§ 2. ON CERTAIN SALES IN SPECIES

We shall treat: 1. of sale with an accessory pact; - 2. of sale at auction; - 3. of monopolies; - 4. of sale through brokers.

1132. Several pacts can be added to sale. The more frequent are:

1. Addiction to a day, or a suspensive or even resolutive condition, by force of which it is licit for the seller, up to the lapse of the term established, to sell the thing to another who has offered a better condition, unless the buyer offers the same.⁰³

2. Pact of trial, or condition of experiment, by force of which the contract is not entered upon except after trial made by the buyer. Cf. Berardi, Theol. mor., II, n. 599; Schindler, II, 650.⁰⁴ - 3. Pact of preemption, or concerning the reserved right of preference, by which the buyer assumes the obligation of offering the thing bought back to the seller to be redeemed, if afterwards he wishes to alienate it.⁰⁵ - 4. Pact of selling back or redemption, by which the right is established that, when the price has been restored and improvement compensated, the thing returns to the first seller. It can be established in favor either of the seller or of the buyer, according as the execution of the pact is remitted to the discretion of one or the other, or of the one first asking.⁰⁶

Concerning this last pact it is enough to NOTE these few things: Since in this pact a burden is imposed on him who is held to rescind the contract at the discretion of the other, equity demands that this burden be compensated. Hence: a) if the pact is added in favor of the seller, the price must be diminished by reason of the burden which is imposed on the buyer; b) if it is added in favor of the buyer, the price must, with proportion preserved, be increased (III, 812). See also the Codes, l. c.

1133. Note. 1. Ancient authors speak much of another contract which is named MOHATRA. This contract is perfected if someone sells on credit, with an explicit or implicit pact that the thing be sold back to himself for less, counted money: for example, Peter sells on credit his house to John for 12,000 francs to be paid after two years, under this pact, that John immediately sell the house back to him for 10,000 to be counted out at present. - It is illicit because it includes palliated usury, as is established from the 40th proposition condemned by Innocent XI. Cf. St. Alphonsus (III, 813).

NOTION. Sale at auction, or by public auction (vente aux encheres), is that which is made through a herald, and in which the thing is adjudicated to the one offering the last greater price. - One is judicial, another voluntary, which is also called BIDDING.

1134. • PRINCIPLE. The just price in sale at auction is that which, without fraud, is constituted from the bidding itself. For it is determined by the free concurrence of buyers; wherefore, the thing becomes more estimable if many buyers concur, less estimable if few. The seller himself has tacitly accepted this estimation. Whence, from common sense, with public authority also approving, that is held as the just price which is offered by the last bidder, whether it is above the highest price or below the lowest; and the seller of himself does not have the right of withdrawing the thing, when bidding has begun, if a lesser price is offered.⁰² But the required equality is situated in this, that from each side, the same hope of gain and the same peril of damage are had.

We said without fraud; but fraud can be inferred both by the seller and by the buyer.

1. Fraud is inferred BY THE SELLER if he conceals an occult vice of the thing, or if he sends in fictitious bidders. Yet a seller would not be condemned who suborns fictitious bidders for redeeming himself from unjust vexation, for example because buyers agreed among themselves about not bidding. Likewise, in judicial sale, the inequity of conditions can easily excuse the seller if he sends fictitious bidders, namely lest things be sold below the middle price which, those adverse conditions being excluded, they would have.

2. Fraud is inferred BY THE BUYER if by deceit or threats he impedes others from bidding, or from offering more. But fraud will not be present if he asks others not to bid; for thus liberty of bidding is not taken away, provided the requests are not importunate.

1135. IT IS ASKED. Whether a buyer can ENTER A PACT with others, that they not bid, or not offer more?

Resp. Negatively, of itself. For the seller "has a right not to be deprived of the hope of obtaining a greater price, if several offerers intervene who, led by emulation, increase the price; for the right and nature of bidding seem to require this, so that equality be preserved. This has force at least in the case in which, by the sentence of a judge, the thing is exposed for auction; because then the owner of the thing is altogether held to hand over the thing to the one offering more, with danger of selling below the lowest price" (III, 808, dub. 2).

It is said of itself, because by accident this is sometimes licit. Thus buyers joined by society or friendship seem to be excused if they agree among themselves that only one of them will bid; because they make as it were one moral person, nor can it be exacted that they bid against each other.⁰³ Similarly buyers are excused in the case in which, from prevailing custom, the seller can withdraw his thing if a lower price is offered; because if he himself can impede the price from decreasing too much, equity demands that buyers also can impede it from increasing too much (Scavini, II, 405).

Note. Heralds to whom the sale of a thing is committed certainly sin against justice if they institute an auction at that time at which they know that few buyers are going to be present, namely so that they may favor friends; if they adjudicate the thing sooner or later than is usually and fittingly done; or employ other things of this kind, by which either damage is inferred on the seller, or favor is shown to one of the bidders, to the detriment of the others.

1136. NOTION. Monopoly, or sale by one, can be defined: the exclusive power of selling, existing in the possession of one or of a few only.⁰⁴

DIVISION. This power can be of right or of fact; whence a twofold monopoly is given: monopoly of right, if this power is sanctioned by public authority; and monopoly of fact, if it is exercised apart from or against right. Besides, monopoly of fact and of right is either public or private, according as it is exercised by the Government or by private persons.

Private monopoly of fact is either strictly so called, or monopoly of merchandise, which can be had in a double way: a) if someone impedes the importation of other wares, so that he alone may sell his own; but today, on account of innumerable railways, this impediment will rarely be possible. b) If at an opportune time, for example harvest, one or a few buy all, or almost all, wares, so that then they may sell again at a great price; - or it is broadly so called, or monopoly of price, and exists when sellers conspire among themselves not to sell or not to buy except at a certain price.

