Sale of Goods

The obligations of the seller refer: a. to the thing to be sold; b. to manifesting the defects of the thing to be sold; c. to handing over the thing sold; d. to guaranteeing the thing sold.

589. As to the thing to be sold. 1. The thing physically or at least morally must be that which the buyer seeks; otherwise the sale is invalid because of substantial error, and the seller is guilty of injustice.

a. At least morally: for although the thing given is physically diverse from that which the buyer seeks, yet if morally it is the same, for example, if it is equally good and equally useful to the buyer for the end intended by him, the contract is valid, because saleable things are appraised according to moral estimation. Therefore a medicine physically different from that sought is validly and licitly sold, if nevertheless it conduces equally to the intended end as the one sought.

b. If therefore an artificial thing is substituted for the natural thing sought, for example, wine which is not from the vine, butter which is not from milk, the contract of itself is invalid; yet if things of this kind made by art are not harmful and are commonly sold, the contract is valid, provided the buyer did not expressly seek the natural thing and the seller diminishes the price according to the value of the thing sold.¹

2. The thing must be one's own, not another's: for, of itself, neither can the seller transfer a right in another's thing nor can the buyer acquire a right.

If another's thing has been handed over and the price paid, the buyer indeed does not acquire ownership of the thing, but the seller acquires ownership of the price, except in the case of eviction. But if recent laws establish that a buyer of another's thing, if he acted in good faith, with a few cases excepted, acquires ownership in the thing bought through the handing over of the thing,² one can stand by this disposition of law also in conscience:³ for civil power, by reason of the common good, in order to render commerce easier and more secure, can transfer ownership in another's thing bought.

3. The thing must be integral, not adulterated or mixed; therefore injustice is certainly committed when the mixture of merchandise is so great that, if it were known by the buyers, they would not buy the merchandise at such a price.

It is permitted to sell a mixed thing at the common price if the thing before the mixture is more perfect than that which is commonly sold, but after the mixture is not worse than it.⁴

The same seems to have to be said concerning those moderate mixtures which are commonly made by merchants and are well known by buyers, at least skilled ones, and yet they do not refuse to buy the merchandise at the common price.

¹ Cf. St. Alphonsus, n. 820; Ballerini-Palmieri III, n. 796; Lehmkuhl, Casus consc. I, n. 870.

² C.G. Section 932 ss.

³ Cf. Lehmkuhl I, n. 1113; Ballerini-Palmieri III, n. 752.

⁴ St. Alphonsus, n. 820.

590. As to manifestation of defects. Some defects are substantial, which make the thing to be sold either harmful or plainly or at least notably useless for the known end of the buyer; others are accidental, which make the thing neither harmful nor useless, but only less apt; likewise some are manifest, which are easily noticed by all, others hidden, which are not easily noticed generally.

1. The seller is bound to manifest substantial defects to the buyer not adverting to them, even if he is not questioned; otherwise the contract is invalid because of defect of consent, and the seller is bound to return the price.

2. If he is questioned about the defects of the thing in general or about some defect in species, the seller is bound to manifest even accidental defects, whether they are hidden or manifest; but if he does not manifest them, and more so if he hides them, he commits deceit, and therefore the contract is rescindable when the error gave occasion to the contract. On the contrary, when the buyer, with the defect known, would nevertheless have bought the thing, it suffices to diminish the price according to the defect.

3. If he is not questioned about defects, the seller is not bound to manifest accidental defects, not even hidden ones, even if they make the thing less useful; and the contract is valid and licit, provided deceit did not intervene and the price is diminished according to the defect. But if the buyer is so unskilled that he does not see even manifest defects, he must be warned about all of them.¹

¹ The positive laws almost agree with these things: C.A. Section 871 s.; C.G. Section 459 ss.

591. As to the handing over of the thing. 1. He is bound to hand over to the buyer the thing sold in that state in which it was at the time of sale, and indeed at the time, place, and mode concerning which agreement was made between the contracting parties; and if agreement is lacking, according as is determined by civil law or received custom. Otherwise the buyer has the right of rescinding the contract and requiring reparation of damages.

2. He is bound to guard the thing sold until handing over as a depositary; wherefore if the thing suffers damage from the fault of the seller, he is bound to repair the damage to the buyer, and indeed before the sentence of the judge if from theological fault, after the sentence of the judge if from juridical fault. But if the thing suffers damage by chance, according to the diverse time at which ownership passes to the buyer, the thing perishes sometimes to the buyer, sometimes to the seller.

3. The fruits of the thing sold and not yet handed over pertain to him who is its owner, for whom therefore it bears fruit, just as he himself of himself must bear its danger.

If the same thing is successively sold to two persons and is handed over to the second buyer, a distinction must be made according to the diverse time at which ownership is transferred. If ownership was transferred by the first sale, the second buyer cannot acquire ownership, and therefore the thing must be handed over to the first buyer; if ownership was not transferred by the first sale, the second buyer, if he is in good faith, acquires ownership by the handing over of the thing, at least by positive law; that is, the handing over of the thing constitutes a right in the thing, which overcomes the right to the thing of the first buyer. But the first buyer must be kept harmless by the seller.¹

¹ Cf. Lehmkuhl, Casus consc. I, n. 873.

592. As to guarantee. 1. The seller is bound to furnish the buyer security concerning the tranquil possession of the thing: for the seller acquires a right to the price on this condition alone, that the thing sold pass fully into the power of the buyer; but the thing is not fully in the power of the buyer unless it is guaranteed for the case of eviction.

To evict a thing means to take away a thing by winning it; eviction (Entwindung) is defined: the legitimate disturbance of the buyer from possession of the thing bought, which is claimed, either wholly or in part, by its true owner.

2. The seller is bound concerning eviction if the cause of eviction was not declared to the buyer; but if the seller knows no cause of eviction, he can agree with the buyer that he not be held concerning eviction. Yet this agreement is null in a seller of bad faith.

3. The seller is bound to furnish the buyer security concerning hidden defects of the thing, and therefore either to restore the price or to diminish it, according as was said above (n. 590).

593. Obligations of the buyer. 1. If the seller is ignorant of the value of his thing and intends to sell it below the just price, the buyer is bound to warn him or at least to offer the lowest price. Likewise if the buyer is ignorant of the value of the merchandise and offers a price greater than the just price, the seller must warn him; otherwise purchase-sale would be unjust: for neither can it be supposed that the seller wishes liberally to give the defect of the price or the buyer its excess.

2. He is bound to pay the price, and indeed at the established time if the time of payment was determined; if none was determined, when the merchandise is handed over. But if the price is not paid, the seller is not bound to hand over the thing; and if payment of the price is delayed beyond the time determined either by agreement or by custom, interest also must be paid.

3. He is bound to accept the merchandise, and indeed at the determined time if any was established; if none was determined, the contract must be committed to execution at once. Wherefore the seller has the right of requiring that the buyer at once accept the merchandise and pay the price.

Whether the practice of merchants is licit by which buyers who paid more than the just amount lose the right of recovering the excess. With fraud excluded, this practice is licit if the seller, to whom less than the just amount was paid by error, equally loses the right of requiring the defect, just as the buyer loses the right of recovering the excess: for on each side then there is equal danger of undergoing damage.

594. Notion. Price is the value of a thing expressed in money. The value of a thing is the common estimation of men concerning the thing in some region, which estimation depends especially on the utility which the thing brings to men. That price is called just which is considered to equal the value of the merchandise. Further, a threefold price is distinguished: legal, common or natural, and conventional.

