An Introduction to the Philosophy of Law Part 4

Grotius and Pufendorf may be taken as types of the older natural-law theories of property. According to Grotius, all things originally were _res nullius_. But men in society came to a division of things by agreement. Things not so divided were afterward discovered by individuals and reduced to possession. Thus things came to be subjected to individual control. A complete power of disposition was deduced from this individual control, as something logically implied therein, and this power of disposition furnished the basis for acquisition from others whose t.i.tles rested directly or indirectly upon the natural foundation of the original division by agreement or of subsequent discovery and occupation. Moreover, it could be argued that the control of an owner, in order to be complete, must include not only the power to give _inter vivos_ but also the power to provide for devolution after death as a sort of postponed gift. Thus a complete system of natural rights of property was made to rest mediately or immediately upon a postulated original division by agreement or a subsequent discovery and occupation. This theory should be considered in the light of the facts of the subject on which Grotius wrote and of the time when he wrote. He wrote on international law in the period of expansion and colonization at the beginning of the seventeenth century. His discussion of the philosophical foundation of property was meant as a preliminary to consideration of the t.i.tle of states to their territorial domain. As things were, the territories of states had come down in part from the past. The t.i.tles rested on a sort of rough adjustment among the invaders of the Roman empire. They could be idealized as the result of a division by agreement and of successions to, or acquisitions from, those who partic.i.p.ated therein. Another part represented new "natural" t.i.tles based on discovery and occupation in the new world. Thus a Romanized, idealized scheme of the t.i.tles by which European states of the seventeenth century held their territories becomes a universal theory of property.

Pufendorf rests his whole theory upon an original pact. He argues that there was in the beginning a "negative community." That is, all things were originally _res communes_. No one owned them. They were subject to use by all. This is called a negative community to distinguish it from affirmative owners.h.i.+p by co-owners. He declares that men abolished the negative community by mutual agreement and thus established private owners.h.i.+p. Either by the terms of this pact or by a necessary implication what was not occupied then and there was subject to acquisition by discovery and occupation, and derivative acquisition of t.i.tles proceeding from the abolition of the negative community was conceived to be a further necessary implication.

In Anglo-American law, the justification of property on a natural principle of occupation of ownerless things got currency through Blackstone. As between Locke on the one side and Grotius and Pufendorf on the other, Blackstone was not willing to commit himself to the need of a.s.suming an original pact. Apparently he held that a principle of acquisition by a temporary power of control co-extensive with possession expressed the nature of man in primitive times and that afterwards, with the growth of civilization, the nature of man in a civilized society was expressed by a principle of complete permanent control of what had been occupied exclusively, including as a necessary incident of such control the _ius disponendi_. Maine has pointed out that this distinction between an earlier and a later stage in the natural right of property grew out of desire to bring the theory into accord with Scriptural accounts of the Patriarchs and their relations to the land grazed by their flocks. In either event the ultimate basis is taken to be the nature of man as a rational creature, expressed in a natural principle of control of things through occupation or in an original contract providing for such owners.h.i.+p.

With the revival of natural law in recent years a new phase of the justification of property upon the basis of human nature has arisen.

This was suggested first by economists who deduced property from the economic nature of man as a necessity of the economic life of the individual in society. Usually it is coupled with a psychological theory on the one side and a social-utilitarian theory on the other side. In the hands of writers on philosophy of law it has often taken on a metaphysical color. From another standpoint, what are essentially natural-law theories have been advocated by socialists, either deducing a natural right of the laborer to the whole produce of his labor from a "natural" principle of creation or carrying out the idea of natural qualities of the individual human being to the point of denying all private property as a "natural" inst.i.tution and deducing a general regime of _res communes_ or _res publicae_.

Metaphysical theories of property are part of the general movement that replaced seventeenth-and eighteenth-century theories of natural rights, founded on the nature of the abstract man or on an a.s.sumed compact, by metaphysical theories. They begin with Kant. He first sets himself to justify the abstract idea of _a_ law of property--the idea of a system of "external _meum_ and _tuum_." Here, as everywhere else, he begins with the inviolability of the individual human personality.

