SEO results and the murky world of link buying

SEO has an issue relating to the measure of authority. Inbound links are one of the key ways Google determines a website’s authority. Complexities then exist around how much authority is passed from one domain to another and the relevancy of the link text.
Good links are difficult and time consuming to obtain. Investment in high quality content, legitimate PR and relationship building is required.
Due to the hard work required, abuse has become rife. Companies of all sizes are buying links to influence Google’s ranking and stave off the competition.
As reported in the FT today, when this backfires it can be damaging to brand reputation. Even if the company claims to be anti link buying, they can’t always control the actions of their agencies.
Perhaps SEO contracts need to contain clauses that prohibit unethical practices and liquidated damages for breach. If clients want this change then SEO agencies may need to change the way they sell. Can results be guaranteed when links can’t be purchased?