595. On legal price. 1. Legal price is called that which is determined by public authority, by statute of the prince or magistrate.

a. Legal price is not divided into highest, middle, and lowest, but is mathematically determined and is presumed just, unless the contrary is established. Besides, today it is rarely any longer in use.

b. A private man who by knowledge justly acquired has learned that the legal price of the merchandise is shortly to be changed can without injustice sell his own things or buy another's at the current price, because the price is still just; yet he sins against charity if by this mode of acting, for the sake of his own gain, he inflicts grave damage on a poor person. But a public person, to whom it is not permitted to use with the damage of others knowledge which he has by force of office, can at most buy things necessary for his own use or sell his own superfluous things.

2. A law which determines legal price obliges in conscience and from commutative justice: for it is established by public power concerning an object which pertains to it, by reason of the common good, and it refers to exchanges.

Therefore he who, without a just title, sells a thing above the legal tax commits injustice and must restore the excess of the price to the buyers. Indeed frequently also he who sells a thing below the legal tax commits injustice, not indeed against the buyers, but against other sellers, to whom damage is inflicted in this way and must be repaired. For legal price is established not only in favor of buyers, but often also in favor of other sellers. Whether this has in fact been done by a law obliging in conscience must be gathered from the tenor of the law.

596. On common or natural price. Notions. 1. Common price is called that which is determined by the common estimation of men, and therefore which men commonly pay for some merchandise at a determined place and time.

2. Common price is not mathematically determined, but highest, middle, and lowest are distinguished: for the prudent estimation of men is not mathematically fixed and determined, but has a certain moral breadth.

a. How great the breadth of the common price is, or how great the distance between the highest and the lowest is, cannot be determined by one rule, since it depends on many and diverse circumstances. Generally, the price of a thing necessary for life has a smaller breadth, the price of a superfluous thing a greater breadth, and the price of a very rare and precious thing the greatest breadth.

b. For things which commonly serve the uses of life, the breadth of the just price between lowest and highest can ordinarily be determined according to this norm. If the middle price is 5, the lowest will be 4, the highest 6; if the middle is 10, the lowest will be 8, the highest 12; if the middle is 50, the lowest will be 45, the highest 55; if the middle is 100, the lowest will be 90, the highest 110. Yet extraordinary circumstances, such as an unexpected coming together of buyers in a particular case, for example, at markets, can bring it about that the highest price is notably increased.¹

c. The circumstances which ordinarily influence the saleable value of merchandise are chiefly abundance or scarcity of merchandise, abundance or lack of money, multitude of buyers and sellers, the mode of selling either in a small or in a great quantity, expenses, damages, dangers, and labors which commonly occur in acquiring and preserving merchandise: for their compensation is justly required. Which commonly occur: for on account of the expenses or labors of some singular merchant the price cannot be increased, because the expenses and labors of one person do not change the common estimation, which regards things commonly happening.

¹ Cf. St. Alphonsus, n. 804; Lehmkuhl I, n. 1117.

597. Principles. 1. When legal price is lacking, the common price must be held as just: for the common estimation indicates the saleable value which the thing has in that place.

Common estimation makes the price just, even if that estimation seems imprudent; hence among barbarous peoples gold or ivory can justly be exchanged for glass or cloths: for the common judgment among those peoples attributes great value to things which elsewhere are of very little value.¹

2. Since any common price is just, merchandise can be sold and bought within the limits of the common price without lesion of justice; but the price which exceeds the highest or does not reach the lowest must ordinarily be considered unjust.

a. Therefore he who sold a thing above the highest is bound to restore the excess, and he who bought a thing below the lowest is bound to supply the defect. In the external forum an action is conceded for rescinding sale both to the buyer and to the seller who has been deceived beyond half the just price.² From this statute of law it does not follow that a buyer or seller who deceives the other short of half the just price is excused from restitution in the internal forum.

b. It can happen that even a price which does not exceed the highest is unjust, namely where the seller by frauds or lies leads the buyer to giving a greater price than he would have given if he had not been deceived: for anyone has the right of requiring that he not be impeded by frauds from buying at the price which he would have wished to give and which is not unjust. Yet the lies by which merchants are accustomed to exaggerate the price of a thing are not considered true frauds.³

3. From a just title it is licit to sell a thing above the highest common price, or to buy below the lowest.

¹ Cf. Lugo, disp. 26, n. 42.

² C.A. Section 1060.

³ Genicot I, n. 633.

598. A title of this kind is had: a. If the seller from the sale or the buyer from the purchase suffers peculiar damage.

If someone in favor of the buyer immediately sells merchandise which he would have kept for another time when it would have had a greater price, he can require a price above the highest; and if someone in favor of the seller now buys a thing which he needs only when it will be of lower price, he can buy at a price below the lowest.

b. If the seller has a special affection toward the thing which he sells in favor of another: for the seller deprives himself of the pleasure which the thing affords him; but this privation is estimable by price, which can be required beyond the highest common price.

alpha. The common opinion with St. Thomas¹ denies that a greater price can licitly be required because the thing brings peculiar utility or pleasure to the buyer: for the seller would require a price for something which is not his. Yet among more recent authors there are some, Gousset, Schwane, Marres, Woffelaert, Genicot, who hold the contrary opinion as probable. Nor is this opinion wholly without reason: for he who, with no necessity compelling him, knowingly consents to a greater price is considered to give the excess of the just value. But today almost common use has this, that a thing which brings a peculiar convenience to the buyer is sold more dearly. Yet an exorbitant price is by no means permitted to be required.

beta. But all affirm that this is valid only when the buyer seeks from the thing to be bought nothing except convenience or pleasure; but that he commits injustice who requires a greater price for this reason, that the other needs this thing: for mere want and necessity, which compels the other to buying the thing, is not estimable by price, nor is the needy person considered to give the excess of the price.

c. If the seller of his own accord offers the thing to be sold, it is permitted to buy below the lowest price: for the value of a thing to be sold decreases the more, the greater the service which is furnished to the seller by purchase. Hence it is said by way of proverb: things voluntarily offered become cheap.

d. If payment of the price is delayed, the thing can be sold more dearly; and if it is anticipated, the thing can be bought more cheaply: for just as gain arises from anticipated payment, so damage arises from delayed payment.

Whether it is permitted to sell merchandise below the lowest common price in order to entice buyers, if in this way other sellers suffer damage.

a. This manner of acting of itself is repugnant neither to justice nor to charity, whether other sellers can procure merchandise for themselves at the same cheap price and sell it at the same price, or whether they cannot, provided frauds and lies are excluded. It is not repugnant to justice, because the sellers use their own right; nor to charity, since charity does not oblige with grave inconvenience, and therefore does not require that someone deprive himself of gain so that another not suffer damage.

b. If sellers who sell their merchandise below the lowest price with damage to others use lies or frauds, they act against justice and are bound to repair damage to the other sellers, if, for example, they adulterate merchandise or lessen weights and measures. It is clear that justice in this case is not injured against the buyers, if namely the price is diminished in the same degree in which the quantity or quality of the merchandise is diminished, but that it is injured against other sellers, from whom buyers are turned away by fraud.

¹ Cf. Summa II-II, q. 77, a. 1.

599. On conventional price. 1. Conventional price is called that which is determined by the free agreement of seller and buyer.