A thing is rightfully mine, he says, when I am so connected with it that anyone who uses it without my consent does me an injury. But to justify the law of property we must go beyond cases of possession where there is an actual physical relation to the object and interference therewith is an aggression upon personality. The thing can only be mine for the purposes of a legal system of _meum_ and _tuum_ where I will be wronged by another's use of it when it is not actually in my possession. This raises in the first instance the question "How is a merely juridical or rational [as distinguished from a purely physical] possession possible?" He answers the question by a metaphysical version of the occupation theory of the eighteenth century. Conceding that the idea of a primitive community of things is a fiction, the idea of a logically original community of the soil and of the things upon it, he says, has objective reality and practical juridical reality. Otherwise mere objects of the exercise of the will, exempted therefrom by operation of law, would be raised to the dignity of free-willing subjects, although they have no subjective claim to be respected. Thus the first possessor founds upon a common innate right of taking possession, and to disturb him is a wrong. The first taking of possession has "a t.i.tle of right" behind it in the principle of the original common claim to possession. It results that this taker obtains a control "realized by the understanding and independent of relations of s.p.a.ce," and he or those who derive from him may possess a parcel of land although remote from it physically. Such a possession is only possible in a state of civil society. In civil society, a declaration by word or act that an external thing is mine and making it an object of the exercise of my will is "a juridical act." It involves a declaration that others are under a duty of abstaining from the use of the object. It also involves an admission that I am bound in turn toward all others with respect to the objects they have made "externally theirs." For we are brought to the fundamental principle of justice that requires each to regulate his conduct by a universal rule that will give like effect to the will of others. This is guaranteed by the legal order in civil society and gives us the regime of external mine and thine. Having thus worked out a theory of _meum_ and _tuum_ as legal inst.i.tutions, Kant turns to a theory of acquisition, distinguis.h.i.+ng an original and primary from a derived acquisition. Nothing is originally mine without a juridical act. The elements of this legal transaction of original acquisition are three: (1) "Prehension" of an object which belongs to no one; (2) an act of the free will interdicting all others from using it as theirs; (3) appropriation as a permanent acquisition, receiving a lawmaking force from the principle of reconciling wills according to a universal law, whereby all others are obliged to respect and act in conformity to the will of the appropriator with respect to the thing appropriated. Kant then proceeds to work out a theory of derivative acquisition by transfer or alienation, by delivery or by contract, as a legal giving effect to the individual will by universal rules, not incompatible with a like efficacy in action of all other wills. This metaphysical version of the Roman theory of occupation is evidently the link between the eighteenth century and Savigny's aphorism that all property is founded in adverse possession ripened by prescription.

When Kant's theory is examined it will be found to contain both the idea of occupation and the idea of compact. Occupation has become a legal transaction involving a unilateral pact not to disturb others in respect of their occupation of other things. But the pact does not derive its efficacy from the inherent moral force of a promise as such or the nature of man as a moral creature which holds him to promises. Its efficacy is not found in qualities of promises or of men, but in a principle of reconciling wills by a universal law, since that principle requires one who declares his will as to object A to respect the declaration of his neighbor's will as to object B. On the other hand, the idea of creation is significantly absent. Writing at the end of the eighteenth century, in view of the ideas of Rousseau, who held that the man who first laid out a plot of ground and said, "This is mine," should have been lynched, and of the interferings with vested rights in Revolutionary France, Kant was not thinking how those who had not might claim a greater share in what they produced but how those who had might claim to hold what they had.

Hegel develops the metaphysical theory further by getting rid of the idea of occupation and treating property as a realization of the idea of liberty. Property, he says, "makes objective my personal, individual will." In order to reach the complete liberty involved in the idea of liberty, one must give his liberty an external sphere.

Hence a person has a right to direct his will upon an external object and an object on which it is so directed becomes his. It is not an end in itself; it gets its whole rational significance from his will. Thus when one appropriates a thing, fundamentally he manifests the majesty of his will by demonstrating that external objects that have no wills are not self-sufficient and are not ends in themselves. It follows that the demand for equality in the division of the soil and in other forms of wealth is superficial. For, he argues, differences of wealth are due to accidents of external nature that give to what A has impressed with his will greater value than to what B has impressed with his, and to the infinite diversity of individual mind and character that leads A to attach his will to this and B to attach his will to that. Men are equal as persons. With respect to the principle of possession they stand alike. Everyone must have property of some sort in order to be free. Beyond this, "among persons differently endowed inequality must result and equality would be wrong."

Nineteenth-century metaphysical theories of property carry out these ideas or develop this method. And it is to be noted that they are all open to attack from the standpoint of the theory of _res extra commercium_. Thus Hegel's theory comes to this: Personality involves exercise of the will with respect to things. When one has exercised his will with respect to a thing and so has acquired a power of control over it, other wills are excluded from this thing and are to be directed toward objects with which other personalities have not been so identified. So long as there are vacant lands to occupy, undeveloped regions awaiting the pioneer, unexploited natural resources awaiting the prospector--in short, so long as there are enough physical objects in reach, if one may so put it, to go round--this would be consistent with the nineteenth-century theory of justice. But when, as at the end of the nineteenth century, the world becomes crowded and its natural resources have been appropriated and exploited, so that there is a defect in material nature whereby such exercise of the will by some leaves no objects upon which the wills of others may be exerted, or a deficiency such as to prevent any substantial exertion of the will, it is difficult to see how Hegel's argument may be reconciled with the argument put behind the conception of _res extra commercium_. Miller, a Scotch Hegelian, seeks to meet this difficulty. He says that beyond what is needed for the natural existence and development of the person, property "can only be held as a trust for the state." In modern times, however, a periodical redistribution, as in antiquity, is economically inadmissible. Yet if anyone's holdings were to exceed the bounds of reason, "the legislature would undoubtedly interfere on behalf of society and prevent the wrong which would be done by caricaturing an abstract right." In view of our bills of rights, an American Hegelian could not invoke the _deus ex machina_ of an Act of Parliament so conveniently.

