Article II. On the Just Price

Price is twofold: one legal, which is determined by law, and the other natural or common, which corresponds to the value of the thing according to the common estimation of men. But natural price is: 1st. highest, above which the thing is not customarily estimated; 2nd. lowest, below which the thing is generally not estimated; 3rd. middle, which is interposed between the two.

I say. The legal price, if it exists, generally speaking, must be observed under the burden of restitution; for it belongs to civil authority to establish whatever regards public commerce. - I said generally, because sometimes it is licit to depart from the legal price, for example, if it is not observed by the greater part of men; if, circumstances having changed, the tax becomes unjust; or if the goods are notably more precious or worse than usual. - But if the legal price is lacking, that alone is to be held as just which is determined as such by common estimation, if there is question of merchandise which has appreciation among the multitude; because the adequate price of such things is deduced from their utility for common uses. Moreover the appreciation of such utility cannot be had better than by common estimation. - Thus all. Cf. St. Alphonsus, n. 806. - Slater, Questions on Moral Theology, pp. 15 et seq.

Question 1. Can things which do not have a common estimation be sold for as much as possible, provided that the buyer agrees concerning that price, as are gems, precious paintings, and other things of this sort?

Resp. Affirmatively, because in that case it seems possible to have recourse to no other measure of just price except the free consent of the contracting parties. Nor may you say that the judgment of expert men is present; for it is answered that this is often variable, often also unjust, and more often can be obtained only with great difficulty. - Cf. St. Alphonsus, nn. 802 and 807.

Question 2. Can a thing be sold more dearly on account of a special affection or utility of the buyer?

Resp. Negatively, according to the common doctrine of theologians. The reason is that special utility and affection is indeed something estimable by price; but since in the stated case it does not belong to the seller, he would be selling something not his own, and therefore would act unjustly. Wherefore St. Thomas says: "If someone is helped much by a thing of another which he has accepted, while the one who sold is not damaged by lacking that thing, he ought not to over-sell it; because the utility which accrues to the other is not from the seller, but from the condition of the buyer; and no one ought to sell what is not his own." St. Alphonsus and the greater part of theologians agree with the Angelic Doctor. Nevertheless it seems possible in this matter to distinguish thus: - If that private advantage of the buyer arises from a great necessity by which the buyer is oppressed, and his affection toward the thing is an insane and blind disturbance of mind, the opinion of St. Thomas must be held, to which the practice of God-fearing men is plainly conformable. But if there is question of a greater utility, of a certain founded delight and reasonable affection, which indeed the buyer alone has, but which others, if they were in the same circumstances, perhaps would equally have, the seller who sold the thing more dearly would not have to be condemned; both because that greater advantage of the buyer is not altogether private and singular, which the reason of St. Thomas supposes, and because this seems to be the practice of the faithful. - Cf. St. Thomas, 2-2, q. 77, art. 1. - St. Alphonsus, n. 806. - Kenrick, n. 51. - Carrière, n. 692.

Question 3. Is it licit to buy more cheaply in favor of a seller seeking a buyer?

Resp. Affirmatively, and the reason is that voluntary things become cheap and the price of a thing decreases when the thing is of little use to the buyer and he buys in favor of the seller. The same must be said concerning the case in which things are sold more cheaply on account of the poverty of the seller, because on the one hand a voluntary thing decreases in price according to common estimation, and on the other the seller's want does not bring it about that the common estimation is changed. - Cf. St. Alphonsus, n. 802.

Question 4. Whether or in what way do merchants sin who, when questioned about the price of goods, notably exaggerate it?

Resp. If in reality they intend to sell at this price, they sin against justice by unjustly desiring what belongs to another; and they are bound to restitution if in reality that price is paid to them. But if they intend only that an opportunity be given to the buyer of offering his own price, so that thus they may arrive at a just price, they are wholly excused both from the sin of injustice and from the sin of lying, because it is known and customary that merchants speak in such a way that they may lead buyers to the just price.

You Will Resolve. - 1st. Someone can buy credits whose payment is very difficult for much less, if by reason of a circumstance special to himself they become easy to be paid. The reason is that the facility of obtaining payment does not depend on the thing which is sold, but on the buyer himself; but the value of a thing is determined by common estimation, not by a particular circumstance of the buyer. Cf. St. Alphonsus, n. 829.

2nd. Someone can sell at the current price a thing which he knows will soon be worth less; provided, however, that this knowledge is private and not obtained by fraud; for if it is common or public, the price would already be changed according to it, and if it were by fraud, equality would already not be preserved. - Cf. St. Alphonsus, n. 824; and Hom. Ap., n. 188.

With regard to very many cases these words of Lugo furnish an easy solution:

"Although the law ought to be common and equal, nevertheless knowledge of it before it is promulgated ought not to be common to all, but can previously belong to some by reason of their office. Yet I said (in the preceding number 140) that it is not licit purposely to defer the promulgation of the law until they themselves or their friends sell off their goods . . ., because this would be to abuse their power to the prejudice of subjects, which is illicit. For power has been given to them for the common good, not for their own good; wherefore they cannot exercise power except for the good of the subjects and the common good, to which end alone such power is ordered. But the use of knowledge is not the use or exercise of power, but is an act of household prudence which is ordered to private advantages; wherefore there is no abuse in that which is ordered to those advantages." Disp. 26, n. 143.

3rd. Merchants sin who, after they have sold a thing at the lowest price, adulterate it before delivery, although by this they do not exceed the limits of the highest price. For even if from the beginning they could have sold it more dearly, they cannot afterward destroy the pact which they entered into with the buyer.

4th. Merchants who sell by retail can sometimes sell more dearly than those who sell in great quantity; because they must spend greater labors and expenses, and greater time, in preserving those things and distributing them to buyers. - Cf. St. Alphonsus, n. 809.

5th. A thing cannot be sold beyond the just price for the reason that the seller, from his ignorance or imprudence, or even by a fortuitous case, bought it at a greater price, or underwent greater expenses than others commonly pay or undergo. The reason is that the prices of things do not increase or decrease from that which happens to one or another person, but from that which commonly happens. Nor, because some private merchant has suffered theft or shipwreck, is the price of things customarily increased in the estimation of the people; just as the price of grain is not customarily increased because one or another man has lost the fruits of his fields by a fatal hailstorm. - Cf. Elbel, n. 587.

6th. The practice of merchants or craftsmen is not to be approved who are accustomed to give gifts to maids, servants, or children of the family, so as to draw them to their workshop; but afterward strive tacitly to compensate such expenses by increasing the price of things beyond justice. For thus they secretly compel the masters themselves to refund those donations unjustly. Cf. Elbel, nn. 523 and 583. - Lugo, disp. 26, sect. 8.

7th. Generally, in making restitution because of injury to the just price, these things must be held: 1st. if there is question of the seller, the unjust excess must be computed from the highest price, because he could have sold at this price; whence the buyer was not injured except in that which exceeds the highest price; 2nd. but if there is question of the buyer, the defect of price must be computed from the lowest price, because he could have bought at such a price; whence the seller was injured only in that which is below this price. - I said generally; because if profit has been obtained by fraud, it would have to be restored, even if the highest price was not exceeded or the lowest was reached.