Part II — Chapter II: On Contracts in Particular

Among contracts, some are gratuitous and others onerous; but the latter are either of certain or of uncertain outcome; whence we shall speak: 1. on gratuitous contracts; 2. on onerous contracts of certain outcome, which are also called commutative; 3. on onerous contracts of uncertain outcome, or aleatory contracts.

675. The principal gratuitous contracts are promise and donation; to these is added testament, which, although properly it is not a contract, but an act, is nevertheless so akin to donation that it is opportune to discuss it immediately after donation; and since successions are intimately connected with testaments, we shall likewise treat of them in this article: -

On promise.

On donation.

On testaments.

On those things which are common to donations and testaments.

On successions.

There are other gratuitous contracts, such as loan for use, loan for consumption, deposit and sequestration, mandate and management of affairs, concerning which the civil Codes can be consulted, in which are set forth rules having force also in the forum of conscience.

676. I. Notion. A gratuitous promise is a contract by which someone gratuitously obligates himself to furnish something to another. Hence for a valid promise three things are required: -

¹ Lessius, lib. II, cap. 18; Lugo, disp. XXIII; Salmant., cap. IV, n. 65-86; Billuart, diss. II, art. 1; St. Alphonsus, n. 720; Carriere, II, n. 472-485; Marres, lib. IV, n. 1-12; Ball. P., n. 626-630; Lehmk., n. 1081-1082; Noldin, n. 536-537.

(a) The intention of obligating oneself, and thus a promise is distinguished from a mere purpose, by which someone indeed intends to do or omit something, yet without wishing to assume a true obligation; wherefore he who does not keep a purpose is indeed guilty of inconstancy, but offends neither fidelity nor justice; - it likewise differs from donation, in which the thing itself is given immediately, while in promise an obligation is assumed of furnishing the thing at a future time.

(b) A spontaneous will, that is, immune from every error, fear, or force, since promise, as being a gratuitous contract, proceeds from liberality, and therefore requires full liberty.

(c) That the promise be manifested externally, and accepted by the promisee, namely by him to whom the thing is promised.

677. II. The obligation arising from promise. 1. According to all, an onerous promise, namely one made with an added condition that the promisee sustain some burden in order to obtain the promised thing, truly obliges from justice, and indeed of itself under grave matter, since it is an onerous contract. The same must be said of a mutual promise, which is made in betrothals, as is explained in the treatise on Marriage, n. 142.

2. But when the matter concerns a gratuitous and unilateral promise, it is controverted whether this obliges from justice or from fidelity, and indeed under grave or under light matter.

According to the more common opinion, the nature and gravity of the obligation depend on the intention of the one promising; for promise is a certain particular law which the promisor freely imposes upon himself according to his choice; wherefore it induces that obligation which he himself establishes: if he intends to bind himself only from fidelity and under light matter, he is obligated only under light matter and from fidelity; but if from justice and under grave matter, in the same way he is obligated from justice and gravely. - But the intention of the one promising must be judged both from his declaration and from the circumstances. - If the matter is doubtful, it must generally be inferred that the obligation is only from fidelity and under light matter, because an obligation of justice is not to be presumed, but must be proved. - Yet an honorable man stands firmly by his promises, whatever his intention may have been.

678. Now, since today civil laws require certain solemnities for the validity of a gratuitous promise, the intention of obligating oneself from justice is generally judged to be absent if formalities of this kind are omitted.¹ - Indeed promises which are uttered for the sake of boasting or from mere civility, and also promises that are wholly general, induce no obligation, because the intention of obligating oneself is lacking.

¹ By French civil law nothing special is defined regarding promise in general; but, from art. 1134, all legitimate agreements have the force of law for those contracting, provided these are certainly established; moreover, from art. 1589, a promise of selling something truly obliges in justice when there is mutual consent concerning the thing itself and the price; cf. Planiol, II, n. 1398-1410.

Nevertheless it can happen, from the circumstances, that a promise, even expressed by words alone, induces an obligation from justice, namely as often as violation of the promise brings harm to the promisee; thus, e.g., if a physician has promised to assist a certain sick person, and the latter, relying on such a promise, has called no other physician; or if a brother has promised his brother to pay half the expenses for the education of a nephew, if the latter enters such a college. This indeed appears still more if an oath is added to the promise, or the promise is signed.

He who promised an illicit thing contracted no obligation: "by promising he sinned, but by changing his purpose he does well."¹

¹ St. Thomas, 2. 2., q. 110, art. 3, ad 5.

679. III. Cessation of the obligation. A promise, even valid and obliging from justice, falls away: (a) if there supervenes or becomes known a change of things which, if it had been foreseen before the promise, would have impeded it; for it is judged to have been made under the tacit condition that it can be fulfilled without grave inconvenience; (b) if the promisee spontaneously condones it; (c) if, when the promise was mutual, the other has not stood by the promises.

When, before the execution of the promised thing, the promisee dies, the promisor is held to nothing, if he wished to benefit solely or principally the promisee himself; but if principally his family, the obligation does not expire. - If the promisor dies before execution, a personal promise, that is, concerning an action to be personally furnished, does not oblige the heirs; if it is real, that is, concerning a thing to be given, it passes to the heirs, unless from the circumstances it is clear that the promisor did not wish to obligate them.

680. I. Notion and elements. Donation in general can be made in three ways, namely among the living, by reason of death, and by testament: in the first case, the transfer of dominion is made actually and irrevocably; in the second actually, but revocably until death; in the third, dominion is transferred in the future, for the time which follows the death of the testator, and at the same time revocably.

² Lugo, disp. XXIII; Salmant., cap. IV, n. 87-118; Billuart, diss. II, art. 2; St. Alphonsus, n. 721-743; Carriere, n. 487-491; n. 450-558; Marres, lib. IV, n. 13-90; Ball. P., n. 631-658; Lehmk., n. 1084-1086; Noldin, n. 538-541.

Here we are treating of donation among the living, which can be defined as a gratuitous contract by which dominion of some thing is transferred to another actually and irrevocably.

Three things therefore are found in donation: (a) the transfer of some thing, or right; (b) gratuitous, and thus it is distinguished from exchange or sale; nevertheless sometimes some burdens are imposed on the donee, and then there is a mixed contract, partly gratuitous and partly onerous; (c) actual and irrevocable, insofar as goods or rights are transferred at once, and indeed in such a way that they cannot be revoked except in cases expressed by law; thus donation is distinguished from promise, by which rights are not transferred actually, and from testament, by which rights are conferred neither actually nor irrevocably.

By natural law, for a valid donation, it is required and it suffices that the thing be given by one who is capable of giving, and accepted by one who is capable of receiving, according to the things said above concerning contracts in general. - But other conditions are required by civil law.

681. II. Prescriptions of civil law. 1. In France¹ donation properly so called is held as a solemn contract, for the validity of which special forms are required, so that it can be certainly established, and its irrevocability be placed in safety.

¹ Cod. civ., art. 931-952, in Supplem., p. 109*; Planiol, III, n. 2501-2676.

(A) Two conditions are necessary for any solemn donation: (a) that it be made before two notaries, or before one notary and two witnesses, and that the protocol (la minute) be preserved with the notary; (b) that acceptance be given explicitly in the same manner, so that the donation does not have force except from the day of acceptance.

(B) Two conditions, moreover, are desired for certain contracts: (a) for movable things, an estimative inventory of all things which are given, in which the individual things and their price are described; (b) for immovable things, which can be subjected to mortgage, the act of donation and acceptance must be transcribed before the conservator of mortgages; nevertheless, the defect of transcription does not render the donation invalid, but only rescindable; but rescission cannot be sought by the donor himself, but by those whose rights were harmed through the donation.

682. 2. From these formalities, however, certain donations are immune: -

(a) Manual donations, which are perfected by delivery alone of the thing; their validity is recognized even in the external forum, provided they are made by a capable person and do not exceed the disposable part (concerning which below). This indeed today is of the greatest importance, since there are many movable things which can thus be transferred from hand to hand.¹

¹ When manual donations exceed 150 francs, they indeed cannot be authentically proved except by a written document; but proof of this kind is not necessary, since the possessor of a movable thing is held as owner, by force of art. 2279: "In the matter of movables, possession is equivalent to title."

(b) Donations under the appearance of simulated purchase, when someone, e.g., sells some thing for the price of one hundred thousand francs, and by the same act makes a condonation of this money, or of part of it; this indeed today is held as valid by magistrates, provided the donor is capable of giving, and the donee capable of receiving.

(c) Accessory donations, that is, those which are joined to an onerous contract in favor of a third party; e.g., Titius sells a house to Caius for 50,000 francs, under the law that Caius give 10,000 francs to Sempronius; this stipulation is held as valid by jurists.

(d) Donations which are made by way of renunciation, as if a creditor remits a debt, or an owner renounces some servitude, or a legatee some legacy, etc.; all these have force, provided they are made in the manner defined by law, e.g., if remission of a debt is made by destroying the note in which proof of the debt is contained.²

² On these, see Planiol, III, n. 2535-2555.

683. 3. Although donation of itself is irrevocable, in three cases it can be revoked: (a) if the donee has been judged guilty of notable ingratitude toward the donor; (b) if a son is afterward born to the donor who, at the time of the donation, lacked offspring; (c) if in an onerous donation, the conditions imposed on the donee have not been fulfilled at all.³

³ Cf. Cod. civ., art. 953-966, in Supplem., p. 112*; Planiol, III, n. 2628-2676.

684. III. To be noted for the internal forum. Donations valid from natural law, but null from defect of legal forms, can be held in the internal forum as valid until they are rescinded by the judge; when rescission has been pronounced, this sentence must be obeyed if the matter concerns profane things (above, n. 618); when the matter concerns pious causes, what is to be done can be inferred from the things which we shall say where we treat of testaments, n. 698.

685. IV. On donation by reason of death. By this name is called a gratuitous contract by which something is actually given to another, yet in such a way that the donation can be revoked until the death of the donor. It is therefore distinguished from donation among the living, which cannot be revoked except in the cases expressed by law; and from testament, by which the right is not actually transferred, but only after death; and therefore it is something midway between donation and testament, - and can be called a conditioned donation, insofar as it is made under the condition that it have force if it is not revoked before the death of the donor.

Today, in France and certain other States, a contract of this kind does not have force, because donation is held as essentially irrevocable, except in the cases excepted by the law itself. But a donation can be made under the condition that it be resolved if the donee should die before the donor.¹

¹ Planiol, III, n. 2522.

686. A testament is a revocable act, by which the testator disposes of his goods, or of a certain part of them, for the time following his death. - It is distinguished from donation: (a) because it is an act, not properly a contract; for it is not an agreement between the testator and the legatee, but an act by which the testator expresses his will, independently of any pact with another; (b) because it is essentially revocable until death, while donation is of itself irrevocable; (c) because it does not transfer rights actually, but only for the time following death. - We shall speak: 1. on the right of making a testament; 2. on the legal forms required for the validity of a testament; 3. on the rights and burdens of legatees; 4. on the cessation of a testament.

² Molina, tr. II, disp. 124-141; Lugo, disp. XXIV; Salmant., tr. XIV, cap. V, n. 1-76; Billuart, diss. II, art. 3; St. Alphonsus, n. 919-931; Carriere, n. 497-499; 559-605; Marres, lib. I, n. 294-380; Ball. P., n. 964-1083; Lehmk., n. 1160-1170; Pothier, Donations testamentaires, Paris, 1777; Troplong, Traite des donations et testaments, Paris, 1865; Baudry-Lacantinerie and Colin, Des donations et des testaments, Paris, 1899.

687. Socialists deny the right of making a testament, since they reject the legitimacy of private dominion.

Concerning the origin of that right, there is keen dispute among theologians and jurists. (a) Some say that it arises from natural law, both because it has been in use among various nations from the most remote times, and because it seems to be morally necessary for the good of society, that the industry of men may be fostered.³ (b) Others, on the contrary, teach that the faculty of making a testament must be derived from civil law; for, if natural right alone is considered, the transfer of dominion through testament is invalid, since dominion is transferred only after death, that is, at a time when the testator has already lost the right of dominion, since death dissolves all rights.¹ (c) Whence others, proceeding by a middle way, contend that the faculty of making a testament is indeed founded in natural law, but does not receive full force except from civil law;² whence it follows that it cannot be taken away by positive law, but only restricted. - What we think the following thesis will declare.

³ Grotius, l. II, c. VI, n. 14; Wolf, Instit. juris nat., § 927; Molina, disp. 134, n. 12.

¹ Puffendorf, l. IV, c. 10, n. 4-8; Zallinger, Instit. jur. nat., § 120; Pothier, op. cit., c. I; Beusch, cap. I, n. 89.

² Carriere, n. 498; Taparelli, Essai de Droit naturel, Paris, 1875, n. 787.

688. Thesis: The right of making a testament flows from natural law, insofar as it is the legitimate complement of the right of private dominion.³

³ To understand the thesis rightly, one should see what we said above, n. 74, on the right of private dominion.

It has already been demonstrated above (n. 74) that private dominion, permanent and exclusive, flows from natural law, and in the present state of things is morally necessary; but the right of making a testament is nothing other than the legitimate complement of private dominion, and for the same reasons is morally necessary in the present order of things: (a) it is the complement of private dominion; for dominion of this kind, as being exclusive and permanent, includes the right of disposing of one's thing at any time, and indeed in perpetuity, and therefore the right of disposing of one's own goods before death, and for the time following death.

689. (b) Besides, such a right is morally necessary for the common good; for unless a man could freely leave his goods to sons, relatives, connections by marriage, or friends, he would for the most part indulge in idleness and pleasures as soon as he had sufficiently provided for his own necessities; while on the contrary, if he can leave his wealth to others dear to him, he will not cease to produce new things and to increase riches, so that he may be able to assist the future necessities of relatives or friends.⁴ In reality, man, desirous of surviving in others and through others, longs to leave lands, houses, and other wealth to those who are most beloved to him, and on this account works assiduously and diligently, that he may lavish something of himself upon them and contribute to their happiness. Now the whole society receives no small advantage from these efforts, by which common wealth is greatly increased.

⁴ "Numerous in this world, let us say it to the honor of human nature, are the men who work and who save less for themselves than for others. If you force them to think only of themselves, they will work less and spend more. What riches in this case thrown into unproductive consumption by a broader manner of life! What years withdrawn from productive labor by a premature retirement!" (Ch. Gide, Principes d'Economie politique, p. 421.)

Moreover, if the right of making a testament is taken away, the goods of the dead either become the property of the first occupant, or are devolved to the State: in the former case, there will be a most bitter struggle among citizens for occupying these ownerless goods, and therefore the greatest disturbance; in the latter case, there will soon arise all the evils which it was proved above (n. 93-98) would follow from collectivism.

690. Difficulties are solved. (A) Some jurists contend that a transfer of dominion cannot be made through testament, because there is not present a simultaneous consent of the testator and the legatee: for the testator is already dead when the legatee accepts his goods.

Some respond that the consent of the testator perseveres virtually after death, or that the acceptance of the legatee is rightly presumed before the death of the testator; but these responses are rejected by many as having little force.

This solution seems more probable to us: simultaneous consent is indeed required for the validity of a contract, but not for the validity of an act, which is called a testament; moreover, a testament is as it were a conditioned donation, which will have force as soon as the legatee accepts it; it can therefore be repudiated, and then it will have no force; but if it is accepted, it then becomes altogether firm. - Besides, if, considering natural law alone, a donation of this kind did not have full force, civil authority can supply for natural law, and can attribute legal force to an act which brings such great utility to the good of society.

691. (B) But socialists contend that by the right of making a testament the idleness of children of families is fostered, and the natural equality of men is destroyed.

Resp. (a) That there are some children of families who indulge in idleness and lust because they expect a fat inheritance, sad experience surely establishes; but this is an abuse, which neither always nor necessarily follows from the right of making a testament; and therefore the abuse must be removed or at least diminished, but the very right of making a testament is not on that account to be denied.

Indeed, to all, especially to younger persons of either sex, the necessity and dignity of labor must be inculcated, not only by words and examples, but also by deeds, namely by giving more to those who labor more strenuously; and also by a manly education, by seeing to it that even the richer learn and exercise some art. Let it be shown to the same persons that idleness is injurious to God, who commands all, even the richer, to labor: "In the sweat of your face you shall eat bread¹... If anyone is not willing to work, neither let him eat²"; - dangerous to the idle themselves; for, Scripture testifying, "idleness has taught much evil³"; and moreover, experience establishes that those who indulge in leisure soon lose their wealth, because, as the negligence of the idle increases, the revenues from lands or from other capital gradually diminish; - harmful to society, since the republic is deprived of all those resources which those persons could have acquired by laboring. - By these and similar means, young men, even the richer, will for the most part be induced to work strenuously, and will become useful no less to society than to themselves.⁴

¹ Gen., III, 19.

² II Thess., III, 10.

³ Eccli., XXXIII, 29; cf. d'Hulst, Confer. 1896, p. 264.

⁴ Not a few adolescents in France remain idle because they do not wish to exercise public office under leaders most hostile to religion; but are there not countless arts wholly independent of the State, in which, by exercising themselves, they may serve religion and the fatherland at the same time? Cf. V. Bettencourt, Du Choix d'une carriere independante, Paris, 1903.

692. (b) But the equality which the socialists champion is impossible, as there is no one who does not see: "For there are in men, as Leo XIII rightly says, very many and very great natural dissimilarities: the abilities of all are not equal, nor skill, nor health, nor strength; and from the necessary difference of these things a disparity of fortune follows of its own accord."⁵ Moreover, experience establishes that this inequality is beneficial to society: for for the good ordering of the republic there must be diverse offices, to the performing of which citizens are impelled by disparity of fortunes; otherwise all would desire to command, no one would wish to obey.

⁵ Encycl. Rerum Novarum.

Moreover, the faculty of making a testament, while it favors a certain inequality, greatly contributes to the good of society; for the richer, who do not need labor for daily sustenance, can devote themselves to the liberal arts and promote intellectual and moral progress; they can more effectively amplify industry and commerce, by favoring new experiments, for which an abundant sum of money is desired; likewise they can erect many institutes useful to the whole community, and in many places really have founded them; and all these things are generally managed in a happier manner by private persons than by the State itself.¹

¹ P. Leroy-Beaulieu, Traite d'Economie Politique, t. IV, p. 282-296.

693. 1. State of the question. By natural and canon law nothing else is required for the validity of a testament, on the part of form, except that there be moral certainty concerning the last will of the deceased. But by civil law various conditions are required among various nations.

Nevertheless, in almost every nation, certain privileged testaments are admitted, which, even if made without legal forms, are valid, provided that the will of the testator is established; thus generally the testaments of soldiers, or of those journeying across the sea, or in a time when an epidemic disease rages.²

² For France, Cod. civ., art. 981-998; Planiol, III, n. 2725. But, even in these cases, it is safer to write a holographic testament whenever this can be done.

694. 2. Prescriptions of civil law in France.³ According to French law, a testament can be threefold: holographic, solemn, and mystic.

³ According to French law, two or more persons cannot make their testament by the same act, but each must declare his last wills by a special act. (Cod. civ., art. 968, in Supplem., p. 114*.)

(A) A holographic testament, from the words holos and grapho (I write the whole), is that which has been written entirely by the hand of the testator, with notation of the day, month, and year on which it was made, and with the subscription of the testator. Whence, for its validity, three things are essentially required:

(a) that it have been written entirely by the hand of the testator, with no word excepted. Interpositions (interlineations) added by the testator's own hand do not vitiate the testament; additions made in the margin are valid, even if they were not signed, if they were written at the same time as the testament itself; but if afterward, and they contain new dispositions, they must be signed, with inscription of the day, month, and year. Erasures (ratures) which are established to have been made by the hand of the testator invalidate only the dispositions which were deleted. - Interpositions or marginal additions made by another hand, but without the testator's knowledge, do not vitiate the testament; otherwise, if the testator consents.

(b) That the day, month, and year on which the testament was made be rightly designated, at the beginning or end of the document, before his own name is signed.

This indeed is required so that it may be known whether it was written by the testator at a time when he was capable of making a testament, and which of two or three testaments is valid. - It must be noted that not a few testaments are declared invalid, either because the designation of the day was omitted, or because it was not rightly or sincerely made. - Designation of place is not necessary, although it can be useful.

(c) That the testator place his name by his own hand at the end of the document; therefore dispositions placed below the signature are null, unless they are signed.

695. N. B. A holographic testament is indeed best, since it is liable to few causes of irritation; but, because it can easily be taken away and destroyed, it is expedient that at least two copies be written, one of which is handed over to the heir himself, and the other to a notary. - When the testator has died, the designated heir must present the testament to the president of the tribunal of the domicile of the deceased, who will establish that the testament is to be deposited with such a notary, and that the goods left to him by the testator are to be handed over to the heir.

Of itself no obligation exists of making a testament; but accidentally, this obligation can be present, so that lawsuits may be avoided and restitution may be made more safely, if it is necessary. But upon priests who have received Mass stipends and monies for instituting good works, the duty is incumbent of writing a testament as soon as possible, so that they may prudently dispose of their goods, and take care lest the things of others, which have been deposited with them, be seized by natural heirs.

696. (B) A solemn testament is that which is received by two notaries before two witnesses, or by one notary before four witnesses. It is dictated by the testator, written by the notary, and signed by the notary, the witnesses, and the testator.

(C) A mystic testament is that by which the testator disposes secretly of his goods, and which he offers closed and sealed to a notary, before six witnesses, declaring that this is his testament written and signed by his own hand, or written out by another and signed by himself.¹

¹ Cod. civ., art. 968-980, in Supplem., p. 114*.

697. 3. On the force in conscience of a testament lacking legal forms.² (A) If the matter concerns a testament or legacies pertaining to profane causes, the testament can be held as valid by the legatee until it is rescinded by the judge, according to what was said above, n. 618; but it is permitted to use no fraud for deceiving the judge, e.g., by supplying the designation of the day or year which was omitted, or by placing the name of the testator who died before he signed; and if he whom the testament favors has used fraud or another unjust means, he is bound to restitution toward the heirs who have the right of seeking rescission of the testament; for the public good demands that fraud be able to patronize no one.

² These principles also have force for donations.

But the natural heir can seek rescission of the testament, unless he explicitly promised the testator that he would not impugn the testament, and the testator, relying on this promise, abstained from changing the testament; for if he does not stand by the promise, by fraud he deprives the legatee of a right which the latter could legitimately have obtained; for the testator would have used other means for transmitting these rights to the legatee.

698. (B) But if the question concerns a testament for pious causes, by which namely goods are left to churches, monasteries, the poor, or pious works erected for divine worship or the relief of the poor, in honor of God, it was controverted whether in the forum of conscience it would have force, even after the sentence of a judge annulling that testament.

(a) The more common opinion affirmed this; for testaments for pious causes, which regard a supernatural end, are subject to ecclesiastical laws, not civil laws, since the Church has the right of acquiring temporal goods independently of the State, for pursuing her end; therefore testaments lacking civil forms remain valid in the forum of conscience, as often as they are valid from the principles of Canon Law, that is, as often as there is moral certainty concerning the will of the testator, e.g., by the concordant testimony of two witnesses, or by the writing of the testator.

The decrees of Pontiffs and the responses of Congregations prove this. Thus Alexander III writes back to the judges of Velletri concerning testaments for pious causes:¹ "Because causes of this kind concerning the judgments of the Church must be treated not according to the laws, but according to the canons, and for these, divine Scripture testifying, two or three suitable witnesses suffice, we command your discretion by apostolic writings that, when some such cause shall have been brought to your examination, you treat it not according to the statutes of the decrees." - This law indeed has by no means fallen into desuetude, as is clear from more recent responses of the Roman Congregations; thus the unmarried Eudorius had instituted Boniface as universal legatee through a testament clothed with due forms; but he had handed over to Boniface a private writing (invalid before the civil law), in which he manifested a pious will. But Boniface, when Eudorius had died, kept the whole inheritance without fulfilling the pious legacy. Having been questioned on this matter, the Sacred Penitentiary responded on June 23, 1844:¹ "Boniface is bound in conscience to fulfill the will of Eudorius certainly known, for the forum of conscience."

¹ Decretal. Greg. IX, lib. III, tit. 26, cap. II, p. 541, ed. Friedberg.

¹ In Acta S. Sedis, II, p. 369.

699. (b) Nevertheless a few theologians, such as Daelman, d'Annibale, Haine,² taught that this obligation was doubtful, and therefore not to be urged.

² Daelman, Tr. de Justitia, p. II, de Contractibus, q. II, obs. 8; d'Annibale, III, n. 70; Haine, q. 53, p. 214-218.

For the rescript of Alexander III indeed has force for the Pontifical territory, but not for the universal Church; and although it was inserted in the Body of Law, and thus extended to the universal Church, it has become obsolete in many parts of the Church, so that today the Church does not urge her right. - But the response of the Sacred Penitentiary does not settle the matter; for Boniface in the case was bound to fulfill the will of Eudorius not indeed by force of the testament, but by force of an innominate contract by which he had obligated himself to fulfill the pious legacies, once he was instituted universal legatee by Eudorius.

700. Practical conclusions. The Code has practically imposed an end to the dispute by establishing these things: (a) "In last wills for the good of the Church, the solemnities of civil law are to be observed, if this can be done; if these have been omitted, the heirs are to be admonished to fulfill the will of the testator." (b) "The wills of the faithful giving or leaving their faculties for pious causes... are to be fulfilled most diligently even as regards the manner of administration and expenditure of the goods..." (c) "Ordinaries are the executors of all pious wills both by reason of death and among the living... Clauses contrary to this right of Ordinaries, added to last wills, are to be held as not added." (Codex, 1513-1515).

But if pious legacies seem too onerous, heirs are easily admitted to composition with the Church; concerning this the Code, c. 1517, establishes the following: "The reduction, moderation, and commutation of last wills, which must be made only from a just and necessary cause, are reserved to the Apostolic See, unless the founder shall have expressly granted this power also to the local Ordinary. But if the execution of the burdens imposed, on account of diminished revenues or another cause, with no fault of the administrators, has become impossible, then the Ordinary also, after hearing those whose interest is involved, and preserving, in the best way possible, the will of the founder, will be able to diminish the same burdens equitably, except for the reduction of Masses, which always belongs uniquely to the Apostolic See."

701. 1. State of the question. A testator can dispose of his goods in various ways, by instituting heirs, or legatees, or executors of the testament, provided he clearly expresses the intention of giving his goods or part of them for the time following his death. - Formerly a distinction was made between heirs and legatees: the former represented the deceased by succeeding to his goods either as a whole or according to an allotted part; but legatees received certain goods from the heirs themselves. Today, however, in France and many other nations, this division is omitted; but universal legatees, legatees by universal title, particular legatees, and testamentary executors are distinguished; concerning these we shall say a few things.

702. 2. Prescriptions of French civil law.¹ (A) Heirs or universal legatees are called those to whom the universality of the goods of the deceased is given. The testator can choose one universal legatee, or several, according as he wishes. (a) As regards rights, a universal legatee, if there are no necessary heirs, immediately obtains the dominion of the goods of the deceased and saisine, as they say; if there are necessary heirs, these obtain saisine, and the legatee must ask from them the handing over of the goods. (b) His offices are these: if he alone receives the inheritance, he must pay all legacies and debts, even beyond the resources of the inheritance, unless he received the inheritance under benefit of inventory;² - but if he concurs with a necessary heir, he alone is bound to pay all legacies, but debts only proportionately to the part of the inheritance which he receives.

¹ Cod. civ., art. 1002-1034; Planiol, III, n. 2730-2835.

² In the forum of conscience, more probably he is not held to pay debts beyond the resources of the inheritance, even if he did not use the benefit of inventory, at least before the sentence of the judge; for debts of this kind, as being real, are annexed to the inheritance itself, and therefore do not obligate the very person of the legatee beyond the resources of the inheritance. But, after the sentence of the judge, the law must be obeyed, which in itself is consonant with reason, insofar as it tends to this: that juridically there can be certainty concerning the resources of the inheritance, and thus the rights of creditors may be preserved.

(B) Legatees by universal title are those to whom the testator gives an allotted part of his goods, e.g., a third or fourth part, or all movable or immovable things. (a) These do not have saisine, but must ask for the goods given to them from the natural or legal heirs, or from the universal legatees. (b) They must pay debts and particular legacies according to the proportionate part of the inheritance which they receive.

703. (C) Legatees by particular title are those to whom the testator gives a determinate thing. (a) They have a right to the goods legated to them immediately after the death of the testator; but generally they cannot enter into possession or demand fruits except from the day on which they sought the handing over of the goods, or this was voluntarily granted by the heirs. (b) They are not bound to pay the debts and burdens of the succession, unless the testator has explicitly declared this, or the goods given to them are burdened with mortgages.

(D) Testamentary executors are mandataries chosen by the testator himself, for the purpose that they may faithfully watch over the execution of the dispositions contained in the testament; their rights and offices depend both on the intention itself of the testator and on civil law.

A testament can cease in three ways: by revocation, caducity, and rescission.¹

¹ The things which follow are admitted among most nations; cf. Cod. civ. Gall., art. 1035-1047; Planiol, III, n. 2836-2870.

704. 1. By revocation; for a testament is revocable from its nature, since the will of man is ambulatory until death. If the testator under the faith of an oath has promised that he will not revoke the testament, he indeed sins against religion by revoking it without a legitimate reason; but not against justice, because an oath cannot change the nature of a testament, which is of itself revocable; accordingly, even in this case, the revocation would have force.

But a testament is revoked: (A) explicitly, by a new testament in which the old one is wholly abrogated or abrogated as regards some dispositions; or by an act before a notary, by which a change of will is declared.

(B) Implicitly: (a) by making a new testament, in which indeed nothing is said about the former one, but dispositions contrary to those which were contained in the old one are contained; (b) by alienation of the legated thing, although the alienation is null, or the testator afterward recovers the thing; for such alienation signifies a change of mind clearly enough; (c) by laceration, obliteration, or destruction of the testament, carried out by the testator himself, or by his order.

705. 2. By caducity, which is verified when dispositions valid from the beginning cannot obtain their effect because of a supervening impediment:

(a) if the legatee dies before the testator; for since testamentary donation is made in consideration of the person, it does not pass to the heirs; (b) if the legatee dies before the condition on which the legacy depended is fulfilled; (c) if the legated thing has totally perished while the testator was living; or, after his death, without any fault of the heir: for then the thing perishes to the owner; (d) when the legatee renounces the legacy after the death of the testator; or becomes incapable of receiving it: this occurs in France only when he undergoes one of those penalties which formerly drew civil death after them.

706. 3. By rescission, which the heirs can seek for a threefold cause: (a) if the legatee does not execute the conditions imposed by the testator; (b) because of grave ingratitude of the legatee toward the testator; thus, in France, if he has plotted against the life of the testator, - has been guilty of cruelties, a delict, or grave injury against him, - or has brought grave injury upon his memory; (c) if there is some cause of nullity from lack of legal forms or from incapacity of the parties.

We shall speak: 1. on incapacity for giving or receiving; 2. on certain modes of giving prohibited by law; 3. on the limitation of the faculty of giving through legal reservation.

707. By natural law, all those are capable of giving and receiving who are suited for contracting, according to the things said above, n. 651. - But by civil law, which is diverse among various nations, the capacity of giving or receiving is restricted, on account of the public good.

1. On Incapacity For Giving From French Law.¹

¹ Cod. civ., art. 903-907, in Supplem., p. 106*; Planiol, III, n. 2888-2908.

708. (A) Minors, even emancipated ones, cannot give except in the cases determined by law; namely (a) after the sixteenth year of age, they can give by testament half the goods which they would be able to give if they were of majority age; (b) when they contract marriage, they can give by the contract of marriage whatever persons of majority age can give. - Moreover small manual donations do not fall under the prohibition of the law.

(B) Wives cannot give among the living without the consent of the husband or the authority of the judge; but by testament they can dispose of their goods: for the testament will not have force except at the time when the authority of the husband will already have ceased.

(C) The insane and the interdicted can in no way give; but those to whom a judicial council has been given cannot alienate goods among the living without the assistance of this council, but they can make a testament.

709. (D) Cessionaries of goods (in French, faillis) cannot give within the ten days which precede the judicial declaration of cessation of payments; and donations made before can be annulled if it is proved that they were fraudulent.

(E) Those condemned to perpetual penalties can in no way give, unless the State dispenses from this incapacity; indeed a testament validly made by them before is annulled by that very fact.

(F) Nuns living in a civilly approved institute cannot give to the community or to one of its members beyond a fourth part of their goods, unless the donee or legatee is an heir in the direct line of the donor; yet this restriction does not touch donations which do not exceed ten thousand francs.¹ Moreover attend to those things which must be said concerning interposed persons below, n. 712.

¹ Law of May 24, 1825, in Riviere, Lois usuelles, p. 221.

2. On Incapacity For Receiving.²

² Cod. civ., art. 908-911, in Supplem., p. 106*; Planiol, III, n. 2209.

710. Some are absolutely incapable, that is, with respect to any person; but others are relatively incapable, namely with respect to such and such a person.

(A) Absolutely incapable are: (a) infants not yet conceived at the time when the testator dies; but he is judged to have been conceived at the opportune time who is born within three hundred days after the death of the testator, provided he is brought forth viable.

(b) Those condemned to perpetual penalties, who can receive nothing except an alimentary pension.

(c) Societies, or associations which are not legally recognized: nevertheless the individual members can receive donations, just like the other citizens, with attention however to those things which we shall say concerning interposition, n. 712.

(d) Legally recognized institutes, such as seminaries, congregations, hospitals, etc., can receive nothing without the approval of the State, namely of the Prefect if the thing given does not exceed 300 francs, and of the Government if it exceeds this sum.³ Yet this restriction is not extended to manual donations.

³ Nevertheless, when the matter concerns church Fabrics, the Prefect can approve donations and legacies which do not exceed 1000 francs. - P. Caulet discusses at length and accurately the civil capacity of ecclesiastical institutes, L'Avocat du Clerge, Paris, 1897, p. 689-748.

(e) Wives cannot accept without the consent of the husband or the authority of the judge; emancipated minors without the assistance of a curator; but minors not yet emancipated can receive nothing of themselves; but their parents or tutors, in their name, can accept donations; the interdicted cannot receive without the consent of the tutor and the council of the family.

711. (B) Relatively incapable are: (a) a tutor in relation to a minor, until the latter has attained majority and the accounts of guardianship have been rendered to him; namely lest the tutor abuse his authority to the detriment of the ward. - Yet if the tutor is one of the ward's ascendants, he can receive something from him.

(b) Physicians, surgeons, pharmacists, and ministers of worship, even non-Catholics, who have furnished the work of their art or ministry to some sick person in his last illness, can receive nothing from him by gratuitous title, through a donation, even testamentary, made during that illness, unless they are direct heirs, - or, if direct heirs are lacking, collateral relatives at least in the fourth degree. The reason is that all these, in circumstances of this kind, can exercise too much dominion over the mind of the sick person.

They are not incapable: a physician who is called only for the sake of counsel (en consultation); a pharmacist who sold medicines without furnishing his work; nor a minister of worship who only furnished extreme unction or sacred communion, or visited the sick person as a friend.

(c) Illegitimate children, legally acknowledged by the parents, receive only a smaller part of the inheritance than legitimate children, as will be said where we treat of successions; if they have not been legally acknowledged, they are held as strangers. - Incestuous and adulterine children, when they are legally demonstrated as such (which rarely happens, because the law does not permit them to be legally acknowledged by the parents), can receive only an alimentary pension.

712. So that the incapable may be more effectively prohibited from giving or receiving, French civil law forbids donations to be made to an incapable person through interposition or substitution, or that an illicit condition be attached to them.

1. Forbidden interposition is present when a donation is made to a capable person, under the law that he hand over the thing to a person who is legally incapable of receiving; for then the donation is made in fraud of the law. - Now generally interposition must be proved by him who impugns the validity of the donation, by showing that a pact, either express or tacit, was entered into between the donor and the donee, by force of which the latter truly obligated himself to hand the thing over to the incapable person, - or that the donor ordered that the thing be given to the incapable person. - But it is not sufficient that he expressed a desire, since such a desire does not induce an obligation.

Nevertheless there are certain persons who are legally presumed to be interposed, namely the father and mother, descendants, and spouse of the incapable person;¹ this presumption indeed is juris et de jure, so that proof to the contrary is not admitted. - From the recent law of July 1, 1901, members of Congregations, or of civil societies which possess the goods of congregations, are held as interposed persons, as can be seen in the Supplem. for France, p. 45; yet in this case proof to the contrary is admitted.

¹ Cod. civ., art. 911, in Supplem., p. 107*; Planiol, III, n. 2988.

713. 2. Substitution in general is a disposition by which the donor designates a twofold person: one who is immediately to receive the gift or legacy, and another who, in default of the former or after the former, will receive the same goods.

It can be twofold: direct or vulgar, and fideicommissary.

(A) The former consists in designating a person who will obtain the gift or legacy if the donee or legatee does not wish or is not able to obtain it; e.g., I give such a house to John, and, in his default, to James. This substitution is nothing other than a conditioned donation, and it is valid, even in French law, from art. 898, in Supplem., p. 105*.

(B) The latter, or fideicommissary substitution, insofar as it is prohibited by the Code (art. 896), is a disposition by which the donor of some thing hands over dominion to another, with the burden of preserving the donated thing until death, and transmitting it after death to a third person. Whence he who receives the thing with the burden of transmitting it is called burdened (le greve) or fiduciary, while he to whom the thing is transferred is called the fideicommissary or the called one (l'appele, le substitue).

714. This kind of substitution, before the French Revolution, was in use among the nobles and the rich, so that the goods of a family might be securely transmitted to descendants, and thus the splendor of these families might be preserved in perpetuity. But the civil Code prohibited it as harmful to the equality of citizens, to the free transfer of goods, and to agriculture; and indeed so strictly that not only the substitution, but the donation itself is annulled; whence the fiduciary can neither retain the donated goods for himself nor hand them over to another, but the natural heirs can vindicate them. This law, as greatly restricting the natural liberty of disposing of one's own goods, more probably does not oblige in conscience except after the sentence of the judge.

Nevertheless, lest spendthrifts dissipate goods legated to them, a twofold substitution is permitted by the civil Code: (a) a father and mother can give to one or several of their children goods of which they have free disposition, with the burden of rendering them to all children born or to be born from them, without any distinction, only in the first degree; (b) those who have no descendants can likewise leave goods of which they can freely dispose to brothers or sisters, with the burden of rendering them to all children born or to be born from them, only in the first degree (art. 1048-1074, in Supplem., p. 120*).

715. 3. On illicit conditions attached to a donation or testament. Conditions of this kind, from art. 900 (Supplem., p. 105*), do not render the donation invalid, but are held as not written, so that the donee is in no way bound to fulfill them. - Nevertheless, from jurisprudence, a donation is held as invalid if the illicit condition truly gave cause to the contract; for then the consent was bound to the condition itself.¹

¹ A fuller exposition of this matter can be seen in Planiol, III, n. 3026-3045.

716. 1. State of the question. By natural law, each one can freely dispose of his goods, unless he has natural heirs for whom he is bound to provide. For parents are bound to give to children who cannot procure the necessities of life for themselves food, clothing, and other necessities, and at the same time to educate them in such a way that they can acquire the means of honorable support. Children likewise must grant an alimentary pension to parents who are now incapable of providing for their own necessities, as will be explained below in the treatise on the obligations of various states.

² Boissonnade, Histoire de la reserve hereditaire, Paris, 1873; Glasson, L'autorite paternelle et le droit de succession des enfants, in the periodical Reforme sociale, 1889, t. II, p. 209; Albert, La liberte de tester, Paris, 1895.

But in many regions, civil law proceeds further, and defines what allotted part of the inheritance is disposable, and what allotted part is to be reserved to natural heirs. Whence the disposable part is that concerning which the owner can dispose gratuitously at will; the reserved part, or legitimate part, is said to be that which is devolved to the natural heirs by the law itself, according to the proportion defined by law; therefore the owner cannot dispose of it gratuitously, but only by onerous title.

