The 'Principles' Paradox
The most up-to-date version of this piece can be found in the Duke Law Scholarship
Although principles-based regulation is thought to more closely achieve normative goals than rules, the extent to which that occurs can depend on the enforcement regime. A person who is subject to unpredictable liability is likely to hew to the most conservative interpretation of the principle, especially where that person would be a potential deep pocket in litigation. This creates a paradox: Unless protected by a regime enabling one in good faith to exercise judgment without fear of liability, such a person will effectively act as if subject to a rule and, even worse, an unintended rule.
Date of Authorship for this Version
Schwarcz, Steven L., "The 'Principles' Paradox" (2008). Duke Law School Faculty Scholarship Series. Paper 122.