As has often been said, the Romans did not have a general contract law but a law of particular contracts. They began to use the term ‘contract’ at a comparatively late date, after most of the rules governing particular contracts had been settled. Gaius was the first to distinguish the general classes of obligations contractus and delictus.1 The distinction is similar to one that Aristotle drew between involuntary and voluntary commuta-tive justice. Modern scholars believe that Gaius took it directly or indirectly from Aristotle.2 In any event, Gaius did not discuss its implications. Having drawn this distinction, he immediately turned to the rules that governed particular torts and contracts of Roman law. As Alan Watson observed, for the Roman jurists:
Each individual type of contract, such as stipulation, loan for use, or loan for consumption, sale, hire, or mandate, remains intact with its own sui generis body of rules … [F]or a Roman jurist it was unthinkable … to write a commentary on the law of contracts or even on the law of a group of contracts, such as consensual contracts. The same is equally true of other fields, for instance of delicts.3
Some of these rules concerned when an agreement between the parties became binding. Although the Roman jurists recognized that the parties must consent for any contract to be binding, only some contracts, the
‘consensual’ contracts or contracts consensu, were binding by consent alone. Gaius mentioned sale, lease (or hire), partnership and mandate, which is a kind of gratuitous agency.4 Others, the ‘real contracts’
(contracts re) were binding when an object was actually delivered, for example, loans for use or for consumption, and deposit, all of which were gratuitous. Other contracts were binding upon the execution of a formal-ity. The all-purpose formality was stipulatio, which was srcinally oral although eventually a writing could be used to prove that a stipulatio had
1 G. 3.88.
2 See Zimmermann (1990) 10–11; Kaser (1959) 522; Honoré (1962) 100;
Coing (1952) 59.
3 Watson (1995) 170.
4 G. III. 135.
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been made. One party would ask the other, ‘Do you promise such and such?’ and the other would answer that he did. For each party to be bound, each party would make a stipulatio in which his obligation was conditional on the other party’s fulfillment of his own. Eventually, a special formality, insinuatio, was required for the promises of gifts. The promise had to be officially registered. Finally, there were ‘innominate’
contracts, contracts ‘without names’, that were not enforceable before performance. An example was barter.
A.
A. RejRejectectioion of n of ththe Roe Roman man DiDiststininctctioionsns
Although some medieval jurists expressed surprise that barter, unlike sale, was not binding upon consent,5the attack on the Roman distinctions among contracts began with the late scholastics. Luis de Molina thought that the Roman distinctions were wrong in principle. In a barter, ownership was transferred when the objects exchanged were actually delivered. Molina saw no reason why, if the parties so intended, they could not transfer upon consent the right to demand delivery. A court should ascertain their intent by examining the ‘circumstances’. 6 Molina concluded that ‘everything, indeed, concerning … innominate and innominate contracts that was invented and introduced by the pagans more subtly than usefully should be abolished’.7 His contemporary Leonard Lessius agreed that the Roman distinction had no principled justification, but for a different reason. He claimed that Molina had failed
to recognize that promises are binding simply because they are promises and not because of the precise intention with which they are made. A promise was a commitment to do something, not a mere statement about what one would do. Therefore every promise gave rise to an obligation.8 A promise to give one object in exchange for another was therefore binding without any need to inquire into the circumstances.
In the seventeenth and eighteenth centuries, these arguments were repeated by the leaders of the northern natural law school, Hugo Grotius, Samuel Pufendorf and Jean Barbeyrac. Grotius and Barbeyrac made the argument of Molina. ‘Why’, Grotius asked, ‘may there not be transferred a right in personam either that ownership be transferred or that something
5 See, e.g., Iacobus de Ravanis, Lectura Super Codice to C. 4.64.3 (1519);
repr. Opera iuridica rariora, vol. 1 (1967) (published under the name of Petrus de Bellipertica: on authoriship, see Meijers (1959) 72–77.