Now in England and the United States of America full liberty of making a testament is in force; in certain other regions, e.g., in Italy and Germany, half the goods is disposable, and the other half is reserved; in Spain, a third part of the goods is disposable, - a third part is to be distributed equally among the children, - and the last part can be given freely to any of the children, but not to strangers.¹

¹ On these, see Albert, La liberte de tester, p. 571-651; cf. Brocher, Etude sur la legitime et les reserves, Paris, 1868; Cunot, Des droits de legitime et de reserve, Paris, 1877.

717. 2. On reservation in France.² (A) The extension of reservation: (a) When legitimate descendants survive, the disposable part depends on the number of children: if there is one child, the parents can freely dispose of half the goods; if two children survive, they can dispose of a third part; if three or more, a fourth part is disposable. - By the name of children are understood also grandchildren (petits-fils) and their descendants, yet in this sense, that all posterity arising from one child are counted only as one; thus if Peter had two sons, John and James, and the former died leaving five children after him, these five represent the one John and are held as one in relation to the reserved part.

² Cod. civ., art. 913-930, in Supplem., p. 107*; Planiol, III, n. 3047-3140.

But if natural children legally acknowledged survive, an allotted part must be reserved to them, yet a smaller one than if they were legitimate.³

³ Since the matter is very complex, see recent jurists, e.g., Planiol, n. 3070-3074.

(b) If ascendants survive, descendants being lacking, and indeed in each line, paternal and maternal, half the goods is reserved; but if in one line, a fourth part is reserved.

(c) There is no reservation in favor of collaterals; nevertheless, in practice, if collaterals, otherwise poor, complain that legacies have been made to public or private institutes, to their detriment, public authority is accustomed to reduce these legacies. And rightly so indeed; for charity demands that certain goods be left to relatives, especially brothers or sisters, who are in common necessity.

(d) To the surviving spouse is not granted a reservation properly so called, but a right to the usufruct of a certain part of the goods of the deceased spouse, as will be said below where we treat of successions, n. 729.

718. (B) On the reduction of donations. When donations among the living or testamentary donations exceed the disposable part, they are not absolutely void, but can be reduced, if the reserving heirs or their successors or those having cause from them demand this; first indeed testamentary dispositions are reduced, according to the proportionate part of value; then, if legacies do not suffice for paying the reserved part, donations are reduced, not indeed according to a proportionate part, but in chronological order, beginning from the most recent and ascending backward to the first, if there is need.

N. B. Some say that any donations expended from mere revenues which had not yet been joined to capital are excluded from the law of reservation; but this is by no means admitted by jurisprudence, excepting those things which are not properly gifts, but only presents or alms.¹

¹ Planiol, III, n. 3088, alleging Cass. Jan. 11, 1882; cf. M. Henry, Du legs de la quotite disponible, Paris, 1902.

719. 3. On the social utility of reservation and of the disposable part. With great heat this matter is disputed among jurists and economists, and also among philosophers and theologians, some defending full liberty of making a testament, while others defend legal reservation; we shall briefly weigh the arguments of each school, drawing certain conclusions therefrom.

(A) Full liberty of making a testament, or at least the faculty for parents of disposing of half the goods, whatever the number of children may be, is defended by Le Play and the school of Social Economy founded by him, Baudrillart, P. Leroy-Beaulieu, d'Espinay, Pinard, Cl. Jannet, and many other economists,² with whom certain theologians agree; they defend this opinion by arguments from both the economic and the moral order.

² Le Play, La reforme sociale, Tours, 1887; id., Organisation du travail, 1888; Baudrillart, Les lois de succession en France, in Rev. des Deux-Mondes, April 15, 1872, p. 851; P. Leroy-Beaulieu, in the periodical L'Economiste francais, March 1880; d'Espinay, La liberte de tester et la copropriete familiale, Angers, 1882; Pinard, Les reformes possibles en matiere successorale, in the periodical La reforme sociale, Aug. 1, 1886, p. 127; Cl. Jannet, Le Socialisme d'Etat, Paris, 1890, p. 491-538; L. Brun, Introd. a l'Etude du droit, Paris, 1887, p. 207-234; - Albert lists others, op. cit., p. 715-727.

720. (a) Legal reservation, as it exists in France, induces the dismemberment of inheritances, with great detriment to families and to society itself; for since, where many children are present, the reserved part is the principal one, and must be divided equally among all the children, great possessions cannot long be preserved in the same family, unless the number of posterity is voluntarily limited; moreover, since from jurisprudence each of the children has a right to a portion not only of the same price, but also of the same nature, estates generally must be so divided that their cultivation becomes altogether difficult, while industrial or commercial institutes, since they cannot be divided, are often sold at a lower price and pass into alien hands, so that the children must begin another business; this indeed harms the progress of commerce or industry not a little. - Moreover, when the matter especially concerns small inheritances, the expenses which arise from succession are so onerous that they almost equal the very price of the inheritance; and thus children, especially minors, are reduced to extreme poverty at the time when they are deprived of their father.¹

¹ You have examples in Le Play, Reforme sociale, t. I, p. 265; Albert, p. 683-686. - "From 1879 to 1883... the average of costs per hundred francs of price had been 146 fr. 72 in sales with a maximum product of 500 fr., 57 fr. 13 in those whose price varied from 501 to 1000 fr., and 31 fr. 10 in the sales of immovables adjudicated for 1000 to 2000 fr." (Rapport du Garde des sceaux, in Officiel, Saturday, May 6, 1893, p. 2300.) Cf. Enquete sur l'etat des familles et l'application des lois de succession, by the Society of Social Economy, Paris.

721. (b) The effects in the moral order are worse: 1. voluntary sterility of spouses; there is no other nation in Europe in which the number of those born is so small as in France; but the chief cause of so great an evil must be taken from the equal and forced partition of inheritances; for parents fear lest, if they have begotten many children, the dominions possessed by them be divided into little parts, and posterity be reduced to a mediocre or lowest state of fortune; and therefore they use means, generally illegitimate, for limiting the procreation of offspring; this is established both from open declarations of fathers of families, - and from the fact that among the poor and workers, who lack possessions, offspring is more numerous, - and from comparison of France with other regions where liberty of making a testament is fuller.²

² Cf. Albert, op. cit., p. 657-667; Cheysson, Discours sur la depopulation de la France, in the periodical Reforme sociale, June 1, 1898, p. 858; Baugas, L'affaiblissement de la natalite en France, in Revue Cath. des Inst. et du Droit, Jan. 1895, p. 54; A. des Cilleuls, Les lois successorales et la population; id., La population, Paris, 1902, p. 124-127. To the matter, Leroy-Beaulieu, L'Economiste francais, March 1880: "They wished to prevent the bourgeois, like the peasant, from doing what was formerly called making an elder, that is, favoring one of the children; they have succeeded only in part. One can always make an elder by suppressing the younger children: it is to this fine result that a crowd of French families apply their ingenuity." - Cf. de Nadaillac, Un cri d'alarme, in Le Correspondant, April 25, 1894, p. 250-264.

2. Marriages on account of money, and not on account of mutual love, are often entered; indeed from this necessity of partitioning the inheritance there has grown up the custom of providing daughters with dowries, so that they may more easily marry; for since the possessions of parents are divided equally, compensation is sought in the marriage contract, insofar namely as young men seek to marry a richer girl, so that the part of the goods which must be left to brothers may be supplied through the dowry of the spouse; and thus it not rarely happens that the goods of the betrothed woman rather than her moral endowments are sought after; from this arise quarrels and divorces.

3. The authority of parents is likewise diminished by this; for since children of families securely expect a fat inheritance, they often become improvident, lazy, luxurious; besides, parents lack sufficient authority for breaking their obstinacy and inciting them to labor strenuously, because they are unable to disinherit them. Hence reverence or obedience toward parents decreases day by day; indeed sometimes children desire the death of their parents, so that they may more quickly and freely enjoy the paternal inheritance. But on the other hand, where posterity is not able to expect so securely the goods of ascendants, they are incited to labor strenuously so that they may provide for themselves, - not rarely they pass over to foreign nations so that they may increase their resources, - and they pursue their parents with due honor, so that they may be able to obtain part of the goods.

722. (B) On the other hand, many jurists approve legal reservation as it lies in the Civil Code:¹ -

¹ Thus, among others, Batbie, H. Ameline, Wolowski, whose arguments can be read in the little work La liberte de tester, discussion sur le regime des successions, Paris, 1892; Boissonnade, op. cit.; Cornulier-Luciniere, Etudes sur le droit de tester, 7th ed., Orleans, 1880.

(a) For it more favors the equality of citizens, and more effectively prevents envies and dissensions, which would be more frequent among brothers if parents were permitted to disinherit one, and to heap gifts upon another. For parents do not always favor sons who are endowed with greater industry or virtue, but rather those who strive to capture benevolence by flattery and blandishments.

(b) Besides, it is of the greatest importance to increase the number of those possessing certain goods; those who have nothing of their own easily slip into socialism, while possessors of lands, even of small value, strenuously defend the right of property; wherefore, among farmers, there are very few who adhere to collectivism, while workers who live in cities and have nothing as their own generally eagerly embrace the theories of the socialists.

723. (c) Moreover, when lands are divided among many, they are cultivated with greater care and industry, and thus are made more fruitful, as experience establishes; for in France, where this partition is in force, fields are cultivated more diligently and fruitfully than in England, where very vast estates have been preserved in the same family for a long time. - Nor should it be said that on small inheritances the use of machines is impossible, and thus greater expenses are incurred; for today associations of farmers (syndicats agricoles) are easily formed, by whose help machines and instruments can be procured for cultivating fields without great expenses.²

² A. de Foville learnedly shows that the division of lands among many is very useful, Le Morcellement, Paris, 1885.

(d) But the voluntary sterility of spouses must not be attributed solely, nor chiefly, to civil law, since in Belgium and other regions, where the same prescriptions are in force, numerous offspring are begotten, - but to unbridled luxury, love of pleasures, and an effeminate education which too often prevails among the rich. Wherefore the law concerning the partition of goods would be changed in vain, unless first morals were reformed and boys were instructed by a more manly discipline.

724. (C) Practical conclusions. (a) We indeed think that liberty of making a testament is restricted more than is just in France, since in reality it is less than in many other regions; but it is by no means established that the civil law in this matter is altogether unjust, as some contend: for the evils which are said to follow from it must not be imputed solely, nor perhaps chiefly, to it, but to other causes. Therefore the French law should be so tempered that, in every case, parents may be able to dispose of half the goods, - and more easily divide their wealth among the children while they are living, without being compelled to give goods of the same nature to each one, - and that inheritances devolved to minors may be divided among them according to equity without so many and such great expenses.¹ - But meanwhile, by a manly education let the inclinations of children toward luxury and pleasures be weakened and corrected.

¹ Cl. Jannet sets these things forth at length, loc. cit. - The Spanish system (above, n. 716) is more pleasing to others, and in reality seems altogether consonant with equity, insofar as it happily reconciles the rights of parents and of children; on this see Glasson, l. c.

725. (b) In certain parts of France, especially in the southern region, the usage has prevailed of giving more to one of the children, especially the firstborn, than the law itself permits, so that in this way better provision may be made for the preservation and decorum of families.² Those who act thus in good faith are not to be disturbed, provided the things which suffice for honorable support are furnished to the other children; for the French law, as restricting the natural rights of parents, does not bind strictly in conscience except after the sentence of the judge. This indeed is more evident when parents have acquired the greater part of their goods by their own labor.

² A. de Brandt, Droits et coutumes des populations rurales de la France en matiere successorale, translated from German by E. Regnier, Paris, 1901.

Besides, heirs who think that they have been injured have the right in conscience to have recourse to the tribunal, and all must acquiesce in the sentence of the judge.

But if parents, because of prejudices or hatred, deprived one or some of the children of the legitimate part, they would certainly sin against charity; yet more probably not against justice, before the sentence of the judge, provided they have left to them the things required for honorable support according to their state; this is especially true when testators by their own industry have greatly increased the family good: for then they can dispose of it more freely.

726. When someone does not dispose integrally of his things by donation or testament, the goods which remain pass to the heirs through legal succession. Legal succession therefore is the transmission of the goods of the deceased to one or several persons, according to the order defined by law. The general principles concerning successions are substantially the same among various nations, with a few exceptions, however, concerning the order to be followed among collaterals and ascendants, descendants being lacking. - Here, according to French law, we set forth: 1. who are the legal successors; 2. whether an option is given to them of accepting or repudiating the inheritance; 3. how the partition among the various successors is to be made.

¹ Carriere, de Justitia, II, n. 501-570; Marres, lib. I, n. 256-293; Planiol, III, n. 1698-2495.

727. 1. Certain persons are excluded from the inheritance:²

² Cod. civ., art. 725-730, in Supplem., p. 123*; Planiol, II, n. 1705-1759.

(A) By reason of incapacity: (a) those not yet conceived (n. 710); (b) those who, being born, are not capable of life (non viables); (c) those who, at the time when the succession begins, are already dead. - All these are excluded by the fact itself.

(B) By reason of indignity: (a) those who were condemned because of the murder of the deceased committed or attempted; (b) those who brought against the deceased a calumnious capital accusation, which has been judicially declared as such; (c) persons of majority age who did not denounce to the judges the murder of the deceased known to them, unless however they are excused from denunciation as relatives or connections by marriage of the murderer. - These, however, are disinherited not by the fact itself, but after the sentence of the judge.

728. 2. On the order of succession.¹ Heirs are of a twofold kind: regular, who by the fact itself succeed to the person of the deceased, and immediately acquire all his rights, provided they take upon themselves the burdens of the succession; irregular, who are put into possession of the goods by the judge.

¹ Cod. civ., art. 731-773, Supplem., p. 124*; Planiol, III, n. 1780-1925.

(A) There are five orders of regular heirs; nor is there a transition from one order to another unless the heirs of the prior order are altogether lacking. - Now the following are called to succession: (a) descendants of the deceased, namely legitimate or legitimated children, or recognized natural children, or adoptive children; then grandchildren (petits-fils), etc.

Legitimate children divide the inheritance equally among themselves. If one of them has died, his posterity divide among themselves the portion which would have fallen to the father. - Recognized illegitimate children obtain only a part of the inheritance determined by law (art. 756-761), if legitimate descendants, or ascendants, or brothers or sisters or their children survive; otherwise, they obtain the whole inheritance.

(b) Descendants being lacking, the father and mother of the deceased are called together with his brothers and sisters or their children, according to the proportion determined by law (art. 746-752).

(c) But if descendants and parents of the deceased are lacking, brothers and sisters divide the whole inheritance among themselves in the manner defined by the Code (art. 752).

(d) If descendants, brothers and sisters, and also parents of the deceased are lacking, the succession is devolved to ascendants: the nearer paternal ascendants divide half the part among themselves; but the nearer maternal ascendants divide the other among themselves (art. 746-749). - But if one of the two lines of ascendants has been extinguished, half the part is divided among ascendants, but the other among collaterals of the other line.

(e) If descendants, brothers and sisters, and ascendants are lacking, the inheritance passes to the children of brothers or sisters up to the twelfth degree (art. 750-755), and to other collaterals up to the sixth.

729. (B) There are two irregular successors: (a) the surviving spouse who, the aforesaid heirs being lacking, obtains the whole inheritance, provided he or she has not been judicially separated from the other spouse. - Moreover, when the surviving spouse does not obtain the whole inheritance of the other, and is not judicially separated, he or she acquires the usufruct of a certain portion of the goods of the deceased, according to art. 767; (b) the State, or fisc, which, in default of other heirs, obtains all the goods (art. 768).

730. 1. On the option given to heirs. Heirs can accept a succession either simply or under benefit of inventory, or repudiate it. It is indeed expedient to accept simply when there is moral certainty that the succession is not burdened by obligations beyond the resources of the inheritance: for thus many expenses are avoided. - But if the matter is doubtful, it is better to accept under benefit of inventory, because, although the expenses are greater, the heir nevertheless is not held to pay debts beyond the resources of the inheritance. - But it is useful to repudiate a succession when there is moral certainty that the inheritance is burdened by obligations which exceed the wealth, or when a donation of very great value, made previously, could be lost or diminished by the obligation of bringing it back to the common mass, as will be said below.

¹ Cod. civ., art. 774-810, Supplem., p. 129*; Planiol, III, n. 1953-2034.

731. 2. On the rights and obligations of one accepting. (A) He who accepts simply, whether explicitly, by assuming the name of heir in an authentic or private act, yet in such a way that it is clearly established that he has accepted the succession, - or implicitly, by eliciting an act which necessarily carries with it the will of accepting: (a) immediately acquires all the rights of the deceased and can dispose of them; (b) likewise takes upon himself all burdens, even beyond the resources of the inheritance, so that he is bound to pay debts not only from the goods of the succession, but also from his own.² - This obligation is irrevocable, according to that saying, "once an heir, always an heir," unless however in cases excepted by law, namely when acceptance was obtained through fraud, - or when the inheritance is diminished by more than half, because of the finding of a testament unknown at the time of acceptance (art. 783).

² Thus indeed from civil law, but not from natural law. - But civil law in this case does not oblige in conscience before the sentence of the judge, as was said above (n. 618-619), because it rests on a false presumption of fraud, which does not exist in the case; for we suppose that the heir acted honestly, and did not withdraw any goods of the succession.

732. (B) He who accepts under benefit of inventory must expressly declare this and have this declaration inscribed in the registry of the tribunal, "au greffe du tribunal de premiere instance dans l'arrondissement duquel la succession s'est ouverte" (art. 793); then: (a) he receives only administration of the goods, until the matters have been put in a clear state, and satisfaction has been made for the burdens; (b) he must take care that an inventory is completed; (c) this having been posited, he is not held to pay burdens beyond the resources of the inheritance, but can free himself from every obligation by leaving all the goods to the creditors and legatees; indeed he has the right of demanding payment of all things which are owed to him by the succession.

733. 3. On repudiation of succession. Since no one is an heir unless willing, someone can renounce a succession. But this renunciation is not presumed, but must be declared expressly in the same manner as acceptance under benefit of inventory. Now one renouncing (a) is judged never to have been an heir, and accordingly his portion accrues to co-heirs of the same order, or, if these are lacking, is devolved to the subsequent degree; (b) is freed from paying debts, but creditors who have been injured by this renunciation can obtain from the judge that they accept the succession in his place; in which case, the renunciation is invalidated only in favor of the creditors, and indeed for this end alone, that those things which are owed to them may be paid (art. 788); (c) can retain gifts and legacies made to him, provided they do not exceed the disposable part.

734. 1. State of the question. Sometimes, to forestall lawsuits, the partition of the inheritance is made by the ascendants themselves while they are living; then it must be made in the form of donation, or of testament (art. 1075-1080), while observing the rules concerning reservation and concerning succession. - If no partition has been made while the parents are living, after their death it must be instituted, unless the co-heirs agree about deferring it for some time, which must not exceed five years; after this time has elapsed, the agreement can be renewed; - but if there is no pact of this kind, no co-heir can be compelled to remain in indivision.

¹ Cod. civ., art. 815-892, Supplem., p. 133*; Planiol, III, n. 2170-2442.

735. 2. On collation (rapport) to be made before partition. So that relative equality may be preserved among the heirs, each must bring back to the common mass whatever he received from the deceased through donation, unless however the donor explicitly said that the things given, which otherwise do not exceed the disposable part, are not to be brought back, - or the law itself disposed otherwise.

Now the law exempts from collation: (a) expenses of education, namely those which are necessary for learning an art or commerce, or nuptial expenses, or customary gifts; but not expenses made for procuring some office or state of life (frais d'etablissement); (b) fruits and interest of the donated thing, which were received before the death of the donor; (c) immovable things which perished without the fault of the donee. - Testamentary legacies are exempt from collation unless the testator has disposed otherwise, or unless they exceed the disposable part.

736. 3. On rescission of partition. Partition once made can be rescinded (a) because of force and fraud; (b) when one party is injured, and this injury exceeds a fourth part of the portion which ought to have been attributed to him. - Moreover in the forum of conscience, any unjust injury whatever must be repaired.

737. 4. On the assurance of partition (garantie des lots). To preserve equality, it has been established that, if one of the heirs suffers eviction, totally or partially, of the goods which had fallen to him, or is disturbed in their enjoyment, the other heirs are bound to render him unharmed, provided: (a) the cause of eviction was prior to the partition, and not to be attributed to the fault of the heir whose interest is involved; (b) this eviction was not exempted from assurance by an explicit clause.

738. 5. On the proportion to be preserved in the payment of debts. The general principle, consonant with natural and civil law (art. 870), is that each heir must concur in the payment of debts, proportion being had to those things which he has received from the inheritance. Nevertheless, when one of the heirs has received some estate subject to mortgage, the creditors can compel him to pay the whole debt by which the estate is burdened; but he has recourse against the other heirs for recovering the part owed by them (art. 874).

739. After the things said concerning gratuitous contracts and acts, we approach onerous contracts, and indeed those of certain outcome, intending afterward to discuss aleatory contracts. Now among onerous contracts of certain outcome the following stand out: purchase-sale, by which the dominion of a thing is transferred for a price; lease, by which the use of a thing is granted for payment; contract of labor, by which work to be furnished is promised for wages; loan for consumption, by force of which gain is received from money which is granted to another for use of consumption; contract of partnership, by which several agree concerning some thing to be placed in common for making profit therefrom and dividing it proportionately among themselves. Concerning these we shall speak separately.

740. Preliminary notes. 1. As was noted above (n. 611), contracts draw their origin from the very social nature of men; for since, given the division of labor, they produce certain things which they do not need, and besides need many things which they do not produce, exchanges of goods are made among them from this, insofar as they hand over certain goods to others and receive from them other goods of a different kind. But afterward, since it often happened that things to be exchanged were of unequal value, gradually by the usage and consent of nations a common measure of things was chosen, namely money,² by which exchanges were made easier and more frequent; but that kind of exchange which is made through money was called purchase-sale.

¹ St. Thomas, 2. 2., q. 77; Lugo, disp. XXVI; Salmant., tr. XIV, cap. II; Billuart, diss. III; St. Alphonsus, n. 793-830; Carriere, II, n. 655-765; Ball. P., n. 747-820; Berardi, n. 597-668; Lehmk., n. 1109-1123; Noldin, n. 577-596.

² Money (pecunia) etymologically draws its origin from the word pecus, because formerly it designated all wealth or riches, which in primitive times consisted chiefly in flocks; hence when coins were employed as the price of exchange, they were called pecunia, and among certain nations coins were marked with the head of a beast (pecus) (Breal and Bailly, Diction. etymologique latin, Paris, 1898, p. 254).

741. 2. Now purchase-sale is an onerous contract by which the dominion of some thing is transferred for a determined price. - Hence three things are required for the essence of this contract: (a) mutual consent of one who buys and another who sells; (b) some thing, whether movable or immovable, which is called merchandise; and thus sale is distinguished from exchange of money, in which some kind of money is exchanged for another kind of money; (c) money as the price of the payment; and thus purchase is separated from simple exchange, in which merchandise is given for merchandise.

742. 3. By natural law, the transfer of dominion is made by the consent alone of the contracting parties, namely as soon as they have expressed mutual consent concerning the merchandise and the price. But by civil law, among some nations, certain conditions are required so that the contract may be perfect; concerning these the Codes should be consulted.

In France,¹ dominion is transferred by the consent alone of the contracting parties. - Nevertheless, in certain cases, the sale is not perfect, because it is subject to some condition. Thus (a) when things are sold according to weight, number, or measure, the sale is not perfected unless they have been weighed, numbered, or measured; (b) when the matter concerns things which are customarily tasted before they are bought, such as wine and oil, the sale is not absolute until the buyer has tasted and approved them; (c) if the sale is made on trial (a l'essai), it is not judged perfect unless the thing has been tested. - In these or similar cases, as long as the sale is not perfect and absolute, the thing perishes to the seller; but as soon as the contract has been completed, the thing, even not yet handed over, perishes to the buyer.

¹ Cod. civ., art. 1583-1593, Supplem., p. 143*; Planiol, II, n. 1354-1365.

We shall speak: 1. on the just price which the seller can demand and the buyer must pay; 2. on the offices of the seller; 3. on the offices of the buyer; 4. on certain species of sale, in which special difficulties occur.

743. 1. State of the question. (A) Price is the value of a thing expressed in money. But whence the value of a thing depends is greatly disputed among economists. Some say that this is to be taken from the very intrinsic utility of the thing, with attention at the same time to the abundance or scarcity of the thing; thus water, which is very useful, is generally esteemed lightly, because it abounds much, but where it is lacking, it becomes of the greatest price. Others hold that the value of a thing is to be derived from the labor consumed in making it. Finally others, to whom we assent, think that value depends on both these causes at once, and moreover on the more or less vehement desire which the buyer conceives of acquiring the thing, on account of the utility or pleasure which it brings to him.¹

² Cavallera, Semaine sociale 1921, p. 57-70.

¹ P. Leroy-Beaulieu, Tr. d'Econom. pol., III, p. 15-94; J. Rambaud, Elements d'Econ. Politique, p. 31-42; Ch. Gide, Princ. d'Econ. polit., p. 51-70; V. Brandts, Les grandes lignes de l'Econ. Polit., Louvain, 1904, t. II, p. 4-25.

Prices today are regulated chiefly by the law of competition, by force of which sellers of the same merchandise are content with small profit, so that they may win for themselves a greater number of buyers; and also by the proportion between things offered and things sought (la loi de l'offre et de la demande, supply and demand), in the sense that, other things being equal, merchandise is dearer in proportion as, on the one hand, it is offered less abundantly, and on the other, buyers who wish to acquire it are more numerous.²

² "It is formulated thus: the value of things (riches or acts) is in inverse ratio to supply and in direct ratio to demand" (J. Rambaud, op. cit., p. 257). - On the utility and disadvantages of competition, see Rambaud, p. 80-83; Gide, op. cit., p. 153-157.

744. (B) That price is called just which is judged morally to equal the value of the merchandise. But the equality about which we are treating here cannot be mathematical and absolute, but only moral and relative, insofar namely as each contracting party derives from the sale some utility, which, all circumstances being considered, seems to compensate that which he hands over to the other. - Now a threefold price is distinguished: legal, common, and conventional.

(a) Legal price is called that which has been defined by public authority; thus, in certain cities, by the authority of magistrates there is determined the price of bread or meat, or the price to be paid for the use of carriages. When a legal price is present, this must be stood by in conscience, unless it is manifestly unjust (which scarcely ever occurs), or has fallen into desuetude; for it was established by legitimate and competent authority, on account of the common good; therefore he who, without a reason altogether special and consonant with equity, exceeds that price, commits injustice either toward buyers, or also (at least frequently) toward other sellers, and is held to restitution.

745. (b) Common price is that which is determined by the common estimation of men, according to the variety of places and times. This indeed is not determined mathematically, but has a certain latitude, and can be threefold: highest, namely that above which honest merchants are not accustomed to sell; lowest, below which honest buyers generally do not buy; middle, which consists between each. - Generally, in necessary things concerning which contracts are often made, the lowest price is not very distant from the highest in the same place, and the middle price is easily known to all through what is called le prix courant, le prix du marche. But in superfluous things, especially when they are rarely sold, there is greater latitude, and scarcely is there found a current or common price.

746. (c) Conventional price is that which is determined by the free will of seller and buyer. Now all concede that things which have neither a legal nor a common price are justly sold at a conventional price, provided fraud, fear, or force is absent. For then the price is just because the contracting parties knowingly and freely agree about it, and besides there is no other way of determining it. - Thus it is, e.g., as regards works of art, precious gems of extraordinary size, ancient manuscripts, or other things of this kind which are sold only rarely; - likewise as regards things already worn by use, furniture not new; or as regards things concerning whose price both contracting parties doubt, when each consents to undergo the peril of the lot.

But the question is whether, even in things for which a common price is present, a conventional price distinct from the common one is licit.

747. 2. Controversy concerning the norm to be followed as regards just price. A twofold opinion is given.

(A) Others, more commonly, after St. Thomas,¹ teach that one must stand in justice by the common price, unless there is a special and legitimate reason for acting otherwise. For (a) when the price of some thing has been determined by the common estimation of honest persons, the contracting parties are judged to make a pact according to that price; and therefore, if it is exceeded, consent is rightly thought to lack due liberty; (b) if agreement alone sufficed for just price, the less prudent and watchful would often be deceived and despoiled by the more skilled, with great detriment to society, since from this the security of commerce would be endangered.

¹ St. Thomas, 2. 2., q. 77, a. 1.

(B) Yet a few theologians, both ancient and new, think that in all things the conventional price is legitimate, provided the contracting parties make a pact concerning it freely. For (a) the price is just when the seller and buyer agree about it knowingly and willingly, although it exceeds the limits of the common price: for then, whatever may be the case concerning common estimation, they think that in this particular case the thing is morally equivalent to the price; (b) besides, such today is the practice even of honest persons; civil laws favor this, while they sanction sales freely entered at whatever price, unless one or the other contracting party has suffered enormous injury; indeed defenders of the former opinion are compelled to admit so many exceptions that in reality in practice they do not differ much from the defenders of the other opinion.

748. 3. Practical conclusions. (a) In things which are accustomed to be sold frequently and commonly, generally one must stand by the current price in justice,¹ unless there is a special reason for acting otherwise.

¹ It can happen that the current price is unjust, either because of lies and frauds, or because of monopolies, which have been instituted by the principal sellers of some merchandise; then the authors of lies and monopolies sin against justice, as will be said below, where we treat of monopolies, n. 777; but other merchants who are deceived by these frauds, or are compelled to stand by the prices of monopolists lest they withdraw from the market and suffer ruin, are immune from injustice (Berardi, n. 643).

(b) But in things which are sold less frequently, and for which scarcely any current price is present, the conventional price can be held as just, provided fraud, force, or fear is absent.

(a) The reason for the former is that, where a current price is present, determined by the common estimation of honest persons, it can scarcely be conceived how the contracting parties knowingly and willingly make a pact concerning another price, unless there is a special reason for acting otherwise: for men are not accustomed, in onerous contracts, to buy above the highest price or to sell below the lowest, unless they are deceived in some way, or are compelled by some necessity.

(b) Besides, there are many things, such as houses, estates, horses, etc., for which scarcely any clearly and absolutely determined price is given, because their value depends on many circumstances of places, times, or persons. Then if two contracting parties, knowing very well the value of the thing not only extrinsic but also relative, and besides immune from every fear or force, freely consent to some price, it can generally be held as just: for if the buyer consents to pay more than the common price, this proves nothing other than that the thing, in his judgment, is worth more than it is worth according to common estimation. - But he who buys a thing at a cheaper price because the seller is placed in some necessity, - because, e.g., he needs money for paying debts, - is guilty of injustice.

749. 4. Applications. (A) On the titles on account of which it is permitted to sell a thing above the common price. Three titles of this kind especially are enumerated: - (a) emergent damage or ceasing profit; e.g., if someone, in favor of the buyer, sells merchandise which he intended to keep for another time, when it would have been dearer; or permits payment of the price to be deferred beyond the legal time; in these and similar cases, it is permitted to exceed the common price, provided the buyer is warned: for the damage which the seller suffers or the profit which he loses is something estimable by price.

(b) The special affection of the seller toward his thing; if the seller pursues his thing with special affection, on account of the utility or pleasure which it brings him, he can demand a greater price, because the lack of a specially loved thing is something estimable by price, and besides the buyer remains free to acquire the thing or not.

750. (c) The special utility of the thing with regard to the buyer, because, e.g., an estate is near the buyer's house. This indeed St. Thomas denies, whom many theologians follow; for then "the utility which accrues to another is not from the seller, but from the condition of the buyer. But no one ought to sell to another what is not his."¹ Yet today not a few theologians teach that this is a legitimate title for demanding a greater price, provided the seller does not abuse the necessity of the buyer; for the value of a thing is taken from its utility not only intrinsic and absolute, but also extrinsic and relative; now an estate located near a house acquires greater value from this proximity; but this, as proceeding from the location of the field, truly belongs to the owner of the estate. Besides, today it is commonly admitted that the price of a thing is partly to be determined from the desires which it arouses; therefore those things can be sold for more which buyers more vividly wish to acquire. - Whence in practice those are not to be disturbed who sell more dearly things which furnish a special utility or pleasure to the buyer. - But it would have to be said otherwise if a greater price were demanded because the buyer is placed in necessity; for then he pays that price not freely, but as if compelled.

¹ St. Thomas, 2. 2., q. 77, a. 1.

751. (B) On the titles on account of which it is permitted to buy below the common price. Three can also be distinguished: (a) if someone buys things which he does not now need, in favor of a seller who lacks ready money; for by acting thus he furnishes to him an advantage which is estimable by price; (b) if merchandise is freely offered; for things freely offered become cheap, and, according to modern economists, the more abundantly they are offered, the cheaper in price they are worth; (c) if payment is made in advance, because then a convenience is furnished to the seller which is estimable by price.

752. (C) Corollaries. (a) Sometimes merchants sell below the common price in order to attract buyers, and thus indirectly bring some damage upon other sellers; and the question is whether such a manner of acting is unjust. Now of itself they do not wound justice, because by selling their merchandise at a cheap price, they use their own right. But if they attract buyers by lies and frauds, indeed pretending to sell below the common price, but at the same time adulterating the merchandise, or diminishing weights and measures, they commit injustice toward other sellers, from whom they turn away buyers by frauds; but not, strictly speaking, toward the buyers themselves, if they diminish the price in the same proportion as the quantity or quality of the merchandise.

753. (b) When contracting parties know from private knowledge that the price of some merchandise is soon to be increased or diminished, they can nevertheless buy or sell at the common price, provided they do not use lies or fraud; for they are not compelled to communicate their private knowledge to others, and besides, when they contract here and now, they are not held to regard the future value. - This is the practice even of honest persons, who try to buy things at the time when they are cheaper in price, so that they may sell them when they become dearer: for rights profit the vigilant.

But if officials or supreme magistrates have acquired this knowledge by force of their office, it is controverted whether they can use it for their own advantage, with detriment to others, before the matter is publicly divulged. Whatever the case may be, all admit that they act unjustly if they purposely delay making this knowledge public, for the end that they may be able to receive great profit therefrom, or if they manifest the same to a few friends before other citizens; for thus they abuse public office, and unjustly favor themselves or others, to the detriment of others.

754. (c) If a precious thing is displayed among common things, these things seem to be established: - if each contracting party is ignorant of the special value of the thing, the price about which they freely agree can be held as legitimate, because each incurs an equal danger of loss and has an equal hope of gaining. - If the buyer knows the value of the thing, while the other is ignorant, he can buy it at a cheap price, if there is scarcely anyone in this place who can know the value of this thing: for in this case the price is not determined by common estimation; otherwise, if there are skilled persons there who know the true price: for then there is a common price, by which one must stand. Nevertheless, some in this case are excused from injustice, on account of good faith. - Whatever the case may be, in these or similar circumstances, an upright and honorable man will pay the whole price, yet retaining for himself a profit proportionate to his industry and skill.

These offices regard: 1. the qualities of the thing; 2. the manifestation of defects; 3. the handing over of the thing sold; 4. its assurance.

1. On The Qualities Of The Thing Sold.

755. (A) Principle: The thing sold must be at least morally the same as the thing sought, whether as regards species, or as regards qualities. - It is said morally, because if the thing sold indeed differs physically from the thing sought, but morally, and, so to speak, commercially is the same, equally useful to the buyer and apt for the intended end, the contract has force. - Otherwise it is invalid and illicit, for consent concerning one and the same thing is not present, since the seller has handed over a thing which, in common estimation, differs substantially from that which the buyer sought.

756. (B) Practical conclusions: (a) Therefore it is not permitted to substitute an artificial thing for a natural thing sought by the buyer, e.g., wine made chemically, not from the vine, - butter which is nothing other than oleomargarine, etc. Nevertheless, after the fact, if the thing handed over is not harmful, and besides the price is equivalent to the thing sold, restitution as regards the past is not to be urged, on account of the good faith which generally exists, but merchants are to be warned not to do this henceforth.¹

¹ Sometimes merchants act thus because buyers do not wish to pay the price of the natural thing; then injustice indeed is not committed, but they would act more honorably if they openly said that the thing cannot be acquired at such a price.

(b) Nor is it permitted to adulterate things sought by the buyer, or to mix them with others of cheaper quality;² under this heading, he acts unjustly who so adulterates or mixes merchandise that buyers would not wish to acquire it at such a price, if the matter became known to them. But if the mixtures are such as are customarily made by merchants, and do not harm health, and besides the price is proportionately diminished, there is not injustice strictly so called, nor therefore an obligation of making restitution.

² How many and how great adulterations of this kind are, P. Delay shows in various facts in our days, in Le Correspondant, Feb. 23, 1903, p. 782-792. Some of these adulterations are specially prohibited by civil law; for France, cf. Cod. pen., art. 423; Law of March 27, 1851; May 5, 1855; February 4, 1888; August 14, 1889; July 11, 1891; July 24, 1894; April 16, 1897; in Riviere, pp. 334, 392, 994, 1059, 1120, 1253.

2. On The Manifestation Of Defects.

757. (A) By natural law: (a) the seller must manifest to the buyer substantial defects, namely those which render the thing harmful, or unfit for the known end of the buyer; otherwise, true consent is not furnished, since no one intends to buy a harmful or plainly useless thing.

(b) As regards accidental defects, which only make the thing less useful for the intended end, the seller is held to manifest them if he is asked about them; otherwise he would use deceit and fraud, and thus would wound justice; a fortiori it is unjust positively to deceive the buyer by words or deeds, by using, e.g., illegitimate means so that the merchandise appears better than it is; for then a lie is committed, and indeed a harmful one. - But if he is not asked, the seller is not strictly held to lay open the defects of the thing, especially manifest ones, unless the buyer is inexperienced and says that he entirely trusts the seller; yet the price must be diminished on account of those defects, lest, all things considered, the highest price be exceeded. The reason is that the buyer himself must take care lest he buy a defective thing; if he is endowed with common skill and prudence, he can perceive manifest defects; but if he lacks this skill, he can and must ask.

758. These principles indeed are admitted speculatively by almost all. But in practice, there are not a few merchants who think it is licit in every case to conceal defects, even hidden ones, provided, once the contract has already been completed, they warn the buyer about the vices of the thing which could harm him. And these indeed, after the fact, are to be excused from so much, if not from the whole, nor are they to be compelled to restitution, unless they sold the thing above the highest price; but they are prudently to be warned not to deceive buyers henceforth.

759. (B) By French civil law,¹ redhibitory vices are recognized, on account of which the buyer can either return the thing and demand restitution of the price, or keep the thing and recover part of the price, according to the estimation of experts.

¹ Cod. civ., art. 1641-1649, Supplem., p. 149*; as regards redhibitory vices of animals, cf. Law of July 21, 1881; August 2, 1884; July 31, 1895, in Riviere, pp. 771, 902, 1318, and Supplem., p. 149*, note 1.

Now for redhibitory vices, four conditions are required: (a) that the vices be hidden; for when they are manifest, so that they can be detected by common diligence, the rule is: let the buyer beware! (b) unknown to the buyer: for if, although hidden, they had been detected by the buyer, he is judged to have wished to acquire the thing, notwithstanding the defect; (c) existing at the time of sale, at least virtually; for, after the sale has been completed, the buyer himself undergoes the peril of the lot: hence he must seek rescission of the contract as soon as possible; (d) impeding or diminishing the utility of the thing, so that the buyer would not have bought it if he had known the defects.

When these four things are verified, the seller is held concerning redhibitory vices, whether he knew them or not. Nevertheless, if he is of good faith, he can exempt himself by a special pact from every obligation as regards defects; and, if he did not make this pact, he is held only to restore the price of the thing and the expenses arising from the contract; but if he is of bad faith, he does not enjoy this privilege, but must compensate all damages brought upon the buyer.