Perhaps he would fall back on graduated taxation and inheritance taxes. But does not Miller when hard pressed resort to something very like social-utilitarianism?

Lorimer connects the metaphysical theory with theories resting on human nature. To begin with, he deduces the whole system of property from a fundamental proposition that "the right to be and to continue to be implies a right to the conditions of existence." Accordingly he says that the idea of property is inseparably connected "not only with the life of man but with organic existence in general"; that "life confers rights to its exercise corresponding in extent to the powers of which it consists." When, however, this is applied in explaining the basis of the present proprietary system in all its details resort must be had to a type of artificial reasoning similar to that employed by the jurists of the seventeenth and eighteenth centuries. The abstract idea of owners.h.i.+p is not the only thing the legal philosopher has to consider. Moreover the reasoning by which that application is made may not be reconciled with the arguments by which the doctrine of _res extra commercium_ is regarded also as a bit of natural law.

Although it purports to be wholly different, the positive theory of the basis of property is essentially the same as the metaphysical.

Thus Spencer's theory is a deduction from a fundamental "law of equal freedom" verified by observation of the facts of primitive society.

But the "law of equal freedom" supposed to be ascertained by observation, in the same way in which physical or chemical laws are ascertained, is in fact, as has often been pointed out, Kant's formula of justice. And the verification of deductions from this law by observation of the facts of primitive civilization is not essentially different from the verification of the deductions from the metaphysical fundamental law carried on by the historical jurists. The metaphysical jurist reached a principle metaphysically and deduced property therefrom. The historical jurist thereupon verified the deduction by showing the same principle as the idea realizing itself in legal history. In the hands of the positivists the same principle is reached by observation, the same deduction is made therefrom, and the deduction is verified by finding the inst.i.tution latent in primitive society and unfolding with the development of civilization.

The most notable difference is that the metaphysical and historical jurists rely chiefly on primitive occupation of ownerless things, while the positivists have been inclined to lay stress upon creation of new things by labor. In any event, laying aside the verification for the moment, the deduction as made by Spencer involves the same difficulties as those involved in the metaphysical deduction.

Moreover, like the metaphysical deduction, it accounts for an abstract idea of private property rather than for the regime that actually exists. Inequalities are a.s.sumed to be due to "greater strength, greater ingenuity or greater application" of those who have acquired more than their fellows. Hence, as the end of law is taken to be the bringing about of a maximum of individual free self-a.s.sertion, any interference with one's holding the fruits of his greater strength or greater ingenuity or greater application, and his resulting greater activity in creative or acquisitive self-a.s.sertion, would contravene the very purpose of the legal order. It will be noted also that this theory, like all that had gone before, a.s.sumes a complete _ius disponendi_ as implied in the very notion of property. But does not this also require demonstration? Is the _ius disponendi_ implied in the idea which they demonstrate or is it only an incident of the inst.i.tution they are seeking to explain by the demonstration?

Historical jurists have maintained their theory on the basis of two propositions: (1) The conception of private property, like the conception of individual personality, has had slow but steady development from the beginnings of law; (2) individual owners.h.i.+p has grown out of group rights just as individual interests of personality have been disentangled gradually from group interests. Let us look at each of these propositions in some detail.

If we examine the law of property a.n.a.lytically, we may see three grades or stages in the power or capacity which men have of influencing the acts of others with respect to corporeal objects. One is a mere condition of fact, a mere physical holding of or physical control over the thing without any other element whatever. The Roman jurists called this natural possession. We call it custody. Writers on a.n.a.lytical jurisprudence regard it as an element of possession. But this natural possession is something that may exist independently of law or of the state, as in the so-called _pedis possessio_ of American mining law, where, before law or state authority had been extended to the public domain in the mining country, the miners recognized the claim of one who was actually digging to dig without molestation at that spot. The mere having of an object in one's actual grasp gives an advantage. But it may be only an advantage depending on one's strength or on recognition of and respect for his personality by his fellow men. It is not a legal advantage except as the law protects personality. It is the physical person of the one in natural possession which is secured, not his relation to the thing held.

a.n.a.lytically the next grade or stage is what the Romanist calls juristic possession as distinguished from natural possession. This is a legal development of the extra-legal idea of custody. Where custody or the ability to reproduce a condition of custody is coupled with the mental element of intention to hold for one's own purposes, the legal order confers on one who so holds a capacity protected and maintained by law so to hold, and a claim to have the thing restored to his immediate physical control should he be deprived of it. As the Romanist puts it, in the case of natural possession the law secures the relation of the physical person to the object; in juristic possession the law secures the relation of the will to the object. In the highest grade of proprietary relation, owners.h.i.+p, the law goes much further and secures to men the exclusive or ultimate enjoyment or control of objects far beyond their capacity either to hold in custody or to possess--that is, beyond what they could hold by physical force and beyond what they could actually hold even by the help of the state. Natural possession is a conception of pure fact in no degree dependent upon law. The legally significant thing is the interest of the natural possessor in his personality. Possession or juristic possession is a conception of fact and law, existing as a pure relation of fact, independent of legal origin, but protected and maintained by law without regard to interference with personality.