2. Those things have a merely conventional price which, since they are placed outside common commerce, have neither a legal nor a common price.

3. The conventional price of these things is just unless it is of plainly irrational greatness.

4. Very few things are had which can be bought and sold by a merely conventional price:

a. Works of exceptional art, as paintings drawn by a celebrated artist, or very precious things, as gems of extraordinary magnitude, or very rare things, as ancient manuscripts.

b. Cheap things or things already worn by use, such as are the things which are sold by dealers in old goods.

c. Things whose common value is equally unknown by each contracting party, concerning which nevertheless they are doubtful, so that each equally exposes himself to advantage or damage.

alpha. If the contracting parties in this case nevertheless agree concerning a certain price, they mutually condone to each other the excess or defect of the price; wherefore if the buyer afterward sells the thing with the greatest gain, by right he is bound to return nothing to the seller.

beta. From this case must be distinguished the case in which each contracting party, erring about the thing itself, buys a thing of great value at a slight price. Hence a contract is invalid by which someone buys at a cheap price a gem which each considered to be glass, or that by which someone buys at a slight price a precious image of a most celebrated painter which each contracting party thought to be a common panel: for there is substantial error.

If a precious thing is bought at a small price, judgment concerning the justice of the sale must be made thus: a thing is worth as much as it is commonly estimated.

alpha. If the true value of the thing is known by all skilled in the art, the sale is unjust, because the thing in common estimation has a greater value. But if the true value of the thing, either by chance or because of singular skill, is known only to the buyer or to a few others, but publicly is unknown in common estimation, the sale is just.

beta. If a thing cheap in common estimation after the sale is at last known, whether by the immediate or mediate buyer, to be precious, the purchase is just, and therefore neither the first nor the mediate buyer is bound to anything, but can retain the thing.

gamma. If the thing sold-bought is in itself altogether unknown, as being hidden in another thing bought, for example, a fish is bought from a fisherman, in whose belly a precious thing is found; or a garment is bought from a dealer in old goods, in which a precious thing sewn in is found; a thing which belongs to no one becomes the property of the first occupier, but a thing which has an owner is his; but if the owner is unknown, the thing is held as abandoned.¹

¹ Cf. Lehmkuhl I, n. 1120; Ballerini-Palmieri III, n. 773; Genicot I, n. 635; Sporer-Bierbaum II, tract. 6, n. 711 ss.

The term goods includes all personal chattels other than things in action and money. It also includes emblements, industrial growing crops, and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale.¹

A contract of sale of goods may be made in writing, or by word of mouth, or partly in writing and partly by word of mouth, or it may be implied from the conduct of the parties. If the value of the goods sold be ten pounds or upwards, the contract cannot be enforced by action unless the buyer accept part of the goods so sold, and actually receive the same, or give something in earnest to bind the contract or in part payment, or unless some note or memorandum in writing of the contract be made and signed by the party to be charged or his agent in that behalf. This is a rule of the external forum and does not affect the conscience.

¹ Sale of Goods Act, 1893.

The subject-matter of a contract of sale may be either existing goods, owned or possessed by the seller, or goods to be manufactured or acquired by the seller after the making of the contract of sale. The contract may be absolute or conditional. Whether a stipulation in a contract of sale is a condition, the breach of which may give rise to a right to treat the contract as repudiated, or a warranty the breach of which may give rise to a claim for damages but not to a right to reject the goods and treat the contract as repudiated, depends in each case on the construction of the contract, and in the forum of conscience on the intention of the parties. In a contract of sale, unless the circumstances of the contract are such as to show a different intention, there is: (1) An implied condition on the part of the seller that in the case of a sale he has a right to sell the goods, and that in the case of an agreement to sell he will have a right to sell the goods at the time when the property is to pass; (2) an implied warranty that the buyer shall have and enjoy quiet possession of the goods; (3) an implied warranty that the goods shall be free from any charge or encumbrance in favour of any third party not declared or known to the buyer before or at the time when the contract is made.

According to English law there is no implied warranty or condition as to the quality or fitness for any particular purpose of goods supplied under a contract of sale, except as follows:

1. Where the buyer expressly or by implication makes known to the seller the particular purpose for which the goods are required, so as to show that the buyer relies on the seller’s skill or judgement, and the goods are of a description which it is in the course of the seller’s business to supply (whether he be the manufacturer or not), there is an implied condition that the goods shall be reasonably fit for such purpose, provided that in the case of a contract for the sale of a specified article under its patent or other trade name, there is no implied condition as to its fitness for any particular purpose.

2. Where goods are bought by description from a seller who deals in goods of that description (whether he be the manufacturer or not), there is an implied condition that the goods shall be of merchantable quality; provided that if the buyer has examined the goods there shall be no implied condition as regards defects which such examination ought to have revealed.

But whatever may be the rules of law for the external forum, in the forum of conscience the contract will be invalid whenever on account of hidden defects the thing sold is substantially different from what the buyer thinks that it is, for then there is no consent in the same matter and the contract is void by natural law. If hidden defects only lessen the value of the thing, but do not make it substantially different from what it appears to be, the price should be accommodated to the value, but the seller is not bound to point out the defects to the buyer. If asked about them, the seller should make known even accidental defects, or say that he does not guarantee their absence. _

By law the price may be fixed by contract, or may be left to be fixed in manner thereby agreed on, or it may be determined by the course of dealing between the parties. If no price is thus determined, the buyer must pay a reasonable price, and what is a reasonable price is a question of fact dependent on the circumstances of each particular case,¹ In conscience, however, the price of things sold does not depend merely on the agreement of the parties. In contracts the equality which justice demands must be observed, and so in sale the price must be equivalent to the value of the thing sold. We do not mean the individual value in use to the buyer or to the seller, but the social or exchange value which the thing possesses. This value will be represented by what the law calls a reasonable price, and sometimes it is fixed by law, so that certain commodities and services have a legal price. In the Middle Ages there was a legal price for most of the articles of commerce, and theologians taught that there is an obligation in conscience to adhere to the legal price as long as the law is in force. In cases where the law has not determined the price, theologians teach that there is an obligation in conscience to adhere to the natural or common price of the commodity. This is not something purely subjective, much less is it purely individualistic; it depends upon supply and demand, upon the costs of production, the manner of sale, and on other factors. It is proximately determined by the common judgement or the common estimation of those who are best acquainted with all the factors which determine social value in the particular case. This is the famous theological doctrine of the just price of commodities, and it only needs to be properly understood to be appreciated as eminently practical and equitable. The just price of a commodity is not something which can be mathematically determined; it admits of a certain latitude, like everything that depends on a general moral estimate. Theologians distinguish the highest, the lowest, and the mean just price. The highest is that above which the commodity in question is not commonly sold, the lowest is that below which it is not commonly sold, and the mean is between the two. Justice will be observed if the price at which a thing is sold is not above the highest nor below the lowest at which the thing sells at the time and in the place in question. As a rule, market prices are just, because they are settled according to the common estimate of buyers and sellers as to what are fair and reasonable prices under the circumstances, Here theologians usually discuss a number of questions concerning the price of commodities in particular cases where there is special difficulty. In the case of rare or single objects, such as a first folio of Shakespeare, or a painting by a great master, or a winner of the Derby, where there is no market price, many theologians teach that no injustice is committed whatever be the price received from a buyer who acts with full freedom and knowledge. Fancy prices may be foolish, but they are not unjust. No difficulty is made by theologians in allowing one to sell at the current rate who has certain information of an imminent fall in price. A merchant may also buy things of value from uncivilized owners for trinkets. In the place and among the people concerned there is equality of value between merchandise and price. A seller is justified in asking a higher price—a price of affection the theologians call it—for what he cannot part with without more than ordinary pangs. The seller may not, however, charge for some special value in use which the thing sold has for the buyer. That belongs to the buyer, not to the seller, who cannot therefore sell it.

