CHAPTER IV. THE RIGHTS OF CONTRACT. 701 We have already (50) spoken of the necessity of mutual understanding and mutual dependence among men; and the consequent necessity of the fulfilment of Promises, as one of the principal bonds of Society. The necessity of depending upon assurances made by other men, gives birth to a Right in the person to whom the assurances are made. A person has, under due conditions, a Right to the fulfilment of a Promise. The Law realizes this Right, and must therefore define the conditions. The mutual assurances, which the Law undertakes to enforce, are called Contracts*. 702 The Law, which enforces Contracts, must determine what Promises are valid Contracts. To show the necessity of recurring to actual Law on this subject, we may remark how vague, arbitrary, and inconvenient are the maxims on this point, which Jurists have attempted to draw from the nature of the case. Thus it has been asserted †, that of the three ways of speaking of the future: I intend to give you: I shall give you: I promise you: the two former do not give a Right to the person addressed; but the third does. It is evident that this distinction is as arbitrary as any merely legal one can be: and if such rules are arbitrary, they must be established as a matter of fact, not of reasoning: that is, they must be established by actual Laws. 703 But according to the Roman Law, even the last formula, I promise you, did not necessarily convey a Right. The Roman jurists distinguished Contracts, which were universally binding, from Pacts, which were not binding except when clothed with special circumstances. A bare Promise was a Nudum Pactum, and did not establish a legal obligation. In thus refusing to recognize a bare Promise as creating a Right, the Law proceeds with a due regard to the gravity of Rights. Relations so important must be brought into being only A Contract gives rise to an Obligation, namely, the Obligation to fulfil the Contract. This the Roman Law calls an Obligatio ex contractu, and it gives the following definition of obligation: "Obligatio est juris vinculum quo necessitate adstringimur alicujus solvendæ rei secun dum nostræ civitatis jura." Inst. III. De Obligationibus. "An Obligation is the jural Bond which makes it necessary for us to discharge something according to the laws of the state of which we are citizens." + Grot. B. et P. II. 11. 2. by acts of a calm and deliberate kind. If a verbal promise, however hasty, informal, and destitute of reasonable motive, were to be sanctioned as creating a Right, the Law must carry into effect the most extravagant proposals of gamesters; as for instance, when a man stakes the whole of his fortune on the turn of a die: for the meaning of such an act is, "I promise to give you so much, if the cast is so." But the Law, whose purpose is to produce and maintain a moral and social condition of man, in which human actions are deliberate, rational and coherent, refuses its sanction and aid to such rash, irrational, and incoherent proceedings*. In the Roman Law, one ground for withholding legal force to certain promises or agreements, was the absence of a Cause or Consideration+: "Cum nulla subest causa propter conventionem, hic constat constitere‡ non posse obligationem. Igitur nuda pactio obligationem non facit." And the same is the case in the English Law in which a Contract is defined§, "An agreement of two or more persons, upon sufficient Consideration, to do or not to do a particular thing:" and the Consideration is necessary to the validity of the Contract. 704 The Law, though it requires a Consideration on each This view of the grounds for not giving legal validity to Nude Pacts is held by eminent jurists and moralists; (for instance, Leibnitz;) but by the English common Law, a wager is a good contract, and, exceptis excipiendis, money won on a wager may be recovered in a court of justice. Excepted cases are, wagers on games, wagers tending to disturb the public peace or to encourage immorality, or which hurt the feelings or character of persons not parties to the wager. But it is obvious that a wager not coming under any of these heads may be as inconsiderate and unwise a transaction as a wager on the turn of a die. Dig. II. 14. 7. "When there is no consideration for the agreement, there can be no obligation. Hence a nude pact does not establish an obligation." It would seem that "consistere" or 'constitui" must be the true reading. § Bl. II. 445. But it appears to be erroneous to state the presence or absence of a consideration as the general distinction between Contracts and Pacts. According to Walter (Geschichte des Römischen Rechts, B. III. c. XIII.) the leading distinction of Pacts from Innominate Contracts was that they were one-sided in the eficial effect, and hence required alities to give them legal validity. Such formalities were Stipulation and Literal Obligation. These were clothed Pacts. As opposed to these, were the informal nude Pacts, which, generally speaking, afforded no ground for an action. But though nude Pacts did not convey a right of action, they might give a defense to an action. "Nuda pactio Obligationem non parit, sed parit exceptionem,' says Ulpian, Dig. II. 14. 