If the thing sold has perished from a redhibitory vice, the seller is held to return the price and compensate damages; otherwise, if it has perished by fortuitous event or by the buyer's fault.

3. On The Handing Over Of The Thing Sold.

760. (A) The seller is held to hand over the thing sold to the buyer, that is, to transfer it into his power and possession; and indeed in that state in which it was at the time of sale, with all fruits which he has received from the day of the contract entered; at the time, place, and manner fixed beforehand, and if a pact is lacking, according to the prescriptions of civil law¹ or the custom received in this place. Otherwise, the buyer has a personal action against the seller, and a real action concerning the thing sold. - Nevertheless, if the buyer does not pay the price at the time fixed beforehand, or falls into a state of bankruptcy, the seller is not held to hand over the thing.

¹ Cod. civ., art. 1604-1624, Supplem., p. 146*; Planiol, n. 1448-1456.

761. (B) The seller is likewise held faithfully to guard the thing as a depositary until it is handed over to the buyer; wherefore, if by his fault it perishes or suffers detriment, he is held to repair the damage; but if by fortuitous event, he undergoes the damage who is the owner of the thing; now in France, dominion is transferred to the buyer even before handing over.

(C) Carrying away (l'enlevement de la marchandise) differs from handing over of the thing; this is done at the buyer's expense, unless it has been otherwise established by agreement or custom.

4. On The Assurance Of The Thing Sold.

The seller is held to furnish security to the buyer as regards possession of the thing and hidden vices.

762. (A) He must furnish security concerning the tranquil possession of the thing, against eviction; but eviction has place when the buyer is juridically compelled to hand over the thing bought to another, either wholly or in part, because, e.g., a mortgage creditor vindicates it. - And rightly indeed; for the seller does not acquire a right to the price except insofar as he transfers to the buyer the quiet possession of the merchandise. - Whence, if the buyer is disturbed, he must have recourse to the seller: but the latter will try to impede eviction, and, if he does not impede it, he is held to repair all the damages which the buyer has undergone, namely the price, the expenses of the contract, expenses made for pursuing his right, etc.

Nevertheless the seller is excused from assurance: (a) if he expressly said that he did not wish to furnish security against eviction, provided he is of good faith; or implicitly, by openly declaring the cause of eviction; for then the buyer takes upon himself the danger of eviction; (b) if the cause of eviction arose only after the sale, e.g., because of prescription which the buyer, although warned concerning this matter, did not interrupt; or if the buyer is evicted by his own fault.

(B) Moreover, the seller is held to furnish security to the buyer as regards hidden vices of the thing, as was said above, n. 757-759, and therefore to restore the price, or diminish it.

The buyer must pay the price and take away the thing.

¹ Cod. civ., art. 1650-1657, Supplem., p. 151*; Planiol, II, n. 1521-1532.

763. 1. To pay the price at the place and time fixed beforehand; and, if nothing special has been agreed upon, at the place and time at which the thing is handed over or ought to have been handed over; for if the thing has perished by fortuitous event, once the contract has already been entered, the buyer is not freed from paying the price. - If payment is deferred beyond the time fixed beforehand, a legal increase is owed provided this was agreed upon, or payment was expressly required, or the thing is fruitful; for otherwise damage is brought upon the owner. - Finally, if the buyer in no way pays the price, the seller can seek rescission of the contract, lest otherwise his rights be injured.

764. 2. To take away the thing, and indeed at the determined time, and, if nothing has been established, as soon as morally possible, lest from delay the seller suffer some damage. - If the buyer has neglected to take away the thing, the seller is no longer held to guard the thing, and, if he has preserved it, he can recover the expenses made for this reason. In France, when the matter concerns movable things, the contract is resolved in favor of the seller if the thing has not been removed after the time fixed beforehand (art. 1657).

There are three concerning which it is necessary to speak, on account of the special difficulties which occur in them: sale through brokers, sale by auction, and monopolies.

1. On Sale Through Brokers (courtiers).

765. Brokers are called all those who buy or sell something in the name of another; they are called by various names: courtiers, commissionnaires, commis voyageurs, representatives of commerce.

They are as it were mandataries of those in whose name they act, and therefore must fulfill the obligations of mandataries.

766. Principles. (A) Brokers must faithfully conduct the business committed to them, namely with that diligence which they are accustomed to employ in their own affairs of the same kind; for they are chosen and receive a stipend for this reason, that they may faithfully conduct the affairs of the principal. Wherefore they are held to repair damages which have been brought upon the principal, because of culpable negligence in conducting the business, according to the principles set forth above, n. 466.

767. (B) They must hand over to the principal every profit which they receive in conducting affairs of this kind; for they act in his name, and receive from him a stipend or salary, and accordingly whatever they gain by negotiating, they acquire not for themselves, but for the owner.

Nevertheless they can retain for themselves part of the profit:

(a) if there has been a special agreement, by which, e.g., five percent is granted to the brokers; (b) if by extraordinary diligence, to which by force of office they were not held, they sold more dearly or bought more cheaply than had been established beforehand by the owner; in this, however, one must beware of illusions, which are so easily conceived.

Generally it is not licit for them to buy the thing for themselves at the established price, and afterward sell the same thing to others at a greater price, retaining the excess for themselves; for the owner is rightly judged to disapprove this manner of acting, since he gives them a stipend so that they may conduct his affairs in the best way possible. Nevertheless, if in a determined case, after diligence has been employed, they could not find anyone who wished to buy the thing for more, strictly speaking they can acquire it for themselves, provided they do this sincerely, taking upon themselves the danger of the thing, and if afterward they have made profit from it, they are immune from injustice.

Brokers can retain for themselves gifts which are given to them by merchants whose shop they frequent, provided however they are not induced thereby to conduct the owner's affairs badly or less watchfully.

But if merchants diminish the common price, generally brokers must hand over that profit to the owner; for since they receive a stipend, and do not have a right to a double payment, they cannot retain for themselves profit which accrues from the negotiation itself. Yet if there is moral certainty that this diminution of price is made in favor of the brokers, it can be retained by them, especially where custom is in force.

768. (C) The same must be said of servants who buy foods and other things of this kind for their masters: they can indeed receive little gifts from merchants, but generally speaking they cannot retain for themselves profit from diminution of the price (which in French is called le sou du franc); for of itself such profit accrues to the master, not to the servants, who already receive a salary. And in reality it is greatly to be feared lest merchants write down a greater price and impose it upon the masters, so that from this they may pay something to the servants, under the pretext of diminishing the price. - Nevertheless, if there is moral certainty that that diminution is truly made in favor of the servants, and not at the expense of the master, but of the merchant himself who in a particular case consents to yield part of his profit, servants licitly retain it for themselves. Moreover the same can be said if masters know this practice and tacitly approve or at least tolerate it, as a means of increasing the servants' salary. But it is to be desired that masters and servants make a clear pact concerning this, lest gradually, by these or similar less honorable means of making profit, the sense of natural equity be diminished.

2. On Sale By Auction (vente aux encheres).

769. (A) Notion. Sale by auction, which is also called auction, licitation (vente a l'encan, auction sale, Versteigerung) is that by which the thing to be sold is proclaimed through an auctioneer before several bidders, and adjudicated to the one offering the greater price. This indeed can be voluntary or judicial,¹ according as it is done spontaneously by the owner, or established by law, e.g., for paying debts.

¹ As regards judicial auction, cf. Code de procedure, art. 702-717; Cod. pen., art. 412.

770. (B) Principle. In a sale of this kind, the just price is judged not from common estimation, but from honest contest among the bidders; for here the matter concerns an aleatory contract, in which the one selling and the one buying commit themselves to equal danger of gain or loss; and accordingly, provided fraud is absent from each side, the price will be legitimate.

771. (C) Practical conclusions. Auction can be made in a twofold way: -

(a) In a fully aleatory manner, when namely the seller expressly or tacitly establishes that the price is to be determined by the bidding alone of buyers, without any intervention, and that the thing is not to be withdrawn, but handed over to the one offering more. Then it is not licit for him to send fictitious bidders, who, without the intention of buying, increase the price of the thing; and, even if a price below the common one is offered, he is held to yield the thing. On the other hand, buyers must not by fear, fraud, in one word, by illegitimate means, impede others from offering more, nor more probably make a pact about not bidding beyond such a price, or as regards such a thing; for otherwise they act unjustly toward the seller, who is deprived of greater profit, and toward the bidders, who are deprived of the hope of acquiring the thing. Nevertheless they do not commit injustice if only by persuasion or prayers they deter others from bidding.

772. (b) In the common manner, or not fully aleatory, when the seller explicitly or implicitly reserves to himself the right of increasing the price through himself or through others, and of retaining the thing for himself if no one offers a greater price; this indeed today often occurs. In this case, on the one hand, the seller can consult for himself by employing false bidders and by withdrawing the thing if too low a price is offered. On the other hand, buyers can protect their rights by making a pact together about not bidding beyond such a determined price; yet they cannot by force, fear, or fraud turn away other buyers from bidding, since these means are unjust.

773. N. B. (a) In either case, auctioneers wound justice if by unjust means they bring damage upon the seller or upon certain buyers: e.g., by holding the auction at a time when they foresee that there will be few bidders, by adjudicating the thing sooner or later, so that they may favor friends.

(b) The seller furnishes security as regards eviction of the thing, but not as regards vices, even redhibitory ones, unless it has been otherwise established by law or pact.

3. On Monopolies.

774. (A) Preliminary notions. Monopolies are of different kinds, especially legal and private. (a) A legal monopoly is the exclusive power of selling certain merchandise, granted to one or a few by public authority.¹ No one doubts that this is legitimate, provided it is contained within certain limits; for it is nothing other than one of the means by which the State can procure for itself the money necessary for managing public affairs well; wherefore even if the price is much greater than the common price, injustice is not committed, provided the money procured in this way is employed for promoting the common good, and besides does not exceed the just limits of taxation.

¹ Not a few theologians describe here another legal monopoly, namely the privilege granted to authors and inventors of selling books or new inventions exclusively; concerning this it was said above, n. 42.

775. (b) A private monopoly exists when a few men by various means bring it about that they alone sell a certain kind of merchandise at a price pleasing to themselves, or make a pact with other sellers concerning a certain payment not to be sold below such a price; for thus the natural competition of merchants is impeded, and prices are determined according to the choice of a few.

Sometimes that pact tends only to correct the excess of competition; nevertheless sometimes it is entered so that a price greater than what is fair may be imposed upon buyers. Monopolies of this kind are instituted in various ways; sometimes various sellers or societies of sellers commit the whole administration of the matter to a few men, who can establish according to their choice all things pertaining to the production and sale of the thing: then what they call a trust is instituted; - at other times, they make a pact only about limiting the production or sale of some merchandise, and as regards other things they retain their liberty; this they call a cartell; - sometimes by common counsel they buy very great quantities of some merchandise, so that they can increase their price and receive very great profit therefrom: this indeed is called a ring or corner.²

² On the notion, advantages, and disadvantages of pacts of this kind, cf. Gunton, Trusts and the Public, New York, 1899; Ely, Monopolies and Trusts, New York, 1900; Jenks, The Trusts Problem, New York, 1900; Nettleton, Trust or Competition?, Chicago, 1900; de Rousiers, Les Industries monopolisees aux Etats-Unis, Paris, 1900; id., Les syndicats industriels de producteurs, en France et a l'etranger, Paris, 1901; Pohle, Die Kartelle der gewerblichen Unternehmer, Leipzig, 1898; Grunzel, Uber Kartelle, Leipzig, 1902; Sayous, La crise allemande de 1900-1902, Paris, 1903; Dolleans, De l'accaparement, Paris, 1902; Martin Saint-Leon, Cartells et Trusts, 1903, where all the other works are compendiously contracted.

Societies which are called trusts have been instituted in Great Britain and especially in the United States of America; others, which are named cartells, are in force in Germany, France, and other regions; rings and corners are commonly used among various nations by speculators.

776. (B) Principles. (a) Monopolies which are instituted for this end, that they may bring a remedy to the excesses of unbridled competition, and pursue this end only by legitimate means, and besides do not exceed the just price, are not illicit of themselves, but must be circumscribed by certain limits, lest they abuse their power to the detriment of citizens and of the republic.

1. They are indeed not illicit of themselves; for they pursue an honorable end by just means; for competition is as it were a blind force which of itself can produce good or bad effects; if it is in no way regulated, it tends to this, that it depresses the prices of things and the wages of workers in such a way that the latter can scarcely obtain daily sustenance; therefore it is expedient that, for restraining these abuses, some pact intervene among merchants of not selling below a certain price. Therefore nothing prohibits such a pact from being entered among various industrial and commercial societies, and honorable means from being employed so that, insofar as it can be done, other merchants do not sell below a certain price, provided this is held as fair by upright and skilled men, all circumstances being considered.

In reality, by a pact of this kind entered among various societies, the expenses necessary for the production and distribution of things can be greatly diminished, whether by the use of more perfect machines, or by a better division of labor; likewise many damages necessarily arising from unlimited competition can be avoided; and thus the condition of masters and workers is made more secure.¹

¹ Cf. Martin Saint-Leon, op. cit., p. 130-178; Gunton, op. cit., p. 213-238; Nettleton, op. cit., p. 15-42.

2. But they must be circumscribed by certain limits; for since the activity of man is finite, associations which seek too great an amplitude soon obtain an unhappy outcome, as is established from those things which recently happened in America; - moreover, if their authority increases too much, and all competition becomes impossible, the prices of things are increased beyond what is fair, because at the same time the accursed hunger for gold increases;² - likewise it is greatly to be feared lest they corrupt officials, magistrates, and other public men with money, and by unjust means obtain laws or judicial sentences harmful to the public good.¹

² Mart. Saint-Leon, p. 148-163; Jenks, op. cit., chap. VIII.

¹ Martin Saint-Leon, op. cit., p. 187-205; Nettleton, p. 175-193.

777. (b) Those monopolies are unjust which are instituted for this end, that, competition having been utterly destroyed, prices may be imposed upon buyers according to the nod of sellers, or which use unjust means for overcoming other sellers. The reason is that in the former case damage is unjustly brought upon buyers, in the latter case upon other sellers.

Now not rarely unjust means are used against sellers who do not wish to adhere to the monopoly, e.g., by selling merchandise at a cheaper price in that city in which free sellers remain, so that these may be compelled to desert business, - by obtaining from administrators of railroads the faculty of transporting merchandise at a lower price (in English, discriminating rates), - by corrupting the servants (employes) of other sellers so that these may deceive their own masters.²

² M. Saint-Leon, p. 134-143; Industrial Commission on Trusts, t. I, pp. 20, 27, 277, 356, 772-774 and passim elsewhere; Nettleton, p. 204-206.

Whence in practice monopolies are full of dangers, unless they are restrained by fair laws, and their manner of acting is diligently inspected by upright officials.

778. Lease-hire in general is an onerous contract by which the use of a thing, or certain works, is promised for a certain price. And thus it is distinguished from loan for use, by which the use of a thing is granted to another gratuitously.

³ Lugo, disp. XXIX; Lessius, cap. XXIV; Billuart, diss. VI, art. 1; St. Alphonsus, n. 857-864; Carriere, II, n. 766-821; Marres, lib. IV, cap. 9, n. 331-365; Ball. P., n. 856-882; Lehmk., n. 1125-1127; Noldin, n. 597-602.

From the very notion there is a twofold species of lease: lease of things and lease of works; the latter is likewise twofold: contract of labor, concerning which in the following paragraph, and undertaking of a work (contrat d'entreprise), concerning which we shall treat here.

779. Lease of things is a contract by which someone obligates himself to furnish to another the enjoyment of some thing, for some time, for a certain price. There are several species of this lease: lease of houses and furniture (bail a loyer), - lease of rural goods (bail a ferme), - lease of animals (bail a cheptel); concerning these the various Codes must be consulted.¹ Here it will suffice to set forth general principles, while noting, however, that special stipulations can be added by the contracting parties themselves.

¹ For France, Cod. civ., art. 1708-1830, in Supplem., p. 155*.

780. 1. Obligations of the lessor (bailleur, proprietor). (A) He must hand over the thing to the lessee (preneur, tenant, farmer), - and indeed at the established time, so that he is held to repair damage arising from culpable delay, and also in a good state, so that it is apt for the use to which it is destined.

(B) He must preserve the thing in that state in which it remains apt for the use for which it was leased, and accordingly must complete the greater repairs necessary for conservation of the thing, but not the smaller ones which must be furnished by the lessee; but which repairs are smaller or greater is determined from the Codes and the usage of places; whence he cannot change the form of the leased thing, nor do anything else from which the enjoyment of the lessee is diminished.

(C) He must furnish tranquil enjoyment of the thing, and therefore render the lessee unharmed against hidden vices which impede the use of the leased thing, - and protect him against eviction or disturbance of right brought by a third party.

781. 2. Obligations of the lessee. (A) He must use the leased thing as a good father of a family, and indeed only for that use for which it was leased, expressly or implicitly, insofar as it can legitimately be presumed from the circumstances; if he abuses the leased thing, he is held to reparation of the damage brought, and moreover the contract can be rescinded. - He can sublease the thing, or cede the lease itself to another, for the same use, unless however this faculty has been forbidden by a special pact.

(B) He is held to pay the agreed rent at the established time, and in the manner fixed beforehand, or according to the custom in force in the region;² otherwise, the lessor has the right to keep certain movable things of the lessee so that he may be made secure concerning payment.

² Farmers leasing fields, when crops are less abundant, or fruits are sold only at a cheaper price, are not immediately and without mercy to be compelled to pay the whole price, under penalty of ejection; but equity and charity counsel that either something be remitted from the price of lease or a delay be granted to them so that they can pay the price without falling into a miserable lot. To the matter Lugo, l. c., n. 40: "It has been introduced from equity and kindness, that because of supervening sterility without the fault of the lessee... when no fruits at all are gathered, the lessee is freed altogether from paying the rent... But if the sterility does not remove all fruits, yet nevertheless is great and notable, the rent is diminished proportionately; but if it is slight, nothing is remitted." Cod. civ., art. 1769.

(C) When the time of the lease has ended, he must return the leased thing in that state in which it was handed over, yet without being held to repair those things which have collapsed or been made worse by age and legitimate use. - If some damage has been brought, whether by the lessee himself, or by domestics or table-companions who are under his care, or by sublessees, he must compensate it, unless he proves that it happened without his fault. By natural law, he must at once repair damages arising from theological fault, but those which arise from juridical fault only after the sentence of the judge.

By French law, if a house has perished by fire, all tenants living in this house must pay a part of the damage proportionate to the price of the lease, unless they prove that the fire was kindled in another's room, or could not have been kindled in their place; this disposition indeed, as contrary to natural equity, does not oblige in conscience those who know very well that the fire was not kindled by their fault, at least juridical, or by the fault of those whose care they have.¹

¹ Cf. C. civ., art. 1734 and Law of Jan. 5, 1883. - On the various species of leases, baux a loyer, baux a ferme, baux a cheptel, see C. civ., art. 1752-1778, Sup., p. 159*; 1800-1830; Planiol, II, n. 1666-1822.

782. 1. Nature of this contract. Lease of a work is a contract by which an architect, or craftsman, or commissioner is hired by the owner for accomplishing a certain work for a determined price, e.g., for building a house, or constructing a railway. - This can be done in a twofold way: namely so that the craftsman furnishes his work only, - or his work together with the material.

In a contract of this kind the price is established for the completed work, so that it is not owed until after the contractor (entrepreneur) has completed the work, unless it has been agreed otherwise; and therefore the danger of the work remains with the contractor until it has been completed and handed over.

Often the work to be completed is publicly announced, by setting forth and describing what thing is to be made, from what material, within what time, etc.; various contractors are invited to compete, and the thing to be made is committed to him who has promised to complete the work for the lesser price. In this matter good faith is required on each side: in the contractor, that he sincerely intends to complete the work for that price and under the determined conditions; in the lessor or owner, that he commit the work to him who asks the lesser price, provided however that he is fit for making the thing.

783. 2. Obligations of the contractor. (A) From justice he is held to make the thing in the manner in which it was agreed, namely to employ that diligence and that quality and quantity of material which had been agreed upon expressly by description, or tacitly by custom. Likewise he must be content with the established price; nevertheless, if the craftsman, because of changed prices of things or increased wages of workers, cannot complete the thing for that price without his own damage, he can ask something more. The owner is not held to believe him lightly, nor perhaps from strict justice can he be compelled to pay a greater price; for here the matter concerns a contract partly aleatory, in which the contractor undertook the danger of the thing; but equity demands that in these circumstances, when the matter is certainly established, the payment be increased notwithstanding the pact, especially when a case supervened which could not be foreseen.

784. (B) He sins against justice who employs cheaper material, or lesser diligence, especially when from this the solidity of the work is diminished; for thus damage is unjustly brought upon the owner. - Yet this not rarely occurs in our days; and not a few contractors can sometimes be of good faith, when they employ cheaper material which nevertheless does not hinder the solidity of the building, and besides they consider this necessary lest they themselves incur damage; if it is foreseen that admonition concerning the past will be useless, they should nevertheless be cautiously deterred from these frauds for the future.

(C) They must complete and hand over the work at the agreed time, unless they are excused by some necessity; if by their own fault they have completed the thing later, they are held to compensate the damage brought from this.

785. 3. Obligations of the lessor or owner. (A) He must pay the established price at the time fixed beforehand; (B) if he asks that the thing be made in another manner than had been agreed, or that certain things be added to the work, he must compensate the greater expenses arising therefrom; (C) if by culpable delay he has neglected to accept the completed work, he is held to repair the damage brought upon the contractor from this.¹

¹ Cf. Cod. civ. gal., art. 1787-1799, in Supplem., p. 163*; Planiol, II, n. 1897-1932. - Special rules as regards the transport of merchandise are set forth in Cod. civ., art. 1782-1786, Supplem., p. 163*; Bauf, Droit Commercial, Paris, 1903, p. 162-175.

786. Among those things which can be leased, works are enumerated; namely, today many men are given who lack the means by which they can carry on industry or commerce in their own name, and therefore are accustomed to lease to others their work or the faculty of working in which they are strong; the contract by which workers obligate themselves to labor in favor of some master, for a time, for a price, is called the lease of personal works, or, from modern usage, contract of labor. Concerning this, because of its importance, it is pleasing to discuss a little more fully: 1. on the contract of labor itself; 2. on wages; 3. on workers' associations; 4. on cessation from work; 5. on modes of improving the lot of workers.

² Lugo, disp. XXIX, n. 54-63; Lessius, cap. XXIV, dub. 4; Carriere, II, n. 801-806; E. J. de Gryse, De contractu conductionis, Roulers, Flanders, 1895; Antoine, Cours d'Economie Sociale, ch. XIX; Lehmkuhl, Le Contrat entre Patrons et Ouvriers et les Greves, Louvain, 1896; Pottier, De Jure et Justitia, n. 118-246; Vermeersch, de Justitia, n. 386-477; Hubert-Valleroux, Le Contrat de Travail, Paris, 1895; P. Bureau, Le Contrat de Travail, le role des Syndicats professionnels, Paris, 1902; L. Garriguet, Le Contrat de Travail, Paris, 1904; T. Rothe, Traite de Droit Naturel, t. IV, Droit Laborique, Paris, 1904.

1. Historical Survey.

787. (A) Manual labor among the Greeks and Romans was lightly esteemed, and was committed only to slaves or men of a lower condition; hence Cicero said: "The earnings of wage-earners, and of all whose works, not arts, are bought, are illiberal and sordid. For in them the very wage is the pledge of servitude. Those also are to be considered sordid who buy from merchants what they immediately sell... Nor indeed can a workshop have anything freeborn."³

³ Cicero, De officiis, lib. IV, 42; cf. Guiraud, La main d'oeuvre industrielle dans l'anc. Grece, Paris, 1900; Waltzing, Etude historique sur les corporations professionnelles chez les Romains.

Christian religion, on the other hand, ennobled labor: Christ himself labored with his own hands: "Is this not the carpenter?... Is this not the carpenter's son?"¹ St. Paul inculcated its necessity: "If anyone is not willing to work, neither let him eat";² he added example to precept:³ "Nor did we eat bread from anyone without cost, but in labor and in toil, working night and day, lest we burden any of you." - Hence, in the first centuries of the Church, not only Christians, but also priests and monks, adhering to the footprints of Christ, did not disdain to labor with their hands.⁴ In reality, in all the rules of monks, prescriptions are found concerning daily manual work;⁵ and Augustine himself wrote a work on the work of monks, in which he exhorts them to labor, especially by the example and doctrine of St. Paul, and gravely rebukes those idle and wandering monks who, relying on the words of Christ, Be not solicitous for your life what you shall eat, under the pretext of being free for contemplation, indulged in laziness: "Indeed they can easily sing divine canticles even while working with their hands, and console the very labor as by a divine rowing-song (song of sailors)."⁶ In reality, monks and their tenants, by diligent and assiduous labor, happily cultivated wooded and arid lands, and brought the greatest advantage to industry and the arts.⁷

¹ Mark, VI, 3; Matt., XIII, 55.

² II Thess., III, 10.

³ Ibid., 3.

⁴ Thomassin, Discipline de l'Eglise, p. III, l. III, ch. 8-16. - St. Anthony, among the rules which he handed down to monks, says these things: "When you have sat in your cell, be solicitous perpetually concerning these three things: namely concerning the work of your hands, concerning the meditation of your psalms, and concerning your prayer." Regula S. P. N. Antonii, Codex Reg., t. I, p. 5.

⁵ Rule of St. Benedict, cap. 48, in Migne, P. L., LXVI, 703, where it is said: "Idleness is the enemy of the soul. And therefore at certain times the brothers must be occupied in manual labor; again at certain hours in divine reading." - Cf. St. Jerome, Regula Monachorum, cap. 17, in Migne, P. L., XXX, 362.

⁶ In Migne, P. L., XL, 565; let the whole treatise be read, 547-582.

⁷ Levasseur, Histoire des Classes ouvrieres, Paris, 1900, t. I, p. 182-196.

788. (B) In the historical evolution of labor, three principal stages can be distinguished: slavery, colonate, and free contract of labor. (a) Before Christ, slavery flourished among almost all nations: but the slave labored not for himself, but for the master, nor did he properly receive a stipend, but only a certain peculium and food and clothing. Nevertheless a few free men, laboring under poverty, leased their work to the richer;⁸ freedmen, or manumitted slaves, devoted themselves to various arts and commerce. This slavery indeed could be abolished only gradually.

⁸ Among whom afterward Plautus, who describes servile labor in the work Asinaria.

(b) Around the fourth century the colonate (servage) began to flourish, or the state of those who were bound to some estate, and cultivated it in perpetuity: they were indeed not perfectly free, but of a middle condition between free men and slaves, since they could not leave the place and owner to whom they were ascribed; but they could acquire for themselves a house and other goods, and transmit them to their heirs; on certain days and hours they worked in favor of the owner, but, this time having been completed, they cultivated the part of the lands assigned to them, and made their own the fruits received therefrom.¹

¹ On these see P. Allard, Esclaves, Serfs et Mainmortables, Paris, 1894, p. 158-398.

789. (C) Afterward serfs and tenants were gradually manumitted and became free, and gave their labor to various arts; then were instituted guilds, which flourished in the Middle Age, and, notwithstanding certain difficulties and disadvantages, contributed to the security of industry and to social peace through many centuries.² Workers, namely, distributed into various associations and confraternities (corporations d'arts et metiers), bore mutual help to one another, and circumscribed competition within certain limits, so that each one could receive sufficient profit; besides, generally dissensions and envies between workers and masters did not flourish, because each worker, after some time, could exercise his art in his own name as master. Guilds of this kind were utterly destroyed by the French Revolution, and "gradually it came about that workers, solitary and defenseless, were handed over to the inhumanity of masters and to the unbridled greed of competitors."³ Wherefore modern socialists and some followers of Christian Democracy⁴ desire that, the contract of lease of works as it now exists having been abolished, in its place there should be substituted a certain contract of cooperation, by force of which workers would obtain a part of the profit proportionate to their labor.

² The history, laws, and discipline of these guilds are described, among others, by Levasseur, Les Corporations d'arts et metiers, Paris, 1885; Martin Saint-Leon, Histoire des corporations de metiers, Paris, 1897; Blanc, Les Corporations de metiers, Paris, s. d.; Levasseur, Histoire des classes ouvrieres avant 1789, Paris, 1901.

³ Leo XIII, Encyc. Rerum novarum.

⁴ Thus, among others, Vogelsang and de Breda in the periodical Oesterreichische Monatsschrift, Vienna, 1885, fascic. 7.

2. On The Nature Of This Contract.

790. Concerning this matter there is controversy among jurists and economists.

(A) The principal jurists contend that the contract which intervenes between worker and master is truly lease-hire, insofar as the worker leases to the master his power of working for a certain price. This is indeed wholly consonant with the laws in force among different nations; for this pact is called locatio-conductio operis faciendi (lease of services or of work) in Roman civil law, and in modern Codes.¹ Yet today many oppose this concept, because it does not befit a free and rational being so to lease his faculties to other men.

¹ "When you deliver your labor, what indeed do you do? Do you not demand a wage? You sell your labor as the grocer sells his salt, his coffee and his sugar, as the baker sells his bread, as the butcher sells his meat." (Yves Guyot, La Tyrannie socialiste, Paris, 1893, p. 44; cf. P. Leroy-Beaulieu, op. cit., t. II, p. 241-244.)

(B) Hence others think that the contract of labor is a certain purchase-sale, by which the worker sells his works, or the exercise of his own activity, for some price.² Many indeed reject this, as by no means consonant with human dignity, since the work of a free man is not merchandise which can be bought for a price. - Yet it could be said, without injury brought upon the dignity of man, that not the work itself indeed is sold, but the fruit of labor, or the part of the thing produced which belongs to the worker because of the work consumed in the thing made; this seems especially true when such a price is given for such a thing to be made (travail aux pieces).

² P. Leroy-Beaulieu, Traite, t. II, p. 241-250.

(C) But others wish the contract of labor to be nothing other than a contract of partnership, by force of which the owner contributes his capital and the worker his works for completing a common work, and for dividing between themselves the profit received therefrom. - Thus, they say, better provision is made for the dignity of workers, for concord between workers and masters, and also for a more equitable partition of profits. - But as regards the fact, the matter is not so in the present state of things; besides, it seems difficult how the contract of labor could be entered in the praised manner: for, on the one hand, owners contend that the happy outcome of industry depends chiefly on the wise management of one and supreme authority, and therefore do not wish to have workers as partners, lest they be compelled to take their counsel; on the other hand, workers, needing a daily and certain wage for sustenance, cannot wait until the quantity of profit is determined and equally divided; moreover, by what proportion and measure profit is to be divided between workers and masters, according to the proportionate part of cooperation, can scarcely be defined.

(D) Wherefore some, with Funck-Brentano, think that the contract of labor is one of the innominate contracts (above, n. 616), namely, on the part of the worker, facio ut des, and on the part of the master, do ut facias, insofar namely as workers obligate themselves to furnish something for a certain price.

791. Conclusion. Whatever the case may be, all sensible men confess that a contract of this kind is of a special nature, since human works are not common merchandise, but bear before themselves something human, and therefore must be governed by more humane laws than merely commercial things.

To the matter Leo XIII says: "Accordingly labor has, as it were, two notes implanted by nature in man, namely that it is personal, because the active force adheres to the person, and is wholly proper to him by whom it is exercised, and for whose utility it is born; then that it is necessary, for this reason, that the fruit of labors is needed by man for preserving life: but nature herself, to which one must chiefly obey, commands that life be preserved."

Moreover, the same Pontiff testifying, it is a very great evil to imagine that the wealthy and proletarians are prepared by nature to fight among themselves in stubborn duel; this indeed is abhorrent from reason and truth; for, just as in the human body diverse members agree among themselves for cooperating harmoniously, so in the state those two classes must act harmoniously among themselves; indeed one absolutely needs the other: capital cannot stand without work, nor work without capital. Wherefore concerning the mutual offices of workers and masters, according to the mind of Leo XIII,¹ a few things remain to be said.

¹ The rules handed down by Leo XIII were renewed and confirmed by Pius X, in a Motu proprio issued Dec. 18, 1903, in which he sets forth fundamental norms of Christian popular action, in Acta S. Sedis, XXXVI (1904), p. 339-345.

3. On The Offices Of Workers.

792. These are thus contracted in the Encyclical Rerum Novarum: "That which has been freely and equitably agreed upon as work, they should render integrally and faithfully; they should in no way harm the property, nor violate the person of the masters; in protecting their own interests they should abstain from force, and never introduce sedition; nor should they mix with wicked men, artfully throwing out immoderate hopes and great promises, which generally have useless repentance and consequent ruins of fortunes." Let us explain these offices in a few words: -

793. (A) To furnish integrally and faithfully that which has been freely and equitably agreed upon, or, in other words, to perform the determined work at the fixed time, with that diligence which is required from pact, law, or custom. Generally ordinary or common diligence suffices; but, in certain cases, special care is required, namely when from pact or from the nature of the matter it is exacted, and besides a greater stipend is furnished. This indeed obliges from justice, as flowing from the contract itself: for the worker does not make the wage his own unless he integrally and faithfully fulfills the work which he freely promised to furnish; for here the matter concerns a bilateral contract, which obliges each contracting party from justice.

Therefore workers sin against justice who from culpable carelessness or negligence spend time uselessly;¹ and the gravity of the sin depends on the gravity of the damage brought.

¹ Honest workers understand this besides; thus among them the axiom is in force: "a fair day's work for a fair day's wages," that is, honest work for a decent wage. (Bureau, op. cit., p. 252.)

794. (B) In no way to harm the master, that is, to bring no damage, whether by using materials prodigally, or by destroying machines, or by producing defective merchandise; for by these and other means of this kind, injury is brought upon the owner or upon the buyer of the merchandise, and often upon each. The gravity of the sin likewise depends on the gravity of the damage foreseen. - Besides, such acts are prohibited by civil law and punished with fines.² But if damage arises from fortuitous event, the worker is not held to compensate it, nor on account of this does he lose the right to the agreed stipend.

² As regards France, cf. P. Pic, Traite de Legislation industrielle, Paris, 1903, n. 1147. "The worker is responsible for deteriorations caused by his negligence to the material entrusted to his care, as well as for faulty workmanship arising from his fault." (Cass., Feb. 15, 1892.)

795. (C) Nor to violate the person of the masters, that is, to bring no injury upon the masters themselves, by insults, threats, cruelties, and other violent modes of acting. Workers indeed have the right of pursuing their rights by legitimate means, by instituting associations, and by manfully setting forth to masters what they desire, and concerning what things they legitimately complain; likewise they have recourse to magistrates, and can choose deputies who may procure the promulgation of just laws protecting their rights. But to move sedition and to employ force or calumnies is neither just nor opportune; those acting thus generally harm not only masters, but themselves, since the ruin of some factory is accustomed to bring more detriment to the latter than to the former. - To judge concerning the gravity of an injury brought, the principles set forth above (n. 285) must be recalled to memory, yet having before one's eyes the psychological dispositions of workers who, not rarely moved by anger and indignation, do not perceive the whole malice of their act.

In practice, therefore, let workers diligently keep away wicked men who, pretending that they hold nothing older than the good of proletarians, in reality are chiefly solicitous about their own advantages, and stir up immoderate hopes, falsely promising goods which it is impossible to obtain, for the sole end that they may obtain the votes of workers, and, these having been obtained, may be able to seek honors and monies.

(D) Not to cease from labor before the fixed time, unless there is a grave reason; concerning this below.

4. On The Offices Of Masters.

Some arise from justice, others from charity.

796. (A) Offices from justice. (a) To pay a fair wage at the established time (Codex, c. 1524):

"Among the greatest offices of masters," says Leo XIII, "this stands out: to furnish just things to each one... But to defraud anyone of the wage owed is a great crime, which calls down avenging wrath from heaven by its cry: Behold the wages of the workers... which have been defrauded by you cry out: and their cry has entered into the ears of the Lord of Sabaoth."¹ But what wage is just will be explained below.

¹ James, V, 4.

797. (b) To revere in workers the dignity of the person ennobled by the Christian character:

"Workers must not be held in the place of slaves; it is fair to revere in them the dignity of the person, ennobled, indeed, by that which is called the Christian character. Gainful arts, if the account of nature and Christian philosophy are heard, are not for shame to man, but for honor, because they furnish an honest power of sustaining life. It is truly shameful and inhuman to abuse men as things for gain, and not to value them more than according to how much they are strong in nerves and powers."²

² Leo XIII, Encyc. Rerum novarum.

And rightly; not rarely workers complain that they are held as slaves, indeed as mere instruments of production, with no respect had for their dignity. They must indeed furnish obedience to masters in all those things which pertain to the agreed work, during the hours of the day in which they submit themselves to their command;³ but when this time has been completed, they remain free, nor do masters have the right to attempt anything against their liberty and conscience.⁴ Moreover, while they preside, they must command in a human manner, demanding nothing which is too burdensome.¹

³ So that the rules for the right ordering of industrial matters may be better preserved, it is expedient that they be approved not only by masters, but also by delegates of the workers; this can be done in a council which is called Conseil d'usine, Shop council. Cf. E. Riviere, Vingt ans de vie sociale, Paris, 1901, p. 61-82.

⁴ Hence if a Christian master wishes to lead irreligious workers back to the faith, he must act prudently, by examples and persuasion, without urging them to embrace religion, lest perhaps he favor hypocrisy: "The Christian head must, while giving example, strive to surround these souls with an atmosphere of love and devotion, also of liberty, so that they may open themselves to the truth." (E. Riviere, op. cit., p. 78.)

¹ This indeed they will furnish much more easily if sometimes they do not hesitate to take the counsel of certain workers. Cf. E. Riviere, op. cit., p. 40-43; 55-56; 80-81.

798. Wherefore the master is held from justice to grant to workers a suitable space of time, so that they may be free for religious duties: for they have a strict right to fulfill such duties, nor can they be deprived of it by any pact of labor; therefore rest from works must be granted on feast days, unless because of some necessity; and if, in some industries, certain workers must labor on any Sunday, nevertheless there must be allotted to them a space of time necessary for fulfilling religious duties. - He must also take care that they not be exposed to the allurements of corruptions and enticements of sin; wherefore in those workshops in which men and women, and also younger persons of each sex, labor together, the office is incumbent upon masters of employing those means by which proximate occasions of sin are removed, insofar as this can be done;² e.g., lest scandal arise from impious or lustful conversations,³ or foremen (contre-maitres) abuse their authority to extort something which is repugnant to the moral law.

² Cf. L. Harmel, Catechisme du Patron, Paris, 1889, p. 31-93.

³ Thus, e.g., a Catholic master, who counted not a few positivists among his workers, with these approving, proposed the following rules to all: "As a convinced Catholic, I ask those of my workers who do not share my convictions to abstain from conversations contrary to my religious ideas. For this I appeal to their sympathy toward a head who sincerely loves them and who will never ask them for an act contrary to their personal convictions. - As a father of a family, having charge of souls before God for the apprentices entrusted to my care by their parents, I ask all my workers to abstain from immoral conversations. Fathers of families would not speak thus before their children; unmarried workers would not hold such remarks before their mother or their young brother." (E. Riviere, op. cit., p. 73-74.)

"Nor is it permitted by any pact to lead them away from domestic care and the study of thrift," that is, nothing is to be attempted which utterly overturns the family and domestic life, namely by impeding the education of offspring, by separating men from wives for a long time, so that domestic life becomes almost impossible. Nor let anything be done to attract workers into taverns, in which they uselessly consume their resources, to the great detriment of the whole family.