Owners.h.i.+p is a purely legal conception having its origin in and depending on the law.

In general the historical development of the law of property follows the line thus indicated by a.n.a.lysis. In the most primitive social control only natural possession is recognized and interference with natural possession is not distinguished from interference with the person or injury to the honor of the one whose physical contact with the physical object is meddled with. In the earlier legal social control the all-important thing is seisin, or possession. This is a juristic possession, a conception both of fact and of law. Such inst.i.tutions as tortious conveyance by the person seised in the common law are numerous in an early stage of legal development. They show that primarily the law protected the relation to an object of one who had possession of it. Indeed the idea of _dominium_, or owners.h.i.+p as we now understand it, was first worked out thoroughly in Roman law, and other systems got their idea of it, as distinguished from seisin, from the Roman books.

Recognition of individual interests of substance, or in other words individual property, has developed out of recognition of group interests, just as recognition of individual interests of personality has evolved gradually from what in the first instance was a recognition of group interests. The statement which used to be found in the books that all property originally was owned in common means nothing more than this: When interests of substance are first secured they are interests of groups of kindred because in tribally organized society groups of kindred are the legal units. Social control secures these groups in the occupation of things which they have reduced to their possession. In this sense the first property is group property rather than individual property. Yet it must be noted that wherever we find a securing of group interests, the group in occupation is secured against interference of other groups with that occupation. Two ideas gradually operated to break up these group interests and bring about recognition of individual interests. One of these is the part.i.tion of households. The other is the idea of what in the Hindu law is called self-acquired property.

In primitive or archaic society as households grow unwieldy there is a part.i.tion which involves part.i.tion of property as well as of the household. Indeed in Hindu law part.i.tion is thought of as part.i.tion of the household primarily and as part.i.tion of property only incidentally. Also in Roman law the old action for part.i.tion is called the action for part.i.tioning the household. Thus, at first, part.i.tion is a splitting up of an overgrown household into smaller households.

Presently, however, it tends to become a division of a household among individuals. Thus in Roman law on the death of the head of a household each of his sons in his power at his death became a _pater familias_ and could bring a proceeding to part.i.tion the inheritance although he might be the sole member of the household of which he was the head. In this way individual owners.h.i.+p became the normal condition instead of household owners.h.i.+p. In Hindu law household owners.h.i.+p is still regarded as the normal condition. But with changes in society and the rise of commercial and industrial activity, a change has been taking place rapidly which is making individual owners.h.i.+p the normal type in fact, if not in legal theory.

Self-acquired property, the second disintegrating agency, may be seen in Hindu law and also in Roman law. In Hindu law all property is normally and _prima facie_ household property. The burden is upon anyone who claims to be the individual owner of anything. But an exceptional cla.s.s of property is recognized which is called self-acquired property. Such property might be acquired by "valor,"

that is, by leaving the household and going into military service and thus earning or acquiring by way of booty, or by "learning," that is, by withdrawing from the household and devoting oneself to study and thus acquiring through the gifts of the pious or the exercise of knowledge. A third form was recognized later, namely, property acquired through the use of self-acquired property. In the same way in Roman law the son in the household, even if of full age, normally had no property. Legally all property acquired by any member of the household was the property of the head of the household as the legal symbol and representative thereof. Later the head of the household ceases to be thought of as symbolizing the household and the property was regarded legally as his individual property. But Roman law recognized certain kinds of property which sons in the household might hold as their own. The first of these was property earned or acquired by the son in military service. Later property earned in the service of the state was added. Finally it came to be law that property acquired otherwise than through use of the patrimony of the household might be held by the son individually though he remained legally under the power of the head.

In the two ways just explained, through part.i.tion and through the idea of self-acquired property, individual interests in property came to be recognized throughout the law. Except for the inst.i.tution of community property between husband and wife in civil-law countries, or as it is called the matrimonial property regime, there is practically nothing left of the old system of recognized group interests. And even this remnant of household group owners.h.i.+p is dissolving. All legally recognized interests of substance in developed legal systems are normally individual interests. To the historical jurist of the nineteenth century, this fact, coupled with the development of owners.h.i.+p out of possession, served to show us the idea which was realizing in human experience of the administration of justice and to confirm the position reached by the metaphysical jurists. Individual private property was a corollary of liberty and hence law was not thinkable without it. Even if we do not adopt the metaphysical part of this argument and if we give over the idealistic-political interpretation of legal history which it involves, there is much which is attractive in the theory of the historical jurists of the last century. Yet as we look at certain movements in the law there are things to give us pause. For one thing, the rise and growth of ideas of "negotiability," the development of the maxim _possession vaut t.i.tre_ in Continental law, and the cutting down in other ways of the sphere of recognition of the interest of the owner in view of the exigencies of the social interest in the security of transactions, suggests that the tendency involved in the first of the two propositions relied on by the historical school has pa.s.sed its meridian. The Roman doctrine that no one may transfer a greater t.i.tle than he has is continually giving way before the demand for securing of business transactions had in good faith. And in Roman law in its maturity the rules that restricted acquisition by adverse possession and enabled the owner in many cases to reclaim after any lapse of time were superseded by a decisive limitation of actions which cut off all claims. The modern law in countries which take their law from Rome has developed this decisive limitation. Likewise in our law the hostility to the statute of limitations, so marked in eighteenth-century decisions, has given way to a policy of upholding it. Moreover the rapid rise in recent times of limitations upon the _ius disponendi_, the imposition of restrictions in order to secure the social interest in the conservation of natural resources, and English projects for cutting off the _ius abutendi_ of the landowner, could be interpreted by the nineteenth-century historical jurists only as marking a retrograde development. When we add that with the increase in number and influence of groups in the highly organized society of today a tendency is manifest to recognize practically and in back-handed ways group property in what are not legal ent.i.ties, it becomes evident that the segment of experience at which the historical jurists were looking was far too short to justify a dogmatic conclusion, even admitting the validity of their method.