7. When a person says "I promise you not to sue for my money which you owe me ;" this is a mere pact no action can arise out of it; but if I sue you, the pact "parit exceptionem leads the judex to find for you. With regard to such Pacts, the Judge says, "Pacta Conventa quæ neque dolo malo, neque adversus leges, plebiscita, Senatus consulta, edicta Principum, neque quo fraus cui rerum fiat, facta erunt, servabo." Dig. II. 14. 17. "I will enforce Pacts which are made in conformity with the Laws, the Decrees of the People and of the Senate, the Edicts of the Emperor, in good faith, and with no fraudulent design." Pactum conventum is the full legal phrase for Pacta. Contracts are binding jure civili. Pacts are not. The Prætor here declares his intention of giving effect, under certain conditions, to the latter. side as a Contract, does not undertake to provide an equality of advantage to both; but is contented with any degree of reciprocity, leaving the force of the Consideration to be weighed by the contracting parties. Thus money paid is a valuable consideration but a good consideration also is that of blood, or of natural love and affection*. And, according to English Lawyers, as a Consideration is made necessary by the Law, in order to avoid the inconvenience of giving legal force to mere verbal promises, the Contract may be made in so solemn a manner that the Law will, for some purposes suppose a Consideration, though it be not expressed. This is the case for certain purposes in the English Law, when a man executes a bond under his sealt. On the other hand (as restraining the efficacy of a Consideration) the Law will not recognize a Contract which binds either of the parties to perform an illegal act‡: "Quod turpi ex causâ promissum est, veluti si quis homicidium vel sacrilegium se facturum promittat, non valet." And the like is said of Pacts§: "Pacta quæ causam turpem habent non sunt servanda." And the English Law recognizes a number of cases of this kind, as annulling Contracts. 705 Contracts are void also when made under violence and constraint. In such cases the person so constrained and compelled is, in the language of the Law, in Duress (Durities). The Law also recognizes Durities per minas, Fear arising from threats, as a circumstance which invalidates a contract made under its influence. But this fear must be of a serious kind; fear of loss of life, or of limb; and this upon sufficient reason; or, as an ancient English Law-writer expresses it T, "Non suspicio cujuslibet vani et meticulosi hominis, sed talis quæ possit cadere in hominem constan A fear of being beaten, though ever so well grounded, is no duress; neither is the fear of having one's house burned, or one's goods taken away or destroyed; because, in these cases, a man may obtain redress; but no sufficient compensation can be made for loss of life or limb. Bl. 11. 297. + On a promissory note or bill of exchange, want of consideration cannot be pleaded against the maker of the note by the indorsee (see Sect. 713), who gave full value for it, nor yet by the acceptor if the indorsee bring his action against him. But between the original parties to the note or bill it may. See Hovenden's Black stone, II. p. 445. Inst. III. De Inutil. Stipulat. 24. "What is promised for a criminal cause is not valid; as for instance, if any one promise that he will commit homicide or sacrilege." Dig. II. 14. 17. "Pacts for a shameful consideration are not to be enforced." Kent's Com. 11. 466. Bracton, quoted Blackst. II. 131. "Not the suspicion of a light-minded and timorous person, but such as may fall upon a man of firm mind." This is taken from the Digest. IV. 2. 6. 