerful mood. “My feeling was, It’s a picture, it’s my picture, we’ll fix it. Nobody got sick or died. It’s a picture. It took Picasso five hours to paint it.” Mary Boies ordered a six-litre bottle of Bordeaux, and when it was empty she had everyone sign the label, to commemorate the calamitous afternoon. Wynn signed it “Mary, it’s all about scale—Steve.” Everyone had agreed to take what one participant called a “vow of silence.” (The vow lasted a week, until someone leaked the rudiments of the story to the Post.)

Since the New York Post broke the story of this $40 million blunder, Wynn's guests have been speaking with whomever will listen. But they promised not to talk about it. Is this an enforceable promise?

Gifts and Contracts

In contracts class we spend a fair amount of time distinguishing between gifts and valid consideration. In short, we talk about whether gifts are enforceable contracts. In the real world this distinction between gifts and enforceable contracts has been creating some problems for organizations who depend on charitable gifts. The Wall Street Journal recently reported that a growing number of donors are reneging (not following through with giving their gift) on their gift pledge. The problem is such now that many institutions are trying to devise ways to make charitable gifts enforceable contracts. The main problem, so says the WSJ, is that many of these gifts are made orally. The problem is compounded by the fact that many charitable donors would probably be offended by having to put their gift pledge in writing. As one donor notes, "My word is good. If they don't trust me they don't have to take the money -- I can go somewhere else. There are plenty of places that are happy to accept gifts without promises." But would putting the pledge in writing really make that much of a difference as far as enforceability goes?