Section — Prümmer, Manuale Theologiae Moralis
2. On the Price and the Obligation of the Buyer
Obligations of the buyer. The buyer must fulfill all those things which in the contract of sale have been justly stipulated concerning the mode and time of receiving the merchandise and paying the price; but especially he is bound to pay the just price.
295. Notion and quality of price. Price is the value of a thing expressed in money. But whence the value of a thing is to be taken is not an easy question: whether from common estimation (exchange value, Tauschwert) or from its own intrinsic utility (use value, Gebrauchswert).142 This second opinion, which St. Thomas, following St. Augustine, defends, seems to be preferred; he says: "The price of saleable things is not considered according to the degree of nature ... but according as things come into the use of man."143 For the rest, the two opinions are not so different. For that which is commonly esteemed more dearly also has greater internal utility. I say, however, internal utility; for whether the price can be increased because of the external utility of the thing, because the thing is accidentally very necessary to the buyer, will be said below. But whatever may be true of this question, all teach that the price must be just, i.e., must at least morally equal the value of the thing. Hence St. Thomas144 says: "Purchase and sale seem to have been introduced for the common utility of both parties, when, namely, one needs the thing of the other and conversely. But that which has been introduced for common utility ought not to be more a burden upon one than upon the other, and therefore the contract ought to be established between them according to equality of the thing. But the quantity of a thing which comes into the use of man is measured according to the price given, for which purpose coin was invented. And therefore, if either the price exceeds the quantity of the value of the thing, or conversely the thing exceeds the price, the equality of justice is destroyed. And therefore to sell a thing more dearly or buy it more cheaply than it is worth is in itself unjust and illicit."
Accidentally, the price can sometimes be increased beyond the intrinsic value of the merchandise, if, namely, the seller suffers particular damage from the sale. On the contrary, "if someone is greatly assisted by the thing of another which he has received, while he who sells is not harmed by being without that thing, he ought not to sell it at a higher price, because the utility which accrues to the other is not from the seller, but from the condition of the buyer. But no one ought to sell to another what is not his own, although he can sell to him the damage which he suffers. Nevertheless, he who is greatly assisted by a thing received from another can of his own accord give something additional to the seller; this pertains to his honorable conduct." Thus again St. Thomas,145 whom St. Alphonsus follows;146 and therefore, according to these Doctors, the just price is to be taken: 1. either from the intrinsic value of the thing; or 2. from the emerging loss or gain ceasing which arises to the seller from the sale. This opinion seems altogether to be followed. Therefore the opinion of a few theologians who teach that the price upon which the contracting parties freely agreed is just must be rejected. For if this opinion were absolutely true, then wide doors would be opened to frauds of every kind. E.g., someone selling an estate so situated that another person altogether needs it could licitly sell it at an excessive price; or someone could sell to an ignorant Indian colored glass for a great weight of gold.147 Certainly in these and similar circumstances it is lawful to demand the highest price. Hence in practice those are not to be disturbed who indeed sell more dearly things which furnish a special utility or pleasure to the buyer, provided they neither demand a wholly excessive price nor abuse the buyer's necessity.
142 Cf. Vermeersch, De iust. q. 8, n. 339ff.
143 S. theol. 2, 2, q. 77, a. 2 ad 3.
144 Ibid., a. 1.
145 Ibid.
146 Theol. mor. l. 3, n. 806ff.
147 Cf. below, concerning the just price.
296. Distinctions of price. A threefold price is wont to be distinguished: a) legal, b) common, c) conventional.
a) On the legal price. The legal price is called that which has been directly and precisely established by public authority or law, so that it is not divided into highest, middle, and lowest, as will be said below concerning the common price.
It is wont to be employed, e.g., in railway tickets, postage stamps, foods served in certain public places, medicines sold by pharmacists, the hiring of public carriages, certain government monopolies, during wartime or a great dearness of provisions, etc.
Principle. The legal price must be observed in conscience,148 and indeed from commutative justice, unless it is manifestly unjust.