¹ Sale of Goods Act, 1893, sec. 8.

The following rules as to the transfer of property in the goods sold are given in the Sale of Goods Act, 1893: Where there is a contract for the sale of unascertained goods no property in the goods is transferred to the buyer unless and until the goods are ascertained. Where there is a contract for the sale of specific or ascertained goods the property in them is transferred to the buyer at such time as the parties to the contract intend it to be transferred.

For the purpose of ascertaining the intention of the parties regard shall be had to the terms of the contract, the conduct of the parties, and the circumstances of the case.

Unless a different intention appears, the following are rules for ascertaining the intention of the parties as to the time at which the property in the goods is to pass to the buyer: Rule I.—Where there is an unconditional contract for the sale of specific goods, in a deliverable state, the property in the goods passes to the buyer when the contract is made and it is immaterial whether the time of payment or the time of delivery, or both, be postponed.

Rule II.—Where there is a contract for the sale of specific goods and the seller is bound to do something to the goods, for the purpose of putting them into a deliverable state, the property does not pass until such thing is done and the buyer has notice thereof.

Rule III.—Where there is a contract for the sale of specific goods in a deliverable state, but the seller is bound to weigh, ‘Measure, test, or do some other act or thing with reference to the goods for the purpose of ascertaining the price, the property does not pass until such act or thing be done and the buyer has notice thereof.

Rule IV.—When goods are delivered to the buyer on approval or “‘on sale or return,” or other similar terms, the property therein passes to the buyer: (a) When he signifies his approval or acceptance to the seller or does any other act adopting the transaction; (b) if he does not signify his approval or acceptance to the seller but retains the goods without giving notice of rejection, then, if a time has been fixed for the return of the goods, on the expiration of such time, and, if no time has been fixed, on the expiration of a reasonable time. What is a reasonable time is a question of fact.

Rue V.—Where there is a contract for the sale of unascertained or future goods by description, and goods of that description and in a deliverable state are unconditionally appropriated to the contract, either by the seller with the assent of the buyer, or by the buyer with the assent of the seller, the property in the goods thereupon passes to the buyer. Such assent may be express or implied, and may be given either before or after the appropriation is made.

Unless otherwise agreed, the goods remain at the seller’s risk until the property therein is transferred to the buyer; but when the property therein is transferred to the buyer, the goods are at the buyer’s risk, whether delivery has been made or not.

Provided that where delivery has been delayed through the fault of either buyer or seller, the goods are at the risk of the party in fault as regards any loss which might not have occurred but for such fault.

As a general rule, the buyer acquires no better title to goods than the seller had, but where goods are sold in market overt, according to the usage of the market, the buyer acquires a good title to the goods, provided he buys them in good faith and without notice of any defect or want of title on the part of the seller.

Market overt in the country is only held on the special market-days provided for particular prescription; but in London towns by charter or every day, except Sunday, is Sale of Goods Act, 1893, secs. 16-18. 2 ibid., sec. 22. market-day. The market-place or spot of ground set apart for the sale of particular goods is also in the country the only market overt; but in the city of London every shop in which goods are exposed publicly to sale is market overt, for such things only as the owner professes to trade in. It is of the essence of the custom that the sale should be an open and public sale, so a sale in a salesroom and apart from the shop, or at a wharf, is not within it. Nor is sale by sample, the bulk sold not being exposed in the shop. Nor does the sale of horses come within the rule of market overt.

When the seller of goods has a voidable title thereto, but his title has not been avoided at the time of the sale, the buyer acquires a good title to the goods, provided he buys them in good faith and without notice of the seller’s defect of title.

Where goods have been stolen and the offender is prosecuted to conviction, the property in the goods so stolen revests in the person who was the owner of the goods or his personal representative, notwithstanding any intermediate dealing with them, whether by sale in market overt or otherwise.

Notwithstanding any enactment to the contrary, where goods have been obtained by fraud or other wrongful means not amounting to larceny, the property in such goods shall not revest in the person who was the owner of the goods, or his personal representative, by reason only of the conviction of the offender.

Where a person having sold goods continues or is in possession of the goods, or of the documents of title to the goods, the delivery or transfer by that person, or by a mercantile agent acting for him, of the goods or documents of title under any sale, pledge, or other disposition thereof to any person receiving the same in good faith, and without notice of the previous sale, shall have the same effect as if the person making the delivery or transfer were expressly authorised by the owner of the goods to make the same.¹

¹ Sale of Goods Act, secs. 23-25.

In execution of the contract it is the duty of the seller to deliver the goods, and of the buyer to accept and pay for them, in accordance with the terms of the contract of sale.

Unless otherwise agreed, delivery of the goods and payment of the price are concurrent conditions; that is to say, the seller must be ready and willing to give possession of the goods to the buyer in exchange for the price, and the buyer must be ready and willing to pay the price in exchange for possession of the goods.

Whether it is for the buyer to take possession of the goods, or for the seller to send them to the buyer, is a question depending in each case on the contract, express or implied, between the parties. Apart from any such contract, express or implied, the place of delivery is the seller’s place of business, if he have one, and if not, his residence, provided that if the contract be for the sale of specific goods, which to the knowledge of the parties when the contract is made are in some other place, then that place is the place of delivery.

Where, under the contract of sale, the seller is bound to send the goods to the buyer, but no time for sending them is fixed, the seller is bound to send them within a reasonable time.

Unless otherwise agreed, the expenses of and incidental to putting the goods into a deliverable state must be borne by the seller.

Where the seller delivers to the buyer a quantity of goods less than he contracted to sell, the buyer may reject them; but if the buyer accepts the goods so delivered, he must pay for them at the contract rate.

Where the seller delivers to the buyer a quantity of goods larger than he contracted to sell, the buyer may accept the goods included in the contract and reject the rest, or he may reject the whole. If the buyer accepts the whole of the goods so delivered, he must pay for them at the contract rate.

Where the seller delivers to the buyer the goods he contracted to sell, mixed with goods of a different description not included in the contract, the buyer may accept the goods which are in accordance with the contract and reject the rest, or he may reject the whole.

The provisions of this section are subject to any usage of trade, special agreement, or course of dealing between the parties.¹

Unless otherwise agreed, where goods are delivered to the buyer and he refuses to accept them, having the right so to do, he is not bound to return them to the seller, but it is sufficient if he intimates to the seller that he refuses to accept them.²

Notwithstanding that the property in the goods may have passed to the buyer, the unpaid seller of goods, as such, has by implication of law (a) a lien on the goods or right to retain them for the price while he is in possession of them; (b) in case of the insolvency of the buyer, a right of stopping the goods in transitu after he has parted with the possession of them; (c) a right of resale as limited by the Sale of Goods Act.

Where the property in goods has not passed to the buyer, the unpaid seller has, in addition to his other remedies, a right of withholding delivery similar to and coextensive with his rights of lien and stoppage in transitu where the property has passed to the buyer,³

¹ Sale of Goods Act, secs. 27-30.