799. (c) "Likewise, not to impose more work than their strength can bear, nor that kind which is at variance with age and sex." For from what was said above (n. 314-315), it is not permitted to command those things from which death or mutilation or loss of health will very probably follow. Therefore, if from the materials which are worked, or the machines which are employed, or from the manner in which labor is performed, or from other causes of this kind, a very probable danger threatens the life, integrity of members, or health of workers, precautions must be used by which the danger is removed. But if it is impossible to avert every danger, in proportion to the probability of the danger, the amount of wage is to be increased, or damages brought in executing the work are to be repaired by fair compensation. - Hence also, if a worker laboring for the utility of the master is wounded, mutilated, or killed from a fortuitous event, compensation is owed to him or to his family; for since the master makes the profit his own, it is fair that he likewise undergo the damages and dangers of the lot. This indeed among most nations has been confirmed by civil law.¹

¹ In France, by civil law this compensation is owed even when workers were wounded by their own fault or carelessness (Law of April 9, 1898; Law of June 30, 1899; Law of March 22, 1902); in this case, however, the law, as less consonant with natural law, does not oblige before the sentence of the judge; indeed workers would commit injustice toward masters if they deliberately exposed themselves to some mutilation, for the end of obtaining monetary compensation. - Cf. P. Pic, op. cit., n. 1036-1145, where the advantages and disadvantages of this law are set forth at length, and also the laws which are in force among other nations.

800. Moreover daily labor must not be prolonged excessively, lest the strength of the worker be exhausted; but according to the different account of labor, the hours consumed in work must be longer or shorter.

The principle which must be kept before the mind Leo XIII sets forth thus: "Namely, that so much work be demanded that the spirit grow dull from excessive labor, and at the same time the body succumb to exhaustion, neither justice nor humanity suffers... But how great the intervals of resting ought to be must be judged from the varied kind of work, from the circumstances of times and places, and from the very health of the workers. Those whose work it is to cut stone from the earth, or to dig out iron, copper, and other things of this kind lying deeply hidden, their labor, because it is much greater and also grave for health, must be restrained by shortness of time. The seasons of the year must also be considered: because not rarely the same kind of work is easy to tolerate at one time, but at another time either cannot be tolerated by any reason, or cannot be tolerated without the greatest difficulty."¹

¹ In France, by the law of Nov. 2, 1892 (in Riviere, Lois usuelles, p. 1170-1173), the law of June 12, 1893 (Riviere, p. 1206), and the law of March 30, 1900, the hours during which women and children may labor have been limited, and many other things concerning the healthfulness and security of workshops have been established; concerning these see P. Pic, op. cit., n. 609-869. - That these laws were necessary for restraining abuses following from competition can be gathered from these works: Villermé, Tableau physique et moral des ouvriers employes dans les manufactures de soie, de laine et de coton, Paris, 1840; J. Simon, L'ouvriere, Paris, 1861; d'Haussonville, Salaires et Miseres de femmes, Paris, 1900; Pelloutier, La Vie ouvriere en France, Paris, 1900; Levasseur, L'Ouvrier americain, Paris, 1898, t. I, p. 422-451; H. Campbell, Prisoners of Poverty, Boston, 1887; H. J. Brunhes, Les conditions de travail de la femme dans l'industrie, in Quinzaine, March 1904; id., L'Exploitation de la femme, Paris, 1904.

801. Nor let labor be imposed on women which exceeds their strength, or does not befit their sex: "Thus certain crafts are less aptly suitable for women, born for domestic works: which works indeed greatly protect honor in the female sex, and by nature correspond to the instruction of children and the prosperity of the family." In reality, since women are born primarily for procreating and educating offspring, and for exercising the offices of mother and wife at home, labor incompatible with these duties must not be assigned to them. - Wherefore in many regions it has been provided by civil law that they be immune from certain kinds of work, and moreover, a little before and after childbirth, that they be free from all arduous labor.

802. Nor is it permitted to entrust to children works for which performing they are not yet equal: "For powers breaking forth in childhood, like greening freshness, are struck down by premature agitation: from which thing all childish instruction will perish." And because abuses have not been lacking in this matter, the State had to pass laws for protecting younger persons against the inhumanity of certain masters.

803. (B) Offices from charity. The master must exercise not only justice, but also charity toward workers. Leo XIII recalls to memory the foundation and reason of this office:

"For all men will plainly perceive and understand that they were created by God as a common parent: that all tend to the same end of goods, which is God himself, who alone can affect both men and angels with perfect and absolute beatitude; likewise that each one equally has been redeemed by the benefit of Jesus Christ and claimed into the dignity of sons of God"... - From this it follows that upon the richer is incumbent the office of lavishing something from superfluous goods upon the poor: "Whoever has received a greater abundance of goods by the gift of God, whether they are of the body and external, or of the soul, has received them for this reason, that he may employ them for the perfection of himself and likewise, as a minister of divine Providence, for the utilities of others."

This obligation indeed urges masters by a stricter bond as regards their own workers.

For, as Card. Zigliara said,¹ "the work of the worker yields to the advantage of the master; therefore as often as the latter is driven by the precept of charity to exercise the offices of charity in individual cases, he is also held to observe the order of charity. This order indeed makes workers exercising long-lasting work for the master's utility nearer to the master than other poor persons doing nothing for him. Wherefore the master who is able to exercise the offices of charity must prefer his own workers."

¹ Letter to the Archbishop of Mechlin, sent by order of Leo XIII, 1891.

804. But the master can exercise this charity in various ways: - (a) first, by kindly receiving the workers, at least at certain hours, when they desire to approach him, and by kindly receiving delegates sent by the workers themselves: for experience establishes that nothing contributes more to peace and concord than more frequent relations between owners and workers, in which, by an honest and sincere exposition from each side, the motives of complaints are declared, and also the changes which are judged useful on each side;

805. (b) by favoring various institutes, by which the condition of workers can become better, e.g., schools for the education of boys, cooperative societies by which useful things can be acquired at a lower price, associations by which workers furnish mutual help to one another, etc. But in all these things let the master diligently beware lest he so insert himself into the management of affairs that workers seem to depend altogether on him; for there is in them an innate love of liberty, and a sense of distrust toward masters, so that many prefer to be poor and miserable rather than abdicate their own liberty. From this it has happened that not a few have stirred up rebellion against masters, notwithstanding the many benefits which they had received from them, because rightly or falsely they judged themselves too oppressed by the authority of masters.¹ Therefore let charity be exercised in such a way that it does not seem to oppress the liberty and dignity of workers.

¹ Cf. P. Bureau, Montceau-les-Mines et le Paternalisme, in La Quinzaine, April 1, 1902. - Wherefore these things should often be kept before the eyes: "Love of the worker, disinterested love, not to hold him eternally, but to elevate him and draw him toward the heights: behold the true solution of the social question." (de Mun, in E. Riviere, op. cit., p. 5.)

5. On The Intervention Of The State In The Contract Of Labor.

806. (A) State of the question. Much is disputed on this matter among the various schools of economists. (a) The so-called liberal school² contends that the State has no right of making new laws concerning relations between workers and masters, but that the general laws concerning contracts in general and concerning lease fully suffice for restraining abuses, if any arise; in reality, they say, every year the condition of workers becomes better, industrial and commercial matters prosperously succeed; if there are any dissensions, they are composed by the natural force of free competition; the intervention of the State, far from profiting, greatly harms both masters and workers.

² A. Smith, Wealth of Nations, rendered in French La richesse des nations; Ricardo, Principes d'Economie Politique; J. B. Say, Traite d'Economie politique; de Molinari, Precis d'Economie politique, Paris, 1893; Hubert-Valleroux, op. cit.; P. Leroy-Beaulieu, op. cit., who nevertheless does not reject a certain moderate intervention of the State.

(b) But on the contrary, socialists of various schools³ cry out daily that the lot of workers is altogether intolerable, that unbridled competition, such as flourishes, is a blind and cruel force by which proletarians are trampled under the feet of the richer: from this just complaints and perpetual dissensions have arisen, which can be settled only by continual intervention of the State; and by such intervention the way is prepared for socialism and collectivism, by whose help social concord will reign in perpetuity.

³ Their works we enumerated above, n. 66-70.

807. (c) Between these two extremes there are today not a few economists who defend moderate intervention of the State, although they by no means agree concerning the extension and limits of this intervention.⁴ Catholics generally adhere to their doctrines, yet in different degree; thus the school which is called Angers approaches nearer to the liberal school, and admits the intervention of the Republic only for protecting the rights of private persons and restraining abuses.⁵ The school named Liege proceeds further,¹ according to which the State must not only restrain abuses, but also prevent them, by making various laws, especially concerning the labor of children and women, concerning hours consumed in working, concerning means for protecting the health of workers, etc. The Austrian school proceeds still further, which, joining Christian democracy with anti-Semitism, expects an almost universal renewal of the whole economic order, and meanwhile wishes the amount of wage to be determined by the State, and cooperative societies to be instituted by it, so that for the contract of labor, such as now exists, the contract of cooperation may be substituted.²

⁴ Among whom Cauwes, Cours d'Economie Politique; Ch. Gide, Principes d'Economie politique; P. Pic, Traite de Legislation industrielle; V. Brants, Legislation du travail, comparee et internationale, Louvain, 1903; R. Jay, La Protection legale des travailleurs, Paris, 1904.

⁵ This school is called Angers because it held a congress at Angers, presided over by Bishop Freppel, who set forth his mind thus: "Individual liberty, liberty of association with all its legitimate consequences, intervention of the State limited to the protection of rights and to the repression of abuses; behold, gentlemen, my formula in the question of labor." (In Revue Catholique des Institutions, 1890, t. II, p. 416 sq.) Thus also Claudio Jannet, Le socialisme d'Etat; J. Rambaud, Elements d'Economie Politique; Thery, Exploiteurs et salaries; d'Haussonville, Socialisme et Charite, Paris, 1896.

¹ It is called Liege because the principal principles which it advocates were set forth in the Congress of Liege, in Belgium; among its followers are enumerated: de Mun, Discours sur la Question sociale; de la Tour du Pin, L. Harmel, Gayraud, Lemire, Ketteler, Korum, Winterer, Lehmkuhl, H. Pesch, Cathrein, Meyer, Pottier, Decurtins, Liberatore, Toniolo; see their doctrines set forth in Antoine, S.J., Cours d'Economie sociale, and Pottier, de Jure et Justitia.

² This school flourishes especially in Austria, and its principal followers are de Liechtenstein, Blome, Vogelsang, Lueger, whose program is briefly contracted thus: "1. Establishment of a just relation between production and consumption; 2. guarantee of stable employment for workers, with the possibility of a progressive wage and of professional advancement; 3. guarantee of suitable treatment for aged or invalid workers, for old men and orphans; 4. corporations accredited by the State or the great financial establishments, so that workers may profit from mechanical manufacture and from production on a large scale; 5. legal measures necessary to procure suitable housing for workers." (In Association Catholique, XXVII, 1889, p. 667.)

So that we may proceed safely in this variety of opinions, we shall set forth the very doctrine of Leo XIII (Encyc. Rerum Novarum).³

³ Cf. L. Gregoire (Goyau), Le Pape, les Catholiques et la Question sociale, Paris, 1899, p. 174-240; A. Leroy-Beaulieu, La Papaute, le Socialisme et la Democratie, Paris, 1893, p. 156-179.

808. (B) General principles. (a) The State must not so involve itself in private matters that it usurps the rights of citizens or of families: "It is not right, as we have said, for the citizen or the family to be absorbed by the Republic: it is fair to permit to each the faculty of acting with liberty, as much as can be done with the common good unharmed and without injury to anyone." For private men are not ordered to the state as to an end, but the state is ordered to them, namely so that it may promote their good; and therefore the activity of citizens must not be so restricted that it seems to be absorbed, but only so directed that it tends to the common good. - The family likewise is older in time and prior in right than the state, and therefore its rights are not to be absorbed by the State, but rather protected. Therefore nothing is to be attempted which harms conjugal society, parental authority, or the relations which, nature dictating, ought to exist among the members of the family.

809. (b) The State can make certain laws concerning the contract of labor, favoring masters and workers equally. For it can and must promote whatever is necessary for the common good: supreme authority has been instituted for this.¹ But the common good demands that peace and concord reign between masters and workers: for this end laws contribute greatly which favor not one order of citizens, but workers equally with the rich:² for both labor together for the prosperity of the Republic.

¹ "Accordingly those by whom the state is governed must first bring their work generally and universally by the whole account of laws and institutes, namely by bringing it about that from the very conformation and administration of the republic prosperity of both the community and private persons spontaneously flourishes." (Encyc. Rerum Novarum.)

² "For proletarians are, by nature, citizens by equal right with the wealthy, that is, true parts and living lives, from which, with families interposed, the body of the republic consists: not to add this, that in every city they are by far the greatest in number. Since therefore it is altogether absurd to consult for one part of the citizens and neglect another part, it follows that public due cares must be placed in protecting the safety and advantages of the proletarian order." (Ibid.)

Nevertheless, although public power must provide for the rights of each order, it can and must specially protect the lowest and the needy, especially when by their own powers they cannot vindicate their rights; for the rich less need public guardianship, while the miserable common people, relying on no resources of their own, more need the patronage of the Republic.³

³ Thus Leo XIII (cited Encyc.): "Indeed, the nation of the rich, surrounded by its own defenses, less needs public guardianship: the miserable common people, safe by no resources of their own, relies chiefly on the patronage of the republic. Wherefore the republic must embrace wage-earners, since they are numbered among the needy multitude, with singular care and providence."

810. (c) The intervention of the State is legitimate and necessary as often as grave detriment has already been brought, or threatens, to common affairs or to the interests of individual orders, which cannot be healed or prevented in another way.¹ For, on the one hand, it is all over with the public good if supreme authority cannot intervene, - whether by promulgation of laws, or by faithful execution of the same, - when grave detriment has been brought upon society, or even upon one order of citizens, or very probably threatens, which otherwise cannot be averted; for then the end on account of which the State was instituted is no longer attained: the more powerful oppress the weaker by force or fraud, until the latter, overwhelmed by evils which cannot peacefully be averted, finally at some time stir up seditions, and by sword, fire, and other violent means pursue the vindication of their rights. - On the other hand, when threatening damages can be effectively forestalled in another way, whether by the industry of private persons, or especially by rightly ordered associations of masters and workers, it is not expedient to have recourse to the State; for excessive intervention restrains private activity and vigilance, and gradually induces a certain idleness and incapacity of citizens, - multiplies public offices and duties, and therefore public expenses, while on the contrary free undertakings of industry and commerce are diminished, - extends too much the power of political men and party zeal, and thus prepares the way for tyranny.² - Wherefore with Leo XIII we conclude: "namely, no more is to be undertaken by laws, nor is one to proceed further, than the healing of inconveniences or the removal of danger requires."

¹ "If therefore some detriment has been brought or threatens to common affairs, or to the interests of individual orders, which cannot be healed or prevented in another way, it is necessary that public authority meet it." (Encyc. Rerum Novarum.)

² How easily politicians, even when they boast that they adhere to democracy, indulge tyranny, can clearly be gathered from the things which Taine wrote, Origines de la France contemporaine; cf. P. Martin, in Etudes Religieuses, Nov. 1891, p. 375.

811. (B) Applications. Leo XIII enumerates the principal applications of this principle thus:

"Wherefore if at any time it happens that some disturbance threatens because of the secession of workers, or works interrupted by agreement (greves, strikes); that the natural bonds of the family are loosened among proletarians; that religion is violated in workers by not sufficiently imparting opportunity for the offices of piety; if danger threatens in workshops to the integrity of morals from the promiscuous sex, or from other pernicious incitements of sin; or if the order of masters presses the order of workers with iniquitous burdens, or afflicts them with conditions alien to the person and to human dignity; if health is harmed by immoderate work, and one not accommodated to sex or age, in these cases the force and authority of laws must plainly be applied, within certain limits."

(a) The reason is that, in these and similar matters, the zeal and industry of private persons by no means suffice for restraining abuses, as is proved by almost universal experience. For those evils began to rage as soon as great industrial workshops were built;¹ indeed excellent citizens, whether privately or collegially, tried for many years to restrain or forestall them, yet with an unhappy outcome. Wherefore, among all peoples, even the English and Americans, although tenacious of private rights, it was necessary to make laws for protecting the rights of workers.²

¹ Cf. Villermé and J. Simon, op. cit.

² R. Jay proves this by many documents, La Protection legale des Travailleurs, Paris, 1904, p. 7-49; for England, cf. Final Report of the Select Committee of the House of Lords on the Sweating System, 1890; Sidney Webb, The Case for the Factory Acts, London, 1900; - for America, Levasseur, op. cit., t. I, p. 198-225; 422-451; N. M. Auten, Some Phases of the Sweating System, in The American Journal of Sociology, March 1901, p. 602-645; for France and other regions, P. Pic, op. cit. - Hence an international society was instituted for protecting the rights of workers, whose statutes can be read in R. Jay, op. cit., p. 225-234.

Now such constant and universal experience clearly demonstrates that private industry is unequal to restraining at least certain abuses.

812. (b) In reality, by force of ineluctable competition, which flourishes not only among merchants of one region, but also among the various nations of the world, producers of things tend daily to this, that they may diminish the prices of merchandise, so that they may be able to sell the same more easily; but they cannot furnish this unless lesser expenses are made in producing the merchandise. From this it follows that, by a certain insuperable necessity, they choose those workers who are content with a lower wage, and consent to labor for a longer time. There are indeed many among them who are upright and merciful, and sincerely desire to act kindly with workers; but if they themselves pay a greater wage or demand less prolonged work, while others act otherwise, soon they will not be able to sell their merchandise at the same price as those others, but will be compelled to dismiss workers and close workshops.¹

¹ P. Bureau vividly sets forth these effects of competition, op. cit., p. 123-134.

And thus the doctrine of Leo XIII is confirmed both by experience and by reason.

Since the chief office of the master is to pay a fair wage, we shall speak: 1. on the norm of a just wage; 2. on the means by which the wage can be increased.

² Besides the works already cited on the contract of labor, cf. Walker, The Wages Question, New York, 1876; Beauregard, Essai sur la theorie des salaires, Paris, 1887; J. A. Ryan, A Living Wage, New York, 1906; Dalla Volta, Le forme del salario, 1893; D. Schloss, Les modes de remuneration du travail, Paris, 1902, translated from the English Methods of Industrial Remuneration; L. Garriguet, Le Salaire, Paris, 1903.

1. On The Norm Of A Just Wage.

This is a truly arduous question, concerning which there has been much dispute among economists and theologians.

813. (A) The system of the liberals. According to the liberal school, the wage is defined, like the price of merchandise, by the sole and free agreement between worker and master, and therefore the stipend which the master offers and the worker accepts must be held as just; in practice, therefore, it is regulated by the law of competition, by force of which wages are increased or diminished according as owners more or less need the labor of workers. For, on the one hand, the master will weigh the utility which accrues to him from the use of the operative faculty of workers, and its scarcity or frequency; but on the other, the proletarian will weigh those things which are required for honorable support; and, if he is truly free, he does not promise to furnish his work except to him who pays back those things which are necessary for honorable support. Moreover, in almost all places, there exists for each kind of work a current price, to which workers and masters adhere, unless special circumstances occur.³

³ "In fact, the debate is not long, because there exists on each worksite, in each workshop, one can say in each locality, a current price applicable to each profession or specialty and from which one scarcely departs, unless there are special circumstances, or exceptional ability of the worker, if he is noticeably above the ordinary." (Hubert-Valleroux, op. cit., p. 176.)

814. Nevertheless this norm cannot always, nor necessarily, determine what the just wage ought to be. For (a) it not rarely happens that workers who accept such and such a stipend are not truly free; for since they cannot labor fruitfully without machines, which are in the hands of owners, and besides need daily labor for earning daily bread, they are often compelled to accept conditions imposed on them, unless they wish to waste away with hunger.¹ Today, indeed, associated workers, by joining their powers together, can more easily obtain a fair wage; but those associated are fewer than the others; indeed, in certain arts, especially where workers are compelled to labor separately in their own rooms (which is especially true of women), any association is morally impossible: in which case solitary and defenseless persons are handed over to the unbridled competition of competitors.² - Now in these circumstances, the price which the master offers and the worker accepts cannot be held as just; Leo XIII declares this thus: "But if the worker, compelled by necessity, or moved by fear of a worse evil, accepts a harder condition, which, even if he does not wish it, must be accepted, because it is imposed by the master or contractor of works, this indeed is to undergo force, against which justice cries out."

¹ For generally there are so many workers that certain persons hired by no one are ready to labor for a lower price: "In ordinary times, the mass of offers of labor sensibly exceeds the mass of demands, and the statistics of all industrial countries attest that the number of workers in forced unemployment ordinarily exceeds 5 percent, which means that, out of twenty workers, only nineteen succeed in finding employment." (P. Bureau, op. cit., p. 122.)

² From this has arisen the system which they call the sweating system, which is described in the works cited above, n. 811.

(b) Even if workers freely yielded from their right, and accepted a wage which does not suffice for honorable support, a pact of this kind would not be fair, because they cannot validly renounce those things which are necessary for living honorably; concerning this let the same Pontiff be heard: "Let it be, therefore, that the worker and the master freely consent to the same agreement, and specifically to the measure of the wage: nevertheless there is always something underlying from natural justice, and this greater and older than the free will of those making the pact, namely that the wage ought not be unequal for nourishing a worker, frugal indeed and well behaved."

815. (B) The system of the socialists. Socialists on the contrary contend that from justice the whole fruit of labor is owed to workers, with only those expenses deducted which arise from the price of materials, the use of instruments, and the intellectual labor of those who preside over the production of things; but this, they say, must not be esteemed more highly than manual work. But that the matter is not so, they say, is established by daily experience; for masters retain for themselves the greater part of the profit, under the pretext of receiving interest for money, or a reward for the peril of the lot; and thus workers are unjustly deprived of the greater part of the fruits, and, by force of the iron law (loi d'airain), slip into misery, scarcely having foods necessary for their own support. They wish, therefore, that workers be held as cooperators, and obtain a part of the profit proportionate to their labor.¹

¹ Vandervelde sets forth their doctrine and arguments, Le Collectivisme, p. 123-140; 192-205.

816. This system indeed is nothing other than a conclusion inferred from the principles of Marx set forth above, n. 61-62; for, if all capital is stolen, certainly nothing is owed to it in the partition of profit. - But if capital has been legitimately acquired, a part of the profit must be assigned to it. For (a) capital, which furnishes machines and materials to the worker, and pays him a wage before the thing made is sold, certainly contributes much to the production of goods, and therefore cannot, without injustice, be deprived of a proportionate part of the advantage. Besides, if the rich man obtains nothing from his wealth employed in industry and commerce, who will ever build workshops, and give labor to producing new things? Will it not be safer and more pleasant to enjoy acquired goods quietly, than to take upon oneself all the cares and labors which the management of an industrial matter requires, without any hope of profit? In business, advantage is sought, and if none or almost none is expected, no one will build workshops, and workers will lack instruments and wealth necessary for laboring.

(b) Moreover capitalists take upon themselves the peril of the lot, and in reality not a few obtain an unhappy outcome in business, and not rarely lose the greatest part of the money committed to undertakings.² Now where the peril of the lot is present, it is necessary that greater profit be received; for who will expose himself to this danger unless he expects great advantage from it?

² "Experience proves that out of ten entrepreneurs of industry or commerce, there are two or three who fall into bankruptcy or insolvency, five to six who find only the means of living by having a modest remuneration for their labor and by preserving their possessions or increasing them only very slightly, and at most one or two who make a fortune of some importance." (P. Leroy-Beaulieu, Traite, t. II, p. 207.)

(c) Nor is it permitted to esteem lightly the intellectual work furnished by capitalists, nor the skill acquired by assiduous labor and many expenses; for experience establishes that the happy or unhappy outcome of undertakings depends chiefly on the skill and activity of those who preside over industrial matters: for in the same region, with the same wealth, and the same wage paid to workers, some prosperously succeed, others slip into ruin, according as they manage their affairs well or badly;¹ - and this is also confirmed by the example of cooperative societies: for not a few, notwithstanding the subsidies which they received, had an unhappy outcome, because the workers who presided over them lacked skill and activity.²

¹ "These figures demonstrate that the profit of the entrepreneur cannot have an automatic origin, like that which the socialists attribute to it, that it has a purely personal cause, holding to the very faculties of the person." (P. Leroy-Beaulieu, l. c., p. 208.) - The same author shows how much utility inventors bring to workers and society, t. I, pp. 569, 685, t. II, p. 198-199.

² On these societies see P. Leroy-Beaulieu, t. II, p. 623-643; Schloss, Methods of Industrial Remuneration, London, 1898; rendered in French by C. Riss, Les Modes de Remuneration du Travail, Paris, 1902, p. 279-315.

From these things it is permitted to infer that not an equal, but a proportionate, part of the profit belongs to masters and workers.

817. (C) Catholic doctrine. Between these two extremes the Catholic doctrine which Leo XIII set forth in the Encyclical Rerum Novarum proceeds by a middle way. There he especially declares two things: (a) "that the wage ought not be unequal for nourishing a worker, frugal indeed and well behaved," and indeed from justice, as we explained above, n. 814; (b) that it is to be desired that the wage be sufficiently ample for the honorable support not only of the worker himself, but also of wife and children: "If the worker receives a wage sufficiently ample that by it he can conveniently protect himself, his wife, and his children, he will easily study thrift, if he is wise, and will bring it about, as nature herself seems to admonish, that, expenses having been deducted, something also remains, by which it may be permitted to him to arrive at a modest property... Wherefore laws must favor this right, and, insofar as possible, provide that as many as possible from the multitude prefer to have property." He afterward describes the utility of this manner of acting, namely a more equitable partition of goods, greater eagerness for laboring, and also the diminution of emigration to foreign nations.

818. From this, however, controversies arose among Catholics, some saying that from this declaration of the Pontiff a family wage is owed from justice, but others asserting that it is fittingly given only from charity, as often as the condition of industrial affairs permits this. Wherefore three doubts were proposed to the Holy See by Cardinal Goossens, to which Card. Zigliara, by order of the Holy Pontiff, responded. Now from this response three things are likewise established: (a) that from commutative justice there is owed to a worker, otherwise capable and laboring well, of itself, a wage which suffices for suitable food and clothing, not indeed to be determined punctually and mathematically, but from common estimation, with attention to the quality, quantity, and duration of the work, and also to the price of things which must be bought by the worker for suitable food and clothing in such and such a region;¹ (b) that a master who pays a wage sufficient for the support of the worker, but unequal to the feeding of his family, indeed does not sin against justice, whose demands are fully satisfied when equality of wage and work is observed; - but sometimes can sin against charity, which demands that the master prefer his workers in lavishing alms; or against natural honesty, insofar as the master, who receives great benefit and advantage from the work of the worker, is in some way held from a certain natural equity to recompense this by supererogation; (c) that, speaking of itself, masters sin against commutative justice who, "using no force or fraud, give less wage than the work furnished deserves and than suffices for honorable support, for this reason that several workers offer themselves, who are content with that small stipend, or freely consent to it"; he says, speaking of itself; for "accidentally particular cases can be given in which masters can hire workers content with an inadequate wage: for example, if the master would draw either no advantage, or one altogether insufficient for the suitable support of his own life, if he lavished an adequate wage, indeed, if he would even suffer damage thereby"; this indeed can happen when, because of an industrial crisis, manufacturers are compelled to sell merchandise at the lowest price.

¹ "Therefore as often as the work is such that the worker through himself satisfies the aforesaid natural office of obtaining the immediate end of his labor, and the wage is unequal for obtaining this end, namely suitable food and clothing, speaking of itself and considering the nature of things, there is an objective inequality between work and wage, and therefore a wound of commutative justice. - Yet two things are generally to be considered in this matter: one is that, just as the price of saleable things is not punctually determined by the law of nature, but rather consists in common estimation, so also this must generally be said concerning wage;... the other is that in assigning the equality of justice between wage and manual work, common estimation attends not only to the quality and quantity of the work, but also to the time of its duration, likewise to the prices of things which must be bought by the worker for suitable food and clothing; which prices are not the same everywhere." (Card. Zigliara, Letter to Card. Goossens, 1891.)

Yet this letter did not impose an end to the dispute; for Father Eschbach, superior of the French seminary in Rome, contended that, according to the style of the school and of the Roman Rota, under the name of sustenance come all foods, clothing, habitation, medicines, etc., with attention to the quality of the one to be sustained; wherefore, if the one to be sustained is married, he has a right to honorable support for himself, wife, and children.¹ - But on the contrary Bishop Turinaz, bishop of Nancy, responded that the labor of the worker is a personal work, and not of the family, nor does it have anything except a secondary and accidental relation with the family, and therefore from justice merits nothing except personal support.²

¹ Eschbach, letter of Aug. 19, 1893 and Jan. 24, 1895.

² Turinaz, Le salaire familial et le Card. Zigliara, Nancy, 1895, where the two letters of Father Eschbach are also found.

819. (D) Practical conclusions. (a) In every case, masters are held from justice to pay a wage which corresponds to the economic value of the work furnished, according to the common estimation of prudent persons, that is, of masters and workers who can bring a fair judgment concerning this matter.

This rule indeed flows from the general principle admitted for all contracts, namely that equality is required between the work furnished and the price paid, according to the common estimation of skilled and honest persons.

But we said that account must be had of the estimation of masters and workers, and not only of one order; for since the matter concerns a thing which pertains to each order, and besides each naturally seeks its own proper good, it is not fair to stand by the judgment of one rather than the other; but skilled and honest persons of each order must come together so that, all things carefully weighed, the just price can be determined. This in practice is done through mixed councils composed of masters and workers (Conseils des prud'hommes, Conseils d'usine).

820. Corollaries. 1. Accordingly it is permitted to stand by the current price which is in force in a region, unless there is moral certainty that it has been determined by an unjust conspiracy.

2. That price cannot be the same in all regions or times, but must be increased or diminished according to the greater or lesser prosperity of industrial affairs: thus, if from various circumstances profit is increased, that increase must be divided between masters and workers in fair proportion, and not accrue to masters alone, especially since it can rightly be attributed to the efforts of each; but on the contrary, if profit is diminished, it is fair that the wage be proportionately less, lest otherwise masters slip into ruin, not without detriment to workers.

3. Masters would act unjustly who, abusing the ignorance or necessity of some worker, furnished to him a wage below the current price, e.g., gave only three coins for work which, according to common estimation, is worth four coins.

821. (b) In the normal state of industry and commerce, from justice there is owed at least that wage which is necessary to the worker himself for his honorable support, provided he labors with common and ordinary skill and activity.

Leo XIII expressly declared this, above, n. 817; and rightly. For the right and office of protecting their own life is incumbent upon workers; but, from things commonly happening, they have nothing else from which they may live except the wage received for labor; therefore they have the right and office of demanding the payment necessary for decent support; otherwise it would have to be said that a worker fit for laboring, and besides laboring with common diligence, cannot provide for himself even in ordinary circumstances without asking alms; this indeed no one of sound mind will say; for if it pertains to charity to relieve the poor and to furnish help to workers in certain extraordinary cases, it certainly pertains to justice to provide for the ordinary necessities of workers, by furnishing to them a sufficient wage; otherwise, it is all over with their dignity, and they must be numbered among beggars.

Now under the name of honorable support are rightly enumerated: foods necessary for repairing strength, clothing suitable to one's state, a healthy dwelling, - those things which are required for observing feast days and indulging some honorable and necessary recreation, and for meeting the customary cases of sicknesses and dangers, and also for preparing for oneself a tranquil old age; for all these things, according to common estimation, must be called morally necessary. - But if extraordinary misfortunes occur, long-lasting diseases, strength broken before the customary time, etc., it is not necessary that the wage suffice for relieving all these things, but recourse must be had to charity, unless the worker has provided for fortuitous cases by insurance.

822. It was said "in the normal state of industry," because if the conditions of things are such that, for some time, owners cannot pay so great a wage unless they fall from their own state, the stipend can be diminished, and it is fair that workers and masters suffer something until the abundance of fruits permits a return to the former wage; nevertheless, it is expedient that this be done by common counsel, by which lawsuits and dissensions may more easily be removed.

Likewise, if some worker, because of old age or weak health, or lack of common skill, cannot furnish integral labor, the master is held from justice only to compensate the work furnished. The same can be said if out of mercy alone he has hired a worker whose work he did not need.

823. (c) In the normal state of industry, the wage furnished to a suitable worker ought to be such that, increased by the wage which wife and children gain by labor proportionate to their powers, it suffices for the honorable support of the family; and this indeed from commutative justice according to many, from legal and distributive justice according to several, but from charity and equity according to others.

It is declared. So that this may be better understood, it must be declared in a few words. Here the matter does not concern a relative family wage, by which namely the wage ought to be increased proportionately to the number of children; nor is it contended that more is owed to married men and fathers of families than to those who remain celibate; for if the matter were so, married men would scarcely find masters who wished to hire them, and thus they would often be compelled to be free from all work, with great detriment to themselves and their family.

But the matter concerns a collective family wage; namely, such a stipend must be furnished to any worker that, when he marries and is made the head of a family, he can support his family, provided however that the wife takes up that kind of work which can stand with her offices, and likewise the children, at an opportune time, begin to labor in a manner proportionate to their powers. It is likewise supposed that the number of children is ordinary; but if the offspring is very numerous, the social good demands that either the Republic or private societies furnish some help to this family; for since numerous offspring well educated contributes greatly to the good of the whole society, it is fair that society itself contribute something to the education of this offspring; nor from justice is the master held to increase the wage of those who have many children, although from charity he can be held to give something, according to the things said above, n. 803-805.

We also suppose that the condition of industry is prosperous, so that the owner, by paying such a wage, not only does not incur danger of ruin, but he himself can make a proportionate profit; for he is not held to suffer some damage so that he may provide for the necessities of workers; but he satisfies justice by furnishing payment equal to the value of the work furnished.

824. It is proved. These things being posited, one can argue thus. The common law of nature is that workers, like other men, enter marriage, and, insofar as they are fathers of families, perform their offices toward wife and children; but one of these primary offices is to provide for the necessities of the wife, when she, because of the duties of mother which are incumbent upon her, cannot provide for herself, and also to feed and educate the offspring whom he has begotten: "It is a most holy law of nature," says Leo XIII, "that the father of a family protect with sustenance and every cultivation those whom he himself has begotten: and this likewise is deduced from nature itself, that he wishes to acquire and prepare for his children, who refer back and in some way produce the paternal person, that by which they may honestly defend themselves from miserable fortune in the uncertain course of life."

Whence thus: in the normal state of industry, a suitable worker ought to have an efficacious means of providing for an ordinary family. But such a means cannot be except labor in which there is a value equivalent to an absolute and collective family wage. - Therefore there is in the labor of the worker a value equivalent to an absolute and collective family wage.

825. From this it follows, according to many, that this wage is owed from justice, as often as the condition of industry permits it;¹ for otherwise the right which workers have of furnishing necessities to their family would be violated. Nor does this opinion, understood thus, contradict the opinion of Cardinal Zigliara; for he was speaking of a father of a family who alone was working for the support of the whole family, while in our case it is supposed that other members of the family contribute something to the domestic matter by some labor proportionate to their powers. In other words, the family itself can be regarded as a moral body, which has a right to honorable support when it labors according to its powers.

¹ Thus Card. Manning, La Question ouvriere et sociale, Paris, 1892; Liberatore, Econ. Polit., p. 246-252; Nicotra, Le minimum de salaire, art. 2; Verhaegen, Le minimum de salaire, Ghent, 1892; C. Perin, Note sur le juste salaire, Mons, 1892; Pottier, op. cit., n. 195; Gayraud, Questions du jour, Paris, 1897, p. 171-176; Waffelaert, in Collationes Brugenses, VI, Jan. 1901; Vermeersch, op. cit., n. 430-440; Lehmk., n. 1127a; Noldin, n. 600-601.

826. Yet we do not deny that there are certain persons, among modern Catholics, who still contend that from justice only the payment necessary for personal support is owed; for, they say, the work furnished is something personal, and has no relation to the family; whence the family wage, in whatever way it is understood, is not owed except from a certain charity or equity; if the wife labors, she indeed will receive from justice payment proportionate to her labor; the same must be said concerning children; but if the collective wage does not suffice for the support of the whole family, this cannot be turned into a fault for masters, who furnished a stipend corresponding to the value of the work. - To these it is responded that there is in the labor of workers, although merely personal, an intrinsic value sufficient that from it provision can be made for the family in ordinary circumstances.

Several, on the contrary, have recourse only to legal and distributive justice. For the common good demands that workers be able to marry and provide for a family, and it cannot be admitted that the support of families is to be expected from charity alone. Hence patrons are held from legal justice to furnish an absolute family wage, and presidents of the state from distributive justice to favor families, especially numerous ones.

Whatever may be the case concerning the speculative question, now a few things must be said concerning practical means by which, gradually and without harm to anyone, the wages of workers can be increased.

2. On The Means By Which The Wage Can Be Increased.

827. (A) Preliminary notions. (a) Most socialists and defenders of seditious syndicalism contend that the wage system is in itself and essentially unjust, and therefore must be abolished rather than amended.

We indeed do not deny that there have been several abuses in this regime, and before the great war wages in many regions were altogether insufficient, especially in those regions in which there were few workers' associations, but chiefly as regards women who labored at home by making clothing for great workshops,¹ so that it was necessary for laws to be made for determining the minimum wage to be paid to them. But from this it by no means follows that the regime itself of patronage, as intrinsically evil, must be abolished, but that means must be sought by which, by a wise and progressive evolution rather than by a violent overturning of things, the wages of workers can reasonably be increased.

¹ Enquete sur la petite industrie (Office du Travail) t. II, Le vetement a Paris; Ch. Benoist, Les ouvrieres de l'aiguille a Paris, 1895; d'Haussonville, Salaires et miseres des femmes; Bonnevay, Les ouvrieres lyonnaises travaillant a domicile, 1896; for England: Final Report of the Committee of the House of the Lords on the Sweating System, 1890; for America: Report of the Committee on the Sweating System, 1893, and more briefly in Levasseur, L'Ouvrier Americain, t. I, p. 422-451.

(b) In any region, other things being equal, the wage is greater for men than for women, especially because the stipend paid to women is held as a complement of the wage furnished to the husband; in great cities than in small ones, where expenses are less.

828. (c) In reality, from the common counsel of masters and workers, wages gradually increase; thus, in the second part of the recently elapsed century, they were increased by about fifty percent, while the expenses necessary for honorable support grew only twenty-five percent.¹ Today, after the war has ended, they have indeed increased much, so that they suffice for the honorable support of workers who are either celibate, or have children already capable of earning something. Nevertheless, because of the diminished value of money and the increased price of things, parents who have numerous offspring still incapable of laboring can support them only with difficulty. Wherefore, in some regions, owners have instituted a common fund from which they pay an additional wage (sursalaire) to workers according to the proportional number of children; this is certainly altogether consonant with equity.²

¹ Souchon, La situation des ouvriers en France au XIXe s., in the periodical Le Musee social, August 1899; E. Cauderlier, L'Evolution economique du XIXe siecle, Brussels and Paris, 1903, p. 73-201.

² Max Turmann, Problemes sociaux du travail industriel, Paris, Gabalda, 1921, ch. III; P. Bureau, La Caisse de compensation du Syndicat des metallurgistes dauphinois, 1919; Antoine du Passage, Economie Sociale, p. 685, where it is read: "Additional wages are becoming... more and more habitual. In Dauphine, in the North, in Normandy... they already constitute true institutions. At first some Dauphine patrons (it is in this region that the first trials were attempted) gave to a family comprising one or several children an additional payment. Then, to establish the measure on a broader base and proscribe every inclination to favor celibates to the detriment of fathers of families more burdensome for the enterprise, the associated patrons founded a regional Compensation Fund. Each enterprise pays into this fund a fixed sum per worker employed (married or not), and it is then the fund which distributes the additional wages among all the families, in the factories thus associated, proportionately to the number of children. - At the Social Week of Caen (August 1920), M. Deslandres noted that the existing compensation funds were already paying additional wages for several million francs each year, and showed that the institution, whose importance grows each day, has a true social scope."