6 Molina (1614) disp. 262.
7 Ibid. disp. 258.
8 Lessius (1628).
In defense of Roman contract law 21
be done?’9 Barbeyrac concluded that ‘if a purely gratuitous promise can confer a true right, then the one to whom the promise was made has certainly lost a right that he had acquired’. 10 Pufendorf conflated the arguments of Molina and Lessius. Every ‘perfect promise’ gave rise to an obligation because ‘it is a perfect promise when a man not only declares his will for a future time to perform something for another, but also shows that he gives him a right whereby the other is fully entitled to demand of him the thing promised’. 11 The Roman distinctions among nominate and innominate contracts came to be regarded, at best, as a peculiarity of Roman positive law, and, at worst, as a mistake. Over the next century, they disappeared in jurisdictions that had adopted Roman law.12 They were abolished by statute in parts of Spain. 13 German and Dutch jurists claimed that, unlike most of Roman law, they had never been received.14So did the leading French jurists Jean Domat and Robert Pothier.15
Molina and Lessius launched the attack on the Roman distinctions with a simple argument: the parties should be able to make their agreement binding by consent if they so wished. Therefore, any of the contracts recognized by Roman law should be binding by consent if the parties so wished. The question that they did not face is whether or not the parties to every sort of voluntary arrangement did wish to be bound on consent.
Molina said that a court should ascertain their intent by examining the
‘circumstances’.16But he was so certain that the parties would wish to be bound upon consent that he said, ‘everything, indeed, concerning …
innominate and innominate contracts … should be abolished’.17 Lessius thought that one who consented to a contract promised to abide by its
9 Grotius (1646) II.xi.1.3.
10 Barbeyrac (1734) n. 10 to III.v.10.
11 Pufendorf (1688) III.v.7.
12 See Zimmermann (1990) 538–40, 544–45.
13 Molina (1614) 257–58.
14 Vinnius (1703) 3.14.2 § 11; Voet (1827) 2.14 § 9; Böhmer (1791) 2.14
§ 25; Stryk (1739) 2.14 §§ 1–3; Brunnemann (1731) 2.14.7 no. 6. An exception was Lauterbach, who denied that an action could be brought on a mere agreement, Lauterbach (1707) 2. 4 §§ 19–20. As Nanz noted, Wesenbeck, in a commentary first published in 1565, was the first to make the claim that, according to usage, all agreements are enforceable, for which he miscited Bartolus and Baldus. Wesenbeck (1665) 2.14 § 9; Nanz (1985) 85. See Birocchi (1990) 146–55, 197–213.
15 Domat (1771) liv. I, tit. i, sec. 1, § 8; Pothier (1821) § 3, 1.
16 Molina (1614) disp. 262.
17 Ibid . disp. 258.
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terms, and therefore bound himself to do so before performance. It is possible, however, for parties to agree on the terms of a voluntary arrangement without wishing to be bound in advance of performance.
Lessius would say that they did not consent or promise and that consequently their arrangement was not a contract. He did not deny that if the parties did not wish to be bound in advance of performance, they should not be. The question he did not address was when, typically, or more often than not, the parties who entered into the Roman real contracts and innominate contracts would wish to be bound.
The conclusion that in principle, all contracts are binding upon consent was accepted by the nineteenth century will theorists virtually without argument. They defined contract in terms of the will or consent or agreement of the parties. 18 They did not explain why the law should enforce contracts or why the expressed will of the parties should be respected. As Valérie Ranouil observed in her study of the French will theories, they took the binding force of contract for granted rather than demonstrating it.19 She quoted Gounot’s characterization of their view:
‘The contract is obligatory simply because it is the contract.’ 20
The question that needs to be addressed is when the parties would wish to be bound. We will examine that question, first, with regard to innominate contracts such as barter, and second with regard to real contracts such as loans for use and consumption and deposit. Then we will see that the same question should be addressed even in dealing with consensual contracts such as sale.
B.