The reason is that this price is legitimately established for the common good by public authority, which is especially able to judge concerning the equitable price of things and which has high dominion over the goods of subjects. Consequently this price is truly just, while every other discordant price becomes unjust. Hence one who notably injures such a price is bound to restitution. E.g., a driver of a public carriage149 who demands from inexperienced persons a greater fare than the rate determined by law is bound to restore. When the legal price is established not only in favor of buyers but also in favor of other sellers, namely, lest disorderly competition arise among them, an obligation of restitution can arise not only from increasing but also from diminishing the legal price, because by such diminution unjust damage is caused to other sellers. Thus the common opinion.
Note. Just as epikeia can sometimes be employed concerning other positive laws, so also concerning the legal price, especially: a) if many transgress the legal price with the legislator knowing and remaining silent; b) if the merchandise offered is of a better condition than that whose price is determined by law; c) if the legal price becomes manifestly unjust.
148 Thus St. Thomas (S. theol. 2, 2, q. 77, a. 2 ad 2), St. Alphonsus (Theol. mor. l. 3, n. 803), and the common opinion. The Salmanticenses treat this question excellently (Curs. Theol. mor. tr. 14, c. 2, n. 110ff.).
149 Commonly, carriage driver, coachman (Droschkenkutscher, cocher). Although in this case it is rather an excessive price of hire, nevertheless the same principles hold for hiring and sale.
297. b) On the common price. The common price is called that which is determined by the common estimation of men according to the diversity of places and times, commonly the market price, Marktpreis, prix du marché.
It does not consist in an indivisible point, but admits a certain latitude and has three degrees, according to which it is highest, middle, or lowest. How great the distance is between the highest and lowest price cannot be determined by one rule, but depends upon many circumstances, especially upon the scarcity of the merchandise and the multitude of buyers. Generally, however, it can be said that the highest price of some thing is that above which no upright merchant would sell it; and the lowest price is that below which no upright buyer would buy it. At least that excess in price which permits rescission of the contract according to civil laws150 must also in the forum of conscience be considered an excess beyond the highest price. There are, however, civil codes, e.g., the German Code, which never permit rescission of a sale for this reason alone, that an excessive price was agreed upon. Nevertheless, it is not lawful to conclude: Civil law does not consider such a price so excessive that it rescinds the contract of purchase and sale; therefore such a price is just also in the forum of conscience. For the Angelic Doctor151 teaches: "Human law could not prohibit everything which is contrary to virtue; but it suffices for it to prohibit those things which destroy the society of men, while it regards other things as though lawful, not because it approves them, but because it does not punish them. Thus, therefore, it regards as though lawful, imposing no penalty, that without fraud a seller sells his thing at a higher price or a buyer buys more cheaply, unless the excess is immoderate; because then even human law compels restitution, for example, if someone is deceived beyond half the quantity of the just price. But divine law leaves nothing unpunished which is contrary to virtue. Hence according to divine law it is regarded as illicit if the equality of justice is not observed in purchase and sale." St. Alphonsus152 observes that in things of small value there is less latitude between the highest and lowest price than in precious things. He establishes this norm: If a thing is worth 5, it can be sold for 4 or 6; if it is worth 10, it can be sold for 8 or 12; if it is worth 100, it can be sold for 95 or 105. But then he adds: "An estate which perhaps was sold for 20,000 can after a year be bought for 12,000." Certainly these things can be held as a directive rule because of the very great authority of the Holy Doctor, but they neither ought nor can always be applied strictly and mathematically in practice.
150 In France (art. 1674), if the deception exceeds half the just price; in Spain (art. 1291), beyond one fourth. Cf. Austrian Civil Code § 1060; Italian Civil Code art. 1529; Code of Canon Law, canon 1684, § 2.
151 S. theol. 2, 2, q. 77, a. 1 ad 1.
152 L.c., n. 804.
298. Principle 1. In the absence of a legal price, the common price is to be followed, so that to sell beyond the highest price and to buy below the lowest is unjust.
The reason is that the common price is determined by common estimation and consequently is considered just. For private judgment is often blind, fallacious, and corrupted by cupidity; but common judgment is ordinarily more prudent and less liable to error. Therefore, when there is no more certain rule, namely, a just positive law, common judgment concerning the price of some thing is to be followed. Thus it is also expressly established in ancient Roman law: "The prices of things are determined not according to the affection or utility of individuals, but commonly," i.e., they are estimated commonly.153 But that which notably exceeds this common price is unjust. I say, however, common and not private estimation, because private estimation cannot change the common price, at least not without limit.154 Hence if in some region a certain thing is commonly esteemed highly which in another place is esteemed little, a high price can be demanded in the first place. E.g., if the common estimation of some barbarian people values red cloth more than ivory, an educated man can buy ivory by giving red cloth.