829. (B) The principal means which have been devised for increasing wages. Here the matter concerns only those means which refer more directly to the wage itself, since later we shall speak of others which can render the general condition of workers better. The principal means are five: -

(a) Certain premiums granted to those workers who labor better, namely who diligently begin the work at the appointed time, or remain longer in the same workshop, or within the same space of time make more things, or make them more perfectly, or also use materials more sparingly; for in these cases a greater profit accrues to the master, who therefore is able to pay a greater stipend without any loss. - To this manner of acting many Socialists are indeed opposed, because it is opposed to perfect equality, and besides exhausts the strength of the workers, and chiefly favors the masters, who usually do not grant a premium proportioned to the more intense labor. Yet that system, notwithstanding certain inconveniences, greatly profits both masters and workers, provided it is brought into practice wisely and honestly, namely by taking care that workers not be drawn out too long in excessively arduous labors, and at the same time by seeing to it that they receive a premium equal to their efforts, according to the estimation of prudent persons.¹

¹ On the various ways of paying premiums (primes a la production, a l'assiduite, a l'economie, a l'anciennete, etc.), Schloss, op. cit., p. 11-134; Vantaer, La Participation aux benefices, Paris, 1898, p. 25-46; P. Bureau, L'Association de l'ouvrier au profit du patron et la Participation aux benefices, Paris, 1898; Gilman, Profit Sharing, London and New York, 1892, ch. II, p. 44-58, wrote wisely.

Sometimes wages also are increased or diminished according to a sliding scale (echelle mobile, sliding scale), corresponding to the quantity and price of the thing sold; this is done especially in England and America.²

² Vanlaer, op. cit., p. 33-36; Bureau, op. cit., p. 90-99; Gilman, op. cit., p. 56-58.

830. (b) A certain participation in profits, by virtue of which workers, besides the daily and usual stipend, each year or half-year receive a proportional part of the profits which the master has made. For even if he who has taken upon himself the whole risk of the business is not held to divide the profit with the workers, nevertheless it is fair that, after setting aside some part of the profit for protecting himself against adverse events, he distribute another part between himself and the workers; since they have had a part in the production of the things, it is not fitting that they be altogether excluded from the profits, especially if these are immense, and if besides they suffer a diminution of wage when things do not succeed so prosperously. - In this way production also is increased not a little, at least in many cases: namely, when workers expect some premium above the usual wage, they are accustomed to labor more intensely. - By this manner of acting, likewise, relations between masters and workers are made more friendly and peaceful, since in this way they understand better that they are co-workers.¹

¹ These advantages may be seen set forth at length in Vanlaer, p. 161-190.

In reality, already from the year 1842, participation of this sort in profits was in use among various Nations,² and, although it did not always and everywhere have a happy outcome, it profited much especially in workshops in which there are fewer workers, who can be stirred up by mutual example to labor better. Today it is judged that this participation can be made through the distribution of labor shares (actionnariat ouvrier, actions de travail), concerning which cf. Supplement, p. 236.

² Cf. Vanlaer, p. 47-81; 277-302, where you will find enumerated the workshops in which this participation flourishes; Gilman, p. 66-411.

831. (c) Subsidies granted to workers (subventions patronales); that is, certain masters divide some part of the profit under the form of subsidies, insofar as from superfluous things they contribute something to various institutes created for aiding workers: for increasing insurances against fortuitous cases, involuntary cessation from work, diseases, old age, or premature incapacity for laboring, - for fostering schools in which professional instruction is given, - for obtaining healthy houses at a moderate price, - for instituting cooperative societies, or other societies entered into for the sake of honest recreation, - for aiding in a special way families burdened with numerous offspring, etc. - These indeed will profit greatly, if masters permit the workers themselves to manage these funds or these societies, or at least to have a part in their management; otherwise they soon conceive a sense of distrust against institutes of this sort, and prefer to suffer everything rather than have recourse to societies which are managed by masters alone, and, as they think, for their advantage.

832. (d) The moderate intervention of the Republic, not indeed in this sense, that by public authority the wages to be paid to workers can be defined in a general and universal manner; but by giving an example, namely insofar as the State, Province, or Municipality, when they hire workers, pay a proportional wage fully suitable for their decent support, or impose upon executors of public works a proportional minimum wage to be paid to workers; and by taking care in a general way that wages in such a city or province be defined by mixed councils, in which delegates from masters and workers, by common vote, weigh the matter fairly, the reasons on both sides being honestly set forth.

(e) Associations of workers, by which they, with united forces, can obtain all that masters can grant without loss; concerning these associations we must now speak a little more fully.

III. On Workers' Associations (syndicats professionnels).

833. 1. State of the question. (A) Among the means by which the condition of workers can be rendered more tolerable and secure, Leo XIII enumerates associations of craftsmen, whose utility in past centuries he thus describes: "That associations of craftsmen among our forefathers long consisted in good deeds is certain. In truth they produced not only distinguished advantages for craftsmen, but also honor and increase for the crafts themselves, as very many monuments testify."¹ In most regions, however, already from the seventeenth century, associations of this sort began to decline, and afterward they were abolished, with the right of association forbidden. Yet some survived secretly; others were instituted under one or another pretext, until at last the liberty of association was restored.

¹ The history and advantages of these associations have been described by E. Levasseur, Histoire des Classes Ouvrieres avant 1789; Martin Saint-Leon, Les Corporations de metiers; Hubert-Valleroux, Les Corporations d'Arts et Metiers; Blanc, Les Corporations de Metiers; more briefly, however, by L. Garriguet, L'Association ouvriere, 1904. - Their present state is set forth: for France, L. de Seilhac, Syndicats ouvriers, Federations, Bourses de Travail, Paris, 1902; for England, P. de Rousiers, Le Trade-Unionisme en Angleterre, Paris, 1904; for America, L. Vigoureux, La concentration des forces ouvrieres dans l'Amerique du Nord, Paris, 1899; R. Ely, The Labor Movement in America, New York, 1886; in Belgium, Vandervelde, Enquete sur les associations professionnelles d'artisans et d'ouvriers en Belgique, 1892; for Germany, Brandts, Les associations ouvrieres en Allemagne, 1899, etc.

(B) The same Pontiff inculcates the necessity of associations of this sort, accommodated to our morals: "In a more instructed age now, with new morals, and with the things which daily life requires having also increased, it is certainly necessary that workers' sodalities be adapted to present use." Indeed we have already demonstrated above, n. 185, the utility and the moral necessity of association; for man, having discovered the scantiness of his own powers, by natural inclination seeks to enter societies with others, so that by common counsel and action he may increase and multiply his powers.¹ And if this is true of all citizens, it must be said with greater right of workers, who otherwise would be handed over solitary and defenseless to unbridled competition; for since as individuals they are much less powerful than masters, they cannot efficaciously vindicate their rights unless by uniting counsels and forces.

¹ To the point Leo XIII (Rerum Novarum): "The explored scantiness of his powers impels man and urges him to wish to join foreign help to himself. That saying belongs to the sacred writings: It is better therefore that two be together than one: for they have the benefit of their society. If one falls, he will be supported by the other. Woe to him who is alone: because when he falls, he does not have one lifting him up (Eccles., IV, 9-10). And also this: A brother who is helped by a brother is like a strong city (Prov., XVIII, 19). By this natural inclination, just as man is led to civil union and congregation, so also he seeks to enter other societies with citizens, small indeed and imperfect, but societies nevertheless."

834. 2. On the relative utility of mixed and independent associations. Here, however, a question arises: what kind of associations is better, whether mixed sodalities (syndicats mixtes), composed of workers and masters, or separated sodalities, composed of workers alone or of masters alone. Leo XIII approves each kind: "That societies of this kind are commonly formed, whether composed wholly of workers, or mixed from each order, is pleasing: but it is to be desired that they grow in number and active virtue." Yet among Catholics, some favor mixed associations, others separated ones.

835. (A) Those who favor the former kind argue thus:² (a) mixed sodalities promote mutual confidence and concord between workers and masters. For associations composed of workers alone are as it were armies armed against masters; on each side perpetual distrust flourishes, and often between the two orders discord breaks out without just motive. For composing disputes no principles are admitted except the principles of strict justice and absolute equality, nor any means except agreements which now are extorted from masters, now from workers, by threats or fear. Hence that regime can be called a regime of separation, mutual distrust, and justice alone, under threats of violent dissension or under an armed treaty of peace. - On the contrary, in mixed associations the hierarchical order in those things which regard the direction of labor is indeed acknowledged, but at the same time equality between masters and workers as regards the contract of labor itself; the various difficulties which arise are solved by confidential recourse to the masters, through a council composed in equal number of delegates from each order (conseil d'usine); wherefore that regime can be called a regime of union, mutual confidence, and benevolence.

² Castelein, Instit. Philos. Moralis et Socialis, p. 400-403; id., Le Socialisme et le droit de propriete, p. 289-304.

836. (b) From this benevolent and mutual concord of masters and workers there arises industrial prosperity, which profits society no less than each order; for the common labor becomes more intense, and is better ordered to the same end, and therefore more and more perfect things are produced, and the profit of the master as well as the wage of the worker can be increased. Thus also the burdens of those laboring are diminished: for the master who truly loves his workers and is loved by them is more inclined to favor them and to furnish assistance to them; for equity tempered by charity profits more than justice alone.

(c) From this there is instituted a stronger struggle against socialism; for since socialists have nothing more ancient than to scatter dissensions between masters and workers, in order more efficaciously to overturn the social order, nothing stronger can be opposed to this manner of acting than the mutual benevolence and confidence of each order: for thus many dissensions are forestalled, and, if any arise, they are composed not by sedition and violence, but by conciliation and arbitration.

837. (B) Those who favor separated associations do not indeed deny these utilities speculatively; but they observe these things: - (a) For several years Catholics in various regions, with the greatest liberality, have tried with all their strength to institute mixed sodalities, yet with an unhappy outcome. Thus today, in France, while in the year 1900 there were only 29,044 workers and masters in mixed associations, 170,030 masters and 588,832 workers adhered to separated industrial associations.¹ The reason is that workers, in mind and character, education, and manner of living, are so distant from masters that they often shrink from meeting and conversing together; for workers wish to be independent, at least during the hours in which they do not labor, conscious of their own dignity, tenacious of their rights, desirous of justice rather than charity, most diligent guardians of solidarity; masters, however, zealous assertors of their own authority and dignity, often ambitious and desirous of acquiring riches quickly, wish to manage their own affairs alone, without any intervention of the State or of workers.¹ Wherefore it is very difficult to join masters and workers together in one and the same association.

¹ In P. Pic, op. cit., n. 552; from that time separated associations have grown much, as can be read in the periodical Bulletin de l'Office du Travail.

¹ For a fuller understanding of the matter, cf. J. Huret, Enquete sur la Question sociale en Europe, Paris, 1897; G. Routier, La Question sociale et l'opinion du pays, Paris, 1894; G. Lebon, Psychologie du Socialisme, Paris, 1902, p. 44-56; 317-323; 332-342; 414-418.

838. (b) Moreover, by separated associations the blind force of unbridled competition is more efficaciously broken; on the one side, namely, associated workers by common counsel and action seek a wage sufficient for themselves and their family, and on the other, associated masters weigh at what price they must sell the things made, so that, without their own loss, they may be able to satisfy the legitimate petitions of the workers. But since difficulties and dissensions often arise, councils of deputies are called, elected from each order, and thus, after an honest and sincere exposition and discussion of the matters, the dispute is amicably composed.

It is objected indeed that separated workers' associations are nothing other than legions armed against masters, always ready for rebellion, and slipping more or less into socialism. - That the matter is so in France and in certain parts of Germany is established with sufficient certainty from many facts.

Resp. We indeed concede that workers' associations, when first instituted, and especially where the best of the workers are deterred from entering them, often foster a certain spirit of rebellion, and more or less embrace the doctrines of socialists; from this arise dissensions, concerted cessations from work, and very many acts of violence. But in the course of time, by experience and by the study of social matters, the leaders of the associations gradually understand that nothing can be obtained by violence and sedition, since the ruin of workshops harms workers no less than masters; wherefore, after various attempts, they begin to be wise and to consider things with a sounder mind, and they strive to make their condition better by legitimate means. Thus especially in Great Britain² and in the Federated States of America;³ and therefore it can be expected that, after some time, things will so stand in France, especially if honest and well-moraled workers institute independent associations, and vindicate their rights no less strenuously, but more legitimately than the socialists.¹

² Sydney and Beatrice Webb, The History of Trade Unionism, London, 1894; G. Howell, Trade Unionism New and Old, London, 1894; F. Fagnot, Le Syndicalisme anglais, Paris, 1903; de Rousiers, op. cit.

³ R. T. Ely, The Labor Movement in America, New York, 1886; G. E. N. Neill, The Labor Movement, 1887; Levasseur, op. cit., t. I, p. 237-305. - Recently, in the 23rd Congress of the American Federation of Labor, held at Boston (Nov. 1903), President Gompers openly declared that the doctrines of the socialists lacked a solid foundation, indeed were erroneous and impossible in practice. (Report of the Proceedings, Washington, 1903; Bulletin de l'Office du Travail, March 1904, p. 240.)

¹ In reality the associations of typographers, which are older, exhibit greater prudence, as may be seen in L. de Seilhac, p. 121-125.

839. (c) By these associations well ordered, the education of workers is promoted, insofar as they, more and more conscious of their own dignity, strive to become more skilled in their art, purer and more temperate in their morals, and more capable in managing affairs; thus, for example, by force of the statutes in force in certain associations, drunkards, blasphemers, the lustful, in one word all those who offend honesty or good morals, are excluded.² - Moreover, when associated workers are Catholics, by good examples and exhortatory words they mutually stir one another up to cultivating virtue and religion, and not rarely bring others to religious practice by persuasion and by a benign manner of acting.

² You have examples, for America, in Ely, op. cit., p. 120-160; for England, in P. Bureau, Le Contrat de Travail, p. 227-228, where these words of one of the leaders of the workers are reported: "Do you believe that if we struggle with the ardor which you know..., it is only to make you gain three or four pence more per day? What would that serve if you continue to bet at the races, and to get drunk in the public houses? A fine result of our efforts indeed! No, my friends, know this well, what we wish, what we must obtain, is that you rise to a better life, to a life more conformable to the dignity of the human species."

840. (d) Thus also the way is prepared for the collective contract of labor, which, rightly understood, profits masters equally and workers; for in great workshops, it becomes morally impossible that masters enter a contract of labor with individual workers; besides, so that the agreement may be fair, and may not furnish occasion for many dissensions, the conditions as to the quantity or quality of the work, and also the determination of the price, must be defined minutely. Now for defining all these things justly, nothing is more expedient than a convention of delegates, who officially act for the parts of masters and workers: this indeed is easily furnished if there are separated associations of masters and workers; for then deputies are freely elected by the workers themselves, who defend their rights, and for that reason the conditions signed by the deputies are more easily ratified and fulfilled.¹

¹ Raynaud, Le Contrat collectif de travail, Paris, 1901; P. Bureau, Le Contrat de travail, p. 183-271; P. Pic, op. cit., n. 442-444.

841. (C) Conclusion. Since reasons not to be despised are brought forward on each side, each person can favor either kind of association, as he pleases.

(a) In small workshops, where masters and workers can more easily meet and friendly relations be had, mixed associations can usefully be instituted;² yet masters should take care that workers may freely open their mind and set forth what changes please or displease them; likewise let it be free to them by their own movement to institute and manage various societies, lest otherwise they seem to depend altogether upon the masters, and afterward, conscious of this dependence, incline to open rebellion.³

² Thus in the place called Val-des-Bois, wholly friendly relations flourish between L. Harmel, who is called a good father, and his workers; cf. L. Harmel, Manuel de la Corporation chretienne, Tours, 1879, p. 23-38; 213-255; U. Guerin, Fileur en peigne du Val-des-Bois (Collection Les Ouvriers des Deux Mondes), 2nd series, 38th fasc., 1896, p. 73-136.

³ You have an example of this matter in La Quinzaine, April 1, 1902, p. 350-375, Montceau-les-Mines et le Paternalisme, by P. Bureau.

842. (b) But in great workshops, with attention to the psychological dispositions, so diverse, of workers and masters, and also to the experiments made in various regions, the institution and lasting preservation of mixed associations often becomes morally impossible. Hence today, among most Nations, whether Catholic or non-Catholic, separated associations flourish, which nevertheless strive to preserve peace and concord by a mixed Council of conciliation and arbitration. Yet it must be diligently cared for that associations of this sort, political-party prejudices being set aside, do not foster the spirit of sedition, but rather promote by legitimate means the professional, physical, intellectual, moral, and religious good of the workers. Therefore from these associations men upright and honest, attached to the Catholic religion, should not be kept away; where the errors of the socialists have already invaded workers' associations, let other independent associations be instituted, to which the upright can join themselves; for the time will come when workers, enticed by socialists, will understand that they have been deceived, and will join themselves to those associations which strive to render the condition of workers better, without however wishing to overturn the whole social and religious order.¹

¹ "The workers who are refractory to socialist excitations, and who ask only to shake off the yoke of the socialist party, are numerous; we even believe that they are the majority. But abandoned to themselves, what can they do, except bend the back before the most violent and most audacious? They will be able to resist seriously only from the day when to the socialist syndicate there is opposed a syndical organization received by the chiefs of industry with real sympathy." (Delcourt-Haillot, in the periodical Reforme sociale, May 16, 1902, p. 767.) - In reality Christian or independent workers' associations have been instituted in Belgium (P. Rutten, Mouvement syndical chretien en Belgique, Ghent, 1903; L. Varlez, Quelques pages d'histoire syndicale belge, in Musee social, March 1902); in Germany (Tondeur-Scheffler, Les Syndicats ouvriers allemands, in Musee social, April 1902; G. Blondel, Le Mouvement syndical chretien en Allemagne, in La Quinzaine, January 1, 1902, p. 30-41); in France today 140,000 men and women adhere to the national association of Catholic workers, whose number grows daily, with not a few bishops favoring it, as will be set forth in French at the end of the work.

To the point Leo XIII: "They indeed for the most part understand that they have been deceived by false hope and a feigned appearance of things... With broken spirit, weakened body, how greatly many would wish to vindicate themselves from so base a servitude: and yet they do not dare, whether because human shame, or fear of want, forbids it. Now to all these, how wonderfully Catholic associations can profit unto salvation, if they invite the hesitating to their bosom, with difficulties to be disentangled, and if they receive the penitent into their faith and protection."

843. (c) So that Catholic professional associations may promote private and social good, they must be imbued with a Catholic spirit and tend to the perfection of piety and morals no less than to the increase of goods of body, mind, and family estate. Wherefore priests, who cannot join themselves to workers' associations, in many regions, must see to it that at least some from among the Catholics who enter these associations are so strengthened in faith and instructed in genuine piety that they are able to instruct others by words and examples; for just as a little leaven lifts up the whole mass, so a tiny flock of devout persons will gradually convert the whole multitude of laborers to better things.

Leo XIII illustrates this by the example of the first Christians, of whom most lived by the work of their hands: "It was possible to see them industrious, laborious, peaceful, holding themselves forth as an example of justice and especially of charity; at the spectacle of such life and morals, every prejudged opinion vanished, the detraction of the malevolent fell silent, and the fictions of long-standing superstition gradually yielded to Christian truth." Thus Christian craftsmen, if they join arduous labor to piety, and at the same time show themselves industrious, modest, and benign, will conciliate to themselves the confidence and benevolence of many, and reverence and honor for the Catholic religion.¹

¹ Certain Catholic societies contribute much to the right and Christian institution of young workers; while they assiduously inculcate the practice of Christian virtues, they teach adolescents how by legitimate means, with the rights of masters unharmed, they can render their condition better. Cf. Max Turmann, Education populaire, 2nd ed.

IV. On Cessation From Work (greve, strike).²

² Lehmkuhl, Arbeitsvertrag und Strike, Freiburg, Herder, 1895, in French Le Contrat entre patrons et ouvriers et les greves; Pottier, op. cit., n. 172-183; Vermeersch, op. cit., n. 470-477; Antoine, op. cit., p. 462-470; Rutten, Nos greves houilleres et l'action socialiste; Turquan, Les Greves, Paris, 1890; L. de Seilhac, La Greve de Carmaux, Paris, 1897; id., Les Greves, 1903; Howell, Conflicts of Capital and Labour, London, 1890; Levasseur, op. cit., t. I, p. 497-571; W. F. Willoughby, La Corporation de l'Acier des Etats-Unis et la Greve de ses ouvriers en 1901, translated from English by J. de Montaignac, in Musee social, February 1902.

844. 1. State of the question. (A) When a contract of labor is entered, it is defined explicitly or implicitly how long it ought to endure; this being posited, workers or masters act unjustly who, without grave reason, withdraw from a legitimate convention, and therefore are held to compensate the damage thence inflicted upon the other.³ - But if the contract was from the beginning, or has become, unjust (which can be judged from the rules set forth above, n. 793-802), those who, on account of the injury which they suffer, withdraw from the contract do not commit an injury. - Once the time has elapsed, workers can cease without injury toward the master, even without any reason: for it is permitted to them either to rest, or to hire out their work to others.⁴

³ Civil laws generally sanction this; for France, cf. Planiol, n. 1878-1896, where the laws of Dec. 27, 1890, and July 19, 1901, are set forth.

⁴ Yet, if they need to labor for the support of themselves and their own, and no hope shines upon them of finding another master by whom they may be hired, from charity and from prudence they can be held not to leave the work.

(B) But the question arises whether workers can cease from work in a body and by agreement, for this end, that they may obtain or extort from masters a greater wage or other conditions. This cessation from work is called by the name strike, and is defined as the common withdrawal by agreement of many workers for obtaining certain advantages from masters. - Often workers desist from laboring in order to obtain a greater recompense, but sometimes also that the labor may be made less long-lasting and less grave, or because certain workers, especially if they are associated, have been dismissed or more harshly treated; sometimes they complain that faith has been violated, or that an unfair stipulation has been attached to the contract. Not rarely, especially in France, they are stirred up by political agitators,¹ who affect love toward the people, so that they may capture their votes; hence sometimes it happens that most do not know the cause why they have refused to work, and do not know what is to be sought from the masters.

¹ "Assuredly the far greatest part of the workers prefer to obtain better things by honest labor without injury to anyone: yet not a few are numbered who are imbued with depraved opinions and desirous of new things, who strive in every way to move disturbances, and to impel the rest to violence." (Rerum Novarum.) - On the various motives on account of which cessation from work occurs, see L. de Seilhac, Les Greves, p. 177-229.

845. 2. Principles concerning cessation from work. (A) A common cessation from work by agreement is not permitted except for a grave cause, after mature deliberation, and after useless attempts to settle the dispute peacefully.

(a) For a strike is as it were a war between masters and workers, and brings many evils with it: "That kind of cessation affects with damage not only masters, and the workers themselves, but harms commerce and the utilities of the republic, and since it is not far from violence and disturbances, it very often brings public tranquillity into danger."²

² Rerum Novarum. - Thus, at Marseilles, in the year 1901, workers, by desisting from work, lost about 2,000,000 francs, the city itself 25,000,000 francs per week; in the Federated States of America, while a cessation from work was in force in the coal mines (houilleres) of Pennsylvania in the year 1902, masters were losing about 157,500,000 francs. - Cf. L. Seilhac, op. cit., p. 23-32.

In reality, during the whole time in which they desist from work, workers receive no wage, but spend for the support of themselves and their family the money amassed by long thrift; but masters not only make no profit, but often incur burdensome expenses for guarding and repairing their buildings and instruments of labor, and lose the opportunity of selling their merchandise not only for the present, but often also for future time, since not a few buyers are accustomed to have recourse to other manufacturers, and often afterwards retain this custom. Moreover railways, and also certain other workshops which depend on those in which the work has ceased, suffer not slight damages from this; sometimes the industry and commerce of a whole province are involved in tangled difficulties, and the number of the poor in the whole region is greatly increased. - Nor must the evils of the moral order be passed over in silence, namely hatreds which dissociate citizens, corruption of morals which naturally flows from long idleness, blasphemies against religion, violent and unjust acts by which persons or things are attacked, and other things of this sort.

Now it is an unshaken principle of ethics that so many and such great evils cannot be permitted without a grave reason which is truly proportioned to these evils; therefore the good which is expected from the strike must be of the greatest moment, and the hope of obtaining it well founded; and therefore the advantages and disadvantages must be weighed diligently and maturely in all justice and charity. Besides, it is necessary that no gentler and better way be available for attaining the intended end; therefore upright and honest men, delegated by masters and workers, must first come together, so that, insofar as it can be done, the dispute may be composed peacefully by mutual concessions; indeed, it is altogether expedient that, if the delegates cannot consent to one and the same proposal, the matter be left to be judged by arbitrators.

846. (b) But when there is a proportionately grave reason, maturely and long weighed, and the dispute could not be composed peacefully by the aforesaid means, it is permitted to workers to desist from work by agreement, provided they pursue a good end; for the matter concerns an act indifferent in itself, from which a double effect will follow, and by hypothesis the good effect intended is foreseen to surpass the bad effect; and if such a right, in these circumstances, were denied to workers, they could scarcely protect their rights in another way.¹ - Nor should it be said that that means is altogether inefficacious; for, as even the economists of the liberal school acknowledge, although workers have suffered many damages from strikes, nevertheless they often have obtained greater advantages from them; often also the fear lest a cessation from work prevail induces masters to concede to the workers whatever they can bestow without loss.¹

¹ Thus Leroy-Beaulieu, Traite, t. II, p. 453-454; Lehmk., Theol. moralis, t. I (11th ed., n. 1348), where he says: "Before this time (of the elapsed contract), to make a strike will not have been unjust if on the part of the master an open violation of the contract is committed, and he, having been warned, does not wish to desist from inflicting injustice. Indeed in such a case, when the matter concerns protecting a right of great moment, it can happen that it is permitted to exercise, not violence indeed, but a certain moral coercion against other workers... by excluding them from undue goods lest they make the repulse of the injury inefficacious, provided however that these can pursue the common cause with the others without incurring their own damage. Such an unjust violation of contract on the part of the master is an openly unjust depression of the recompense, an unjust denial of festal rest, the continuation of a grave danger against good morals."

¹ "Everything considered, strikes have been rather useful than harmful to the working class. - The permanent gain greatly surpasses the passing losses. - Strikes have chiefly contributed to improving workshop regulations, to reducing the excessive working day, to rendering the manner of payment more loyal, finally to making the worker respected by the patron." (P. Leroy-Beaulieu, Repartition des richesses, p. 626; cf. p. 395-407; P. Pic, n. 292-295.)

847. (B) Even when cessation from work is legitimate in itself, violent means must not be used either for deterring others from laboring, or for inflicting damage on masters.

The reason is that it is not permitted to use illegitimate means even for pursuing a good end; now violence is something illegitimate, nor must it be used except for repelling force. Wherefore workers who desist from work cannot by force compel others to do the same, nor strike or wound those who continue to labor. Yet they probably can, when the injustice of the masters is certainly established and redounds to common damage, morally compel other workers, especially those associated with them, by persuasion and just threats (for example, by expelling them from the association), not to labor for these masters until satisfaction has been made for the just complaints;² for otherwise the rights of workers often cannot be vindicated.

² Thus Lehmk., Casus 278, n. 895: "But if the injustice of the masters is clear and redounds to the grave common damage of the workers, it will not be unjust also morally to compel those workers who would wish to continue laboring for that lower recompense, not to do so."

Likewise, positively to inflict damage on masters by burning their houses or goods, or by harming them, is prohibited no less by natural law than by positive law; for there are other means for protecting the rights of workers; indeed experience establishes that by these violent means their cause is ruined, both because the mind of other citizens is thus alienated, and because occasion is given for the armed intervention of the Republic.

848. (C) When the common cessation from work is illegitimate, whether in itself or from the violences employed, the right of the State comes in, to impose an end upon it or to restrain abuses.

For it pertains to the supreme authority to promote the public good, and to prevent those things which disturb the order of society; but strikes which take place not because of a grave and reasonable cause, but for fostering sedition or other motives of this sort, or which bring force upon peaceful citizens, by that very fact disturb peace and the social order, and especially harm industry, commerce, and good morals, as was said above. "Let the authority of the Republic therefore intervene," says Leo XIII, "and, a bridle having been put upon agitators, let them restrain corrupting arts from the morals of the workers, and the danger of plundering from legitimate masters."

849. 3. On conciliation and arbitration.¹ Since it is better to forestall evils than to correct them, it is certainly very expedient to prevent dissensions between masters and workers by councils of conciliation and arbitration, some of which have been instituted by private authority, others by law.

¹ H. Crompton, Industrial Conciliation, London, 1876; rendered into French under Weiler's care: Arbitrage et conciliation entre patrons et ouvriers, Brussels; Office du Travail: De la Conciliation et de l'Arbitrage, Paris, 1893; Weiler, L'organisation des Conseils d'arbitrage etablis en Angleterre, Paris, 1877; Bayles, The Shop Council, New York, 1886, rendered into French under Foccroutte's care: Le Conseil d'Usine, Brussels and Paris, 1892; Peronnet, La Conciliation et l'Arbitrage, Paris, 1897; de Seilhac, La greve et l'arbitrage, Correspondant, Dec. 1902, p. 820-842; Tanquerey, in Vacant, Diction. de Theologie, t. I, 1733-1737.

(a) First indeed in England, Belgium, and the Federated States of America, already from the year 1860, councils of this sort were created by private authority, composed of an equal number of masters and workers, for solving difficulties which often arise concerning all things that regard industry, e.g., the amount of the wage, the duration of labor, the rules to be followed in the workshop, etc. The president of these councils is either one from the members selected by the council itself, or a certain magistrate of the region who is chosen for this office by the common vote of the workers and masters. By these means many dissensions were peacefully composed.

850. (b) Wherefore, in many regions, laws have been enacted for instituting officially mixed tribunals, which can compose disputes between masters and workers, or for defining the conditions under which arbitrators can be chosen. In most places, recourse to arbitrators remains altogether free; yet in certain places, such as Switzerland and Australia, workers and masters, in the case of dissension, are compelled to submit themselves to arbitration.

What is more opportune concerning this matter is controverted among sociologists. We indeed judge that workers and masters can be compelled, whether through themselves or through delegates, to appear before the magistrate, so that they may honestly set forth the motive of the dissension and their arguments; but it is not expedient that the sentence of the arbitrators be so obligatory that they are compelled to obey it. - The reason for the former is that it is certainly opportune, for forestalling violent conflicts, that delegates of each order meet together and plainly open their mind; for by a sincere exposition of facts and reasons many prejudices are set aside, and the way of concord is prepared. Now, in many cases, unless a legal obligation of acting thus rests upon each party, under whatever pretext, one or the other will reject the proposed convention.

On the other hand, it is generally not expedient that dissenters be compelled to obey the sentence; for who will compel workers to labor for such a master, against their own mind? and, if they labor unwillingly, will not the work be very imperfect? Likewise, if masters judge that they cannot accept the imposed conditions without their own loss, can they be condemned to certain ruin?

Nor can it be said that a sentence which does not have the force of law is altogether useless; for since this becomes a matter of public right, workers and masters are morally obliged to obey it, provided it seems sufficiently evidently consonant with reason; for they are impelled to this by public estimation, namely lest they incur the indignation of other citizens.

V. On The Means By Which The Condition Of Workers Can Be Made Better.¹

¹ Soderini, Socialisme et Catholicisme, Lille, 1896, chap. 23-27; G. Goyau, Autour du catholicisme social, Paris, 1900-1903; V. Brants, Les grandes Lignes de l'Econ. pol., Moyens generaux d'ameliorer la situation sociale, t. II, p. 266-363; Millot, Que faut-il faire pour le peuple? Paris, 1901; F. Veuillot, L'Apostolat social, Paris, 1902; Bouchage, L'Apostolat paroissial, Paris, 1903; Berardi, De officio parochi nostris temporibus, Faenza, 1902; E. Rostand, L'Action sociale par l'initiative privee, Paris, 3 vols., 1892-1897-1902; Vermeersch, Manuel social, Louvain, 1900; Baunard, L'Evangile du Pauvre, 2nd ed., Paris, 1904. - We also treated these things where we treated Charity, n. 817-835.

851. State of the question. Since these things are so, the office rests upon upright and Catholic men, but especially upon priests, of striving with all their powers that they make the condition of workers better, insofar as this can be done, and thus render concord and peace between the rich and proletarians more firm. To the point Leo XIII: "As regards the Church, she will at no time and in no way allow her work to be wanting, and she will bring so much more assistance, the more liberty in acting shall have fallen to her... let the ministers of sacred things direct all the powers of mind and industry." - These words indeed, spoken in the year 1891, laymen and priests heard, and in various regions they gave themselves to Catholic action; hence diverse institutes were created for the benefit of workers: "banks for loans to countrymen; associations, some for rendering mutual assistance, others for relieving necessities due to misfortunes; sodalities of workers; other helps of this kind, both of societies and of works."¹ This manner of acting received from some the name of Christian socialism, yet less rightly, since socialism, such as it is in fact defended, openly contradicts Christian dogmas; - but from others, popular Christian action, and elsewhere Christian democracy: the former appellation indeed suffers no difficulty; the latter, which did not please many, is nevertheless permitted by Leo XIII, provided it is not twisted to a political sense, and does not seem to exclude superiors and the rich, but "pertains solely to this, that those who sustain life by hand and art be brought to a more tolerable state, and gradually have that by which they may provide for themselves; that at home and openly they freely fulfill the offices of virtues and religion; that they feel themselves to be not animals but men, not pagans but Christians; and thus strive toward that one thing necessary."²

¹ Thus Leo XIII, in the Encyclical Graves de Communi, Jan. 18, 1901; Max Turmann described the evolution of Catholic action from the year 1891, Le Catholicisme social depuis l'Encycl. Rerum Novarum, Paris, 1900.

² Leo XIII, the cited Encyclical Graves de Communi, which is to be read attentively in its entirety; you have a commentary in the little work: L'Eglise et la Democratie chretienne by Goyau, Toniolo, and Pottier, Liege, 1901. - What in past centuries the Gallican clergy did for promoting also the temporal good of the faithful, Sicard sets forth, L'ancien Clerge de France, Paris, 1893, t. I, pp. 142-192; 318-335.

It will not therefore be unpleasant to enumerate briefly the principal means hitherto used for improving the condition of workers: 1. the young are to be instructed by Christian education, so that they become good workers; 2. adults are to be united together by various associations, so that they may more securely provide for themselves; 3. they are to be aided by other associations instituted among the richer; 4. they are to be strengthened in faith and virtue through religious associations.

852. 1. The Christian, virile, and professional education of the young. For rendering the lot of workers better, the good education of the young contributes greatly; for many, whether at home or in neutral schools, are not rightly instructed. It is necessary therefore that education be completed in pious works which are called patronages, or in study circles (cercles d'etudes, debating clubs). This indeed ought to be: (A) Christian; for piety "is useful for all things, having the promise of the life which now is, and of the future";¹ for by forming young people who are sober, chaste, lovers of labor and thrift, it certainly helps them much to manage even temporal matters prosperously. But, since today errors are scattered everywhere, the faith of the young must be nourished and strengthened: it is not enough to explain rightly, but it is necessary to prove by solid arguments the principal dogmas, such as the existence of God, the immortality of the soul, the divine mission of Christ, the authority of the Church, etc. Let adolescents be taught how, according to their capacity, they may answer the common difficulties of unbelievers, and, in more difficult matters, have recourse to learned men. Among them let some be chosen, endowed with a sharper intellect, a nobler character, and greater fortitude, who may form a special society, imbued with an apostolic spirit, and draw other young persons to the practice of virtues by words and examples. They will be like so many apostles, who will greatly help priests in defending the faith and reforming morals.²

¹ 1 Tim., IV, 8.

² Congres international officiel du Patronage de la Jeunesse ouvriere, from June 10 to 13, 1900, Paris, 1901; Max Turmann, Les Oeuvres complementaires de l'Ecole, Paris, 1900; id., Les Patronages, 3rd ed. 1901; Gatouillat, Reflexions pratiques sur la necessite et la direction des Patronages de Jeunes Gens, Troyes, 1899.

853. (B) Virile, that is, tending to furnish courage of soul and invincible strength of will; and therefore gradually to change boys into men, who can suffice for themselves. For workers are exposed to various allurements, whether internally from passions, or externally from vain human fear and diverse occasions by which they are enticed to evil; it is therefore of the greatest importance that they firmly believe and exteriorly manifest their faith by works, without boasting and without shame; likewise that, strengthened in virtue, they despise the allurements of pleasures, and vigorously resist depraved companions. Wherefore let them gradually be taught how, with the grace of God helping, they can increase their own powers and act manfully, by fleeing useless occasions of sin, and in necessary ones by fighting bravely.¹ Let it be set forth to them how great is the efficacy of association for overcoming difficulties and multiplying energies; and how necessary it is that the upright be united together, so that they may crush the audacity of the evil.

¹ "Obliged without doubt to preserve the child from certain dangers superior to his age or his powers, education nevertheless does not have preservation for its end: this would be the substitution of the effort of the master for the effort of the child. On the contrary, it aims to form energies which can suffice for themselves and guard themselves: it is necessary to help the weak, but to arrive at making them robust enough to do without helps... One word sums up everything: our moral education wishes to make men." (Ackermann, in Congres internat., p. 30-31.)

854. (C) Professional, insofar as it forms workers skilled in their own art;² for the more skilled and at the same time the more honest they are, the more they will be esteemed both by associates and by masters; wherefore at the opportune time they will obtain a greater wage and nobler offices. But in our days it is altogether expedient that the chief principles of social science be handed on to them, so that they may more easily refute the sophisms of socialists, and have very much authority in workers' associations; for thus they will be able to protect moderately and wisely their own rights and those of their associates; thus also the way will be prepared for concord between masters and workers. - But to girls let there be given not only speculative education in letters and arts, but practical education, so that they may learn how they can attend to domestic affairs.³

² "Yes, it is necessary to develop professional formation and to prepare the young man for social cooperation. Industrial evolution obliges to the one, social evolution imposes the other: these are two new elements which it is urgent to introduce into the education of the child of the people. One will therefore complete his instruction, one will therefore develop his intelligence and his technical skill. Then one will accustom him to foresight, to economy, to the sentiment of solidarity." - Cf. Law of July 21, 1919, on professional teaching.

³ Thus in Belgium there have been instituted schools which are called housekeeping schools (ecoles menageres), cf. Mme Van Gehuchten, Guide de la Jeune Menagere, Lierre (Belgium), 1894; de Diesbach, L'enseignement menager, Paris, 1903.

855. 2. Various associations instituted among Catholic workers. (A) First of all let workers' associations (syndicats professionnels) be promoted; for unless upright and Catholic men are joined together among themselves, they will not be able to protect their rights, and besides, socialist sodalities will altogether preside over the workers and will soon overturn the social order; concerning these associations we have already treated above, n. 833. But among countrymen let societies be instituted which are called agricultural syndicates, by which farmers are helped not a little in learning the best means for cultivating fields more perfectly, and for protecting their rights legally.¹

¹ On their origin, evolution, many advantages, and organization, de Rocquigny discusses, Les syndicats agricoles, leur oeuvre professionnelle, economique, sociale, Paris, 1898; de Gailhard-Bancel, Manuel pratique des Syndicats agricoles, 6th ed., Paris, 1900. - What part priests had in their foundation in Belgium, Max Turmann describes, Les Associations agricoles en Belgique, Paris, 1903.

(B) Let those mutual associations (mutualites) also be promoted, by which workers can render help and assistance to one another, and increase thrift.² For since workers receive a modest wage, and are liable to many damages from unforeseen cases or diseases, or from cessation from labor, they will certainly profit much if, by living soberly, chastely, and frugally, they set aside some money at the time when matters are succeeding rather prosperously, and deposit it with those societies called mutuals, which have been instituted in various regions. Certain ones have been created in schools, so that already from boyhood the young may be able to study thrift, and, vain prodigality having been despised, become accustomed to living more sparingly and providing for future necessities;³ it is altogether expedient to institute these in Catholic schools.