B. InInnomnomininatate e ConContratractctss
In innominate contracts, one performance is given for another. There is no price, and so the contract is neither a sale nor a lease. In a passage ascribed to Paul but probably interpolated by Justinian’s compliers, 21 there are said to be four such arrangements: either I give to you so that you give; or I give so that you do; or I do so that you give; or I do so that you do.22We will discuss barter ( permutatio), in which one thing is given
18 See, e.g., Savigny (1840) § 134; Puchta (1884) §§ 49, 54; Windscheid (1891) § 69; Demolombe (1882) § 12; Larombière (1857) 1, § 41; Laurent (1875) 15, §§ 424–27; Leake (1867) 7–8; Pollock (1885) 1–9; Langdell (1880) 1–21. See generally Gordley (1991) 161–213.
19 Ranouil (1980) 71–72.
20 Gounot (1912) 129, quoted in Ranouil (1980) 72 n. 31.
21 Zimmermann (1990) 534.
22 Dig. 19.5.5.pr.
In defense of Roman contract law 23
for another, although the same analysis would apply to other innominate contracts.
It is not clear that the reasons why contracts such as sale should be binding in advance of performance normally apply to a barter. Modern scholars disagree over what these reasons are. I have discussed their opinions elsewhere,23 and argued that the best explanation is that of Melvin Eisenberg: one party may want to lock in a favorable bargain.24It might seem as though the parties to a barter would want to lock in a favorable trade just as the parties to a sale might want to lock in a favorable price. Nevertheless, although the parties to a sale typically are seeking the best bargain they can make, it is hard to say what is typical of the parties to a barter. Moreover, even if the parties to a barter are seeking the best deal they can, it is not clear that they would want to lock each other in.
Sometimes, the parties to a barter are not seeking the most favorable bargain. To intend to bind the other party legally would be repugnant to the reason they chose to barter instead of choosing to buy and sell. One party might want to acquire an object owned by the other party but, because they are friends, relatives, neighbours or colleagues, they might prefer to barter because a cash transaction seems commercial. Artists frequently trade their work with each other in part because it would be embarrassing for them to buy and sell for cash based on the estimated market value of the work of each artist. One of the parties might be trying to do the other a favor and wish to barter because the favor is less obvious than if he had adjusted the price. During the Depression my wife’s grandfather, a physician, used to accept cuts of lamb and beef from a local meat dealer in return for the medical services he provided. I suspect that my grandfather-in-law was receiving less meat than he could have purchased for his normal fee because he wanted to help his patients in hard times, but it may be that the dealer was giving him more meat than his normal fee would buy, having noticed that he was no longer buying choice cuts of meat.
Even if each party to a barter were interested only in getting a good bargain, they might not want the transaction to be binding in advance as the parties typically do in a sale. Each party to a sale has the choice of taking the price that the other party proposes or waiting and looking for a better one. Because a sale is binding upon consent, each party insures himself against the loss he would suffer if he had waited and obtained a
23 Gordley (2006) 293–96.
24 Eisenberg (2001) 223, 279.
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worse price by forfeiting the gain he would make if he had obtained a better one. If the parties are risk averse, they will both want to insure. In contrast, the parties to a barter may not be insuring themselves against such a risk. They may have chosen to barter rather than to buy and sell, not to avoid the risk of contracting on less favorable terms if they look further, but to take advantage of the fact that each happens to have the very thing that the other wants. Each may have something that the other regards as very special or difficult to obtain elsewhere. Or they may be bartering in order to avoid such extra costs as broker’s fees, taxes possibly, and, in any case, the time and money spent in looking for a good price. The reason one party would want the other party to bind himself in advance of performance is the fear that the other party will back out, not because he has found better terms, but because he has reconsidered and decided the exchange would make him worse off rather than better. But is that a reason both parties are likely to have? And if so, is it one the law should respect?
It might be that one party is afraid that the other will back out because the other party has acted foolishly and will back out as soon as he realizes it. He realizes that the exchange is one to which no sensible person would agree. It is unlikely that both parties would want the other to be bound for this reason, each believing that he has gulled the other. If so, it is hard to see why the law should enforce an arrangement which is, in effect, a bet they have placed on which of them has been gulled.