It remains to consider some twentieth-century theories. These have not been worked out with the same elaboration and systematic detail as those of the past, and as yet one may do no more than sketch them.

An instinctive claim to control natural objects is an individual interest of which the law must take account. This instinct has been the basis of psychological theories of private property. But thus far these theories have been no more than indicated. They might well be combined with the historical theory, putting a psychological basis in place of the nineteenth-century metaphysical foundation. A social-psychological legal history might achieve much in this connection.

Of sociological theories, some are positivist, some psychological and some social-utilitarian. An excellent example of the first is Duguit's deduction from social interdependence through similarity of interest and through division of labor. He has but sketched this theory, but his discussion contains many valuable suggestions. He shows clearly enough that the law of property is becoming socialized. But, as he points out, this does not mean that property is becoming collective.

It means that we are ceasing to think of it in terms of private right and are thinking of it in terms of social function. If one doubts this he should reflect on recent rent legislation, which in effect treats the renting of houses as a business affected with a public interest in which reasonable rates must be charged as by a public utility. Also it means that cases of legal application of wealth to collective uses are becoming continually more numerous. He then argues that the law of property answers to the economic need of applying certain wealth to definite individual or collective uses and the consequent need that society guarantee and protect that application. Hence, he says, society sanctions acts which conform to those uses of wealth which meet that economic need, and restrains acts of contrary tendency. Thus property is a social inst.i.tution based upon an economic need in a society organized through division of labor. It will be seen that the results and the att.i.tude toward the law of property involved are much the same as those which are reached from the social-utilitarian standpoint.

Psychological sociological theories have been advanced chiefly in Italy. They seek the foundation of property in an instinct of acquisitiveness, considering it a social development or social inst.i.tution on that basis.

Social-utilitarian theories explain and justify property as an inst.i.tution which secures a maximum of interests or satisfies a maximum of wants, conceiving it to be a sound and wise bit of social engineering when viewed with reference to its results. This is the method of Professor Ely's well-known book on Property and Contract. No one has yet done so, but I suspect one might combine this mode of thought with the civilization interpretation of the Neo-Hegelians and argue that the system of individual property, on the whole, conduces to the maintaining and furthering of civilization--to the development of human powers to the most of which they are capable--instead of viewing it as a realization of the idea of civilization as it unfolds in human experience. Perhaps the theories of the immediate future will run along some such lines. For we have had no experience of conducting civilized society on any other basis, and the waste and friction involved in going to any other basis must give us pause. Moreover, whatever we do, we must take account of the instinct of acquisitiveness and of individual claims grounded thereon. We may believe that the law of property is a wise bit of social engineering in the world as we know it, and that we satisfy more human wants, secure more interests, with a sacrifice of less thereby than by anything we are likely to devise--we may believe this without holding that private property is eternally and absolutely necessary and that human society may not expect in some civilization, which we cannot forecast, to achieve something different and something better.

VI

Contract

Wealth, in a commercial age, is made up largely of promises. An important part of everyone's substance consists of advantages which others have promised to provide for or to render to him; of demands to have the advantages promised which he may a.s.sert not against the world at large but against particular individuals. Thus the individual claims to have performance of advantageous promises secured to him. He claims the satisfaction of expectations created by promises and agreements. If this claim is not secured friction and waste obviously result, and unless some countervailing interest must come into account which would be sacrificed in the process, it would seem that the individual interest in promised advantages should be secured to the full extent of what has been a.s.sured to him by the deliberate promise of another. Let us put this in another way. In a former lecture I suggested, as a jural postulate of civilized society, that in such a society men must be able to a.s.sume that those with whom they deal in the general intercourse of the society will act in good faith, and as a corollary must be able to a.s.sume that those with whom they so deal will carry out their undertakings according to the expectations which the moral sentiment of the community attaches thereto. Hence, in a commercial and industrial society, a claim or want or demand of society that promises be kept and that undertakings be carried out in good faith, a social interest in the stability of promises as a social and economic inst.i.tution, becomes of the first importance. This social interest in the security of transactions, as one might call it, requires that we secure the individual interest of the promisee, that is, his claim or demand to be a.s.sured in the expectation created, which has become part of his substance.