² F. Lepine, La Mutualite, ses principes, ses bases veritables, Paris, 1903; L. Mabilleau, La Prevoyance sociale en Italie, Paris; Rostand, t. III, p. 663-678.

³ Lepine, op. cit., p. 53-67; M. Turmann, Educ. populaire, p. 69-76.

856. (C) To these can be joined cooperative societies, whether for buying merchandise at a lower price, or also for producing certain things.⁴ The former are easily instituted and managed; but in small towns it is generally expedient to create societies which do not directly buy goods in order to sell them to cooperators at a lower price, but enter an agreement with merchants, so that these consent to cede to the cooperators some determined part of their profit; otherwise, the hatred and envy of merchants is stirred up, who from the foundation of a cooperative society not rarely lose the greatest part of their profit. - It is much more difficult happily and prosperously to manage the care of societies which are called productive; for for this two things are desired: no small capital, not only for obtaining instruments, but also for paying the manifold expenses which it is necessary to incur for several months before any profit is received; and an expert administrator, who can manage the matter wisely, and who has sufficient authority for commanding the other workers; these things indeed can scarcely be found.¹

⁴ Ch. Gide, La Cooperation, Paris, 1900; id., L'Economie Sociale a l'Exposition de 1900, Paris, 1902, p. 273-294; id., Les societes cooperatives de consommation, Paris, 1904; Clavel et Soria, Guide pour l'organisation et l'administration des societes cooperatives de consommation, 4th ed., Paris, 1901; Hubert-Valleroux, La Cooperation, Paris, 1904; Congres des Associat. ouvrieres de production, Paris, 1900; Comptes-rendus du Congres de l'Alliance cooperative internationale, Paris, 1902; Bertrand, Histoire de la Cooperation en Belgique, Brussels; Beatrice Potter, The Cooperative Movement in Great Britain, London.

¹ Nevertheless bakery societies, or those instituted for making bread, profit better, both because the baker's art is rather easy, and because in well-organized bakeries (boulangeries) the price of bread is much diminished, as may be seen in Gide, Coop. de consommation, p. 84. - Socialists happily manage not a few productive societies; among these that one excels which is called Vooruit, concerning which read Le Vooruit, la cooperation et l'organisation socialiste en Belgique, in Musee social, Dec. 20, 1897; - about societies of the same kind in France, cf. Une Enquete sur les boulangeries cooperatives rurales, in Musee social, Dec. 1899. - How necessary it is for Catholics to institute cooperative societies is clear from the fact that socialists use these to spread their errors; for M. Lauzel says, Manuel du Cooperateur socialiste, Paris, 1900, p. 17: "In the hands of socialists, cooperation is only a means of socialist action, a powerful lever, capable of moving the capitalist world on its bases of individual property and social injustice. We do not wish to be cooperators for the satisfaction of diminishing a little the infinite misery of the proletariat: We wish to be cooperators in order to cooperate more efficaciously in the social revolution."

Whatever may be the case, if a priest has been the promoter of these societies, let him consent to lie hidden in secret, and commit the thing to be managed to upright and prudent laymen, who at the opportune time will render an account of the whole matter to the members.² It must likewise be guarded against that societies of this sort seem to bring some profit to the priests themselves; for if workers suspected this, they would soon be turned away from those societies.

² "I call quite particularly the attention of the founding Cure to this important point. Do you wish to have men in your church? Do you wish to form a numerous, lasting, and honorable meeting? Let them administer themselves. Give them a home of their own: they must not be at your home, but at theirs... The changes which have occurred for a century in French society have only made more imperative this need of autonomy, of self-government, as the English say." (L. de la R., Les Associations d'hommes, Marseilles, 1903, p. 7, 9.)

857. (D) Among those societies there are deservedly praised those banks which were first invented by Raiffeisen (caisses Raiffeisen), and are also called societies of mutual credit (pret mutuel), because they give money on loan, with the smallest interest.¹ They consist of farmers of the same parish, who possess certain immovables; these form a certain civil society, constituted according to the laws of each region; directors are elected, who fulfill their office gratis; only the treasurer (tresorier) receives some recompense, yet a minimum one. Now poor farmers can borrow money from the society, with the directors approving, if they promise to restore the capital with a small interest; each year the accounts are rendered to the presidents of the society; and if any profit remains, it is not distributed to the creditors, but is either kept, or is spent upon a work of public utility, e.g., for acquiring those recently invented machines by which the work of sowing and reaping is accomplished much more promptly and easily. - To these societies there can be attached insurances against fire, hail, pestilence of animals, etc.²

¹ A. Kannengieser, Catholiques allemands, Paris, 1892, p. 138-148; Max Turmann, Associations agricoles, p. 322-374; G. Malherbe, Le Raiffeisenisme, Brussels, 1902; C. Ract, Les Caisses de Famille, Paris, 1896.

² Max Turmann, op. cit. p. 375-408; de Rocquigny, Les petites Institutions mutuelles de prevoyance contre la mortalite des animaux, in Musee social, June 1898.

858. 3. Associations formed among the richer for aiding workers. Since workers can scarcely aid themselves and their own sufficiently by their own powers, it is necessary that societies be instituted among the richer for furnishing assistance to proletarians.³ Now, among those which have already been founded in various regions, these excel: -

³ Leo XIII certainly inculcates this, in the Encyclical Graves de Communi, where he says: "In a not dissimilar way that other head of offense must be removed from Christian democracy: namely, that it so places its cares in the advantages of the lower orders that it seems to pass over the higher; whose use, however, is no less for the conservation and perfection of society... Their benign work is especially advocated, to whom place, census, and cultivation of talent and soul conciliate somewhat more authority in the city."

(A) Societies for building healthy houses,⁴ which can be rented or sold to workers at a lower price. This indeed is of the greatest moment: for when workers inhabit a decent house, they not only remain well, but also think less of entering taverns, and live a domestic life which greatly favors good morals and social order. For this, however, it is also required that the wives of workers practically learn the art of attending cleanly and orderly to domestic affairs. - Hence among various Nations laws have been made by which advantages not to be despised are conferred on these societies, especially immunity from certain taxes.¹

⁴ Rostand, L'action sociale par l'initiative privee, t. I, p. 147; II, p. 313; Siegfried, Les Habitations a bon marche; Gans et Weber, L'Ouvrier stable et l'Habitation ouvriere, Paris, 1897; H. Barrau, Le Congres internat. des Habitations a bon marche, in Musee social, July 1900; C. Wright and Gould, The Housing of the Working People, 1895; J. Perez Canto, El Obrero propietario, Santiago de Chile, 1903; Reforme sociale, March 1, 1904, p. 382-395.

¹ For France see P. Pic, op. cit., n. 1368, where the laws of Nov. 30, 1894, and March 31, 1896, are set forth; for other regions, Ann. de legislation etrangere, 1898, p. 546; 1900, p. 26, etc.

(B) To these can be joined societies which rent or sell gardens to workers at a modest price;² for they can cultivate these with their own hands, and receive from them fruits by which they are helped not a little in domestic affairs; moreover, it has been found by experience that by the cultivation of gardens relations are made better between the rich, who rent them gratis or for a modest price, and workers who enjoy them, - drunkenness is diminished, - thrift is increased, - the vanity of socialism appears, insofar as cultivators of gardens perceive better the utility of private dominion.

² The origin, utility, and practical organization of these societies is described by L. Riviere, La Terre et l'Atelier, Jardins ouvriers, Paris, 1904; cf. D. Lancry, Une visite aux Jardins ouvriers de Sedan, in Democratie chretienne, Oct. 1897; Lemire, who wrote various things on this matter in the periodical Le Coin de terre et le Foyer.

859. (C) To these can be added various associations of insurance against fortuitous cases, or involuntary cessation from labor; for since workers themselves often cannot pay the whole sum of money for protecting themselves against diverse dangers, it is certainly expedient that they be helped in this matter by the richer: this can be done in such a way that when they furnish such a sum of money, benefactors lavish another equal or even twice greater one.³ - In certain regions, as in Germany, insurance is prescribed by civil law, and a fund is constituted from which pensions can be paid to all workers who labor under disease or old age: to this fund the workers themselves, masters, and the State contribute a determined sum of money. This system indeed has been attacked by many as too much invading the rights of private persons; in reality, however, it has had rather happy effects;⁴ whence, in other regions, laws more or less similar to the law which prevailed in Germany are being prepared. Catholics can favor these, yet watching that excessive power not be conceded to the State, but that their rights be preserved for private societies and individuals.

³ L. Lefebure, Le Devoir social, Paris, 1890, p. 217-247; 292-297.

⁴ P. Pic, n. 1388-1391, 1394. - In the same place, n. 1392-1393, what has been established in other regions is set forth; and n. 1396-1397, what has been proposed in France concerning this matter. Cf. Salauin, Les retraites ouvrieres en Belgique, in Musee social, June 1901, July 1902; Ghio, Les retraites ouvrieres en Italie, Musee social, Dec. 1902; Lemire, Discours sur les Caisses de retraites ouvrieres; Les Questions actuelles, t. LIX, 1901, pp. 354, 386, 418; t. LX, 1901, p. 2, 72, 107, 112, 130; t. LXVII, 1903, p. 56-63.

A remedy cannot so easily be brought to involuntary cessation from labor (chomage force). Yet this brings many evils with it; for it hands over a valid worker to idleness and to all the vices which follow from it, deprives him of the means of honestly supporting himself and his own, and not rarely makes the same man a beggar, a wanderer, and a drunkard.¹ This miserable condition is sometimes alleviated by private charity, especially when not only alms are given, but labor to be furnished is also offered; or also by workers' associations, which furnish to their members a modest sum of money until they are hired;² or by those private or public institutes, by whose help workers can more easily be hired (bureaux de placement),³ without being compelled on this account to undergo useless expenses; and certainly it is greatly to be desired that institutes of this sort be multiplied among Catholics. But since, notwithstanding all these means, not a few are compelled to be idle from work, in certain regions a new form of insurance has been created, by force of which the fund is increased which workers' associations divide among members hired by no one.⁴ Likewise, in certain cities, subventions have been granted to these associations:⁵ this indeed can be expedient at a time when a special crisis flourishes; but, outside this case, it is certainly better so to order the production of things that the number of those who cease involuntarily from work may be diminished.

¹ Varlez, Les Formes nouvelles de l'assurance contre le chomage, Paris, 1903, vividly describes these evils, p. 13-15; and also the remedies, p. 23-265; cf. Rostand, t. II, p. 817-897; t. III, p. 609-626; Gide, Econ. sociale, p. 235-244; Crafts, Practical Christian Sociology, New York, 1896, p. 138-146.

² Thus in the periodical Bulletin de l'Office du Travail, June 1903, p. 485-488, there is set forth what the Federation of typographers furnished in this matter; cf. M. Lecoq, L'Assistance par le travail en France, Paris, 1900.

³ Le Bailly, Bureaux Municipaux de Placement gratuit, Paris, 1890.

⁴ On this read Varlez, op. cit., p. 23-71.

⁵ Varlez, p. 248-254.

860. 4. Catholic associations by which workers can be aided either in cultivating virtues, or in fulfilling the offices of religion. For the social question is not only economic, but also and chiefly moral and religious. For in vain will the wage paid to workers be doubled, in vain will the price of those things which are necessary for food or clothing be diminished, or the hours consumed in laboring be shorter, unless at the same time the proletarians are well-moraled, sober, chaste, honest, and religious. For if they waste their wage and time in feasts, drinking-bouts, games of chance, and other things of this sort, their condition will become more miserable than before.¹ It is necessary therefore that Catholics enter societies for preparing better things for the people, for solidly instructing the ignorant, for vigorously strengthening the weak, and confirming the unstable in faith; and also for converting those who have been alienated from the true religion, and for gradually drawing all who already believe to a more perfect practice of virtues and religion.

¹ Leo XIII sets this forth excellently, in the Encyclical Graves de Communi: "Grant that the wages of those who hire out their work are doubled; that there is also cheapness of provision: yet, if the wage-earner hears those doctrines, as he is accustomed, and uses those examples, which allure to casting off reverence for the Deity and to corrupting morals, it is necessary that even his labors and property waste away. By trial and use it has been perceived that most workers live narrowly and miserably who, although they have work of shorter space and more abundant wage, nevertheless live with corrupt morals and no discipline of religion. Take away from souls the sentiments which Christian wisdom inserts and cultivates; take away providence, modesty, thrift, patience, and the other right habits of nature: you will pursue prosperity in vain, even if you strive much. This plainly is the cause why We have never exhorted Catholic men to enter assemblies for preparing better things for the people, and to introduce other similar institutes, without at the same time warning that these things be done under the auspice of religion, with it as helper and companion."

In this matter it is necessary today that priests assume as cooperators certain upright and pious laymen, who burn with zeal for souls. For everywhere socialists, positivists, and rationalists with all their powers daily strive to scatter their errors among the people; and unless Catholic priests and laymen unite counsels, powers, and efforts, and provoke one another by fraternal emulation to furnish better things, it will be impossible happily to resist the associated powers of adversaries, and to lead back to the right path those wandering from the way of truth.

861. (A) It is indeed greatly expedient to erect confraternities, for promoting piety among those who already cultivate religion; for in our days it is necessary that some faithful lead a more intense Christian life, who can instruct and edify others by words and examples; now confraternities, which, under the auspice and as promoter of a devoted priest, are often gathered to hear pious exhortations and to render life more conformable to the Gospel, contribute not a little to this more perfect practice of virtues. Among these certainly excels the sodality of the Third Order of St. Francis, whose members closely approach the religious life, without however breaking the bonds of family; for the spirit of this order is this, that luxury and vain delights be despised, and the poor be loved as bearing the image of Christ.¹

¹ On this see the Encyclical of Leo XIII Auspicato concessum, Sept. 17, 1882.

(B) Nor must those societies be omitted which, while they promote the sanctification of the members, lavish on others alms not only corporal, but also spiritual. Such are the Societies of St. Vincent de Paul, which F. Ozanam happily instituted and propagated; for the members visit the poor, and furnish to them not only temporal food, but also the bread of the divine word and of human consolation. Today's socialists indeed attack alms as injurious to the inborn nobility of man, which certainly can be true when it is given from ostentation; but Christian charity, which loves and aids men as brothers, brings nothing indecorous before itself, but rather fosters true fraternity and solidarity: "For there is no man so wealthy that he needs no one; no one is so needy that he cannot profit another in some way: this is inborn, that men confidently ask and benevolently bear help among themselves."²

² Encyclical Graves de Communi.

862. (C) For announcing the word of God to those who have wandered far from the Catholic faith, popular institutes have been created (instituts populaires, universites populaires),³ in which there come together, for peacefully disputing about moral and religious matters, on the one side learned Catholics, and on the other, plebeians who have said farewell to the practice of religion or even to faith. These institutes indeed in our days seem altogether necessary: for there are many who never enter churches, and therefore never hear the word of God; unless therefore Catholics go to those sheep which have perished, it can scarcely be hoped that these will ever return to the sheepfold. Therefore laymen and priests who try to lead wandering sheep back to salutary pastures are worthy of every honor.

³ On these see Max Turmann, L'Education populaire, p. 61-110, where those things which have already been instituted by Catholics in this matter are described.

(D) But since one of the vices which today brings the greatest detriment to workers is intemperance, or the abuse of intoxicating drinks, societies instituted for promoting temperance are very opportune. "For excess of this sort is a perpetual tinder of sin, and a fecund origin of miseries; it buries countless men and whole families in the worst ruin, and drags very many souls headlong into eternal destruction."⁴ Hence, in certain regions, especially Great Britain and America, societies have been instituted, whose members abstain altogether from the use of intoxicating drinks. But in France and the Latin regions, in which almost all are accustomed to drink wine, beer, or other fermented liquors, societies have been created in which the members promise to abstain altogether from distilled liquors (liqueurs distillees), and to use fermented liquors, such as wine, moderately. Therefore let priests promote those societies which can be better adapted to the character of each region, and let them not omit to furnish a good example in this matter. By laws also the making and commerce of alcohol can be restricted; by education received in schools and family this vice can be diminished; against a scourge of this sort science, morals, the State, and Religion must fight without ceasing.¹

⁴ Third Plenary Council of Baltimore, n. 262. - On the extent and remedies of this abuse see M. Vanlaer, L'Alcoolisme et ses remedes, Paris, 1897; J. Bertillon, L'Alcoolisme et les moyens de le combattre juges par l'experience, Paris, 1904; Cyclopedia of Temperance, New York.

¹ On this we disputed more fully in Tr. on Sins, n. 550-555.

863. Points to be noted for practice. So that priests may act more prudently, before they institute new works, let them carefully inspect those things which in the same region have already flourished for some time, so that, taught by the experience of others, they may avoid rocks and proceed safely. - Moreover Catholic action, of whatever sort it may be, will obtain a happier effect, if all associations, with the rights of each preserved, are joined in one and the same federation.² But in any diocese, Catholic priests and laymen should remain subject to the authority of the Bishops: "Finally We again and more gravely admonish this, that whatever plan, in the same cause, either individual men or associated men undertake to be accomplished, they should remember that they must obey the authority of the Bishops entirely."³ In reality in many dioceses special councils have been instituted for promoting and directing Catholic action; and deservedly indeed: for to new times new means of apostolate must be accommodated.⁴

² Hence, in Italy, the Holy Pontiff ordered that all Catholic associations be directed by Catholic Congresses; and it is certainly to be desired that in other regions Catholic Congresses be often gathered, under the auspice and leadership of sacred Prelates, in which common action can be determined by certain general rules.

³ Encyclical Graves de Communi.

⁴ "If labor is not imposed upon us as a necessity of existence, let us know how to embrace it and to labor at social works, syndicates, mutualities, and other forms of beneficent action." (Card. Richard, Mandement for Lent, 1904, p. 10.)

By these and other means which zeal for souls, informed by prudence, will suggest, the condition of workers will certainly be rendered better, and gradually all things will be restored in Christ.

864. State of the question. After the things said concerning the lease of things and of services, it remains to speak of onerous loan, which by certain moderns is called the lease or quasi-lease of money, and by others the contract of credit.

¹ Among the almost countless works written on loan, the principal are: Gibalinus, De usuris, commerciis, Lyons, 1656; Bossuet, Traite de l'usure, 1682; Leotardus, Liber singularis de usuris, Lyons, 1682; Collet, Traite des usures, Paris, 1694; Thomassin, Traite du negoce et de l'usure, Paris, 1697; Broedersen, De usuris licitis et illicitis, Delft, 1743; P. Ballerini, De jure divino et naturali circa usuram, Bologna, 1747; Zech, Rigor moderatus doctrinae Pontificiae circa usuras, 1747 (Migne, Curs. Th., XVI, 763-996); Biner, Dissertatio juridica de usuris, 1766 (ibid., 996-1007); Card. de la Luzerne, Dissertations sur le pret de commerce, Dijon, 1823; Pages, Dissertation sur le pret a interet, Lyon, 1830-1838; Funk, Zins and Wucher, Tubingen, 1868; id., Zur Geschichte des Wucherstreites, Tubingen, 1901; Ashley, An Introduction to English Economic History and Theory, London, 1892; W. Blissard, The Ethic of Usury and Interest, 1892; J. Favre, Le Pret a interet dans l'Anc. France, Paris, 1900; H. Savatier, La theorie moderne du capital et la justice, Paris, 1898; Bohm-Bawerk, Capital und Capitalzins, rendered into French under J. Bernard's care: Histoire critique des theories de l'interet du capital, Paris, 1902-1903.

(A) Loan in general is a contract by which a fungible thing, or a thing consumable by first use (above, n. 121-122), is handed over to another on this condition, that, at the appointed time, a thing of the same species and quality be returned. - It differs therefore from commodatum, in which the same identical leased thing is returned, because it is not consumable by first use, but permanent; and also from lease of things, in which the lessor retains dominion of the leased thing, while in loan the dominion of the money is transferred to another; hence in lease the thing perishes for the owner, while in loan it perishes for the borrower (emprunteur), who is held to return a similar thing to the lender (preteur).

Loan, according to Roman civil law, is a contract of itself gratuitous, and under this respect it is also distinguished from lease, which is of itself an onerous contract (n. 779). But the question is whether loan can be onerous, namely whether the lender can justly receive, beyond the thing lent (which is called the principal), some gain, namely an increase or interest. This was formerly disputed with great heat among theologians and economists, and today also is frequently debated among sociologists.

865. (B) For understanding this better, certain notions must be set forth. (a) Today money is considered under a twofold respect: as a medium of exchange (moyen d'echange), insofar as by the help of money any thing whatever can be procured; as a medium of production (moyen de production), insofar as it is capital and an instrument by which new things are produced. Now ancient philosophers and theologians generally held money as a medium of exchange and a measure of saleable things; wherefore they called it sterile, because in reality under this respect it bears or produces nothing.¹ - But modern economists teach that money is not only the measure of saleable things, but also and chiefly a medium of production, insofar as it greatly contributes to producing new things; whence they say that it is virtually fruitful, insofar as it can at once be changed into fruitful things of any kind, and therefore is able to beget many things.

¹ Van Roey, De justo auctario ex contractu crediti, Louvain, 1903, p. 150-175; V. Brants, Les Theories economiques aux XIIIe et XIVe siecles, Louvain, 1895, p. 133-138.

(b) Wherefore loan can be industrial or commercial, when it is made for producing or distributing new things, namely when money is handed over to those who give themselves to industry or commerce for this end, that they may make something estimable by price; or a loan of necessity, when money is given on loan to the needy, so that from it they may procure for themselves the necessities of life. - Now in antiquity the loan of necessity mostly flourished, while today commercial loan is very frequently made.

866. (c) Moreover the increase or interest received from money lent can be moderate, if, with attention to the practice commonly observed by honest men of this place or time, it does not exceed just limits; or immoderate, if, with all things considered, it goes beyond the limits determined by the upright. Moreover in antiquity interest was not rarely immoderate, namely twenty, thirty, and sometimes fifty percent; while today, among cultivated Nations, it does not exceed five or six percent.

Today the word usury generally designates an immoderate increase; formerly it signified whatever was received beyond the principal, and therefore even moderate interest.

All these things indeed must be kept before one's eyes when ancient authors are read and the history of loan is sketched.

Since the matter is very involved, and the principal difficulties arise from history, we shall hand on a historical survey of this question, setting forth: 1. the doctrine of each Testament; 2. the theories of ancient legislators and philosophers; 3. the common doctrine of the Fathers and Councils up to the twelfth century; 4. the opinions of the Scholastics and the decisions of Councils up to the sixteenth century; 5. the principal systems of the moderns; 6. the doctrine of Benedict XIV and practical resolutions of the Congregations; 7. today's theories concerning loan; 8. the solution of the difficulty which seems more consonant with authority and reason at the same time.

I. The Doctrine Of Each Testament Concerning Loan Is Set Forth.

867. 1. Before Christ, under the Mosaic law, usury was prohibited to the Jews among themselves, but was permitted to them with respect to foreigners.

(A) It was prohibited to Jews among themselves, especially toward the poor and in an excessive way: "If thou lend money to my people, poor, who dwells with thee, thou shalt not urge him as an exactor, nor oppress him with usuries";¹ a little below: "Thou shalt not lend to thy brother at usury money, nor fruits, nor any other thing, but to a foreigner. But to thy brother thou shalt lend without usury that which he needs, that the Lord thy God may bless thee in every work of thine in the land into which thou shalt enter to possess it."² That this law was not accurately observed is gathered from the fact that the Prophets reprove usuries, and praise those who do not give their money at usury;³ wherefore, after the captivity, Nehemiah rebuked usurers thus:⁴ "And my heart thought with me, and I rebuked the nobles and magistrates, and said to them: Do you exact usuries, each one from your brethren?... The thing which you do is not good." - Now from the context it is sufficiently evident that, in all these places, the matter concerns a loan made to the needy, but not a commercial loan.

¹ Exod., XXII, 25; cf. Levit., XXV, 35-37.

² Deut., XXIII, 19-20; cf. XV, 7-10. - La Luzerne, op. cit., t. I, p. 211-284, shows at length that these texts do not regard commercial loan.

³ Ps. XIV, 5; Ps. LXXI, 14; Ezek., XVIII, 5-20.

⁴ Nehem., V, 7, 9.

(B) Onerous loan was permitted with respect to foreigners; this is certainly clear from the words related above: "Thou shalt not lend to thy brother at usury... but to a foreigner." This indeed is easily understood, if it is kept before the eyes that, under the Old Law, the Jews did not cultivate charity toward foreigners in the same way and to the same degree as among themselves.

From this, moreover, it can at once be gathered that moderate usury is not absolutely and intrinsically evil; otherwise it could not have been permitted by God even toward strangers. - Some indeed have said that this was permitted by force of the supreme dominion of God, as if, namely, he had given to the Jews the power of despoiling foreigners; but this distorted evasion does not please honest men: so unusual a derogation from natural right cannot be admitted without a solid reason.

868. 2. Christ himself handed down these things concerning onerous loan: (a) in the parable of the talents, the master thus speaks to the servant who had hidden the talent received: "Thou oughtest therefore to have committed my money to the bankers, and on my coming I would certainly have received what is mine with usury."¹ From this some wished to infer that interest from commercial loan is legitimate; but undeservedly; for here the matter concerns a parable, in which Christ sets forth what those who possessed money were accustomed to do in his time, without by that fact wishing to approve their manner of acting; he indeed does not reprove them, but neither does he intend to praise them, since the primary end of the parable is to show that those alone are to be rewarded who have used well the talents received from God.

¹ Matt., XXV, 27.

(b) Elsewhere, speaking of charity, he says: "But love your enemies; do good, and lend, hoping for nothing thereby; and your reward shall be great."² From this it is certainly gathered that one of the works of charity which obtain an eternal reward is gratuitous loan; but whether, and in what cases, it is commanded to lend money is not clearly defined, but must be determined from the rules concerning alms. But, as is clear, nothing is said about money handed on loan to the richer, and destined to produce new things; Christ by no means intended here to discuss industrial matters. - In the same sense he says: "To him that asks of thee, give: and from him who wishes to borrow from thee, turn not away";³ there likewise loan is enumerated among works of charity, and nothing is said about onerous loan, which therefore in the Gospel is neither approved nor condemned.

² Luke, VI, 35. - In the older Latin versions it is read: despairing nothing, that is, do not fear lest your money perish; - in the Syriac version: and do not cut off the hope of anyone, that is, do not cast anyone into despair by denying money to one in need. Cf. Fillion, Les SS. Evangiles, Saint Luc, in this place. - Some Fathers understood these words in this sense, that even the return of the principal itself ought not to be expected. (La Luzerne, t. I, p. 290-329.)

³ Matt., V, 42.

It must be noted that under the New Law no distinction is made between Jews and foreigners, but gratuitous loan is commended with respect to all.

II. The Theories Of Ancient Philosophers Concerning Loan.

869. Usury prevailed among most pagan peoples, and generally was approved by laws; but commonly it was reproved by the philosophers themselves.

1. Thus, among the Greeks, immoderate usury flourished: namely borrowers had to pay at least twelve and often thirty percent. Before the times of Solon, debtors who could not furnish interest were reduced to servitude; yet the wise Athenian legislator prohibited this,¹ although he permitted onerous loan.² - But the philosophers, by no means distinguishing between use and abuse, condemned all usury as alien to nature. Plato reproves it as contrary to the equality of citizens: according to him, to avoid seditions, it is necessary that there not be two orders of citizens, one very rich and the other very poor; therefore the means by which riches can easily be procured must be prohibited, especially certain forms of commerce and usuries.³ - Aristotle likewise, averse from every gainful exchange of money, condemns usury especially as contrary to the right of nature; for money of itself is sterile, because coin does not beget coin; nevertheless usurers wish to gain money from money, as if it were fruitful.⁴

¹ Schomann, Antiquites grecques, trans. by Galuski, Paris, 1884, t. I, p. 376-379.

² A. Boxler, Precis des Institutions publiques de la Grece et de Rome, Paris, 1903, p. 72.

³ Plato, de Legibus, V, 742.

⁴ Aristotle, Polit., l. I, c. 3, n. 23.

2. Among the Romans, by the law of the twelve Tables, unciary interest was permitted, that is, ten percent; from the time of Sulla, centesimal usury began to flourish, that is, twelve percent; not rarely, however, money-lenders demanded double centesimals, or twenty-four percent; when Christian emperors reigned, semisses usuries prevailed, namely six percent.⁵ - Yet Roman philosophers reproved usuries no less strictly than the Greeks; thus Cicero⁶ says that, according to Cato, to lend at interest is the same as to kill: "When he was asked what was most expedient in household property, he responded, to feed well... And when he who had asked said, what about lending at interest? Then Cato said, what about killing a man?" Likewise Seneca:⁷ "For what are these things, what are debt-book and calendar and usury, except names of human cupidity sought outside nature?"

⁵ A. Boxler, op. cit., p. 215.

⁶ De officiis, II, near the end.

⁷ Seneca, De Beneficiis, VII, 10.

These things indeed must be kept before one's eyes when the doctrine of the Fathers is weighed.

III. The Doctrine Of The Fathers And Councils Concerning Usury Up To The Twelfth Century.

870. 1. The Fathers generally held usury as something contrary to Christian charity, since in the Gospel it is commended and commanded to give money on loan to the needy, without any hope of gain; indeed, especially in the fourth and fifth centuries, since immoderate usuries were not rarely extorted from the poor, several Fathers openly denounced this as inhuman and unjust. Yet a few tolerated or permitted some moderate gain to be received from money lent. We shall declare this by setting forth certain places of the Fathers.

871. (A) In the first three centuries, the Fathers teach only that interest exacted from a needy person is opposed to the precept of charity and mercy.

(a) Thus, among the Greeks, Clement of Alexandria, speaking of the Mosaic law insofar as it is the source of all moral doctrine, commends its humanity from the fact that it prohibits exacting interest from brethren:¹ "But concerning largess and communication, although many things could be said, it suffices to say this, that the law prohibits lending at interest to a brother; naming as brother not only him who was born from the same parents, but also him who has been of the same opinion, and a participant of the same Logos; not judging it fair that we gather usuries from money, but that with open hands and souls we gratify the needy."

¹ Clem. Alex., Stromat., l. II, c. 18, Migne, P. G., VIII, col. 1023.

(b) Among the Latins, St. Cyprian,² in describing the corrupt morals of Christians, severely rebukes very many Bishops, "who ought both to be an exhortation to the rest and an example," and nevertheless, divine care having been contemned, increase interest by multiplying usuries. - But Tertullian,³ proving against Marcion that the New Testament does not contradict the Old, observes that the prohibition of usuries which is found in Ezekiel (l. cit.) prepared the way for the more perfect law which commends that the lender renounce the principal itself; for thus they interpret the words of Luke: hoping nothing thereby.

² St. Cypr., De lapsis, c. 6, Migne, P. L., IV, col. 470-471.

³ Adversus Marcionem, l. IV, c. 17, Migne, P. L., II, 398-399.

872. (B) In the fourth and fifth centuries, the Fathers inveigh much more strongly against usurers; and deservedly: for in these times usuries were sometimes carried even to fifty percent, and sometimes the children of those who could not pay interest were sold as slaves;¹ it is therefore not wonderful that usuries of this sort were reproved as inhuman and unjust.

¹ Troplong, Contrat de Pret, Preface, p. LXXXII.

(a) Among the Greeks, St. Basil has an entire homily against money-lenders,² in which he declares usury to be reproved by the Sacred Scriptures: "For in reality it is very great inhumanity, that he indeed who lacks necessaries seeks a loan for the support of life, while this one is not content with the principal, but devises revenues for himself from the calamities of the poor, and gathers riches."³ Afterwards he vividly describes the miserable lot of the borrower:⁴ "He who has received silver is at first indeed splendid and cheerful... but, when the monies gradually flow away, and time, advancing, brings interest with it, then nights bring him no rest, the day is not cheerful, the sun not pleasant, but life wearies him. He hates the days hastening toward the appointed time, he fears the months as parents of interest. But if he sleeps, he sees the money-lender in dreams, which is an evil dream over his head, standing by; but if he wakes, he thinks and is anxious about the interest." At the end, he rebukes the usurer thus:⁵ "You make gain from calamities, you gather silver from tears, you strangle the naked, you beat the hungry: nowhere is mercy." From these things it is established that the matter here concerns a loan furnished to those in need.

² In Migne, P. G., XXIX, col. 263-280.

³ Ibid., 266.

⁴ Ibid., 267.

⁵ Ibid., col. 279.

St. Gregory of Nyssa likewise has a whole oration against usurers,⁶ where, besides biblical arguments, he brings another philosophical one drawn from the sterility of money; God alone is so omnipotent that he can produce something from things by no means fertile: "But you, of bronze and gold, things not accustomed to bear, do not seek offspring, nor compel poverty to furnish those things which belong to the rich, nor him who seeks the principal to pay usuries."⁷

⁶ Migne, P. G., XLVI, col. 433-452.

⁷ Ibid., 442.

St. Chrysostom asserts that usuries are prohibited by Christ with respect to all, while in the old Law it was forbidden to exact them from brethren alone; and from this he extols the humanity of Christ: "And see the humanity of the Lord. In these sensible monies he prohibited anyone from receiving usury. Why and for what cause? Because each one is afflicted with great damage. For the debtor indeed is worn away by want, but the creditor, increasing riches, accumulates for himself a multitude of sins."⁸ - Proceeding further, he declares that those who oppress the poor with usuries are guilty of injustice:⁹ "Those who are commanded to open their treasures to the needy grow rich from the poverty of others, devising a specious robbery and a well-colored avarice... this is a bond of injustice... Are there not many just trades? Of fields, flocks, herds, manual labors, and skillful care of the household? Why do you rage madly so that you may reap thorns in vain?" - These words indeed are rather easily explained of immoderate usuries toward the poor.

⁸ In Genesim homil. 56, Migne, P. L., LIII, 377.

⁹ In Matth. homil. 56, Migne, P. L., LVII, col. 556-558.

873. (b) Among the Latins, St. Ambrose, in the book on Tobit, discusses usury at length,¹ which is a grave sin; for the money-lender hands over to the poor man money which is idle, so that he may receive more than he gave: "He seeks medicine, you offer poison; he begs bread, you extend a sword; he beseeches liberty, you inflict servitude; he prays for release, you tighten the knot of a shapeless snare."² There usury is reprehended as something inhuman.

¹ Migne, P. L., XIV, col. 762-794.

² Ibid., col. 763.

St. Augustine teaches the same, reproving every interest received from any thing whatever:³ "I do not wish you to be money-lenders, and therefore I do not wish it because God does not wish it... And how detestable it is, how hateful, how execrable, I think even the money-lenders themselves know... if you have lent at interest to a man, that is, have given your money on loan, from whom you expect to receive something more than you gave; not money alone, but something more than you gave, whether that is wheat, or wine, or oil, or any other thing; if you expect to receive more than you gave, you are a money-lender, and in this you are to be disapproved, not praised."

³ Enar. in psalm. XXXVI, Migne, P. L., XXXVI, col. 386.

St. Leo the Great calls unjust the manner of acting of those who oppress the poor with usuries: "Unjust and shameless avarice, which says that it furnishes a benefit, when it deceives... The iniquity of interest must be fled altogether: and gain which lacks all humanity must be avoided. Wealth is indeed multiplied by unjust and sorrowful increases, but the substance of the mind wastes away: since the interest of money is the funeral of the soul."⁴

⁴ Sermon XVII, al. XVI, in Migne, P. L., LIV, 181.

From these and other places, in which the same doctrine is contained, it can be gathered: (a) usury received from the needy is something inhuman and opposed to the precept of charity; (b) in certain cases, immoderate usuries exacted from the poor are truly unjust; (c) but nothing certain can be defined with respect to commercial loan, about which the Fathers are silent.

874. 2. At the same time, Councils first prohibited clerics from receiving usuries; then gradually extended this prohibition to laymen themselves; finally they asked from civil legislators that laws permitting usury be changed.

(A) Already among the Canons of the Apostles (fourth century) we read: "A bishop, or presbyter, or deacon exacting usuries from debtors, either let him desist or certainly be condemned."⁵ - The Council of Elvira (Eliberitanum, 305) also prohibits laymen from receiving usuries, although it acts more mildly with them than with clerics: "If any of the clerics shall have been detected receiving usuries, it has pleased that he be degraded and abstained. But if any layman is proved to have received usuries, and, corrected, shall have promised that he will now cease and will exact no further, it has pleased that pardon be granted him. But if he shall have continued in iniquity, he is to be cast out from the Church."¹ - But the general Council of Nicaea (325) treats only of clerics who were exacting centesimals (12 percent):² "The holy and great Synod judged it fair that, if anyone shall have been found after this definition receiving usuries... he be deposed from the clergy." - The provincial Council of Carthage (about 419) brought penalties against usurious clerics, at the same time reprehending usury in laymen; for it says: "What is reprehended in laymen ought much more to be condemned beforehand in clerics."³

⁵ Can. 44, in Mansi, Sacr. Concil. Collectio, Florence, 1759, t. I, p. 56. - Cf. La Luzerne, op. cit., t. III, 1st part, 256-386, where all the canons published concerning this matter are gathered.

¹ Can. 20, in Mansi, t. II, p. 10. - Yet not a few critics hold this last sentence suspect, since it is lacking in Ivo and the Panormia, Migne, P. L., CLXI, 805, 1167.

² Can. 17, in Mansi, t. II, p. 675.

³ In Mansi, t. IV, p. 494.

(B) Already from the eighth century the prohibition of usury becomes common even with respect to laymen; Aachen (Aix-la-Chapelle, 787): "In the law the Lord himself commanded that it be altogether forbidden to all to give anything at usury";⁴ likewise Paris⁵ (829) and Meaux⁶ (845). - Indeed, from the ninth century, certain Councils declare usurers to be subject to restitution: "If those from whom they exacted usuries survive, let them restore to these what they are proved to have taken more abundantly."⁷

⁴ Mansi, t. XIII, p. 825.

⁵ Mansi, t. XIV, p. 470.

⁶ Mansi, t. XIV, p. 831.

⁷ Mansi, t. XIV, p. 937.

At about the same time, namely in the age of Charlemagne, civil law, at the persuasion of the Church, prohibited usuries to all.⁸

⁸ "It is only at capitular legislation that one must arrive to find the abrogation of imperial laws on usuries and the agreement of Church and State for proscribing their use. The capitulary of Aachen of 789 (lib. 1, c. 5) forbids usuries to all without exception: Omnino omnibus interdictum est ad usuram aliquid dare. This prohibition is repeated in another Capitulary of 813 (lib. V, c. 38): Usuram non solum clerici, sed nec laici christiani exigere debent." (Troplong, op. cit., CX-CXI.)

875. 3. Although in these times no explicit distinction was made between immoderate usury and moderate interest, a few facts and testimonies are alleged from which it seems to be established that a moderate increase was tolerated or permitted. Thus Sidonius Apollinaris (430-488), bishop of Clermont, narrates that he went to a creditor named Maximus, to seek delays in favor of a friend burdened with debt; the creditor, who had been made a cleric, benignly granted the delays and forgave the usuries; Sidonius praises this act as a work of piety and mercy, and adds that the creditor had the right to receive the usuries, "since he could exact the whole," that is, the principal and increase, as appears from the context.¹

¹ Sidonius, Epistle 24, Migne, P. L., t. LVIII, col. 528-531.

876. Likewise St. Gregory the Great (540-604) asks Anthemius to go to a certain creditor, who had handed merchandise to another under the condition of some interest, and ask him to yield from his right, because matters had succeeded badly for the debtor, thus supposing some moderate gain to be legitimate: "Let him not expect gain from another's loss, but, the principal of the price having been received, let him be content, so that whatever he shall have yielded to the poor man, almighty God may compensate to him, as he has promised, by a multiplied restitution."²

² Epist. 38 to Anthemius, Migne, LXXVII, col. 973.

Likewise St. Gregory of Tours (538-593) narrates that Desideratus, bishop of Verdun, asked King Theuderic to lend some money to citizens engaged in business, promising that he would return the money with legitimate usuries: "We shall return your money with legitimate usuries."³ In reality the citizens traded with that money, and indeed with a happy outcome; but the king liberally refused the money offered. - From these things it seems to be established that a certain moderate interest was held as legitimate.