706 Contracts are also void, from the want of that free agency which the law requires, when the deficiency arises, not from violence or threats, but from the condition of the party as to age or understanding. Persons under the legal full age, called Minors or Infants by the Law, cannot make a valid Contract. By the English Common Law the Wife also is incapable of binding herself by Contract; her interests being supposed to be so inseparably bound up with those of her Husband, that she cannot act independently of him. A Contract made by a person not having the use of Reason, non compos mentis, is void. The Contracts of Lunatics are void from the time when the Lunacy commences. It has also been settled by the English Law*, that a Contract made by a man in a state of intoxication, if his state be such that he do not know the Consequences of his conduct, is void. Imbecility of Mind is not sufficient to set aside a Contract, when there is not an essential privation of Reason, or an incapacity of understanding and acting in the common affairs of life. 707 Contracts may be rendered void by Deception or Fraud practised on one side; but it is a matter of no small difficulty to lay down consistent Rules on this subject. The Roman law does not enforce Contracts which are made dolo malo. And this is further explained+: "Dolus malus fit calliditate et fallaciâ. Dolo malo pactum fit quoties circumscribendi alterius causâ aliud agitur et aliud agi simulatur." But it is easier to lay down Rules on this subject when Contracts have been distinguished into different kinds. 708 The Roman Jurists have divided Contracts into Kinds, according to the Consideration and the mode of expressing it. Some are called nominate Contracts-Contractus nominati-in which there are familiar names for the acts on each side; Buying and Selling; Letting and Hiring; Partnership; Commission:Emtio Venditio; Locatio Conductio; Societas; Mandatum. Others are called innominate Contracts-Contractus innominati: such as are expressed by the four Formula: Do ut des; Facio ut facias; Facio ut des; Do ut facias. The Nominate Contracts comprehended the most common transactions of men, and hence they had assigned to them at an early period settled forms of action which bore the name of the contract: and these agreements were specially called Contractus, others being Pacta Kent, II. 151. + Dig. 11. 14. 17. "Fraud is the use of trick and deception. A pact is fraudu lent when, for the purpose of circum venting some person, one thing is done and another simulated to be done." Heinec. Elem. Jur. Civ. $774. 779. But see the note to (703) for Walter's view. 709 By the Roman Law, some of the Nominate Contracts become valid merely by the expression of the mutual agreement, and are hence called consensual*. Such are buying and selling; letting and hiring; partnership; and commission (Mandatum) : other Contracts, though nominate, do not take effect except there be a delivery of the thing agreed about such are, borrowing and lending, deposit, and pledge:-Mutuum, Commodatum, Depositum, Pignus. These were called real Contracts, because they became valid by act, not by word. In these, re integra, before delivery, the parties were allowed to retract. But in Sales, in order to remove any doubt which might arise, as to whether the Sale was completed, the practice was sometimes adopted of giving Arrha, Earnest, a portion of the price; which, however small, was evidence of the Contract. Among the Northern Nations, shaking the parties' hands together had this efficacy; and a sale thus made was called handsale; whence handsel was also used for the earnest of the pricet. In the same manner a symbolical delivery of the goods was introduced: as for instance, the delivery of the key of the warehouse in which they were contained. 710 Borrowing and Lending is a Contract, in which the Romans distinguished two different cases, which we confound under one term. Mutuum was applied to the lending of those things which are reckoned by number, weight, and measure; as wine, oil, corn, coined money, of which the borrower receives a stated quantity which he may use, consume, or part with. Commodatum was that which was lent, to be restored identically the same; as a book, a harp, a horse. And the Law made a distinction in the responsibility of the borrower in these two cases. The person who had received a thing as commodatum, was bound indeed to keep it with as much care as if it were his own, or with more, if more were possible: yet if it were lost or destroyed by no fault of his, he was not bound to make compensation. But if he had received a thing as mutuum, it was to be repaid at any rate, in whatever way it had been consumed or lost. Paleys calls things which may be the subject of commodatum, inconsumable property. The other kind, consumable property, is also termed * Ib. § 895. Blackstone, II. 448. Inst. III. 15. The principle of the distinction by which mutuum and commodatum are opposed, as to liability of risk in the case of loss, is the principle of ownership: Res perit domino, in case of innocent loss, is a general rule. In mutuum the property is transferred to the Borrower in commodatum it remains with the Lender. Therefore the loss in the first case falls on the Borrower, in the second on the Lender. § Moral Phil. B. III. c. 3. BB |