In civil-law countries the interest of the promisee, and thus the social interest in the security of transactions, is well secured. The traditional requirement of a _causa ciuilis_, a civil, i.e., legal, reason for enforcing a pact, gave way before natural-law ideas in the eighteenth century. Pothier gave over the contract categories of the Roman law as being "very remote from simplicity." Then came the rise of the will theory of legal transactions in the nineteenth century.

French law made intention of gratuitously benefiting another a _causa_. The Austrian code of 1811 presumed a _causa_, requiring a promisor to prove there was none. And this means that he must prove the promise was not a legal transaction--that there was no intention to enter into a binding undertaking. In the result, abstract promises, as the civilian calls them, came to be enforced equally with those which came under some formal Roman category and with those having a substantial presupposition. Modern Continental law, apart from certain requirements of proof, resting on the same policy as our Statute of Frauds, asks only, Did the promisor intend to create a binding duty?

Likewise in civil-law countries the enforcing machinery is modern and adequate. The oldest method of enforcement in Roman law was seizure of the person, to coerce satisfaction or hold the promisor in bondage until his kinsmen performed the judgment. Later there was a pecuniary condemnation or, as we should say, a money judgment in all cases, enforced in the cla.s.sical law by universal execution or, as we should say, by involuntary bankruptcy. But along with this remedy specific relief grew up in the _actio arbitraria_, a clumsy device of specific performance on the alternative of a heavy money condemnation, which repeated itself in Pennsylvania before equity powers were given the courts, and is substantially repeating in our federal courts in their attempts to apply equitable relief to torts committed in foreign jurisdictions. The civil law developed, or perhaps the canon law developed and the civil law took over, an _actio ad implendum_ or action to require performance, with natural execution, that is a doing by the court or its officers at the expense of the defendant, of that to which he is bound as ascertained by the judgment. In general in civil-law countries today what we call specific performance is the rule. A money reparation for breach of contract is the exceptional remedy. It is only when for some reason specific relief is impracticable or inequitable, as in contracts of personal service, that money relief is resorted to.

In countries governed by the common law we do not secure this interest so completely nor so effectively. For one thing we do not recognize as legally enforceable all intentional promises intended to be binding upon the promisor. Many technical rules as to consideration, rules having chiefly a historical basis, stand in the way. Many jurisdictions have abolished private seals and have made no provision for formal gratuitous or abstract promises. Moreover, we do not give specific relief ordinarily but only exceptionally where pecuniary relief is considered inadequate. Hence in the great majority of cases the promisee cannot compel performance in specie.

If we look into the reasons for this wide and effective enforcement of promises in the one system and narrower and less effective enforcement in the other, we come in both cases upon a mixture of historical background and philosophical reasoning, each influencing the other and neither governing the subject completely. Philosophical theories have arisen to explain existing rules and have been the basis of new rules and of remaking of old ones. But they have been the means also, at times, of intrenching the rules they sought to explain and of fastening on the law doctrines of which it were better rid. Nowhere is the reciprocal action of legal rules and philosophical theories more strikingly manifest than in our law of contractual liability.

Law did not concern itself at first with agreements or breaches of agreements. Its function was to keep the peace by regulating or preventing private war and this only required it to deal with personal violence and with disputes over the possession of property. I may remind you of the proposition of Hippodamus in the fifth century B. C.

that there were but three subjects of lawsuits, namely, insult, injury and homicide. If a dispute over breach of an agreement led to an a.s.sault and a breach of the peace, tribunals might be called on to act. But it was the a.s.sault not the breach of agreement with which they were concerned. Controversy as to possession of property was a fertile source of disturbance of the peace and tribunals would entertain an action to recover possession. Agreements to compound for a wrong are perhaps the earliest type. But the law had its eye upon the need of composition, not upon the agreement. No basis for a law of contracts was to be found in the power of the tribunals with respect to injuries although our law did make a.s.sumpsit out of trespa.s.s on the case. On the other hand recovery of property could be used for this purpose. Hence the first legal, as distinguished from religious, contract was worked out on the a.n.a.logy of a real transaction. Before this, however, another possibility had developed in the religiously sanctioned promise.

Religion, the internal discipline of the organized kindred, and the law of the state were three co-ordinate agencies of social control in ancient society. Nor was law for a long time the chief of these nor the one which covered the widest field. If the G.o.ds had been called to witness or good faith had a religious sanction, the duty to keep a promise was a matter for religion. Otherwise the mere pact or agreement not within the cognizance of the priests was but a matter for self-help. Hindu law shows the idea of religious duty to keep faith in full vigor. In the Hindu system the relation between the parties to a debt is not legal but religious and now that a law has grown up under English influence it is said that there is a legal obligation because there is a religious obligation. A man is bound in law because and to the extent that he is bound in religion and not otherwise and no more. To the Hindu lawyer a debt is not an obligation merely. It is a sin the consequences whereof follow the debtor into another world. Vrihaspati says: "He who, having received a sum lent or the like does not return it to the owner, will be born hereafter in his creditor's house a slave, a servant, a woman or a quadruped."