³ Histor. Franc., l. III, n. 4, Migne, P. L., LXXI, col. 267.

877. 4. Nevertheless, from the time of Gratian (1150), usury was universally prohibited: for Gratian, in his Decree, inserted those sentences of the Fathers and those Canons by which usuries are reproved in a general way.⁴ Afterwards Gregory IX, in the Decretals, promulgated an entire title De Usuris,⁵ where suspension is decreed against usurious clerics, and excommunication against laymen.

⁴ Decret. Grat., 2nd p., cause XIV, q. 3-4, p. 734-738, ed. Friedberg.

⁵ Decretal. lib. V, tit. XVIII, p. 811-816, ed. Friedberg.

IV. The Theories Of The Scholastics And The Decrees Of Councils Down To The Sixteenth Century.

878. For rightly understanding the doctrines of the scholastics concerning loan, it helps to set forth the opinion of St. Thomas, whom nearly all the others followed.⁶

⁶ St. Thom., 2. 2., q. 78; Quodlibet III, art. 19; De Malo, q. 13, art. 4.

1. Doctrine of St. Thomas. (A) "To receive usury for money lent is, according to itself, unjust."⁷ To prove this, he asserts, after Aristotle, that money was principally invented for making exchanges, and thus the principal use of money is its consumption; he treats therefore of loan destined for consumption, not for commerce. This being posited, he thus proves his thesis: (a) If interest is received for money, that which is not is sold, namely the use of the thing which is not distinguished from the thing itself; or, in other words, a double compensation is demanded for the same thing: one indeed, the restitution of an equal thing; but another, the price of use, which is called usury; this is unjust. For, in consumable things, the use of the thing ought not to be counted separately from the thing itself, but to whomever the use is conceded, by this very fact the thing is conceded; if therefore, besides the principal, some interest is demanded, the use of the thing is unjustly sold, as if it were distinct from the thing itself; just as he would act unjustly who, after he has sold wine at a just price, would wish again to sell the use of the wine separately. (b) Besides, money, which principally is a medium of exchange, is sterile, and therefore nothing can be received for its use.

⁷ St. Thom., 2. 2., q. 78, a. 1.

879. (B) But by accident some gain can be received from money lent: (a) "If someone conceded coined money for display or for placing in the place of a pledge; and man can licitly sell such a use of money."¹ For then money is not destined for consumption, but for another use, from which gain is legitimately received. (b) "He who gives a loan can without sin draw into an agreement with him who receives the loan the recompense of damage by which something which he ought to have is withdrawn from him; for this is not to sell the use of money, but to avoid damage."² Behold the origin of the extrinsic title which afterward was called emergent damage. (c) "He who commits his money either to a merchant or to a craftsman by way of a certain partnership does not transfer the dominion of his money to him, but it remains his; so that the merchant trades with it, or the craftsman works with it, at his risk; and therefore thus he can licitly seek a part of the profit proceeding from it, as from his own thing."³ Or, in other words, he who enters a contract of partnership with a merchant and craftsman, lending money so that this man may trade or work with it, licitly receives some gain, because he retains dominion of the money and undergoes the risk of the principal.

¹ St. Thom., 2. 2., q. 78, a. 1, ad 6.

² St. Thom., 2. 2., q. 78, a. 2, ad 1.

³ Ibid., ad 5.

880. 2. Decrees of Councils. These things having been set forth, the Canons of the Councils of this time can be better understood. For since in the Middle Ages industry and commerce did not greatly flourish, money was handed on loan, at least for the most part, not for producing new things, but for consumption, to the needy, and often with the greatest increase (15 and 20 percent):¹ whence it is not wonderful that usury was strictly prohibited. Thus the Third Lateran Council (1179) says that usuries are condemned by the pages of each Testament, and strikes usurers with excommunication.² Lyons II (1274) besides prohibits houses from being leased to foreigners wishing to hire them for exercising usuries.³ But Vienne (1311), after renewing the excommunications formerly laid down, also condemns the error of those who pertinaciously assert that usury is not a sin: "If anyone shall have fallen into that error, that he presume pertinaciously to affirm that to exercise usuries is not a sin, we decree that he is to be punished as a heretic."⁴ It is not there defined whether usury is a sin against justice or against charity, whether against the natural law or against positive law. Nor likewise is it declared what usury is; but afterward, in the Fifth Lateran Council (1515), this notion was handed down, which can be accommodated to the definition of the Council of Vienne: "This is the proper interpretation of usuries, namely when from the use of a thing which does not germinate, with no labor, no expense, or no danger, gain and fruits are studied to be acquired."⁵ Wherefore he does not exercise prohibited usuries who receives gain from a thing which is fruitful, or is exposed to some danger of the principal. - Around the end of the sixteenth century, Sixtus V reproves "the gulf of usuries, hateful to God and men, condemned by the sacred canons, and contrary to Christian charity."⁶

¹ "From the twelfth to the fourteenth century, in France and England, on the part of the Lombards and Jews, the rate of 20 percent is cited. Philip IV of France fixes the maximum interest at 20 percent, and lowers it to 15 percent for the fairs of Champagne." (P. Leroy-Beaulieu, Traite, t. II, p. 148.)

² Mansi, t. XXII, p. 231.

³ Mansi, t. XXIV, p. 99.

⁴ In Denzinger, n. 407.

⁵ In Denzinger, n. 623.

⁶ Bullar., p. 4, t. 4, p. 263.

881. Many indeed of today's writers turn it into a fault for the Scholastics and Councils that they were ignorant of economic laws and, by the prohibition of usuries, retarded the progress of industry and commerce. - We observe first that the error of which they are accused is not moral, but economic; for they thought that money was sterile, and from this inferred that no interest could be received from money lent according to itself: this principle is true, if money really is altogether sterile. Besides, the error of fact which is attributed to them can easily be excused. For money in itself is truly sterile, and is not made fruitful except when it is turned into fruitful things. Now in the Middle Ages it was very difficult, because of the economic conditions of that time, to turn money into fruitful things: namely, lands could scarcely be procured, because of the system which they call feudal; industries were local and reserved to workers' associations; commerce was exercised only by a few, namely Jews and Lombards; it is therefore not wonderful that money was commonly held as sterile.¹

¹ "With a very narrow market, without powerful equipment and without active industry, when great enterprises were reduced to the construction of churches and feudal fortresses, productive employments of money were lacking. There was scarcely place, at least in the twelfth century and almost still in the thirteenth, except for loans for consumption... The fixity of feudal property and the general immobility of conditions even excluded what we call today employments in immovables." (J. Rambaud, Histoire des doctrines econ., p. 39.) On the state of industry and commerce, and also on the economic doctrines of the Middle Ages, cf. W. J. Ashley, An Introduction to English Economic History and Theory, London, 1892-1893; Ch. Jourdain, Memoires sur les commencements de l'Economie polit. dans les ecoles du Moyen Age (Mem. Acad. Inscr. et B. L., t. 28, 1874); L. Cossa, Di alcuni studii recente sulle teorie economiche nel Medio Evo, Milan, 1876; Espinas, Histoire des doctrines econom., Paris, s. d., p. 72-119; V. Brants, Les Theories economiques aux XIIIe et XIVe siecles, Louvain, 1895.

Besides, if by this prohibition the Church in some way retarded the progress of commerce, she favored agriculture and also small industries, and contributed not a little to the dignity and happiness of workers. Besides, by the contract of partnership and other agreements of this sort, provision was sufficiently made for the evolution of industry, until the invention of machines gave rise to a new state of things, and to a new form of loan which is called the contract of credit.

882. 3. Mitigation of discipline concerning usuries. Already from the fifteenth century a milder discipline gradually began to flourish. (A) First indeed there were instituted Mounts of piety (Monts-de-piete, Funds of piety), in which monies and other fungible things were collected which were handed on loan to the poor, by means of some pledge and moderate increase. Now the Fifth Lateran Council (1515) solemnly declared that these mounts were licit and meritorious, "in which, for their expenses and indemnity, something moderate is received only for the expenses of the ministers and of other things pertaining to their preservation, as stated before, merely for their indemnity, beyond the principal, without the gain of the same Mounts." From this it also happened that wealthy merchants, especially Lombards, obtained from princes the license of receiving moderate gain from loan, as was done in the Mounts of piety. And thus provision was made for the necessities of the poor.

883. (B) Afterwards, even with respect to the rich, besides the contract of partnership (above, n. 879), there was recognized the contract of census, by force of which there was acquired the right of receiving an annual pension, first indeed from a fruitful thing alienated, then also from money handed over to another. Such a contract did indeed differ from loan, because money was handed over to another in perpetuity, on this condition, that an annual census (rente annuelle) be paid; but, when it was stipulated that the census would be redeemable, in reality that contract was scarcely distinguished from onerous loan. Wherefore it was reproved by Pius V (1569); nevertheless it was held as legitimate by not a few theologians and canonists.¹

¹ Thomassin sketched the history of this contract of census, op. cit., p. 453-471.

884. (C) Likewise extrinsic titles, from which interest can legitimately be received from money lent, began to be multiplied; namely, not only emergent damage was admitted (above, n. 879), but also ceasing gain, which namely is verified when the lender loses the occasion of gaining, insofar as with his money he wished to buy a census or fruitful field, or to trade licitly; and also danger to the principal, insofar as it is legitimately feared that the money lent may be lost.

(D) Soon by custom and civil law the practice prevailed, in the sixteenth century, of receiving moderate interest (5 percent), as distinct from usury; this indeed Pichler, S.J., acknowledged as legitimate on account of the public good. - Moreover, as opportunities for using money for trading increased, not a few theologians taught that it is permitted to any merchant to demand an increase for a loan, as the price of the obligation of lacking money for a certain time, even if in reality no gain ceased thereby.

885. (E) Likewise the triple contract was acknowledged by many as licit, so called because a threefold agreement was included in it: a contract of partnership, a contract of insurance of the principal, and a contract of insurance of gain. Namely Peter and John enter a partnership of trading, into which Peter contributes 1000 gold pieces, and John his works: Peter hopes from this to gain 200 gold pieces; behold the contract of partnership. But Peter, who does not wish the principal to be endangered, offers John 50 gold pieces so that he may insure the principal: behold the contract of insurance of the principal. But because he prefers a lesser certain gain to a greater uncertain gain, he sells to John the hope of gaining 200 gold pieces for 100 gold pieces: behold the contract of insurance of gain. When the trading has finished, therefore, Peter will receive 50 gold pieces. Now it is easily understood that by this manner of acting interest of 5 percent is received for money.

But the contract mohatra was deservedly reproved, by which, under the appearance of sale-purchase, immoderate usuries were received.²

² The contract is entered thus: Peter, needing one hundred gold pieces, wishes to borrow them from John; John denies the loan, but offers to Peter goods to be sold on credit at the highest price, e.g., one hundred and ten gold pieces, with the agreement that Peter immediately sell back the same goods to John at the lowest price, e.g., one hundred gold pieces; thus Peter indeed obtains one hundred gold pieces, but, after a year has elapsed, will return one hundred and ten.

V. The Theories Of The Moderns Concerning Loan.

886. 1. The theories of Protestants. The first defenders of onerous loan were Calvin and Molinaeus (Dumoulin), who had not a few followers.

(A) Calvin (1509-1564) taught that not every usury is a sin, but only that which is opposed to charity toward the miserable, or is opposed to justice, as demanding immoderate interest. For the texts of Scripture adduced above regard only Jews; but reason shows that usury is legitimate, because money is not sterile, but is virtually fruitful, insofar as fruitful things can be procured with it.¹ Oecolampadius, Viretus, and Rivetus followed him.

¹ He set forth his doctrines in Comment. ad Ezechielem, and in Epist. ad Oecolampadium; cf. Favre, op. cit., p. 127-129; Bohm-Bawerk, op. cit., t. I, p. 32-34.

(B) Molinaeus (1500-1566), a very celebrated Parisian jurist, asserted that money must indeed be lent to the poor without any interest, but that moderate usury is legitimately received from a loan granted to traders; for the public good requires that traders be able to borrow money; now they will not be able to obtain this unless they pay some increase.²

² Tractatus contractuum et usurarum redituumque pecunia constitutorum, 1546; cf. Favre, op. cit., p. 130-145; Bohm-Bawerk, op. cit., t. I, p. 34-38.

(C) Grotius contended that, by natural right, moderate usury is permitted, but confessed that it is prohibited by divine right.³ - Pufendorf held that it is permitted by both natural and divine right: "For although a coin does not beget another, nevertheless, after eminent price was conferred upon it, by means of the industry of men it is certainly rendered most fruitful, things naturally and civilly fruitful having been procured for it."⁴ - Salmasius (Claude de Saumaise, 1588-1658) judged that money can be leased, or that the use of money is saleable, just as the use of all fruitful things is: for money, like a field, is rendered fertile by human industry.⁵

³ De Jure belli ac pacis, lib. II, cap. XII, § 20-23; Commentar. in Lucam, VI, 35; cf. Favre, p. 158-161.

⁴ De jure naturae et gentium, lib. V, cap. 7, § 10; cf. Favre, p. 161-165.

⁵ Salmasius, De usuris, 1638; De modo usurarum, 1639; Dissertatio de foenore trapezitico, 1640; Diatriba de mutuo, 1640; cf. Favre, p. 148-153; Bohm-Bawerk, I, p. 41-47.

887. 2. The theories of economists. Many writers who gave themselves to political and economic matters generally taught that moderate usury is necessary - and therefore legitimate - for the public good, but especially for commercial affairs.

Thus Montesquieu (1689-1755) handed down that trading would be impossible without onerous loan;¹ Condillac (1715-1780) taught the same,² and Turgot, who besides added that money is fruitful, insofar as it is as it were capital, which greatly serves for producing new things;³ and also Bentham, who contended that the amount of the increase is to be defined not by law, but by the free convention of those making the agreement.⁴

¹ Montesquieu, Esprit des Lois, liv. XXII, ch. 19-22; cf. Favre, p. 216-220.

² Condillac, Le commerce et le gouvernement, ch. 18; cf. Favre, p. 224-226.

³ Turgot, Memoire sur les prets d'argent, presented to the Council of State in 1769.

⁴ Bentham, Defense of Usury, 1787, in French: Lettres sur l'usure, 1787; cf. Favre, p. 232-237.

888. 3. Opinions of certain theologians. Moved by these arguments, some Catholic theologians began to hand down a milder doctrine concerning usury; thus, among others, J. Gibalinus, S.J., who openly defended the liceity of the triple contract;⁵ - Maignan, of the Order of Minims, who acknowledges as licit the contract of committed money, "by which someone, retaining for himself dominion of property in his own money, and therefore the right to seek it back, hands it over for trading, not by his own work, but by another's work and industry hired for this, with an agreement of vindicating for himself one moderate part of the gain, to be determined by the judgment of prudent persons";⁶ - Le Correur, a Parisian priest,⁷ who distinguishes a twofold loan: one, by which a thing is given for consumption, another by which it is given for trading; now gain received from the former, as from a sterile thing, is usurious, but gain accepted from the latter is licit, because the thing is given for a use estimable by price; - Scipio Maffei, who teaches that usury is indeed unjust when gain is demanded beyond the measure determined by laws, or from the poor; but that moderate gain received from the rich, who seek a loan for amplifying fortune, is licit.¹

⁵ Gibalinus, De usuris, commerciis, deque aequitate et usu fori Lugdunensis, Lyons, 1656.

⁶ Maignan, De usu licito pecuniae, Toulouse, 1673, p. 42. P. de Calonia, of the same Order, taught almost the same, Eclaircissement sur le legitime commerce des interets, Lyon, 1676; cf. Carriere, III, n. 1114, note 1.

⁷ Le Correur, Traite de la pratique des billets entre les negociants, Mons, 1684.

¹ Maffei, Dell' impiego del Danero, 1744; in French: De l'emploi de l'argent, by M. le marquis de Maffei, Avignon, 1787. - Maffei had dedicated his book to Benedict XIV, but nothing shows that this dedication pleased the Pontiff; besides, after the Encyclical Vix pervenit had been published, he retracted nothing, but in the second edition declared that the doctrine of the Encyclical was by no means opposed to his theories.

VI. The Doctrine Of Benedict XIV And Of The Roman Congregations Concerning Loan.

889. 1. The Encyclical Vix pervenit. Since minds in the Church, and especially in Italy, were greatly moved by these various opinions and controversies, Benedict XIV instituted a congress of theologians for thoroughly weighing the matter, and promulgated their conclusions in the Encyclical Vix pervenit, Nov. 1, 1745, which he sent to all the bishops of Italy.² In this Letter, as he himself declares, he did not wish to decree anything concerning those contracts "about which Theologians and interpreters of the Canons go off into diverse opinions," but to establish certain doctrine concerning usuries. This doctrine is contained in five propositions, which we briefly contract.³

² There is much dispute about the doctrinal force of this Encyclical; for some hold that it is an infallible definition; but others, a doctrinal judgment of the gravest moment, but not infallible. To the point Vermeersch, S.J., n. 360, p. 458: "Observe, however, that this letter was sent only to the bishops of Italy. Long afterward indeed, July 29, 1836, the Holy Office, with the approval of Gregory XVI, seems to have declared in passing that the letter regards the universal Church. Yet this letter could not for that reason become an infallible definition. Wherefore we judge that there is in it the gravest authority indeed, but not the supreme." Likewise E. Van Roey, op. cit., p. 44, note 1, writes that it "is not an utterance ex cathedra, but rather bears as it were the form of a decree of some Congregation, approved indeed in a special and more solemn manner by the Sovereign Pontiff, and promulgated by his authority."

³ You have the text in Denzinger, n. 1318-1322.

1. Usury is placed in this, that someone from the loan itself, which by its nature demands that only as much be returned as was received, wishes more to be returned to himself than was received, and therefore contends that, beyond the principal, some gain is owed to himself by force of the loan itself: this is illicit and usurious.

2. Nor can usury become legitimate from the fact that the gain is moderate, or is demanded from a rich man, or from one who is going to spend the money for amplifying his fortunes, or for buying new estates, or for carrying on gainful business; by force of the loan itself nothing can be received, and if someone has received gain, he will be subject to restitution.

3. Nevertheless, extrinsic titles can concur with the contract of loan, from which a just cause may arise for demanding something more above the principal. - Likewise money can rightly be placed and spent through other contracts different from loan, whether for acquiring annual revenues for oneself, or also for exercising licit commerce and trading, and receiving honest gains from them.

4. In these various contracts equality must be preserved; otherwise injustice is committed and an obligation to restore is present; but with equality preserved, there remains a manifold licit way of preserving and frequenting fruitful trading for the public advantage.

5. It is falsely and rashly asserted that there are always found and everywhere available, together with loan, other legitimate titles, or other just contracts, by which it is permitted to demand a moderate increase beyond the principal. For in many cases a man is held by a simple and naked loan to succor another gratuitously, according to that:¹ "From him who wishes to borrow from thee, turn not away."

¹ Matt., V, 42.

890. 2. Controversies after the Encyclical. This letter did not impose an end on the dispute. Maffei, in a new edition of his work, said that he had taught beforehand whatever the Pontiff handed down, but had not taught whatever was reproved in it; - Fr. Grangier did not cease to defend the triple contract;² - De la Forest, parish priest of Lyons, contended that in a loan of trading usury is not admitted;³ - Beurrey, a priest of La Rochelle, said that money can be leased as a fruitful thing.⁴ At the beginning of the nineteenth century, two men chiefly contended that moderate interest can legitimately be received from commercial loan: Cardinal de la Luzerne, who sets forth that money can be handed on loan to another for a threefold end, for consumption, for conservation, or for increase: in the first case there is loan properly so called, from which usury cannot legitimately be received; in the second and third case, there is the contract of commercial credit, from which moderate interest is legitimately received;⁵ - Mastrofini, who tried to show that the faculty granted to the borrower of gaining something by means of the use of the money lent is estimable by price, and therefore a legitimate title for receiving some increase.¹

² Examen theologique sur la societe du pret a rente, Paris, 1741; this work was refuted by Lecoq, superior general of the Eudists, Dissert. theologique sur l'usure, Rouen, 1767.

³ Traite de l'usure et des interets, Cologne and Paris, 1769, 1776; this was refuted by P. Carpuac, Minor Conventual, Examen et refutation du Tr. de l'Usure, Avignon, 1779.

⁴ La question de l'usure eclaircie, Paris, 1786; this was attacked by Rougane, Les nouveaux patrons de l'usure refutes, 1789.

⁵ Dissertation sur le pret de commerce, Dijon, 1823; this was attacked by Bouyon, canon of Clermont, Examen du systeme de feu Mgr le Card. de la Luzerne sur le Pret de commerce, Clermont, 1826.

¹ Le Usure, Rome, 1831; this was refuted in the following works: Osservazioni pacifiche sopra di un'opera intitolata, Le Usure, Rome, 1834; Reponse au livre de Mastrofini, by Moralet, priest of the diocese of Annecy, Lyon, 1836; cf. Pages, Dissertation sur le Pret a interet, t. II, Lyon, 1838.

891. 3. Responses of the Roman Congregations. (A) Until the year 1830, the Sacred Congregations, when asked about loan, responded, according to the mind of Benedict XIV, that it is not permitted to receive an increase by force of loan, but only by force of an extrinsic title, namely by reason of danger to the principal, ceasing gain, and emergent damage. Thus, for example, in 1645, to the Chinese Missions it was responded: "By reason of loan, immediately and precisely, nothing is to be received beyond the principal principal; but if they receive anything by reason of a probably imminent danger, ... they are not to be disturbed, provided that account be had of the quality of the danger and its probability"; in the same place it is added that something can be received by reason of ceasing gain and emergent damage.²

² In Collectanea S. C. de Propag. Fide, n. 2118; ibid. n. 2119-2143 you will find the principal responses of the Congregations; cf. Bucceroni, Enchiridion, n. 853 sq., 863 sq.

892. (B) From the year 1830, the Sacred Congregations proceeded further: (a) the Holy Office, asked by the bishop of Rennes whether the manner of acting of confessors could be approved, who did not deny absolution to penitents receiving gain from money given on loan to traders, responded, Aug. 18, 1830, "that they are not to be disturbed"; (b) the Sacred Penitentiary, Sept. 16, 1830, declared that priests are not to be disturbed who contend that it is licit to receive an increase of five percent by force of the law of the Prince alone, without another title; (c) the same Congregation responded, Nov. 11, 1831, that a confessor acts more harshly and severely who denies absolution to penitents who received gain from loan by the sole title of civil law; (d) the Holy Office declared, Jan. 17, 1838, that penitents who received moderate gain from loan by the title of law alone in doubtful or bad faith can be sacramentally absolved, no burden of restitution being imposed. - We here submit the principal part of these documents.

893. Pius VIII, in the audience of the Assessor of the Holy Office, to the doubts of the Bishop of Rennes: - "The Bishop of Rennes in France sets forth to the Sacred Congregation of the Inquisition that the opinion of the Confessors of his diocese is not the same concerning gain received from money given on loan to traders, so that they may grow rich.

The sense of the encyclical letter Vix pervenit is sharply disputed. On each side reasons are brought forward to defend the opinion each has embraced, favoring such gain, or contrary to it. From this arise complaints, dissensions, denial of the sacraments to very many traders adhering to this manner of growing rich, and countless damages of souls.

So that they may meet damages of souls, some Confessors think they can hold a middle way between each opinion. If anyone consults them concerning gain of this sort, they try to deter him from it. If the penitent perseveres in the plan of giving money on loan to traders, and objects that the opinion favoring such a loan has many patrons, and besides has not been condemned by the holy See, more than once consulted concerning that matter; then these Confessors demand that the penitent promise that he will obey with filial obedience the judgment of the Supreme Pontiff, if it should intervene, whatever it may be: and, this promise having been obtained, they do not deny absolution, although they believe the contrary opinion to such a loan more probable. If the penitent does not confess about gain from money thus given on loan, and seems to be in good faith, these Confessors, even if they otherwise know that such gain has been received by him or is even now being received, absolve him, no questioning having been made about that matter, when they fear lest the penitent, warned, refuse to restore or to abstain from such gain. Therefore the said Bishop of Rennes inquires: I. Whether he can approve the manner of acting of these latter Confessors. II. Whether he can exhort other stricter Confessors approaching him for the sake of counsel, to follow their manner of acting, until the holy See should bring an express judgment on that question. - C. L. Bishop of Rennes.

On Wednesday, the 18th day of August 1830, our Most Holy Lord Pius, by divine providence Pope VIII, in the usual audience granted to the Rev. Lord Assessor of the Holy Office, the report of the above doubts having been heard together with the vote of the most eminent Lords Cardinal General Inquisitors, responded: To I. That they are not to be disturbed. To II. Provision has been made in the first."

894. The Sacred Penitentiary to the doubts of D. Denavit, Professor of theology in the Seminary of St. Irenaeus at Lyons: - "When doubts concerning the matter of usury are proposed to the Sacred Penitentiary, it always refers to the doctrine of the Supreme Pontiff Benedict XIV, which in reality is sufficiently clear and perspicuous for those who wish to investigate it in good faith.

Nevertheless there are certain Priests who contend that it is licit to receive an increase of five percent by force of the law of the Prince alone, without another title either of emergent damage or ceasing gain: because, they say, the law of the Prince is a legitimate title, since it transfers dominion of the increase just as it transfers dominion in prescription: and thus they utterly annihilate the divine law and ecclesiastical law which prohibits usuries.

Wherefore the undersigned Orator humbly begs that the following doubts be solved: I. Whether in conscience he can deny absolution to the aforesaid priests. II. Whether he ought to. - Lyons, May 25, 1830. Denavit, professor.

The Sacred Penitentiary, the proposed doubts having been diligently and maturely weighed, judged that it should be responded: The Priests of whom the matter concerns are not to be disturbed until the holy See has issued a definitive decision, to which they are prepared to submit themselves; and therefore nothing stands in the way of their absolution in the sacrament of Penance. Given at Rome, in the Penitentiary, on the 16th day of September 1830."

895. The Sacred Penitentiary to the new questions of D. Denavit, professor: - "To the Sacred Penitentiary the undersigned orator again sets forth: From the response of the sacred Penitentiary directed to the undersigned orator on Sept. 16, 1830, those priests are to be absolved who contend that the law of the Prince is a sufficient and legitimate title for receiving something beyond the principal in loan, without another title commonly admitted by Theologians, until the holy See has issued a definitive decision, to which they are prepared to submit themselves: and to this response I humbly and gladly acquiesce. Nevertheless, saving the aforesaid response of the sacred Penitentiary, approved authors having been consulted, and with attention to the doctrine of almost all the Seminaries of France, and especially of those which are directed by the priests of the Congregation of Saint Sulpice, the opinion which rejects the title of civil law as insufficient seems far more probable, safer, and the only one to be held in practice until the holy See has defined. Wherefore to the faithful who seek counsel from me whether they can receive an increase from loan, and who have no title commonly admitted by Theologians besides the title of civil law, I respond that they cannot demand the aforesaid increase, and I deny sacramental absolution if they demand it. Likewise I deny absolution to those who, having received usuries of this sort, that is by force of the title of law alone, do not wish to restore. It is asked: I. Whether I hold myself more harshly and severely toward the faithful of this sort. II. What manner of acting is to be held in practice toward the faithful, until the holy See has issued a definitive sentence. Lyons, Sept. 24, 1831. Denavit, Professor.

The Sacred Penitentiary, the doubts proposed by the orator having been weighed, responded: To I. Affirmatively: since from the response given by the sacred Penitentiary it is clear that faithful of this sort, who so conduct themselves in good faith, are not to be disturbed. To II. Provision has been made in the first: whence let the orator strive to conform himself in practice to the earlier response of the sacred Penitentiary under the date of Sept. 16, 1830. Given at Rome, in the sacred Penitentiary, on the 11th day of November 1831."

From these and other responses of this sort, the practical question is now solved, and moderate gain can be received in every case, until the Holy See shall judge otherwise, with the offices of charity nevertheless preserved, concerning which below; but the speculative question remains to be weighed.

VII. Today's Theories Concerning Loan.

896. They are reduced to three principal ones: of Socialists, Economists, and Theologians.

1. The Socialists, with Proudhon, Lassalle, and K. Marx, contend that no gain can ever be received from money; for since labor is not only the primary, but the unique source of value, the whole value which is produced belongs to the workers themselves; therefore the increase which is attributed to the capitalists is unjustly given to them, since it deprives the worker of a part of the value owed to him.¹ - Certain ones, however, admit that some moderate interest is legitimate so long as private dominion remains.

¹ V. Modeste, Le pret a interet, derniere forme de l'esclavage. Bohm-Bawerk sets forth and refutes this theory, t. II, p. 1-136; cf. G. Rambaud, Hist. des Doctrines economiques, p. 447-466. - Besides socialists, certain persons reject every increase received from money as illicit and contrary to the good of society: thus J. Moret, Du pret a interet ou des causes theologiques du socialisme, Paris, 1873; P. Lafleyre, Le Catholicisme social, Paris, s. d., t. II, p. 125-150.

897. 2. On the contrary, Economists who reject collectivism acknowledge not only the liceity of interest from money lent, but also its advantages and necessity, in the state of today's civilization, and proclaim this with one voice;² yet they greatly disagree concerning the reason why it is permitted to receive an increase.

² P. Leroy-Beaulieu, Traite, II, p. 83-108; Gide, Principes d'Econ., p. 487-490.

(A) Many say that the primary cause, or reason, why an increase can be received from money lent is the fruitfulness or productivity of capital and of money, which participates in the nature of capital when it concurs in producing new things. Namely three things concur for production: nature, or natural powers, - labor, and capital: for by means of money, machines, materials, and other things of this sort can at once be procured or made, from which human powers are multiplied and the productive force is increased a hundredfold. Now if money has no small part in the production of things, it ought to have a part in the gain.³

³ Thus chiefly J. B. Say, Traite d'Econ. Politique, Paris, 1803; Cours complet d'Econ. Pol., Paris, 1828-29; Lauderdale, An Inquiry into the Nature and Origin of Public Wealth, Edinburgh, 1804; Bohm-Bawerk sets forth and critically weighs this theory, t. I, p. 135-243; t. II, p. 248-268.

(B) But others say that by this fruitfulness of money the increase is not sufficiently explained, unless it be added that the increase is the remuneration of the use of money; for money is not productive of itself, but only from human labor; therefore not the money itself, but the use of money confers a right to receive some gain; namely he who uses money lent produces more than he could have produced alone; therefore he who handed money on loan has some right to a part of the things produced.⁴

⁴ Hermann, Staatswirthschaftliche Untersuchungen, 1870; Menger, Grundsatze; cf. Bohm-Bawerk, t. I, p. 244-343; t. II, p. 198-200.

898. (C) Yet this opinion did not please all; wherefore some devised another theory, namely that some remuneration is owed to capitalists because for some time they deprive themselves of things which they could enjoy, and voluntarily cede them to others so that these may be able to produce new things; and this privation, or abstinence, insofar as it contributes something to production, merits a certain recompense.¹ For he who voluntarily abstains from the enjoyment of some money, and cedes it to another, confers on this man an advantage, namely an opportunity of gaining something, which is estimable by price.

¹ N. W. Senior, Outlines of the Science of Political Economy, London, 1836; Bastiat, Harmonies Economiques, p. 188-211; cf. Bohm-Bawerk, t. I, p. 344-373; t. II, p. 200-230. Lassalle mocked this theory thus, Kapital und Arbeit, Berlin, 1864, p. 110: "The profit of capital is the wage of abstinence! Happy, inestimable word! The European millionaires are ascetics, Indian dervishes, canonized saints! They hold themselves on a column, pale of face, bent of body, arm extended to present the plate in which they gather the wage of their privations!" (In Bohm-Bawerk, I, 352.) These things are certainly witty; nevertheless money, of which capitalists deprive themselves for increasing production, profits others more than if it were uselessly consumed in pleasures.

(D) But others, thinking that the unique source of value is human labor, contend that an increase is nothing other than the price of previous labor; namely money, like capital, is as it were labor inserted into some thing and as it were frozen in it (travail cristallise); when therefore money is handed on loan, by that very fact some labor is furnished to another, which certainly is worthy of some recompense.² - Yet certain German writers propose this theory otherwise; for they say that the capitalist is as it were a minister constituted by society for producing goods, to whom therefore an increase is owed as the recompense of quasi-social labor.³

² J. Mill, Elements of Political Economy, London, 1821; M. Culloh, Principles of Polit. Economy, 1825; Courcelle-Seneuil, Traite d'Econ., Paris, 1858; cf. Bohm-Bawerk, I, 374-384.

³ Schaffle, Das gesellschaftliche System, der menschlichen Wirthschaft, 1873; Wagner, Allgemeine oder theoretische Volkswirthschaftslehre, 1879, I p.; Stolzmann, Die Sociale Kategorie in der Volkswirthschaftslehre, Berlin, 1896; - cf. Bohm-Bawerk, I, 384-394; II, 230-248.

(E) Some reject these theories as insufficient, and propose a new one, by force of which increase becomes legitimate from the difference which exists between present goods and future goods; namely present goods are worth more, other things being equal, than future goods; thus, for example, one hundred coins possessed here and now are deservedly estimated as worth more than one hundred coins which will be possessed only after a year has elapsed; wherefore he who here and now hands one hundred coins to another, on this condition, that they be returned to him after a year, in reality loses something if, after the year has elapsed, he receives only one hundred; therefore he has the right to obtain something more: otherwise equality is not preserved.¹

¹ Thus Bohm-Bawerk, t. p. 332: "Loan is a true exchange of actual goods for future goods... Actual goods possess a value superior to that of future goods of the same kind taken in equal quantity. Consequently and as a general rule, a determined quantity of actual goods can be acquired only with the help of a more considerable sum of future goods."

899. (F) Finally certain eclectics compose several of these titles together, so that they may more easily demonstrate the legitimacy of the increase. Thus P. Leroy-Beaulieu thinks that the principal foundation of a legitimate increase is indeed the productivity of money, but that at the same time the difference between present and future goods, and also the privation which the creditor suffers and the danger to the principal, and the advantage enjoyed by the debtor, contribute to this.²

² P. Leroy-Beaulieu, Traite, II, p. 83-94; cf. Bohm-Bawerk, II, p. 137-159.

From these things it can be gathered that the matter is sufficiently tangled, and therefore that ancient theologians cannot be censured without injustice because they were ignorant of the principles of today's economic science: they could not foresee the evolution of industry and commerce; besides, from the things said, the dispute is still under the judge.

900. Today's theologians, before the Code, held various opinions:

(a) Some, adhering to the footsteps of Benedict XIV, said that every gain received from loan itself by force of loan is unjust, but that moderate gain can very often be received by force of an extrinsic title, e.g., on account of a special danger to the principal, emergent damage, ceasing gain, or a conventional penalty.

(b) Certain ones, with Ballerini (n. 707-735), contended that an increase cannot be received from loan properly so called, but from the lease of money.

(c) Many also, after Lehmkuhl, thought that loan taken in the proper sense excludes the right to usury (1296), but today generally passes into the lease of a quasi-fruitful thing (1314).

Today, however, in practice one must stand by the solution which the Code exhibits, c. 1543, concerning which we must now speak.

VIII. Doctrine To Be Held And Practical Conclusions.³

³ F. Cavallera, in Semaine sociale, 1921, p. 71-76.

We shall speak: 1. on loan in general; 2. on pecuniary loan.

901. 1. On Loan in general the Code hands down these things (c. 1543): "If a fungible thing is given to someone in such a way that it becomes his, and afterward as much is to be restored in the same kind, no gain, by reason of the contract itself, can be received. But in the furnishing of a fungible thing it is not of itself illicit to agree concerning legal gain, unless it is established that this is immoderate, or even concerning a greater gain, if a just and proportioned title supports it."

It is explained and proved by parts.

(a) The matter concerns a contract by force of which a fungible thing, and one consumable by first use, either physically or morally, e.g., a cask of wine, is given into someone's dominion on this condition, that a thing of the same kind be restored in the same quantity, whatever name may be imposed upon this contract.

Now, by force of such a contract, no gain can be received.

1. It is established from natural right. For it is not permitted to someone to sell what is not his own. But the use of a fungible thing given to another so that it may become his and afterward be returned in the same quality and quantity does not pertain to the giver. Therefore the giver cannot receive gain from that use.

But the minor is proved thus. In a fungible thing, use is not distinguished from dominion; but dominion pertains to him to whom the thing has been given; therefore also the use. Cf. above n. 878.

2. It is established from ecclesiastical right, namely from the various documents which have already been adduced, especially from the Encyclical of Benedict XIV, Vix pervenit.

(b) Nevertheless, in the furnishing of a fungible thing it is not of itself illicit to agree concerning moderate legal gain.

It was indeed sharply disputed whether civil law, other titles failing, could render usury licit. Before the Code, the affirmative opinion seemed more probable and could be held in practice, especially from the response of the Sacred Congregation de Propaganda Fide, 1873: "Other titles of whatever sort failing... the one title of civil law also can be held as sufficient in practice."¹

¹ Collect. de Propaganda Fide, n. 2140.

But the Code declares as of itself licit an agreement concerning legal price, which is presumed just, unless it is established that the gain is immoderate; but it abstains from a formal explanation of this liceity.

Yet the reason seems to be the following, according to many. Civil authority can validly transfer the dominion of material goods from one to another by reason of the common good; but when some gain is determined by law on the occasion of the contract of which the matter concerns, it is presumed that a transfer of dominion from one to another is required for the common good, and this now becomes licit.

(c) Indeed, in the furnishing of a fungible thing, it is not of itself illicit to agree concerning greater gain, if a just and proportioned title supports it.

But what can be a just and proportioned title is gathered from the doctrine already commonly admitted, and confirmed by the Sacred Congregation de Propaganda Fide, in the year 1873, in these words: "Other titles of whatever sort failing, of which kind are ceasing gain, emergent damage, and the danger of losing the principal or of undertaking unusual labors for the recovery of the principal." Namely the matter concerns the privation of gain which the lender would have had if he had not given the loan, the detriment which the lender suffers in his own things by reason of the loan, the special danger of losing the principal or of undertaking extraordinary labors for the recovery of the principal. To these titles there is also added the title of conventional penalty, by which the borrower obliges himself to pay something by way of penalty, if he shall not have returned the principal at the appointed time.

Now, when these extrinsic titles are present, according to common estimation, the lender has a right to some compensation estimable by price, provided that it does not exceed just proportion.

2. On pecuniary loan.

The question concerning pecuniary loan is solved theoretically from the principles already set forth. But it can be asked whether today in practice a just title is always present for receiving gain. Now these things seem to us to be established.

902. (A) Today, on account of the peculiar economic conditions of society, money is virtually and truly fruitful.¹

¹ Antoine, ed. du Passage, p. 602-606.

The matter therefore concerns today's times, but not past or future ones, in which economic conditions can be plainly diverse. Nor do we contend that all money has been fertile at every time, but that today, because of special circumstances, it is virtually productive. For money of itself is sterile, because coins do not generate coins; but it can be called virtually fruitful, because today it can at once, and without any difficulty, be converted into fruitful things or fruitful uses. This aptitude for gainful uses does not depend on the special industry of the individuals using it, but inheres in money itself, as it is now generally considered. For it is very easily converted into fertile fields, houses from which a legitimate census is received, machines and instruments from which the productive force of labor is greatly increased. But if some persons do not wish to use their own money in this way, everywhere there are agricultural, industrial, and commercial societies which vehemently desire to render this money fruitful, for a moderate increase; nor are States, Cities, and Municipalities lacking, which earnestly solicit capitalists to be willing to commit monies to them, for moderate interest, for promoting the public good.

Nor should it be said that money entrusted is only the occasion, but not the cause of gain, which in reality is acquired from human labor alone.