² ibid., sec. 36.

³ Sale of Goods Act, sec. 39.

I. Notion. Buying and selling is a contract by which, through mutual consent, some thing is exchanged for a price. It differs from exchange, in which a thing is granted on each side.

II. Subject. With natural law considered, the same persons are capable of buying and selling as are capable of donating. To what extent civil law excludes some persons, learn from the law of one's country.

III. Object. Besides what was said in n. 832 and following about objects unfit for contracts in general, these things are specially to be noted:

1. The sale of another's thing, with natural law considered, is invalid; for no one enjoys the faculty of disposing in any way of the thing of another. But the seller, if he has acted in bad faith, is bound to render the owner and the buyer unharmed; if in good faith, he ought to refund the price to the buyer. The buyer, if he has proceeded in bad faith, is bound to restore his own thing to the owner and to reimburse him for other damages perhaps following; if in good faith, he is per se bound to restore the thing to the owner, but, if otherwise he cannot recover from the seller the price paid, he can return the thing bought (n. 983).

Nevertheless, let it be seen what civil law establishes, which one who has proceeded in good faith may licitly follow and urge.

2. The sale of a determinate thing already sold to a third party, with natural law considered:

a) Is invalid if the sale, with civil law considered, confers a right in the thing, as obtains, for example, in France. The reason is that there is had the sale of another's thing.

b) If the sale, with civil law considered, confers only a right to the thing, and delivery, by which a right in the thing is conferred, has not followed, it is likewise invalid, because the seller cannot grant to a third party the right which he has already granted to the former buyer. Nevertheless the delivery of the thing, although injurious to the former buyer, seems valid, because the seller, since he is still owner of the thing, is able to grant its ownership or right in the thing to the third party. But in the case he is per se bound to take care that the former buyer obtain the thing, and in addition, if he has proceeded in bad faith, to reimburse the former buyer for damages perhaps following from the injury.

What the law is, with civil law attended to, see in the Civil Code.

c) The sale of a thing which at the time of sale has totally perished is manifestly invalid. If the thing has perished only in part, with natural law considered, it must be resolved according to what is to be said in n. 898.

d) Finally, a thing bought with another's money belongs to the buyer; who nevertheless, as is clear, ought to return the money to the owner.

IV. Price of the object, concerning which more must be said.¹

1. Notion of price. Price can be defined: the saleable or exchange value of a thing, expressed in money. It is said:

a) Value of a thing. Now the value of a thing is that on account of which it is worthy of estimation. But it is worthy of estimation on account of its aptitude for serving man.

b) Saleable. A twofold value of a thing can be distinguished: intrinsic and saleable. Intrinsic value is its aptitude immediately for serving man's necessity or utility. Intrinsic value again can be distinguished into objective and relative, according as a thing is commonly necessary or useful to human beings, or is specially necessary or useful to a determinate person, for example to the seller or buyer. Saleable value is the aptitude of a thing for serving the acquisition of another thing. That intrinsic and saleable value of a thing are not to be confused is clear, for example, from the fact that water is very useful, but is scarcely a medium for acquiring another thing.

c) Expressed in money; namely, so that the acquisition of necessary and useful things might be rendered easier, there was sought a common sign, a common measure or norm, which would represent the saleable value of all things; and money was selected for that end. Therefore money represents and expresses the saleable value of things; but the saleable value of things expressed in money is called price.

There are those who define price as: the objective value of things expressed in money. But price is money insofar as it has been constituted the medium of acquiring another thing. But money is the medium of acquiring another thing insofar as it represents or expresses saleable or exchange value. Therefore price is saleable value expressed in money.

2. Division of price. Price is distinguished into legal, common, and conventional, according as it is determined by legitimate authority, by common estimation, or by the free agreement of the contracting parties. But since human estimation is not accustomed to agree exactly in one point, the common price admits a certain latitude, and is distinguished as highest, lowest, and middle. Further: "the price of cheap things has a smaller latitude than that of precious things. For wine, either if it is worth 10, can be sold for 12 or 8 ... or if it is worth 100, can be sold for 105 and 95 ... But a house or estate, which perhaps was sold for 20 thousand, after a year will be able to be bought for 12 thousand" (St. Alphonsus, III, 804). These things, however, are now to be taken more broadly.

Corollary I. The saleable value of things, and consequently price, is subject to variation according to various circumstances. Thus, for example, generally it increases by reason of scarcity, and decreases by reason of abundance of merchandise (St. Alphonsus, III, 801).

Corollary II. A great number of buyers for the most part indicates that people now need some thing, or at least use it frequently, and therefore that the saleable value of the thing is greater; consequently the price increases. The contrary obtains if buyers are few (St. Alphonsus, III, loc. cit.).

Corollary III. If there is scarcity of money, the saleable value of things is not thereby changed; consequently the price decreases materially rather than formally; namely, a smaller sum of money is indeed received for the thing sold, but the money itself, since it is rare, increases in value, or, if you prefer, can represent a greater saleable value of things.

3. The just price is per se that which represents a saleable value equal to the saleable value of the thing bought and sold. By accident even a greater or lesser price can be just; likewise sometimes the conventional price is just. It is said:

a) The just price per se is that which represents a saleable value equal to the saleable value of the thing bought and sold. For in the contract of buying and selling, equality between the contracting parties must be preserved. But equality is preserved only when the price represents a saleable value equal to the saleable value of the thing bought and sold.

The major is deduced from the fact that price, or, if you prefer, the contract of buying and selling, was invented for the common good, and therefore ought not to be more burdensome to one than to the other; in other words, equality between the contracting parties must be preserved. It is confirmed from the fact that buying and selling holds the place of the contract of exchange, namely insofar as price holds the place of the thing with which another thing would have to be acquired if price had not been invented. Hence, just as, clearly, equality between exchangers must be preserved in the contract of exchange, so also in the contract of buying and selling between buyer and seller.

b) By accident even a greater or lesser price can be just, for example if the seller, receiving a price just per se, would by accident suffer detriment, namely from the fact that the thing was worth more to the seller on account of peculiar circumstances; these matters will become clearer from what is to be said afterward.

c) Likewise sometimes the conventional price is just; this too will become clearer from what is to be said afterward.

St. Thomas speaks thus: "We can speak of selling and buying in two ways: in one way according to itself, and according to this buying and selling seems to have been introduced for the common utility of each, namely when one needs the thing of another and conversely ... But what has been introduced for common utility ought not to be more burdensome to one than to the other; and therefore the contract ought to be established between them according to equality of the thing; but the quantity of the thing which comes into human use is measured according to the price given; for this money was invented ... and therefore if either the price exceeds the quantity of the value of the thing, or conversely the thing exceeds the price, the equality of justice will be taken away; and therefore to sell a thing more dearly, or to buy it more cheaply, than it is worth, is in itself unjust and illicit. In another way we can speak of buying and selling according as by accident it turns to the detriment of the seller ... and in such a case the just price will be such that regard is had not only to the thing which is sold, but to the damage which the seller incurs from the sale; and thus something can licitly be sold for more than it is worth in itself, although it is not sold for more than it is worth to the one having it" (St. Thomas, II-II, q. 77, a. 1; St. Alphonsus, III, 807).