Narada says that when one dies without having paid his debt, "the whole merit of his devotions or of his perpetual fire belongs to his creditors." In short the debtor is looked on as one who wrongfully withholds from the creditor the latter's property and hence as in some sort a thief. The legal idea, so far as there is one, is not one of obligation but of a property right in the creditor. One may suspect that religious obligation arising from the detention of property is a legal way of putting it in a polity in which social control is primarily religious and religious precepts are turning into legal precepts. At any rate the Hindus carry the idea of religious obligation so far that a descendant is bound to pay the debts of his ancestor in many cases whether he receives any a.s.sets of the ancestor or not. The liability of the son to pay the father's debt is held to arise from the moral and religious duty of rescuing the father from the penalties attaching in a future state to non-payment of debts.

Accordingly if the debt is of such a kind that no penalties would so attach, there is no religious duty and hence no obligation imposed upon the descendant.

Roman law in its earliest stage was not unlike this. Agreements of themselves were not cognizable by the tribunals. It was no ground for summoning a defendant before the magistrate that he had made a promise and had broken it. Agreements were matters for religion or for kin or guild discipline. If one had called on the G.o.ds to witness his promise or sworn to fulfil it, he was liable to pontifical discipline. The presence of an impious oath breaker was a social danger and he might be devoted to the infernal G.o.ds. As law replaced religion as the controlling regulative agency, the old religiously sanctioned promise becomes a formal legal contract. Thus in the strict law we get formal contracts with their historical origin in religious duty, and formal contracts with their historical origin in a legal duty created by a real transaction of suretys.h.i.+p or conveyance, perhaps by calling the people to witness so that there is an affront to the state if they are called upon in vain.

When contact with Greek philosophers set the Roman jurists to thinking about the basis of obligation, there were two sorts of promises: (1) Formal promises, (a) by stipulation, using the sacramental word _spondeo_ and thus a.s.suming the pouring out of a libation that the G.o.ds might take notice of the promise, (b) by public ceremony apparently symbolizing a real transaction before the whole people, (c) entered upon the household books of account, and (2) mere informal promises not recognized by law. The latter depended wholly on the good faith of the maker since the law had put down self-help which formerly had been available to the promisee. Accordingly Roman jurists distinguished civil obligations and natural obligations--those recognized and secured legally and those which primarily had only a moral efficacy. A _nudum pactum_ or mere agreement or mere promise, not clothed with legal efficacy because it did not come within any of the categories of legal transactions sanctioned by the _ius ciuile_, created only a natural obligation. It was right and just to adhere to such a pact, but only contracts, undertakings recognized by law because of their form or nature, were enforceable.

With increasing pressure of the social interest in the security of transactions through economic development and commercial expansion, the natural-law philosophy slowly affected this simple scheme of formal undertakings legally recognized and enforceable and informal undertakings of only moral efficacy, and brought about the complicated system of enforceable undertakings in the maturity of Roman law with which you are familiar. Four features of this movement are noteworthy.

In the first place it led to a juristic theory of formal contract which has affected our ideas ever since. In the strict law the source of obligation was in the form itself. For in primitive thinking forms have an intrinsic efficacy. It has often been pointed out that the faith in legal forms belongs to the same order of thought as faith in forms of incantation and that legal forms are frequently symbols to be cla.s.sed psychologically with the symbols of magic. The stage of equity and natural law, relying on reason rather than on form, governed by philosophy instead of by nave faith, looked for the substance and found it in a pact preceding and presupposed by the formal ceremony. Thus a formal contract was a pact with the addition of legal form. The pact was the substance of the transaction. The form was a _causa ciuilis_ or legal reason for enforcing the pact. But if the form was only a legal reason for enforcing something that got its natural efficacy in another way, it followed that there might well be other legal reasons for enforcement besides form. Consequently new categories of contract were added to the old formal contracts and it is significant that while the latter were transactions _stricti iuris_ the former were considered transactions _bonae fidei_ involving liability to what good faith demanded in view of what had been done.

In the scope of their obligation these contracts responded exactly to the postulate of civilized society that those with whom we deal will act in good faith and will carry out their undertakings according to the expectations of the community. On the other hand the old formal contracts responded thereto in part only since their obligation was one to do exactly what the terms of the form called for, no more and no less. When one makes _nexum_, said the Twelve Tables, as he says orally so be the law. New categories were added in successive strata, as it were, and juristic science sought afterward to reduce them to system and logical consistency. Thus real contracts, consensual contracts and innominate contracts were added. But it is evident that many of these are juristic rationalizings of what had been done for a long time through formal transactions. Thus the consensual contract of sale with its implied warranties rationalizes transfer by _traditio_ with stipulations for the price and for warranties. The real contract of _depositum_ rationalizes _fiducia c.u.m amico_. The real contract of _mutuum_ rationalizes _pecunia credita_. But the latter was so thoroughly established as a formal transaction that the case of a loan of money, a.n.a.lytically a real contract, preserved the incidents of the strict law. Moreover certain pacts, _pacta adiecta_, _pacta praetoria_, became actionable which do not fit into the a.n.a.lytical scheme of the Inst.i.tutes. For example, a _causa_ or reason for enforcing these pacts was found in their being incidental to something else or in a pre-existing natural obligation which they undertook to satisfy. There still remained natural obligations which had not been given legal efficacy as the basis of actions. The mere will of the person who undertook or the claim of the promisee was not a reason for enforcing. Yet in reason they were morally binding and the legal and moral should coincide. Hence they might be used defensively or as the basis of a set-off. Meanwhile the forms of stipulation and of literal contract had been reduced to their lowest terms by conceiving them in terms of substance, and taking orally expressed agreement to be the substance of the one and writing to be the substance of the other. The results have defied a.n.a.lysis although the best that juristic ingenuity could do has been expended upon them for centuries.