It is indeed true that coins, without man's industry, remain idle and produce nothing of themselves, just as generally a field does not bear fruits without cultivation, nor does an instrument work anything without the hand of the craftsman. But the farmer who wisely uses money for cultivating lands better, the craftsman who with money lent obtains more perfect instruments, legitimately make a much greater profit, and indeed from those things which they have obtained by the help of money; therefore money is not only the occasion, but truly an efficient instrumental cause, at least partial, of this increase, and consequently can vindicate some right to a part of the profit.

903. (B) Since today money is virtually fruitful, it is permitted to receive from it moderate interest, provided that the matter does not concern a charitable loan (n. 905).

For he who hands money over to another to be used deprives himself, for a determined time, of the opportunity of making some gain, and confers an advantage on another, insofar as he furnishes to him the faculty of gaining something; or, in other words, on the part of the creditor there is ceasing gain, while on the part of the debtor there is an opportunity of increasing his revenues. Moreover these two things are something estimable by price, which merits some recompense. Formerly the title of ceasing gain occurred rather rarely; but today, given the virtual fruitfulness of money, it has become universal.

904. (C) The contract by which money is committed to another, under the condition of some moderate increase, is not properly loan, nor lease of money, but a contract of its own kind, which can be called the contract of credit.¹

¹ On this see E. Van Roey, op. cit., p. 219-297.

(a) It is indeed not loan, such as it was understood by the ancients; for according to them, in loan there was handed over a thing consumable by first use, which in no way was fruitful; while today there is handed over a thing which is virtually fruitful; hence in antiquity loan was of itself gratuitous, while today the handing over of money is not made except for some price.

(b) It is not lease of money, because in lease the thing is not alienated, but the same thing altogether is returned after some time; while in our case, money is truly alienated, and is returned only in an equivalent.

(c) But it is a contract of its own kind, which can be called the contract of credit; in reality it is already called by this or a similar name among those skilled in commercial affairs; and deservedly; for he who hands money over to another truly entrusts to him the use of his thing, on this condition, that after a determined time there be returned both a thing equivalent to the thing committed, and some recompense for the use of a thing virtually fruitful. - Nor is it wonderful that a new name is required for a new thing; now, given the change which has obtained a place in economic matters, a new contract, unknown to the ancients, gradually and insensibly has prevailed, which is subject to new rules.

And thus, unless we are mistaken, the apparent discrepancy between older and more recent theologians concerning this matter is very well explained. The ethical principles are the same today as in past centuries; but the economic conditions are altogether diverse. At the time when money was held as sterile, it was true to say that no increase could be received from money lent by force of the loan itself, but only by force of an extrinsic title. But today, since money has become virtually fruitful, it is no less true to say that from the contract of credit, by which it is handed over to another, some increase can legitimately be received, provided it is moderate.

905. 2. Practical conclusions. (A) In our days, as in the time of Christ, charity can demand that we succor a neighbor placed in grave necessity by the help of a gratuitous loan, namely when he cannot pay an increase, and besides we are able to do this without grave inconvenience. To the point Benedict XIV, cited Encyclical: "For this at least can be hidden from no one, that in many cases a man is held to succor another by a simple and naked loan, especially as Christ the Lord himself teaches: From him who wishes to borrow from thee, turn not away."¹ Ordinarily, however, the rich are not held to hand over great sums of money on loan to the poor, because of the danger of losing the principal, and they can imitate St. Francis de Sales, who was accustomed to give a small sum of money to the poor or to richer persons asking for a loan, and thought such a manner of acting to profit himself and others.

¹ Matt., V, 42.

906. (B) Outside these cases, it is permitted to receive moderate interest from credited money; indeed anatocism is not prohibited of itself, or an agreement by which interest due and not yet paid produces a new increase (capitalisation des interets).

Interest, however, will be moderate if it is proportioned to the danger to the principal, ceasing gain, emergent damage, and other circumstances of times and places, according to the common estimation of the upright. Wherefore, where there is a legal rate or one defined by custom, one must stand by this, unless there are special reasons for seeking something further, e.g., a greater danger of losing the principal. - Therefore those are to be reproved as guilty of injustice who abuse the need of others in order to extort immoderate usuries.

Today, among cultivated Nations, the increase is sufficiently moderate (4-6 percent) and gradually becomes less each year, especially when money greatly abounds, and besides wars do not arise in which it is uselessly consumed.¹ And it is certainly to be desired that the increase decrease still more; for thus those who lack wealth, and besides enjoy talent, skill, and activity, by borrowing money, will be able to produce new things, not only for their own utility, but for promoting the good of the Republic.

¹ On the causes which chiefly influence the diminution of interest, P. Bureau discusses ingeniously, La Diminution du revenu, Paris, 1893; cf. P. Leroy-Beaulieu, Traite, II, p. 109-182.

907. I. Notion and species. 1. The contract of partnership is that by which two or more bind themselves to contribute some thing in common, so that the gain which can arise from it may be divided among them in equal proportion.

² Lugo, disp. XXX; Billuart, diss. V, art. 3; St. Alphons., n. 904-910; Carriere, II, 851-900; Marc, lib. IV, n. 401-426; Ball. P., n. 884-891; Genicot, n. 651-652.

Therefore two elements are found in it: (a) some thing placed in common, which can be either money or some movable or immovable good, or also some work, industry, some commercial credit. A partnership can be entered in such a way that both together contribute money and work, - or one work and the other money; and indeed equally or unequally.

(b) Some gain to be divided among the partners (societaires); this is the intended end, namely that some advantage be received and divided: this can be either money, or the use of some thing, or an intellectual or moral benefit. It is not necessary that in fact some gain be received, but it suffices that it can probably be received. But if there are losses, the partners equally and likewise ought to undergo them.

908. 2. Today partnerships are countless, and are ruled by various rules among diverse nations.¹ - We shall set forth those which are more received.

¹ For France, cf. Cod. commerc., a. 18-64; Boeuf, Resume de Droit Commercial, Paris, 1903, p. 26-108; Baudry-Lacantinerie et Wahl, De la societe, du pret, du depot, Paris, 1898.

(A) Partnership can be universal or particular: the former contributes in common all present goods and all profits, or only all profits afterward to be made; but the latter contributes certain determined things, or their use, or the fruits to be received from them, or a determined trading. This is much more frequent than universal partnership.

(B) But particular partnerships are some civil and others commercial: the former are indeed entered for making gain, but in another way than by trading; e.g., for buying and cultivating estates, for building houses, for instituting and administering colleges, etc.; but those are called commercial which give themselves to trading.

(C) Under another respect, partnerships are: (a) designated by a collective name,² when two or more partners act under a common personal name (raison sociale), so that each one is held personally and in solidum for all the debts of the partnership; thus, e.g., Desclee, Lefebvre and associates; (b) anonymous, when the partners do not act in their own collective name, but in the name of the partnership (Banque de France, Credit Lyonnais), so that they are not held for debts beyond the portion of capital which they contributed or ought to have contributed.³

² For France, Cod. Commerc., a. 19-28; Boeuf, p. 37-70.

³ For France, see law of July 24, 1867, and Aug. 1, 1893; Boeuf, op. cit., p. 70-80; Houpin, Traite general theorique et pratique des societes civiles et commerciales, 3rd ed., Paris, 1901.

909. II. Principles. The offices of partners, whether among themselves or toward others, must be defined both from civil law, and from the special statutes of each partnership. Wherefore we can hand down only general principles.

1. On the obligations of partners toward the partnership. (A) Any partner ought honestly and integrally to transfer to the partnership all those things which he promised to contribute (apports), whether the matter concerns money or things, or industry and work; otherwise, he commits injustice and is held to restore the damage inflicted. If money was promised, and was not handed over, legal increase is owed.

(B) Partners cannot act in the name of the partnership itself, and bind it, except under the conditions determined by law, statute, or custom; likewise they cannot use things proper to the partnership except in the predefined way. If, contrary to laws and statutes, they involve themselves in the administration of the partnership, they act in their own name and bind themselves, but not the partnership.

(C) Administrators must manage the affairs of the partnership as their own, with at least common diligence, and therefore adequately compensate damage arising from culpable neglect.

910. 2. On the obligations of partners among themselves. (A) The partition of gains must be made according to the laws of equity, that is, proportionately to those things which any partner has contributed to the partnership, with attention not only to money and things, but also to industry and work furnished. But gains are computed after expenses have been deducted; wherefore there is also made a partition of losses proportionately among the partners, if these surpass the gains. Yet in many partnerships, losses are limited to the part which has been contributed in common: thus especially in anonymous partnerships.

Generally this proportion is determined by law and particular statutes, and one must stand by it in conscience, unless it is manifestly unjust. Thus a convention would be unfair by which one of the partners is altogether excluded from gain; but if someone is altogether exempted from loss, although he has a part in gain, there is not a partnership properly so called, but another contract, by force of which he who furnishes work will obtain an aleatory part in the gain.

(B) No partner can convert common money to his own uses: for this pertains to the partnership itself, but not to the individual partners, before partition. Wherefore, if any gain has been taken from the common fund, it must be restored without delay, with legal increase; besides, the damages inflicted on the partnership on this head must be compensated, as was said concerning the unjust damager and possessor in bad faith.

911. III. The principal ways by which injustice is committed in partnerships, especially anonymous ones.¹ Today frequent injustices are committed in the institution and management of partnerships, especially anonymous ones, which it is expedient briefly to enumerate, not only so that confessors may bring a fair judgment concerning them, but also so that those who transact business with these partnerships may be more cautious.

¹ Cf. Cl. Jannet, Le Capital, la Speculation et la Finance, Paris, 1892, p. 167-188.

1. In the institution itself of partnerships, (a) not rarely the founders attribute to themselves a part of the gains which greatly surpasses those things which they contributed to the partnership, namely by greatly exaggerating the value either of the things which they placed in common, or of the industry and work which they furnish or promise to furnish; it is certainly fair that those who have devised some undertaking and by their industry have formed the partnership receive some recompense, either in numbered money, or by the concession of rights which are called founder's shares;¹ but in all these things it is not permitted to exceed that which, all things considered, is held by honest men as a fair retribution.

¹ To the point Jannet, op. cit., p. 167: "Founder's shares (deferred shares, as they are called in England), are in themselves very legitimate, and, under this form, there is nothing to object to the levies of founders: they represent the legitimate remuneration of the conception of an affair. But these levies are effected most of the time under the form of increasing contributions in kind, such as immovables, patents of invention, clienteles." In the same place he brings examples, and adds: "In ten commercial or industrial affairs put into shares, the public lost more than 84 million!"

(b) When the capital of these partnerships is increased, often administrators retain for themselves a part of the money subscribed by private persons, and apply only half the part for increasing the resources of the partnership (which is called watering the stock, mettre de l'eau dans le capital):² from this it happens that the revenues of the partners are unjustly greatly diminished. - This also frequently occurs when two or more partnerships are joined together at the same time to constitute a new one, or to form what they call a trust.

² "Other times an already existing company increases its capital, under the pretext of extending its affairs, without a proportional increase of profits being the consequence; this is called, in America, putting water into the capital." Cf. Nettleton, Trusts or Competition, p. 54-56; Martin Saint-Leon, Cartells et Trusts, p. 119, 124-129.

912. (c) Sometimes also a partnership is instituted with capital plainly insufficient for managing the matter prosperously; a little afterward, when the partnership is now tending toward ruin, the founders, either through themselves or through others, institute another partnership, which at a cheap price procures all the resources of the prior partnership, to the great detriment of those who had contributed monies to it.³

³ Cl. Jannet, op. cit., p. 168.

(d) Bankers (banquiers) are likewise guilty of injustice, who cooperate in instituting these partnerships, by issuing and selling shares and obligations at a price which they know to be greater than fair;⁴ directors of newspapers,⁵ who receive money for extolling the value of these partnerships, when they foresee that readers, deceived by these writings, will suffer damage from this.

⁴ Ibid., p. 168-170; cf. Cauwes, Econ. Politique, t. II, n. 651-655.

⁵ "When in March 1888, L'Assurance financiere put up for subscription, at the price of 250 fr. each, 100,000 savings bonds, the treaty passed between M. Boulan and M. Xau, publicist, fixed at 2,850,000 fr., that is, 28 fr. 50 per title or 11 fr. 40 per 100, the expenses of publicity." (Jannet, op. cit., p. 171.)

913. 2. In the management of partnerships not a few frauds likewise are committed: -

(a) To capture the confidence of the people, political men or nobles are put in charge of these partnerships, who cannot or do not wish to give time and work to the business of the partnership, whether because of inexperience, or because they are already preoccupied with other business:¹ deceived by the authority of these names, not a few adhere to the partnership and not rarely lose part of the money committed.

¹ "Senators and deputies of the right, of the left, of the center throw themselves upon financial companies as upon prey: the title of former minister is worth a place as president of an administrative council: the common run of deputies and senators simply becomes administrator. There are indeed two or three hundred in this case, seeking to cut out for themselves some sinecure rather thin by the direct profits it gives, but which one hopes ought to be more productive by indirect profits, premium issues, participations in syndicates." (P. Leroy-Beaulieu, in Jannet, op. cit., p. 176.)

(b) Sometimes also the same men apply themselves to the management of various partnerships, and unjustly favor one before another.

(c) Frequently also the partners are deceived by a fraudulent exposition of affairs: in the earlier years gains are distributed which in reality have not been made (dividendes fictifs), so that thus new partners may be drawn to procure shares or actions at a greater price; this being done, a little afterward, the partnership suffers bankruptcy.

By these and other frauds of this sort, injustice is committed, and damages unjustly inflicted must be fairly compensated. - Therefore let priests act cautiously in judging concerning these matters, and not imprudently induce their parishioners to adhere to such or such a partnership, on the pretext that the president has merited well of the Catholic religion: for experience establishes that certain persons have been deceived by the shadow of a great name. Let them warn the same persons besides not to contribute money to those partnerships which are opposed to religion or good morals: for then they are made cooperators in the evil performed by those partnerships.

914. Aleatory contracts, so called from the die (coup de de), are those in which that which is given or promised by one or each contracting party depends on an uncertain event. - For sometimes uncertainty exists only with respect to one contracting party, - as in insurance, in which one pays a certain thing, while the other obliges himself to repairing an uncertain damage; but sometimes what must be furnished by each depends on chance, as in gaming. - But the event can be uncertain in a twofold way, either because it is future, or because it is unknown, although present or past.

From this it follows that an aleatory contract differs much from a conditional one: for the latter does not exist unless the condition has been fulfilled, while the former is firm and absolute, although it is uncertain whether or which of the contracting parties ought to furnish something.

The principal aleatory contracts concerning which we must treat are: 1. insurance, in which for a certain price a right is acquired to compensation for possible damage; 2. gaming and wagering, in which a certain price is attributed to the victor; 3. stock-exchange speculations, which approach gaming, insofar as they bring a determined or indetermined gain to one of the contracting parties and damage to the other.

915. 1. Notion, origin, and liceity. (A) Insurance is a contract by which one person, for a certain price, obliges himself to compensate damages which another can suffer from an involuntary case. - He who takes upon himself the obligation of compensating damage is called the insuring party or insurer; but the other is called the insured.

¹ Lugo, disp. XXXI, n. 93-103; Carriere, III, n. 951-1011; Lehmk., n. 1131-1135; Ball. P., n. 933-937; Genicot, n. 656-658; - for French civil law: Alauzet, Traite general des Assurances, Paris, 1844; Agnel and de Corny, Manuel general des Assurances, Paris, 1900; - for America: J. W. May, The Law of Insurance, 4th ed. revised by Gould, Boston, 1900.

The matter of this contract can be whatever, on the one hand, is estimable by price, and, on the other hand, is subject to some danger. Thus ships and goods are customarily insured against the danger of shipwreck, buildings or movables against the danger of fire, crops against the danger of hail, fragile things against the danger of breakage, the integrity of members against mutilation, life against the danger of death, etc.

(B) A contract of this sort, almost unknown to the ancients, was instituted in modern times, and today among all cultivated nations has especially prevailed. In the fourteenth century, it was first introduced with respect to goods to be carried over the sea, namely when maritime commerce had already begun to flourish. In the seventeenth century, the first society of insurance against fires was founded in London (1684); in the eighteenth century, a society of the same kind was instituted in France;² in the nineteenth century, almost countless societies of this sort appeared everywhere and with respect to dangers of every kind.

² Sicard, L'ancien Clerge, t. I, p. 475-476, describes how Bishops in France instituted a certain kind of insurance, by prescribing collections in churches for bringing help to those who had suffered some damage from fire.

916. (C) In antiquity some theologians doubted concerning the liceity of this contract, because they feared lest it bear before itself something usurious; but today, its nature having been better inspected, its legitimacy is acknowledged by all, provided that the rules to be set forth below are observed. - Indeed there is no one who does not see its social utility. For it concerns the public good that damages which can occur from a fortuitous case be foreseen and forestalled; otherwise industry and commerce would often be retarded in their progress, and often also masters and workers would be led to the extreme of poverty and want; now, for forestalling damages of this sort, nothing simpler and more efficacious has hitherto been devised than that contract by force of which, by means of a modest price paid each year, a fund is instituted for compensating all damages fortuitously occurring. - Thus besides, the foresight and thrift of individuals is promoted, joined with the greatest security.

917. 2. Principles. In a general way one must stand by the laws and special statutes by which the mutual offices of the insurer and the insured are determined. Yet it helps to set forth certain general principles, by whose help the difficulties more commonly occurring can be solved.

(A) On the price to be paid. The price of insurance ought to be proportioned to the quantity and probability of the danger, according to the estimation of prudent persons. For the equality of this contract is placed in this, that, all things having been diligently weighed, there be a fair proportion between the probability and extension of the danger and the price which is paid by the insured, so that, from things commonly occurring, the insurance society, after all damages have been compensated, may receive some moderate gain. - But this proportion is determined according to statistics which today are sufficiently accurate; and, since besides there are many societies, not only national but also international, which freely compete in this matter, commonly the current price is legitimate. For, if the gain is immoderate, soon other societies will be stirred up which will furnish insurance against the same danger for a lower price.¹ But it would have to be said otherwise if all or most societies agreed together not to diminish the price. - Besides, when the price seems excessive, nothing prohibits mutual societies from being instituted, in which the insured themselves have a part in the gain received.²

¹ Wherefore that which Lehmkuhl says (n. 1135) rarely occurs: "For if those who have a part in the insurance society, after all expenses of administration have been deducted, are accustomed each year to have excessive gain, e.g., as it is sometimes said to happen, 20 percent and beyond, for the sum which they handed over for the sake of caution: this seems to me to exceed the limits of justice." - Besides, before a thing is declared unjust, it must be weighed whether these gains do not proceed from the great number of insured persons, from the skill of administrators, who wisely apply the money received to fruitful uses, and especially whether there is danger of losing all these gains, when a common calamity occurs, e.g., a fire in which the greatest part of a city is destroyed. Cf. Ball. P., n. 935.

² Astresse, Traite general des assurances mutuelles, Paris, 1901; Agnel and Corny, op. cit., n. 177-198.

918. (B) On the offices of the insured. The insured ought honestly and sincerely to declare the true value of the thing insured and all the dangers to which it is exposed. Otherwise there will not be proportion between the price which is demanded by the society and the danger which it takes upon itself.

(a) Wherefore, by natural right, the contract is void if, in declaring the danger of the thing insured, a notable circumstance is voluntarily kept silent, which, if known, would have prevented the contract from being entered; but if the circumstance is not notable, so that the contract would nevertheless have been entered, the contract is valid, but the insured is held to increase the price by reason of the danger. Hence also, if, after the thing has already been insured, the danger is increased, this ought to be candidly declared. - But often by civil law, or from special statutes contained in the agreement itself, the contract is declared void even when a circumstance of little note has been kept silent, or at least rescindable at the will of the insurer, and indeed in such a way that he can retain the price already paid, although he is not held to compensate the damage. Yet this, as being less consonant with natural right, does not oblige except after the sentence of a judge.

Thus, when the matter concerns life insurance (assurance sur la vie, life insurance), not a few of the insured deceive concerning their age, so that the price to be paid is diminished; then the price ought to be increased, so that the premium may be licitly received.¹ But if a disease has been kept silent, from which the danger of death is greatly increased, the error is substantial, and he who knowingly deceived the insurers not only loses the right to the money already paid, but also ought to compensate the damages which the society underwent from this. This indeed is true even when the insured has subjected himself to medical investigation, as is the custom: for he ought sincerely to set forth diseases known to himself, and candidly to respond to legitimate questions proposed by the physician.² - Yet, if, as the years pass, the health of the insured grows strong beyond expectation, the contract is made valid, because the contract is implicitly renewed as often as the price is paid and accepted.

¹ According to the statutes of certain societies, the insured can make a new declaration without losing his rights, provided he increases the price; but according to the statutes of others, he loses all his rights as soon as the fraud has been recognized. - For France, see Maire and Gellie, Manuel theorique et pratique de l'Assurance sur la vie, Paris, 1898; Agnel and Corny, op. cit., n. 258-468.

² Yet, in Germany and certain other regions, many societies declare in their statutes that they renounce the right of attacking the contract on account of false declarations, after it has already endured for five years; but not so in France (Agnel and de Corny, n. 360-376). As to Germany, see Ph. Huppert, Der Lebensversicherungsvertrag, Mainz, 1896.

919. (b) When error concerns the value of the thing, these things can be established, with attention to natural right alone: if each contracting party has erred in good faith, the contract remains valid, but, the error having been discovered, the value of the thing insured and the price to be paid ought to be diminished; if each knowingly and willingly agreed concerning the excess of value, the convention assumes the nature of a wager (gageure), concerning which we shall speak below; if the insured deceived the insurer, the contract is indeed invalid as to the excess of value, but it stands as to the true value of the thing, which therefore ought to be compensated, in the case in which the thing perishes: for the error is not substantial, and therefore does not void the whole contract. - If anything contrary is declared in the statutes, it does not oblige in the forum of conscience except after the sentence of a judge.

But the value ought to be declared as it is commonly estimated at the time the contract was entered; but if it has been diminished at the time when the thing perished, the insurance society commonly does not compensate damages except proportionately to the value then had, according to the estimation of arbitrators.

Wherefore if movables which had been insured have for the most part been sold, this ought to be declared so that the price and the owed compensation may be proportionately diminished. But if this declaration was not made, and therefore the price was not diminished, one must distinguish: if this was done fraudulently, restitution of all things is not owed, but only of those things which truly perished; but if this was done in good faith, the insured can retain whatever the society paid: for damage is not unjustly and voluntarily inflicted on it, since the same price had been paid each year.

N.B. From the things said above, where we treated the unjust damager, n. 477, he who voluntarily destroys an insured thing not only does not obtain a right to compensation, but ought to repair all damages unjustly inflicted. - But he who, in the case of a fortuitous fire, in no way tries to restrain the conflagration, is likewise guilty of injustice; for he ought to use ordinary diligence for protecting his own things; he is guilty a fortiori who prohibits others from extinguishing the flames.

920. (C) On the offices of the insurer. (a) The insurer ought to be equal to compensating all damages concerning which he is held: for to this he explicitly obliges himself. For this, however, it is not necessary that he possess a sum of money equal to all the goods whose danger he has taken upon himself, but only that he have as much as is probably required for compensating the damages which, from things commonly occurring, can happen: for it is plainly improbable that all the goods whose danger he has taken upon himself will perish at the same time.

Therefore societies act unjustly which take upon themselves more dangers than they can probably compensate, unless however they immediately reduce the danger to just limits by having recourse to societies of reinsurance, which, by means of some price, consent to undergo a proportionate part of the danger.

If the insurer is unequal to repairing the whole damage, the insured can rescind the contract and seek back the price paid, because he had not consented to the contract except for obtaining perfect security. - Hence also, if, after he has paid the price, the insured thing has perished, he has the right of pursuing full reparation of the damage by all legitimate means.

921. (b) The insurer ought to repair the whole damage truly inflicted on the thing insured, according to the conditions determined in the contract itself, and indeed as soon as morally possible after the thing has perished or has become worse: for he does not make his own the price paid by the insured, except by obliging himself to repair damages.

But what compensation is owed must be defined both from law and from the statutes expressed in the agreement. As to the time at which compensation ought to be furnished, the insurer can indeed wait until it is morally established that the damage was inflicted by a fortuitous case, but not by the fault itself of the insured or of his family; but he would act unjustly who, when this is established, under one or another pretext, deferred compensation, or compelled the insured without reason to present himself before a tribunal.

But when the damage has been inflicted from the grave fault of the insured,¹ or of his relatives - namely of those who are designated in the statutes of insurance - the insurer is not held to compensate it. But if it has occurred from the malice of others, the insurer ought to repair it, unless it has been established otherwise, yet with his recourse preserved against the unjust damager: for then the insurer succeeds to all the rights of the insured with respect to the author of the damage.

¹ If the fault is light or only juridical, the insured licitly accepts compensation, unless he is deprived of this right by the sentence of a judge, from the things said n. 475.

922. I. On gaming. 1. Here the matter does not concern gaming insofar as it is relaxation of the mind, or bodily exercise ordered to the recreation of the mind; but that in which those playing agree concerning a certain price to be handed to the victor as a prize.

Gaming can be threefold: aleatory, whose outcome depends altogether on chance, as in the game of dice; industrial, in which the event depends chiefly on the skill of those playing (billiard, or baseball); mixed, whose outcome depends partly on chance and partly on skill, as a game of cards.

923. 2. Its liceity. Honest gaming, in which only a relatively modest sum is exposed to the risk of chance, and to which those playing do not give themselves frequently or for long, but only for the sake of useful recreation, is altogether permitted by natural right. For, on the one hand, relaxation of the mind is licit in itself, indeed often morally necessary, - and, on the other, games in which no price at all is exposed grow languid. - But if the sum of money is notable relative to those playing, and especially if the game is played frequently and for long, sins of prodigality, imprudence, idleness, and sometimes drunkenness are committed, insofar as the victors rejoice in cups and the vanquished seek solace in wine. Moreover those who expose money necessary for the support of the family sin against charity and piety. - But it is chiefly to be feared lest a habit of gaming be contracted, and those playing, leaving honest labor, give themselves wholly to dangerous speculations; for immoderate gaming easily excites vain hope and an inordinate desire of gaining money without proportionate labor. Wherefore priests ought diligently to watch lest penitents or parishioners, especially the younger, become accustomed to these games.

924. But here we must inquire especially what conditions are required so that gaming may be immune from injustice. Now there are four principal conditions of this sort: -

(A) That those playing can freely dispose of the goods which they expose: for they cannot expose to the risk of chance things belonging to another, or things of which they do not have the administration, or money necessary for paying debts.

Wherefore (a) if someone in reality exposes another's money and gains, he can indeed keep the gain, as an industrial fruit; but if he loses another's thing, the victor, who certainly knows this, cannot retain it, but ought to restore it to the owner, although afterward he can seek compensation from him who was defeated, provided that this man is not unable to pay.

(b) Minors, or wives, or others under a guardian cannot expose in gaming except those sums of money of which they have free administration. Hence he who has won from them a great sum of money which they could not alienate cannot retain it, but is held to restore it.

925. (B) That the game be entered freely; otherwise there will not be true consent, and therefore no true contract of gaming. Hence: -

(a) He who plays with one half-drunk, or half-witted, or another who is incapable of full consent, ought to restore the gain received from him.

(b) If someone has been induced to play by grave fear, fraud, or another unjust means, he is not held to pay the money which he lost, because he did not furnish free consent; but if he himself came out victor, he is not held to restitution, because he inflicted no injury on the other. But he who used fear or fraud is held to restore that which perhaps he gained, because he inflicted injury on the defeated.

926. (C) That the laws of the game be honestly observed, namely by avoiding frauds and illicit arts; otherwise damage is inflicted, and he who has used fraud is held not only to restore the gain unjustly obtained, but also to repair the damage which he inflicted by depriving another of the hope of gaining something.

Yet certain stratagems in gaming, as in war, are permitted or at least tolerated by custom or rules, e.g., to simulate fear or confidence, so that the other may become more daring or more timid, according to the various opportunities of the game.

927. (D) That some equality be preserved among those playing; for if someone very skilled were to abuse the simplicity of another in order to draw out from him abundant sums, he would commit injustice.

But if someone, already of mature judgment, knowingly and willingly plays with another more skilled, he cannot complain, because no injury is done to one who knows and wills; likewise, if each player was ignorant of the greater skill or lack of skill of the other, but wished to try fortune, properly speaking no injury is committed; because in this case the matter is truly aleatory, and each in good faith consents to the damage which he can suffer.

N.B. In most regions, civil law neither approves nor acknowledges the contract of gaming; in others, certain games are prohibited as dangerous or as preparing a way for frauds: in which case, the law, as ordered to the common good, is to be observed even in conscience; if the game is explicitly declared void, the victor cannot retain the gain; otherwise, if it is held only illicit, the conditions set forth above nevertheless having been observed, he can.

928. II. On wagering (gageure, pari, betting). 1. Wagering is an aleatory contract by which two or more, contending concerning the truth of some thing or of some uncertain event, agree concerning some price which will fall to the victor.

2. Concerning the liceity of this contract the same must be said as concerning gaming, above, n. 923; one must altogether guard against the habit of easily wagering being contracted, especially when the price is relatively notable, since nothing more turns men away from honest and arduous labor, and nothing more efficaciously leads them into drinkings and drunkenness. This is especially true of the habit of wagering in public horse races; wherefore, in certain regions, this is prohibited by civil law, because of many abuses arisen from it.

Yet if wagering is done rarely, on account of an honest motive, e.g., as relaxation of the mind, or as a stimulus for investigating the truth of a thing or fact, and indeed concerning a licit or at least indifferent thing, a moderate price having been fixed, it is not illicit of itself.

929. So that this contract may be immune from injustice: (a) the prize must be equal on each side, unless however one of the contracting parties spontaneously and freely offers a price of greater value; (b) the event must be uncertain to each party; whence if one is truly certain concerning the event, he cannot licitly wager, unless he openly says that the fact is known to himself and the other nevertheless perseveres in wagering: for then this man yields from his own right, and is judged, under the appearance of wagering, to make a donation.

930. III. Lottery is an aleatory contract by which, a certain price having been paid, the right is acquired of obtaining some prize, if the lot favors. - This indeed is not illicit of itself, since that which has already been set forth concerning gaming and wagering can be said of it; but it easily draws toward many abuses, especially by exciting a vain hope of quickly growing rich without labor; whence not a few are found who abstain from almost everything in order to buy a lottery ticket. Wherefore in many regions it is wisely prohibited by civil law, or at least is permitted only with special license, on account of a grave motive.

931. So that a lottery may not be unjust: (a) there ought to be a fair proportion between the price paid and the hope of obtaining the prize, with attention both to the value of the prize and to the number of those competing. Hence it is not permitted to the owner or institutor of the lottery to gain much more than he could make in honest business, unless however it is known to all that the lottery was instituted for promoting some good work: in which case the lottery is nothing other than an occasion of giving alms, with a modest hope of gaining something.

(b) Every fraud in drawing tickets or in attributing the prize to the victor must diligently be avoided: for if equality among those competing is taken away, or the proposed prizes are diminished, injustice is committed.

932. 1. The nature of these speculations is briefly set forth. (A) The stock-exchange (Bourse, Borse, Stock-Exchange) is a place in which public revenues, shares and obligations of societies (actions, obligations, stock, bonds) are sold and bought, and also certain goods, such as grain, oil, wools, metals, etc. Whence a twofold Exchange is distinguished: the financial Exchange, where revenues and shares or obligations are sold, and the commercial Exchange, where certain goods are sold.

¹ Carriere, III, n. 1248-1266; Berardi, n. 938-940; Ball. P., n. 927-932; Genicot, n. 664-665; Deville, Les Operations de Bourse devant la conscience, Lyon, 1884; A. Tavernier, Traite elementaire des Operations de Banque et de Bourse, Paris, 1899; Courcelle-Seneuil, Traite theorique et pratique des operations de Banque, 8th ed., Paris, 1899; Courtois, Traite des Operations de Bourse, 12th ed., Paris, 1902. - On this we wrote more fully in French in the Supplement, p. 216*.

Now contracts entered in either Exchange are of two kinds: either for the present, or for a term (au comptant ou a terme). Concerning the former nothing special occurs to be said, since the rules set forth above concerning purchase-sale must be applied to them: for then certain rights or goods are bought or sold for ready money.

(B) Therefore the whole difficulty turns on contracts for a term; in these, securities or goods are bought or sold on this condition, that the price be paid after a certain time, e.g., on the first or fifteenth day of the month (which day is called the liquidation day), and indeed the price which on that day will prevail in the Exchange. Now, since a price of this sort is liable to perpetual changes, the contract is aleatory and is called a certain speculation, because each contracting party can gain or lose something, according as the price will be greater or less on the day of liquidation. But when this day arrives, securities or goods are generally not handed over, but only the difference between the price which prevailed in the Exchange on the day of purchase and that which prevails on the day of liquidation is paid to the victor.

The matter is declared by an example. On May 3, Albert buys from Augustus, for the price of 7000 francs, which he will pay on the fifteenth day of the same month, a revenue of 300 francs, confidently expecting the price at that time to be 7080 fr.; if the matter stands thus, Augustus will pay to Albert the difference, namely 80 fr.; but if the matter shall have stood otherwise, and on May 15 the price is 6950, Albert will hand to Augustus the difference, namely 50 fr.

934. (C) When the buyer sees that he will suffer some damage if he pays the difference, he can seek that the operation be extended, or deferred for fifteen days (se faire reporter a la quinzaine). For this, however, it is required that he find a third contracting party who, at the fixed price, buys the revenue and promises to cede it back at the same price after fifteen days, yet by means of some increase; and thus, if during that time the value of the revenue is increased, the buyer, far from losing anything, can receive some gain.

Thus, to take the same example, on May 15, Albert asks that the operation be extended to the end of the same month; therefore he asks Casimir that, for the current price 6950, he receive the revenue which on the first day of June he will cede back for 7025; for then, if in reality the revenue on the day of liquidation is worth 7080, Albert, far from losing 50 fr., will gain the difference between 7025 and 7080, that is, 55 fr.

935. (D) Sometimes also, so that the damage which the buyer can suffer may be limited, he can contract under the condition that the agreement is rescindable, provided that a certain determined premium be left to the seller (which is called marche a prime).

Thus Albert, in buying for 7000 fr. a revenue of 300 fr., can stipulate that he can renounce this agreement, provided that on the day before liquidation he yield to the seller a determined premium, e.g., 20 fr.; wherefore, if on the day before liquidation he foresees that the revenue will be worth only 6950, he can declare that he wishes the contract to be rescinded; and thus, in place of 50 fr., he will lose only 20 fr.

936. 2. Moral principles concerning stock-exchange speculations. (A) Operations of the Exchange, even for a term, are not of themselves unjust, provided frauds are avoided, and no more money is exposed to the risk of chance than the contracting party can pay.

For the speculations of which the matter concerns are nothing other than certain wagers concerning the increase or decrease of revenues or goods, and at the same time aleatory games, in which the victor receives some prize; therefore they are licit under the conditions set forth above. - Nor should it be said that these operations are illicit because they furnish a means of acquiring great riches without proportionate labor; for, so that someone may be able to enter contracts of this sort with sufficient security, he ought diligently and daily to inspect the state of industry, commerce, and the money market: for the perpetual changes which occur in the price of things arise not from fortuitous chance, but from various causes, which speculators ought excellently to know, unless they wish to rush into certain ruin. - Besides, it concerns the public good that there be certain men who, by the hope of gain, are drawn to investigating things of this sort; for thus the true price of a thing is more easily and safely defined, and provision is better made for the progress of industry and commerce.¹

¹ Concerning the utility of speculation as to goods, Cl. Jannet writes, Le Capital, p. 241-279, where, among other things, he says: "Operations for a term are indispensable to industry; it needs to count on deliveries of raw materials at fixed times and at determined prices in order to establish its cost prices... The market for a term is also in general rule favorable to producers; for it assures a constant outlet for their products. Without it, there would be long periods during which farmers would not find anyone to sell their products to or could do so only to local merchants inclined by the absence of competition to exploit them... Today, on the contrary, in Europe as in the United States, every owner is sure of being able to sell his products on the day he wishes and at a price in relation with the quotation of the regulating market." - He says almost the same concerning revenues, shares, and obligations: "If there were not sellers for a term, that is, speculators who hope at liquidation to procure the titles below the rate at which they sell them today, one would not find anything to buy on certain days. This was seen for the employments of the funds of savings banks, in May, June, and July 1890. Ready money did not suffice to furnish counterparts to the demands for revenue; the term - that is, the great speculators - alone could furnish the quantities demanded." (C. Jannet, op. cit., p. 358.)

937. (B) They are guilty of injustice who by deceit, fear, or fraud strive that the prices of securities be artificially increased or diminished, with their own gain and the damage of others. Thus they act, for example, who scatter false rumors concerning the prosperous or calamitous state of such a kingdom or such a society, so that they may deceive others and induce them to sell securities at a lower price or to buy them at a greater one;¹ likewise those who join together so that by any means, right or wrong, they may oppress societies hateful to themselves. For these are unjust means, of themselves apt to inflict damage on others; and the gain captured from this arises not from chance or prudence, but from fraud; but fraud ought to patronize no one.

¹ "The great players seek to make the event arrive, rise or fall, on which they have wagered: this is what constitutes stock-jobbing, and what makes its character absolutely culpable from the moral point of view. The bulls and the bears are organized into two parties which deliver fierce struggles to one another, by employing the most immoral means. False news spread in a low voice or special financial newspapers were the infancy of the art. - Today recourse is had to false statistics of production to influence prices." (C. Jannet, op. cit., p. 279-280.)

938. Corollaries. (a) Those who knowingly and willingly take upon themselves so many and such great aleatory affairs that they foresee themselves very probably going to be incapable of satisfying all their obligations, by that very fact are guilty of injustice; for they expose themselves to the danger of inflicting damage on others. - Thus also, with greater right, it must be said of those who expose to the risk of chance not only their own money, but also money committed to them by those who do not wish to be mingled in these speculations.

(b) But those who spend upon aleatory affairs resources necessary for feeding the family not only lack prudence, but also sin gravely against the charity owed to children.

(c) Moreover the custom of giving oneself to the games of the Exchange is very dangerous, both because of the excessive anxieties which it brings with it, and because of the danger of temporal ruin which it induces, and because of the acts of injustice to which it easily impels, and other evils which we described where treating gaming, n. 923.

(d) But speculations of this sort are forbidden to clerics, because they assume the nature of trading. Hence the Holy Office, April 15, 1885, declared that "according to the things set forth and with attention to the peculiar circumstances of the time, ecclesiastical persons are not to be disturbed if they bought or buy shares or titles of a money-bank, provided they are prepared to stand by the mandates of the Holy See, and abstain from any trading of the said titles, and especially from every contract which has the appearance, as it is commonly called, of dei giuochi di borsa"¹ (jeux de bourse).

¹ In Nouv. Rev. Theol., t. XXV, p. 604; cf. Ball. P., Tr. IX, n. 478.

And let these things suffice concerning contracts and the virtue of justice properly so called.

As to the virtues annexed to justice, elsewhere there is discussion of religion,² of piety,³ of observance,⁴ of truthfulness,⁵ of equity or epikeia.⁶

² On the Virtue of Religion.

³ On Various Obligations.

⁴ Ibid.

⁵ On Justice, where treating lying.

⁶ On Laws.

But others, according to St. Thomas, are the following: gratitude, which inclines to acknowledging and in some way compensating benefits;⁷ vindication, which inclines to rendering to the wrongdoer the penalty owed for injury;⁸ affability (comity, urbanity, civilite, politesse) which inclines to rightly ordering intercourse with one's neighbor in serious matters;⁹ liberality, which disposes man to rightly spending money.¹⁰ Concerning these see the Angelic Doctor, who discusses these virtues excellently.

⁷ St. Thomas, 2. 2., q. 106-107.

⁸ 2. 2., q. 108.

⁹ 2. 2., q. 114-116.

¹⁰ 2. 2., q. 117-118.