Gentlemen’s Agreement

handshake

A gentlemen’s agreement is an informal agreement between two or more parties. It is typically oral, though may be written, or simply understood as part of an unspoken agreement by convention or through mutually beneficial etiquette.

The essence of a gentlemen’s agreement is that it relies upon the honor of the parties for its fulfillment, rather than being in any way enforceable. It is, therefore, distinct from a legal agreement or contract, which can be enforced if necessary. A variation on the gentlemen’s agreement is the gentlemen’s bet, wherein there is nothing to win or lose through the bet, other than the honor of winning and shame of losing.

The phrase’s first known use was in 1888 in the ‘Report of the Railway Accounting Officers’ published by the Association of American Railroads Accounting Division. A gentleman’s agreement, defined in the early 20th century as ‘an agreement between gentlemen looking toward the control of prices,’ was reported by one source to be the loosest form of a ‘pool.’ These types of agreements have been reported to be found in every type of industry, and very numerous in the steel and iron industries.

A report from the United States House of Representatives detailing their investigation of the United States Steel Corporation asserted that there were two general types of loose associations or consolidations between steel and iron interests in the 1890s in which the individual concerns retained ownership as well as a large degree of independence: the ‘pool’ and the ‘gentleman’s agreement.’ The latter type lacked any formal organization to regulate output or prices, nor did they contain any provisions for forfeiture in the event of an infraction. The efficacy of the agreement relied on members to keep informal pledges.

In the automotive industry, Japanese manufacturers agreed that no production car would have more than 276 horsepower, which ended in 2005. German manufacturers limit the top speed of high-performance saloons (sedans) and station wagons to 250 kilometers per hour (155 miles per hour).

Gentlemen’s agreements have come to regulate international activities such as the coordination of monetary or trade policies. According to Edmund Osmańczyk in the Encyclopedia of the United Nations and International Agreements, it is also defined as ‘an international term for an agreement made orally rather than in writing, yet fully legally valid.’ This type of agreement may allow a nation to avoid the domestic legal requirements to enter into a formal treaty, or it may be useful when a government wants to enter into a secret agreement that is not binding upon the next administration. According to another author, all international agreements are gentlemen’s agreements because, short of war, they are all unenforceable. Osmańczyk pointed out that there is a difference between open gentlemen’s agreements and secret diplomatic agreements. In the United States, a prohibition against gentlemen’s agreements in commercial relations between states was introduced in 1890 due to the secretive nature of such agreements being beyond anyone’s control.

Gentlemen’s agreements were a widely-used discriminatory tactic reportedly more common than restrictive covenants in ‘preserving’ the homogeneity of upper-class neighborhoods and suburbs in the United States. The nature of these agreements made them extremely difficult to prove or to track, and were effective long after the United States Supreme Court’s rulings in Shelley v. Kraemer and Barrows v. Jackson. One source states that gentlemen’s agreements ‘undoubtedly still exist,’ but that their use has greatly diminished.

In 1934, the National Football League entered into a gentlemen’s agreement to ban black players. Until Jackie Robinson was hired by the Brooklyn Dodgers in 1946, a gentlemen’s agreement also ensured that African American players were excluded from organized baseball.

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