For all practical purposes, law is a reason to do or to refrain from doing something. It is a reason for claiming payment under a contract, for invoking the Fifth Amendment right to remain silent, and for the corporate executive to terminate a program that would have increased profits but run afoul of the antitrust laws. There are two fundamentally different ways in which law serves as a reason. One is external, the other is internal. The internal perspective is that of a participant in the legal system. It is epitomized by the judge. The participant asks what is permitted and prohibited within the legal system. For example, the participant asks: “Is price fixing among competitors lawful?ǃ? The answer, within the legal system, is “no.ǃ? And that’s the end of the inquiry. For the participant, the legal system provides a sufficient answer to every legal question. (Whether the law determines that answer is a different question.) The external perspective, in contrast, is that of an observer of the legal system. He or she asks not what is right within the legal system, but rather how the legal system (operating internally on the lawful/unlawful distinction) will impact him or her or someone else. For example, suppose that the corporate executive, after learning that price fixing is illegal, asks: “How likely is it that we would get caught? And if we get caught, what’s the penalty? And even if we have to pay the penalty, would we still come out ahead?ǃ? He or she is not indifferent as to the lawfulness of the contemplated course of action. To the contrary, he or she explicitly takes the illegality into account. But for our (ethically challenged) hypothetical executive the classification lawful/unlawful is not the only relevant consideration. The risks of detection, enforcement, and punishment are also important. The observer’s inquiry, therefore, does not necessarily end with the determination that the conduct in question is lawful or unlawful. For the observer, the law (here, the expected reaction of the legal system) is one among many reasons, influencing his or her decision. For the participant, the law (here, what’s right or wrong within the legal system) is the only relevant reason to reach a decision.
The participant/observer distinction is of fundamental importance. Lawyers, for example, constantly oscillate between these two points of view. A lawyer advising a client who prematurely wants out of contract might say:
Realistically, the only legal right for you the get out of the contract is to give 6 months notice. That’s what the contract says. [Participant] But the other side might be willing to negotiate an immediate release with you, particularly if we raise questions about their performance. [Observer.] From a legal point of view, our arguments as to their lack of performance are rather weak. [Participant] But given that there is at least some risk for them that a court would be sympathetic to our non-performance argument [Observer], weak as it is from a legal point of view [Participant], and given that you have a long term relationship and that the other side still wants to do business with you in the future, they will probably let you off the hook. [Observer.]
In contrast, a judge, presiding over the case, would be confined to the participant’s perspective, at least in explaining his or her opinion. He or she would not be permitted to take observer considerations into account. For the judge, the only relevant question is whether there was a breach of contract, and if so, what the appropriate legal remedy would be. This is not to say that, from an external point of view, the judge’s non-legal value commitments are irrelevant. But those commitments must be expressed within the constraints imposed by the law (e.g., legal doctrine) and the forms provided for by the law (e.g., opinions).
While lawyers do oscillate between the participant’s and the observer’s view, they are, ultimately, participants, which explains their role as “officers of the court.ǃ? Lawyers may advise their clients as to the consequences of illegal behavior, but they must not advise their clients to violate the law. Thus, in the last consequence, at least from a normative point of view, the internal perspective trumps external considerations.
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