From what has been said the following norms are deduced:

a) If a legal price exists, this must be observed. For just as it belongs to the republic or to those who exercise public authority to establish laws and statutes for the common good, so also it sometimes belongs to the same common good to judge the saleable value of things and to express it by price, namely so that the cupidity and frauds of sellers and buyers may be forestalled, and the plundering of the poor prevented² (St. Thomas, II-II, q. 77, a. 2, ad 2; St. Alphonsus, III, 803). Further, the legal price, as the very nature of price indicates, must be observed from commutative justice. Nevertheless it is licit to demand a greater price: 1° if because of changed circumstances it becomes less than just; 2° if the goods to be sold are notably better than usual, because the law is understood about ordinary goods. Besides, the buyer can buy below the legal price, while nevertheless preserving the common price, because the law is judged to have been made in favor of buyers (St. Alphonsus, loc. cit.).

b) If the legal price is lacking, one must stand by the common price - whether highest, lowest, or middle - which prevails in the place where the thing is bought and sold, and which has been constituted independently of fraud, unless nevertheless there is present a special title for selling above the highest or buying below the lowest. It is said:

a) One must stand by the common price, that is, the price which is determined by common estimation; for it belongs to this, and not to private estimation, to judge the saleable value of things and to express it by price. The reason is that the former is less subject to error, while the latter is often blind, deceitful, and perverted by passion, especially if there is question of one's own cause (St. Alphonsus, III, 816).

b) Whether highest, lowest, or middle (p. 600). Nevertheless it is unjust to induce someone by deceit to pay the highest price. Note, however, that often frauds are employed only in appearance, since the things which sellers put forward to commend their goods are commonly regarded as hyperboles and stratagems. Moreover, one who asks a price which exceeds the highest price, for the end that he may receive the common price, even the highest, cannot be accused of sin, provided that he is willing to restore if he receives more than the highest price.

c) Which prevails in the place where the thing is bought and sold. Therefore it is not licit in our region to demand from foreigners or barbarians a price above the highest, although the thing to be sold is held as more precious in their region. But it is licit in their region to acquire a thing, for example a gem, which is esteemed little by them and greatly by us, by granting to them a thing, for example glass, which is esteemed little by us and greatly by them. If the contract is entered into equally in one region and in the other - for example, if a seller who lives in America sells something by telegram to a buyer who is in the Netherlands - the contracting party can choose what pleases him.

d) Which has been constituted independently of fraud; hence they act unjustly who by false reports exaggerate the excellence of some merchandise or business and thus, with common estimation changed, receive a greater price.

Corollary I. One who by private knowledge knows that the price of goods will soon be increased or diminished can, without injustice, buy and sell at the price now current, because the price is not changed by particular knowledge (St. Alphonsus, III, 824). For the same reason it is licit to pay with money whose value someone knows by private information will soon be diminished (cf. St. Thomas, II-II, q. 77, a. 3, ad 4).

Corollary II. A magistrate who by official knowledge knows that the price either of goods or of public bonds will soon be changed can certainly buy or sell them as he has been accustomed to do, since he cannot be of worse condition than others. Besides, it is sufficiently probable that he does not sin against justice or against another virtue by buying up goods at a lesser price with the intention of later selling them at a greater price. The reason is that the office undertaken sufficiently probably does not involve an obligation to abstain from the things mentioned. Nevertheless he would sin against his office by warning others about the price to be changed.

e) Unless a special title is present, etc.; which, lest the order of essential matters be interrupted too much, we shall explain under 4.

c) If things have neither a legal nor a common price - as notable paintings, extraordinary gems, etc. - the conventional price is sufficiently probably valid, or the thing can be bought or sold according to the price about which the contracting parties agree. Many indeed deny this, "because although the price of such things receives a great latitude, it is nevertheless equitable that it should have some assessment according to the judgment of prudent persons" (St. Alphonsus, III, 808). But "when a thing has no price, neither legitimate, that is, assessed by law, nor common, namely according to the common estimation of human beings, that is judged just which is agreed upon" (St. Alphonsus, loc. cit.). The same must be said of some human actions, as if someone exposes his life to danger for the safety of another. Finally, the conventional price is valid: 1° if the buyer alone, or almost alone, knows by private study that the thing is precious; the reason is that not only legal and common price are lacking, but also experts by whose judgment one would have to stand; 2° if each contracting party knows that the price of some thing is unknown to him, because there is had a just aleatory contract (St. Alphonsus, III, 802); 3° according to the authors, the buyer can buy at a conventional price: a) from antiquarians; b) from all those persons whose things have already been destined to vile use, as if a book is being carried to be torn apart or sold for the price of paper. The reason alleged is that things of this kind, by common estimation, have in some way lost their natural price, so that the buyer can proceed broadly. But should not common estimation in the case be called less correct? Besides, as regards antiquarians, there is added that the buyer can reasonably presume a quasi-condonation, because buyers are thus enticed by the hope of buying precious things for a lower price.

4. Titles for departing from the common price,³ that is:

a) For selling above the highest price,⁴ or rather more dearly, are:

a) Emergent damage and ceasing profit (St. Thomas, II-II, q. 77, a. 1; St. Alphonsus, III, 807).

b) The risk of not receiving the price, as was said about mutuum (p. 595; St. Alphonsus, III, 810).

c) Delay of payment, insofar as this brings with it for the seller emergent damage, ceasing profit, or risk of not receiving the price (St. Alphonsus, III, 810). Therefore this title is referred to the titles already assigned.

d) Sale made retail, since it brings with it greater cares and expenses (St. Alphonsus, III, 809).

e) Sale under the hammer (n. 901).

f) The special affection of the seller. "The reason is that deprivation of a thing toward which someone is specially affected is truly estimable by price" (St. Alphonsus, III, 807).

g) Whether the special utility and delight of the buyer are titles is disputed, but with St. Thomas (II-II, q. 77, a. 1) and St. Alphonsus (III, 806) it seems that it must be denied. For first, "if someone is much helped by the thing of another which he has received, but the one who sells is not harmed by lacking that thing, he ought not to sell it above price; because the utility which accrues to the other is not from the seller, but from the condition (or, in another reading, the buying) of the buyer; but no one ought to sell to another what is not his; although he can sell to him the damage which he suffers. Nevertheless, he who is much helped by a thing received from another can of his own accord give something over and above to the seller, which belongs to his honesty" (St. Thomas, loc. cit.). Then, the just price not only can be demanded, but must be paid. Therefore, if the special utility of the buyer changed the account of the just price, the buyer would either have had to increase the price of his own accord, or at least to indicate that utility, so that the seller might be able to use his right of increasing the price. Yet no one would say this; and buyers have recourse to various arts so that this utility may be unknown.⁵ Finally, if the contrary opinion is admitted, it does not appear why the price could not also be increased because of the buyer's necessity without sinning against justice; for necessity argues special utility and increases the value of the thing relative to the buyer equally with utility. Almost all the older authors and several more recent authors follow this opinion,⁶ while other more recent authors contradict it.

Objection. In the supposed case the seller furnishes the buyer an accommodation or benefit, which is estimable by price.