In the Middle Ages primitive ideas came back for a time through Germanic law. General security in its lowest terms of peace and order was the pressing social interest. There was little commercial activity. The civilization of the time did not involve the corollaries of our jural postulate. Religiously sanctioned undertakings by promissory oath and real transactions of pledge of person or property and of exchange gave rise to a simple system of formal undertakings.

Out of these came a theory of _causa debendi_, or reason for owing the promised performance, which has had a profound influence upon subsequent thinking. The Roman _causa ciuilis_ was a legal reason for enforcing a pact. Under the influence of the Germanic idea _causa_ becomes a reason for making the pact, the good reason for making it furnis.h.i.+ng a sufficient reason for enforcing it. For a time it seemed that the church might succeed in establis.h.i.+ng a jurisdiction over promises. Oaths and vows involved religious duties and might well be claimed as the province of the spiritual. But the moral obligation of pacts, binding the conscience of a Christian, might also be cognizable by a zealous corrector of the conduct of the faithful for their soul's welfare. Had not the power of the canon law broken down and the law of the state developed rapidly in respect of the security of transactions after the sixteenth century, the law of contracts might have grown along religious instead of along philosophical lines, and perhaps not to its advantage. As it is, one need but read Doctor and Student with the t.i.tle _de pactis_ of the _Corpus Iuris Canonici_ and casuist writings as to the moral efficacy of promises before him, to see that religion paved the way for much that was done presently in the name of philosophy.

To the jurists of the seventeenth and eighteenth centuries no distinction between natural obligations and civil obligations was maintainable since all natural rights or obligations must for the very reason that they were natural be legal also. If it was morally obligatory that one adhere to a pact, then it must be treated as a contract. However much systematized a.n.a.lytically, the Roman categories of contract did not deal with undertakings from this standpoint. What the jurists desired was not a.n.a.lytical categories but a principle upon which men were to be held or not to be held upon their promises. Thus the philosophy of contract, the principles underlying the binding force of promises and agreements, became the chief problem of philosophical jurisprudence of the seventeenth century, as interests of personality were the chief subject of discussion in the eighteenth century, and interests of substance, the philosophy of the law of property, the chief subject of discussion in the nineteenth century.

The decisive element in seventeenth-century thought as to contract was the idea of natural law; the idea of deduction from the nature of man as a moral creature and of legal rules and legal inst.i.tutions which expressed this ideal of human nature. But the idea was put to work upon existing materials and the result was a reciprocal influence of the conception of enforcing promises as such because morally binding, on the one hand, shaped to some extent by canon law and casuist discussions of what promises were binding in conscience and when, and the ideas of _nudum pactum_ and _causa debendi_ on the other hand.

Roman law was a.s.sumed to be embodied reason. As D'Aguesseau put it, Rome was ruling by her reason, having ceased to rule by her authority.

Hence all consideration of the subject starts with the a.s.sumption that there are morally naked agreements which for that reason are to be naked legally. Where there was an exchange of promises there was the authority of Justinian for enforcement (_synallagma_) and it was easy to find a reason in the a.n.a.logy of exchange of property. Where something was exchanged for a promise, that something was a _causa debendi_. But suppose there was no exchange of promises nor was anything exchanged for the promise. There was nothing but a promise a.s.sented to. In Roman law this would have to take the form of a stipulation. In the Germanic law it would have required an oath or the form of a real transaction of pledge or exchange. At common law it required delivery of a sealed instrument. Clearly there was no moral efficacy inherent in these forms. Why should these "abstract" promises be enforced and not others? Should every such promise be enforced or should none be enforced without something in the way of exchange, or should such promises be cla.s.sified for the purpose of enforcement, and if so, how?

Two theories arose in the seventeenth century. One may be called the theory of an equivalent. This theory is obviously a rationalization of the Germanic _causa debendi_ influenced by canon law and casuist writings. According to this theory an abstract promise, no equivalent having been given for it, is not naturally and hence is not legally binding. Three reasons have been given for this which have figured in juristic discussion of the subject ever since. It was said that one who trusts another who makes a promise for no equivalent does so rashly. He cannot ask to be secured in such an unfounded expectation.