Mutual options, like the one in Jose Bautista’s new contract with the Blue Jays, are hardly ever exercised. So are they worthwhile … or worthless?
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The world runs on mutual options. If you go on a first date, it comes with a mutual option to go on a second if you both so desire. In fact, right now, you and I have a mutual option to go on a date tomorrow. What will you wear to our date? No need to decide, because I’m declining my half of the mutual option.
This is just how we live: We have freedom and liberty and we get to choose, individually, whether to do things together. Business transactions start as mutual options. Conversations are mutual options. Life itself is a mutual option, between us and our fate. But only in baseball, weirdo baseball, does the mutual option get written down, as it did last week, when Jose Bautista and the Toronto Blue Jays agreed to a one-year contract with a mutual option for a second year. Or, in other words, a one-year contract.
Just when it looked like Jose Bautista’s multiyear contract ambitions had been iced, the Blue Jays swooped in. Does a reunion work for both?
Jose Bautista and the Blue Jays have reached a one-year contract with mutual options for the 2018 and 2019 seasons.
It’s worth asking: What’s up with mutual options? These options, typically tacked on to the end of a deal, can be declined by either party when the year in question comes. There is no downside. There is, consequently, very little upside for obvious reasons: If one party stands to benefit relative to the market, the other party stands to lose. And will thus decline the option.
There have been scores of these clauses tucked into major league contracts, though, which raises many questions: Why are we still seeing this phenomenon? What’s the point? Does one side actually benefit? Can both? Let’s start at the beginning.
The mutual option did not enter baseball parlance until 1992. Even then, it was not American baseball, but rather a team in Japan’s Nippon Professional Baseball league, the Osaka Kintetsu Buffaloes, that gave former big leaguer Alvin Davis a contract that included a “mutual” option. The quotation marks are from the original report, as this novel contract feature was still