Response. The benefit or accommodation consists either in the action of selling, or in the fact that he sells a thing which will be specially useful to the buyer. Now the action of selling is intrinsic to the sale, and therefore is not estimable by price separately from the thing sold. But the fact that the thing sold is specially useful to the buyer depends on this buyer's condition and circumstances, not on the seller; and the seller cannot receive something for a thing which is not his. If, however, the thing in question is already useful to many, its objective value, and therefore its price, has increased.

b) For buying below the lowest price, or rather at a lower price, are:

a) Emergent damage and ceasing profit by reason of this purchase, if nevertheless it is made in favor of the seller; as if, for his convenience, you buy a thing which you will need only when its price has been diminished. But if you do not buy in favor of the seller, but in your own favor, the reason for denying him the price just per se is lacking, because in reality emergent damage and ceasing profit are not present.

b) Risk of not receiving the merchandise bought and paid for.

c) Anticipation of payment, insofar as this brings with it for the buyer emergent damage, ceasing profit, or risk of not receiving the merchandise. Therefore this title is referred to the titles already assigned.

d) Purchase in a large quantity at once, since it frees the seller from many cares and expenses (St. Alphonsus, III, 809).

e) Purchase in a sale under the hammer (n. 901).

c) A spontaneous offering of goods - whether by a rich man or, as the things to be said seem to prove, by a poor man - insofar as this casts suspicion of a hidden defect, or argues fewness of buyers; for fewness of buyers rather often proves that the value and price of the thing have decreased (p. 600). If, however, the thing is offered spontaneously because of poverty, you will easily sin against charity unless you buy solely in favor of the seller (St. Alphonsus, III, 802).

But it is not licit for a buyer who knows the greater value of a thing to ask from a seller wholly ignorant of the greater value "that he condone what it is worth beyond this; ... because such a donation, since it proceeds from ignorance, is null" (St. Alphonsus, III, 819).

Besides, each should commonly warn the other about an existing legitimate title; nor should he increase or decrease the price more than the title allows, with common estimation considered.

¹ Cf. Janssens, Le juste prix; Hagenauer, Das justum pretium bei Thomas von Aquino; Aengenent, Leerboek der Sociologie, n. 125 sq.

² Billuart, De iure et iustitia, diss. 3, art. 2.

³ Nevertheless do not take these things so strictly, because several of the titles to be explained rather bring it about that the price increases or decreases.

⁴ Vermeersch, De Iustitia, n. 345.

⁵ Vermeersch, loc. cit.; Lehmkuhl, I, n. 1330.

⁶ Vermeersch, loc. cit.; Lehmkuhl, I, n. 1330.

V. Form of the contract. Let the form of the contract be consulted in the Civil Code; there also see what things regard the proof of the contract.

VI. Effects. 1. With only natural law considered, the contract of buying and selling confers on the buyer a right to the thing, since with the execution of the contract a right in the thing is constituted. Sometimes, however, the contract by force of civil law - for example French law - confers a right in the thing.

2. Where the contract without delivery confers a right in the thing, per se the thing sold and not yet delivered is at the risk of the buyer, so that the buyer is bound to pay the price even if the thing has perished. At whose risk the thing sold and not yet delivered is, where the contract confers only a right to the thing, see in the Civil Code.

3. The fruits of a determinate thing sold, not yet delivered, become the buyer's, unless the contracting parties have stipulated otherwise; for the contracting parties are judged to comprehend the accessory, such as fruits are, in the principal (St. Alphonsus, III, 798).

VII. Obligations of the seller. 1. The seller, as regards defects of the thing to be sold, is bound to manifest:

a) Substantial defects, and the defect of a quality to which he perceives the buyer's consent to be bound. For otherwise the contract, because the buyer's consent to the object of the present contract is lacking, is invalid, and therefore the seller cannot accept the agreed price (n. 837; St. Alphonsus, III, 819; cf. St. Thomas, II-II, q. 77, a. 3).

b) A notable and hidden defect. The reason is that a thing is sought by the buyer which lacks a notable defect; this being posited, the seller, by furnishing the thing and not disclosing the defect, tacitly affirms that it lacks such a defect, unless that defect itself is manifest; and therefore he uses deceit and inflicts injury on the buyer. Hence authors generally add that even a notable and manifest defect must be disclosed if it is noticed that the buyer is laboring under invincible ignorance (St. Alphonsus, III, 823). Besides, there must be manifested:

c) A defect about which he is specially questioned, unless the buyer can discover the defect by his own inquiry. The reason is that otherwise buyers would lack a means of inquiring what sort of thing it is concerning which they are going to contract; and this cannot be admitted.

d) Outside the cases assigned there is no obligation of manifesting defects, not even hidden ones; both because otherwise trading would become almost impossible, and because universal custom confirms this.

Corollary I. If some defect can bring damage to the buyer and is not noticed by him, the seller must always - even in a case in which, according to what has been said, he is not held from justice - warn the buyer; as if a horse is furious, or a house ruinous.

Corollary II. The seller, even if he is not bound to manifest a defect, ought nevertheless to take account of the existing defect in establishing the price; if he has not done so, he is bound to restore part of the price received.

Corollary III. A seller who has not manifested defects that had to be manifested is bound, if the contract nevertheless was valid, to restore the excess of price and to reimburse other damages perhaps following from the silence; indeed, if the buyer's error gave cause to the contract, he is bound also to rescind the contract at the buyer's judgment (St. Alphonsus, III, 823).

Corollary IV. "If the seller," says St. Alphonsus with others, "protests that he does not wish to give an account of any defect whatever, but to sell as is commonly said: A sacco d'ossa rotte; then he is bound to nothing. Hence Tamburini deservedly approves the custom which flourishes in some places, especially in great fairs, that animals are sold in this way, even if the defects are most hidden. The reason is that, for removing lawsuits on account of the common good, this can be sufficiently rendered honorable by custom: provided it is understood that the thing is not sold beyond the just price, at least the highest," which the thing has when account is taken of that hidden defect (St. Alphonsus, III, 823). Apply the same to sales by an antiquarian.

Question 1. Whether it is licit to sell a "something for something else," as is said, provided that what is handed over is equivalent to the natural thing, for example to wine, butter, vinegar.

Response. It seems licit, because there is not present a substantial diversity as regards "the end of the buyer" (St. Alphonsus, III, 821). Except: 1° if the buyer manifestly wants the natural thing or a thing of a determinate species; 2° if merchants are held by custom to declare the imitation.

Question 2. Whether it is licit to sell merchandise mixed with cheaper merchandise, provided the just price is retained.

Response. Per se it is illicit. By accident it is licit: 1° if the seller's merchandise is better than usual; 2° if custom so bears. Except if the buyer offers a price greater than usual for this end, that he may certainly receive merchandise not adulterated.

2. The seller is bound to deliver the thing sold to the buyer, who, according to the diversity of civil law, by delivery acquires either a right in the thing and possession, or possession alone. In what way the thing must be delivered is established by civil law; what things must be observed by him or by the buyer as regards the place of delivery, expenses, etc., should be gathered from civil law and from the special stipulations of the contracting parties.

3. The seller is bound to furnish eviction, that is, he is bound to render the buyer unharmed if the thing bought is reclaimed totally or partially by a third party who proves himself to be owner. Hence he is bound to return the price perhaps received.

But what if a seller who proceeded in good faith no longer possesses the price either in itself or in an equivalent?

Response. Most judge that the seller is nevertheless obliged, namely by reason of the contract, whose nature carries this obligation with it. But with St. Alphonsus (III, 800) it seems that it must altogether be denied, because the seller is bound to nothing by reason of the contract, since it is invalid and destitute of all value (n. 894).

VIII. Obligations of the buyer. The buyer is bound to pay the just price, and this at the time and in the mode concerning which agreement was made. Besides, compare civil law. But if he himself perhaps received false money from a third party, he cannot for that reason give it to another contracting party as price. If he has given it, even though he acted in good faith, he is bound to restitution; since the fact that he himself suffers damage is not a reason why you can deny to another what is owed (St. Alphonsus, III, 855).