1137. PRINCIPLES. I. Private monopoly of right is licit. For the Government can, on account of a just cause of the public good, concede such a privilege to merchants.

Thus, in some regions, the privilege of selling tobacco or salt is conceded to a few, so that the tax necessary to the republic may thence be increased. But lest civil society be burdened by monopolies of this kind, it belongs to the prince or magistrate to tax fittingly the price of the things to be sold (III, 814). - With respect to typographers, or authors, recall the things said n. 856.

Note. A fortiori, a public monopoly is licit, provided it does not extend to almost all businesses (cf. Vermeersch, o. c., n. 183, 2, b).

1138. • II. Private monopoly of fact is sometimes unjust, sometimes illicit, and sometimes just and licit.

1. It is unjust: a) If a merchant impedes by fraud or lie that other wares be brought in, so that he may sell his own wares more dearly with damage to citizens. b) If merchants conspire among themselves so that they may sell above the highest price, or buy below the lowest; for it does not belong to private persons to change the common and legitimate taxation of price. c) If one or a few buy all or almost all things necessary for support, so that they may sell them for more than they would be sold in the market, monopoly being removed.

We said necessary things; for it would not be unjust if wares not necessary for the support of life or for the common state of the republic were bought, such as precious gems, noble horses, ornaments of women, and similar things.

2. It is illicit, but not unjust, if merchants, without force and lie, so agree about the price of wares that, with the just price preserved, they neither sell for less nor buy for more than what was agreed among them.

These indeed sin against charity, although it is not always mortal; for charity, although it does not oblige one to sell below the highest price, nevertheless seems to oblige one not to dissuade others from selling for a lesser price. - But they do not sin against justice, because the highest price is still just.

3. It is licit and just if one or several buy wares so that they may sell them again with moderate gain.

Indeed, although they were to sell again at the highest price, they would not sin against justice, because anyone has a right to sell his own thing at the rigorous price; nor against charity, because no one is held to neglect his own benefit so that he may avoid another's damage, which he is not held to avert (III, 816, 838).

IT IS ASKED. Whether, after a monopoly has been made by merchants concerning a price beyond the highest, it is licit for OTHER merchants to sell at the same price?

Resp. St. Alphonsus denies it with the truer opinion; because that estimation, as arising from injustice, cannot be just, nor can it be called common estimation, but deception and fraud (III, 817; H. Ap., X, 184; l. El. qq. ref., n. 34).

1139. Note. The things which we have said about a conspiracy of sellers also have force for masters who hire craftsmen to work at a lesser price from mutual machination; as for craftsmen who, as in today's time is accustomed to be done, especially by members of the worst association, commonly called internationale, by mutual agreement promise themselves that they will not do or not perfect such work unless they receive such a price. But what is to be said concerning mutual agreement to cease from one's work, see below n. 1154.

1140. • DEFINITION. Sale through brokers is that which is not made immediately by him to whom the thing to be sold belongs, but from his mandate or commission by others, who are called brokers, that is, intermediate negotiators.

Some are legally created (agents de change, courtiers), others simple mandataries, for example traveling agents (commis voyageurs), and others finally act as broker by way of a transient act, as children of the family selling or buying for parents, servants for masters.

From the definition it is clear that their obligations are to be taken from the things said above (n. 1088). But if they have agreed concerning a wage to be accepted, they are to be held as lessors of work (cf. n. 1154).

PRINCIPLE. A broker, as such, has a right to the price of the labor of industry only, but not to a part of the benefit. The reason is that he acts not in his own name, but in the name of the owner (III, 825 ff.). - Hence, speaking of itself, a broker cannot retain gain for himself if he sells above the determined price, nor the excess of the price if he buys below such a price.

Yet by accident, he can retain the excess of price: a) If by his industry, or by labor not owed, the thing became better; but if he sold for a greater price, for example because in a place very distant from that which the owner designated, he cannot retain except the price of labor. The same has force if gain was made by occasion of purchase. b) If he tacitly agreed with the owner that he would give him nothing beyond the price designated. Likewise, if the owner's consent can easily be presumed, as commonly happens when the gain is of small moment. c) If to his mere favor the buyer offered a greater sum, or the seller diminished the price: for example, if a merchant remits something of the price to a tailor buying cloth, so that he may entice him to frequent his workshop. Yet let the confessor cautiously give faith to brokers asserting that such donations were made to themselves, especially if it is a question of servants or children of the family (Praxis, n. 60).

1141. • Questions. QUAER. 1. Whether a broker can BUY FOR HIMSELF a thing to be sold at a determined price, and afterwards sell the same thing, as his own, for a greater price?

Resp. Affirmatively, from Natural Law, but under these conditions: a) that, with moral diligence employed, he did not find a buyer who would offer more; b) that he buy the thing for himself not fictitiously, but truly, so that he undergo its peril, and if perhaps he does not sell it for so much, nevertheless he returns the determined price to the owner. - Likewise, if someone commits to you the purchase of some thing at such a price, and you find it at a lower price, you will be able in this case to buy the thing for yourself, and afterwards sell it to that other at a greater price (H. Ap., tr. ult., 35).

We said: from Natural Law, for, as Marres notes, this manner of acting is today reproved by law or at least by received custom, on account of the frauds which would easily arise (de Just., l. 4, n. 286).

QUAER. 2. Whether a broker who offered himself GRATIS for selling or buying can retain the price of his labor?

Resp. More probably he can, if he did not have the mind of donating, and the owner had already previously determined to sell the thing, and there was no one else who would furnish this gratis. For thus he was indeed mendacious, but not unjust; because his labor was worthy of a price (III, 825, in fine, with Roncaglia, Sporer).