Contract and the Common Law

Most Anglo-Saxon conservative libertarians – a group with whom I have rather more sympathy than my leftist stance might suggest – place great store by the common law, the rule of which was asserted eight hundred years ago in the Great Charter of King John but whose roots go back to the earliest days of our humanity and which has evolved by precedent and practice to become the foundation of capitalist society, in two principles: that of contract and property. By contrast, the Civil Code imposed by a Corsican terrorist on the continent of Europe, relies on the artificial and somewhat alien notions of human rights developed by the Enlightenment philosophers of Europe, which are – under that code – superior to traditional rights of property moderated by contract.  I will admit that I incline to the idea of the rights of humanity, that there are some liberties which must trump that of  property. If not, as many early European settlers of America were wont to argue, a property right can subsist in a human being. The Thirteenth Amendment clarified that it may not.

The Founding Fathers of the United States were influenced by both traditions: the revolutionary and the established, the common law having been established on their continent since the settlement of Virginia.That they were, for the most part, already men of property, influenced them in retaining the common law rights of property their forefathers had brought from Europe and thus helped establish the capitalist nature of the United States from its foundation.  It is part of the mythology of America that the first peoples had no notion of property rights in land and were thus misled into selling Manhattan to mijnheer Stuyvesant for a pittance.

In a settled common-law jurisdiction, property rights can be transferred only by deed – including testamentary –  or by contract, and the whole edifice of capitalism is built upon these foundations. Contracts are the key to commerce.

In the common law, a contract is an agreement between parties, which binds only the parties. It cannot bind anyone not a party to the agreement; there must be an exchange of  valuable consideration; and the agreement must be witnessed. There is no requirement that it be in writing; the shake of a hand, before witnesses, is sufficient; and those documents which we nowadays somewhat lazily call “contracts”, are, in fact, merely paper embodiments of the intangible agreement. Old-school lawyers still draught a paper contract that “witnesseth…” and, before the signature, include the words “witness my hand this day”.  The document  witnesseth – that is, it provides evidence of – the agreement; but it is not the agreement itself. That is between the parties, and is intangible. To deny a contract, it may be sufficient to prove that, despite the evidence of the signatures, there was in fact no agreement between the parties – because, say, one did not read the document and the other knew that it had not done so.

Because contracts had to be witnessed, so they  could not be secret. In a dispute, a judge will hear the witness in open court. But it has become an aberration, lately, that contracts should be confidential.

This is not desirable in an open democracy. Secret deals – particularly those involving government – undermine our faith in commerce, and run counter to the principle of open law.

More simply, we can see that a great deal of public law rests on the principle that the legal system will support openness. The principle is most apparent in the case of patents: the state grants an inventor a monopoly, in exchange for publication of the invention.  In the case of contracts, the law upholds a contract made before witnesses – that is, in public; it doesn’t uphold one made in secret.  Or rather it shouldn’t.

We now live in a connected, digital age. Everything is indexed, searchable. Publishing stuff is easy – post it to Google Drive, or WordPress or any one of dozens of similar cloud operations – and select “share”. In the age of quill and vellum, publishing needed an army of scribes to make copies. So contracts should be published, witnessed and witnessable by all of us.  Ancient principles are upheld, not undermined if we do so.

“A contract is enforceable at law only to the extent that it is published”, and

“Any contract that is not published shall not be enforceable”, and

“Failure to publish a contract shall be taken as evidence of intention to deceive”

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