reevaluation,64 and reconciliation.65 As a result, Keeton’s original
principle has spawned several variations.66 Most prominent are a strong
(pure) form and a weak form. The strong form follows Keeton’s original
formulation, allowing the policyholder’s reasonable expectations to control,
even though the policy’s text precludes coverage.67 The weak version
differs little from the general principle of contra proferentem, which
construes ambiguous contract language against the drafter.68 Indeed, it is
questionable whether this weak version should be considered a variation on
doctrine fails to offer meaningful criteria for determining reasonable expectations); Thomas,
An Interdisciplinary Critique, supra note 47 (arguing that the doctrine fails to achieve its
goals); Popik & Quackenbos, supra note 47 (arguing that the doctrine is plagued with
problems like indefiniteness and unpredictability); Ware, supra note 45 (arguing for
abandonment of the doctrine).
64. See, e.g., Rahdert, Revisited, supra note 45 (defending the doctrine against
critiques); Rahdert, Reconsidered, supra note 45 (updating his views of the importance of
the reasonable expectations doctrine); Abraham, Judge-Made Law, supra note 45 (analyzing
applications of variations of the reasonable expectations doctrine).
65. See, e.g., Swisher, supra note 45 (discussing how the doctrine of reasonable
expectations is a “‘middle ground’ synthesis of traditional, objective, and contractually based
reasonable expectations principles”).
66. See Jerry & Richmond, supra note7, at 145-151 (describing the doctrine of
reasonable expectations and its variations); see also Stempel, supra 45, at 192–93
(describing seven court reactions: ( 1) strong or pure Keeton version; (2) construction in
favor of insured where contrary text is hidden, surprising or contravenes the essence of the
contract; (3) mandated coverage to accomplish the purpose of the policy; (4) estoppel against
insurer because of insurer’s actions; (5) construction of ambiguous text in favor of insured’s
expectations; (6) rejection of policyholder’s expectations; and (7) rejection of policyholder’s
unreasonable expectations or expectations that contravene basic insurance principles, such as
moral hazard, adverse selection or fortuity); Rahdert, Revisited, supra note 45, at 115, 126,
136, 140 (finding four applications of the doctrine in cases of ( 1) ambiguous policy
language, (2) unconscionable policy provisions, (3) making the policy work for its intended
purpose, and (4) protecting policyholders from catastrophic loss).
67. See Jerry & Richmond, supra note 7, at 146 (describing the strong form of the
reasonable expectations principle); see also Stempel, supra note 45, at 192 (explaining that
this strong form the most favorable to policyholders).
68. See Restatement (Second) of Contracts § 206 (1981) (explaining that standard
contract terms are construed against the drafter); see also Rahdert, Revisited, supra note 45,
at 112 (explaining that the “ambiguity principle” invokes contra proferentem – a maxim that
the courts apply to interpret ambiguous insurance policy language). This weaker form and
variations that apply only in the presence of ambiguous language fit within traditional rules
of contract interpretation. Id. Professor Jerry describes how noted scholars of contract
foreshadowed the reasonable expectations doctrine. See Jerry, supra note 45, at 42-50.
Among the antecedents Jerry cites are Kessler, supra note 56, Karl Llewellyn, The Effect of
Legal Institutions Upon Economics, 15 Am. Econ. Rev. 665 (1925), SPENCER L. KIMBALL,
INSURANCE AND PUBLIC POLICY: A STUDY IN THE LEGAL IMPLEMENTATION OF SOCIAL AND
ECONOMIC PUBLIC POLICY, BASED ON WISCONSIN RECORDS 1835-1959 (1960), and Alan
Schwartz, Karl Llewellyn and the Origins of Contract Theory, in The Jurisprudential
Foundations of Corporate and Commercial Law (Jody S. Krauss & Stephen D. Walt, eds.,