A more likely reason is that one party wants the other to be bound for fear that the other will decide the exchange is not to his advantage because of a change of circumstances or simply a change of mind. Is it likely that both parties would have this fear, and to such an extent that each would be willing to bind himself for fear the other party will not wish to be bound? If so, each party thinks it more likely the other will back out than that he will want to do so himself. Sometimes each party’s fear that the other will want to withdraw, and his confidence that he will not wish to, may be so great that each party will want the arrangement to be binding on both. But it would be odd if that were normally the case.
Even if it were, it is hard to see why the fear that one party may decide the bargain is disadvantageous is a reason that the law should respect for holding them bound. A prime objective of contract law is to allow the parties to enter into contracts that make each of them better off, at least in his own estimation. Sometimes there is a good reason why the party who later finds the contract disadvantageous should not be able to withdraw: the purpose of the contract is place on one of the parties a risk that must be borne by someone. The party who bears that risk is compensated for doing so. He should not be able to withdraw if he loses
In defense of Roman contract law 25
when he might have won. Insurance contracts are binding for that reason.
So, as we have seen, are sales which insure each party against the risk of finding worse terms if he waits and looks further. Suppose, however, that one party wants to lock the other in for fear the other party will discover that the deal will make him worse off. It is hard to see what good purpose is served by holding the parties bound in advance of performance. If each party is free to withdraw, and one party discovers that the deal on the srcinal terms will make him worse off, it may still be possible to renegotiate the deal on terms that make both parties better off. If not, one party will have been made worse off and the normal purpose of contract law will have been frustrated.
C.
C. ReReal al CoContntraractctss
In Roman law, some contracts, the contracts re, were not formed until an object was delivered. Translators call them ‘real contracts’, using ‘real’ in the sense of ‘real estate’, not in the sense of ‘the real McCoy’. Among these contracts are loan for consumption ( mutuum), loan for use ( com-modatum), and deposit ( depositum). All three are gratuitous. No compen-sation is paid by the person who is allowed to consume or use a thing, or to a person who agrees to safeguard an object deposited with him.According to the late scholastics, as we have seen, all contracts should be binding on consent as long as the parties so intended. They assumed that when the parties consented, they intended to be bound as of that moment. Nevertheless, they recognized that the real contracts were different than others. One of the parties was doing the other a favor, and, indeed, a favor that he could do without cost to himself. The lender might have no other use for the object loaned, or the depositee for the storage space needed to keep the object deposited. That difference seemed to call for a difference in the treatment of these arrangements. Having assumed that the parties had promised to be bound before delivery, Lessius and Molina moderated the rigor of this conclusion by saying that they had promised subject to a condition: that the party doing the favor could perform at no cost to himself. If that party discovered that he needed the object loaned or the storage space, he could withdraw from the arrange-ment even after delivery.25
They reached this conclusion despite a Roman text:
As lending rests on free will and decency, not on compulsion, so it is the right of the person who does the kindness to fix the terms and duration of the loan.
25 Lessius (1628) lib. 2, cap. 27, dub. 5; Molina (1614) disp. 294, nos. 8–10.
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However, once he has done it, that is to say, after he has made the loan for use, then not only decency but also obligation undertaken between lender and borrower prevent his fixing time limits, claiming the thing back or walking off with it in disregard of agreed times … Thus, if you have lent me writing tablets for my debtor to enter a cautio, you will do wrong suddenly to demand them back. For if you had refused, I would have either bought some or made sure I had witnesses present. The same applies where you have lent timber to prop up a building and then hauled it away again or even knowingly supplied
However, once he has done it, that is to say, after he has made the loan for use, then not only decency but also obligation undertaken between lender and borrower prevent his fixing time limits, claiming the thing back or walking off with it in disregard of agreed times … Thus, if you have lent me writing tablets for my debtor to enter a cautio, you will do wrong suddenly to demand them back. For if you had refused, I would have either bought some or made sure I had witnesses present. The same applies where you have lent timber to prop up a building and then hauled it away again or even knowingly supplied