153 L. 33, D. book 9, tit. 2.
154 Cf. below, n. 299.
299. Principle 2. There are extrinsic titles on account of which it is lawful to sell above the highest and to buy below the lowest common price.
With regard to a dearer sale, the principal titles are: 1. gain ceasing and emerging loss, to which the other titles can be reduced, namely: 2. a special affection of the seller for the thing to be sold; 3. the mode of selling. With regard to a cheaper purchase, however, the principal titles are: 1. emerging loss or gain ceasing from the present purchase; 2. a spontaneous offer; 3. the mode of buying.
Concerning gain ceasing and emerging loss for the seller, what was said above, n. 295, from St. Thomas applies. A few things concerning the other titles:
A special affection of the seller for the thing to be sold is a sufficient reason for demanding a price greater than the ordinary price, which is wont to be called the price of affection. E.g., one who takes great delight in a talking parrot can demand a greater price if another wishes to buy that bird. The common opinion teaches with St. Thomas and St. Alphonsus155 that it is not lawful to demand a greater price for a thing to be sold because the thing brings a special utility or pleasure to the buyer and not to the seller. The reason is that then the seller would demand a price for some thing which is not his. For that special utility or pleasure of the buyer is not the property of the seller. Hence, e.g., it is not lawful to sell above the highest price a field which is very necessary to the neighboring buyer.156 But there are certain more recent theologians, Gousset,157 Schwane,158 Marres,159 Waffelaert,160 Génicot,161 and Tanquerey,162 who regard the contrary opinion as probable, saying that conscientious men also act thus in practice. Nevertheless, they are wont to limit their opinion somewhat. Therefore Noldin163 says: "All affirm that this has force only when the buyer seeks from the thing to be bought nothing except convenience or pleasure; but that he commits injustice who demands a greater price because the other needs this thing: for mere need and necessity, which compels another to buy the thing, is not estimable by a price, nor is the needy person considered to donate the excess of the price." But even with this limitation the proposed opinion seems to be slightly probable. For the reason adduced above from St. Thomas retains its force. Hence in these circumstances it is indeed lawful to sell the thing at the highest price but not at an excessive price, unless, however, such a price is considered as a gift and not as a true price.
The mode of selling sometimes permits a much greater price to be demanded, e.g., if a thing must be sold retail in a small quantity (Detailverkauf), or if it is sold at auction. Especially in the latter case any price, whether the lowest or the highest, is permitted, as will be explained more fully below, n. 302. Furthermore, if payment of the price is deferred, the thing can be sold more dearly; but if payment is anticipated, the thing can be bought more cheaply.
The titles legitimating purchase below the lowest price are:
Gain ceasing or emerging loss which arises to the buyer from the purchase. E.g., the buyer does not need the thing but nevertheless buys it from mercy toward the seller. In this way, however, he loses the interest on the money which he otherwise would have had. Consequently, he can buy more cheaply in order to compensate himself.
The spontaneous offer of a thing to be bought is also assigned by St. Alphonsus164 as a title for buying it more cheaply, according to the adage: "Merchandise spontaneously offered becomes cheaper by one third."165 For it is often a sign that things exist in great quantity, while, on the contrary, buyers are few. But if things are offered because of the poverty of the seller, the buyer would certainly act against charity if he wished to depress the price, unless, however, emerging loss would arise to him from the purchase.
The mode of buying sometimes permits a notable diminution of the price, e.g., when a great quantity of merchandise is bought, when a thing is bought at auction or from dealers in secondhand goods, etc.
You will ask: Is it lawful to sell things below the lowest common price in order to attract buyers (Reklameverkäufe, ventes de réclame) if other sellers suffer damage from it? If frauds are not employed, e.g., by adulterating merchandise or diminishing the measure, this is lawful, or at least is not contrary to justice, because everyone is free to sell his thing for a small price; otherwise, however, it is not lawful, since then unjust means are employed to cause damage to others. In our times great merchants disposing of ample capital often depress the price of merchandise immoderately in order to drive away weaker rivals. This mode of acting can injure charity, although means injuring commutative justice are not employed.
