Among my problems is that it mis-communicates the condition of being a student in a particular classroom, with a particular instructor. The registration itself compels the student to be held to the standards stipulated by the instructor (hopefully documented in the syllabus), and for the instructor to enforce those standards. Supposedly "signing a contract" doesn't change that in any way, and effectively constitutes fraud on the part of the instructor.
What if a student refuses to sign? Are they then not held to those standards? Are the expelled from the course? Assuming this never happens, is the real lesson then one of training students to mindlessly sign anything put in front of them by an authority figure? *
Here's a quote I ran into today from the website of CIO Magazine, from someone who actually is experienced with these issues in the business setting:
... the purpose of contracts isn’t to define relationships -- it’s to define what happens when there’s no trust and something goes seriously wrong.
When most educators roll out "contracts" they phrase it in terms of, "a contract is a guarantee that can never be broken", but the truth is they're exactly the opposite. In my game-engineering days, we once worked on a project where work started, progressed, and actually completed while the contract was still being negotiated between our executive and the outside company. That is: the contract was signed after the job was already done. The job itself commenced based on mutual trust and good faith on both sides. The contract was only a foundation for any legal actions that would occur afterward if one party truly screwed the other one over. That's what contracts are really for; evidence in a court case when a dispute does occur. Contracts only matter when they are broken.
* This is an enormously corrosive habit in a civil society. Many times I've fantasized about a reverse lesson where I give a contract on the first day with some clause like "give me your firstborn child", point it out after signing, and then rip them all up in front of students. However, this would rather obviously be too much of a mind-fuck on day one, when the primary challenge is one of building trust at that time.