University of Toronto Law Journal

John Willis was deeply engaged with one of the central institutional controversies of his time, the relationship between the courts and the administrative state¹. He was a deft and ironic reader of the discursive frame in which the controversies over their respective roles was conducted; he was especially well versed in the rejoinders proffered by those who opposed the administrative state in the name of the rule of law; and he was alert to the material interests and venal motives that could be cloaked in the rhetoric of legalism. In short, Willis had a sharp sense of the relationship between professional debates in law and the larger political conflicts and transformations in which they played a part.

John Willis and his contemporaries were proponents of functionalism as a means to resolve regulatory controversies. Functionalism began as an antidote to a conceptualism that attempted to divorce legal reasoning from context in adjudication. The realists debunked the analytic infrastructure upon which formalism rested. They also invoked the demands of modernization and the authority of social science in response to those, including judges, who defended adjudicative practices that were inimical to the expressed desires of democratic electorates in the name of the inherent nature of legal rights and the demands of the rule of law. Instead of the generation of legal entitlements from the germ of a legal idea or concept, they proposed a pragmatic, empirically grounded analysis of the relationship between legal rules and the social world in which they operated and which they helped to construct and a frank balancing of the rights and interests at stake in the choices on offer. As a counter-strategy, a means of ensuring that the space to further democratic political agendas was not crowded out by a muscular judiciary with defensive territorial ambitions, functionalism worked well for a certain period of time.

At the beginning of the twenty-first century, functionalist and formalist arguments in law have resurfaced, albeit in an altered form, as have many of the concerns, controversies, and claims with which they were originally connected. However, the relationship between these arguments and institutional projects is now very different. For example, we are once again arguing about the extent to which corporate activities [End Page 853] should be regulated for the public good. We are intensely engaged in the relationship of private rights to the advancement of general welfare, and there are debates underway all over the industrialized and developed world about the relationship between legal institutions and economic growth. Within these debates, however, formalist and functional arguments no longer necessarily operate as they did in Willis's day. Functionalist arguments, in particular, have developed a different cast. Although originally deployed to advance or defend the regulatory state, functionalism is now being used to transform the state and dismantle many of its institutions; it has become the instrument of, rather than the answer to, those whom Willis and his ilk originally opposed.

What follows is a reflection on functionalist and formalist reasoning about legal rights and the rule of law in contemporary debates on law and development and in the international financial institutions in particular. By way of preamble, it is useful to know that the issues at stake and the terms in which they are considered are not restricted to the field of law and development; nor will they feel like foreign territory to anyone familiar with Willis's work. Many of the questions that preoccupy scholars and policy makers in that field are fundamentally the same as those that underlay Willis's defence of the administrative state, and they remain both fascinating and deeply important for lawyers working in a variety of areas. Indeed, looking at the debates on governance and law and development is simply a convenient, and often sharply focused, way of identifying a set of controversies concerning the transformation of the state and the place of law and regulation in economic life, controversies and changes in which we are currently immersed. These debates also provide an angle from which to assess the limits of functionalism and to evaluate its dark side. For...