155 Cf. the places cited above, n. 294.
156 Cf. Lehmkuhl, Cas. consc. I, n. 790ff.; Mausbach, Moraltheol. II, 2, § 39.
157 Theol. mor. I, 840.
158 Lehre über die Verträge § 19, n. 6.
159 De iust. l. 4, n. 188.
160 Tract. de iust. I, n. 613.
161 Theol. mor. I, n. 633.
162 De iust. n. 749.
163 De praeceptis n. 598.
164 Theol. mor. l. 3, n. 802.
165 Cf. Cajetan, Comm. in 2, 2, q. 77, a. 1.
300. c) On the conventional price. The conventional price is called that which is determined by the free agreement of the buyer and seller.
Principle. In the absence of a legal and common price, a thing can be sold at any conventional price, provided, however, that neither fraud nor fear is employed.
Hence, e.g., precious paintings, extraordinary gems, ancient manuscripts, etc., do not have a fixed price, but can be sold at any price, however high. But what is to be said if a precious thing, whose true price was unknown to both contracting parties or at least to the seller, was bought for a low price? E.g., someone buys at a low price a painting which is afterward recognized to be a genuine work of Raphael. The response is made with a distinction. If both seller and buyer were ignorant of the true price of the thing, then that price upon which agreement is made will be just. Thus St. Alphonsus.166 The principal reason seems to us to be that then the buyer begins to possess the thing in good faith and consequently has all the privileges which civil law grants to a possessor in good faith. But civil laws are wont in this case to admit the conventional price as the just price. But if the seller indeed was ignorant while the buyer knew the true price, then again a distinction must be made. If the thing was bought from dealers in secondhand goods or other merchants who, by force of their office, are bound to know the true price of the things offered, then any stipulated price is just. The reason is threefold: a) just statutes of civil codes are wont to permit this; b) the common judgment of the people so bears; c) no injury is done to the seller, since he can and ought to know the true value of the things offered by him. But if the thing was bought from a private person who through his simplicity did not know the true value, then the better and more probable opinion teaches that the purchase thus made is unjust and induces an obligation of restitution. The reason is: a) because then the buyer abuses the simplicity of the seller, who does not consent because of an enormous error;167 b) because there is no proportion between the merchandise and the price, as is supposed.
But if the true value of the thing is so hidden that according to the common course of affairs it cannot be estimated even by experts in the art, and it was discovered by the buyer only through an extraordinary cause, then the conventional price seems just and the buyer is not bound to restitution. E.g., someone discovers that a treasure is hidden in some field, or that beneath the colors of one image there is found another very precious image. In these and similar cases the fortunate discoverer can also be a fortunate buyer, who probably is not bound to give more than the common price. The reason is that the just price is to be determined according to common and not particular estimation. But according to common estimation these things have only the conventional price actually given by the buyer.168
Theologians also commonly teach that in a sale by auction any price offered and accepted is just, civil law also so establishing, unless, however, fraud has been employed, as will be said immediately.
166 Theol. mor. l. 3, n. 802, fourth point to be noted; Noldin, De praeceptis n. 499, teaches the contrary.
167 Cf. Billuart, De contract. diss. 3, a. 7; Berardi, Praxis Confess. II, n. 646; Gury, Cas. consc. I, n. 930.
168 Noldin, l.c.; Billuart, l.c.
301. Scholion. On counterfeit money. Not only the counterfeiter of money himself, whether metallic or paper money, and his cooperators, but also all who knowingly use counterfeit money in paying a price are bound to restitution. The reason for the first is evident of itself; the reason for the second is that counterfeit money is not a just price. Nor is one excused from restitution who spends counterfeit money of this kind after he himself received it in good faith in payment of a debt. For from the fact that he himself was deceived he does not have the right to deceive an innocent third person. Restitution is to be made to the person to whom the counterfeit money was given. But if he suffered no damage from the fact that he too spent this money, restitution is to be made to the person who actually suffered the damage; if this person is unknown, restitution is to be made to the poor or to pious causes. Nor is it lawful to give counterfeit money that may have been accepted as alms or as a gift, because then cooperation occurs in the spreading of such counterfeit money among the people.