It remains that we say certain things about earnest money. Now then:

I. Earnest money is called a certain thing handed over to the other party on the occasion of a contract.

II. Earnest money is distinguished as twofold, confirmatory and penitential.

Confirmatory earnest money is that which is given by the buyer to the seller as a sign and confirmation of the contract, perfected according to the intention of the contracting parties. From a contract of this kind, since it is perfected and confirmed, one can retreat without mutual consent even less than from another contract. But the earnest money given is judged to be part of the price.

Penitential earnest money is that which is given by one party to the other for this end, that the contract, not yet plainly perfected, may be rendered more certain. In the case each party can withdraw from the contract, yet in such a way that he who gave the earnest money, if he withdraws, loses the earnest money given; but he who received the earnest money, if he withdraws, restores the earnest money received.

In doubt whether the earnest money is confirmatory or penitential, it is presumed to have been given according to the custom of the place (St. Alphonsus, III, 794).

Besides, also as regards earnest money let civil law be consulted.

Formal Cooperation by the Manufacture or Sale of Objects Whose Sole Purpose is Gravely or Venially Sinful.—(a) Cases of explicit cooperation are those of the inventor of contraceptives or of instruments that frustrate generation, of the designers of blasphemous representations or of tablets in honor of false deities, the authors of somewhat profane or irreverent cards, and the like. (b) Cases of implicit cooperation are those of persons who, for profit only, make or sell objects such as those just mentioned, while knowing that the purpose to which they naturally tend is the commission of sin.

Material cooperation by the manufacture or sale of objects that are used for gravely or venially sinful purposes, is lawful under the conditions given in 1515. Hence, in the first place, the cooperation itself must not be intrinsically sinful, that is, the object made or sold must have good as well as evil uses. There are two classes of objects of this kind: (a) there are some objects which may have good uses, but which in fact are nearly always made to serve bad ends (e.g., idols, insignia of forbidden societies, pictures of the nude, ultra-fashionable dress, certain drugs or poisons, blackjacks, and pistol silencers); (b) there are other objects which are indifferent in themselves, although often employed for sinful uses (e.g., dice, playing cards and chips, rouge, lipsticks, necklaces and other feminine adornments, imitation jewelry, adulterated articles, and the like).

The rules about proportionate cause for cooperation by the manufacture or sale of things that are employed in committing sin are those given above in 1519.

(a) Hence, the greater the sin that will be committed or the more harmful the consequences that will ensue from the use of an object, the greater the reason required for making, repairing or selling it. In some instances only a most grave reason will excuse, such as peril of instant death for refusal. Thus, one may not sell poison or drugs to a person who contemplates suicide, murder, or abortion. One may not sell narcotics to a person who asks for them in good faith and who cannot obtain them elsewhere, but who will become a drug-fiend if they are given him. One may not sell morphine, heroin, etc., to a person who is already a drug-addict and who will abuse the drugs, unless there is a very grave reason for not refusing, such as danger that refusal will lead him to set fire to the building. If one has all the playing cards in some remote hamlet, one should not sell them without grave reason to a customer who will spend a great part of the time at games to the neglect of serious duties, nor without a very grave reason to a customer who is a card sharper and who will swindle many innocent victims, or to a gambler who will waste the money due to his wife and family.

(b) The more closely related an object is with sinful uses, the graver must be the excuse for having part in its manufacture or sale. Thus, an ordinary reason (e.g., profit) might suffice for selling a lamb to a pagan or attractive ornaments of dress to a woman, where only a very grave or most grave reason would suffice for selling incense to a pagan or ornaments that are frequently used as amulets or charms. Generally speaking, it is seriously wrong and gravely sinful to make or sell articles whose ordinary use is gravely sinful.

(c) The more a customer depends on a determinate manufacturer or merchant to obtain such an object, the more serious must be the reason for making or selling it. Thus, a grave reason, such as a notable loss, is sufficient reason for selling a special fancy apparel to a notorious “vampire” (i.e., a woman who carries on scandalous flirtations in order to get presents), if the adornments can be obtained from other dressmakers or modistes or stores; but a much graver reason would be required, if the apparel could not be purchased except at one place. In the former case, refusal to sell would not prevent the activities of this woman; in the latter case, it would at least hinder her to some extent.

(d) The more certain it is that an object will be employed sinfully, the greater must be the reason for making, repairing or selling it. Examples: Sempronius, a curio dealer, is asked by three men for a statue of Joss along with joss-sticks and papers. The first customer says he intends to use these articles for religious rites; the second will not tell what his purpose is; the third wishes to present the articles to a museum. Sempronius may not sell to the first customer except for a most grave reason, such as fear of death if he refuses; he may not sell to the second customer without a very great reason, such as a very considerable loss to himself; he may sell to the third customer for an ordinary reason, such as the profit he makes from the sale. Titus, who sells firearms, knows that some of his customers, though he has no particular individuals in mind, will use these weapons unlawfully in poaching or shooting out of season. Since evil is not to be presumed of any particular individual, Titus has the right to sell to all for the usual reason of business profit.

Is a merchant bound to inquire the use which a customer will make of an article that is often employed for sin?

(a) If the positive law requires that the merchant inform himself, he is bound to make inquiries necessary for obtaining the information. Thus, if the civil law forbids the sale of weapons without a permit or of poisons without a prescription, the merchant has to ask for the customer’s authorization to buy.

(b) If the positive law has no such regulation, we should distinguish between articles that are frequently used for sin and articles that are generally used for sin. When an article of the former class is requested, there is no obligation to make inquiries, for such an obligation would be unduly burdensome; but, if an article of the latter class is desired, one should make inquiries, unless one is morally certain that the intention of the customer is good, or there is a very grave reason for seeking no information. Thus, one may sell a deck of cards to a stranger without asking for proofs that he is not a confidence man in disguise; but one may not sell deadly poison to an entire stranger merely on the strength of his word that he needs it for medical or other lawful purposes.

3. A merchant buys several casks of wine, the price being established for each measure of wine; he gives earnest-money to the seller, and marks each cask with his seal. The casks are carried to his shop, and after a month he himself tastes the wine and finds sourness. The merchant then wishes to return the casks to the seller as if unbought. The seller refuses to receive them as sold, and says that the damage must be sustained by the buyer.

Q. What as to the case?

R. It is indeed certain that the sale of that quantity of wine, the price being established for each measure of wine, depended on the measuring of the wine; and consequently it was not made per aversionem. But that measuring ought not to have been lacking in the case, since those casks of wine were even carried to his shop. - As to tasting, there is no doubt that, if it was explicitly added as a suspensive condition of the sale and purchase, before it the sale and purchase is not understood to be perfected; and the buyer is held to taste. And if he does not wish to taste, it is the same as if he tastes and approves. If that condition was not explicitly added, it is tacitly present, because the question concerns a thing which is not customarily bought unless it has first been tasted and approved; and because such is the law, there is altogether no sale and purchase, and the buyer can withdraw and not taste. - But neither is there any doubt that someone can renounce that tasting, as when someone writes to an absent merchant that he should send him such a quality of wine. Tacitly he renounces tasting, and if truly that quality of wine has been sent, the sale and purchase is perfected.

Moreover, that merchant seems altogether to have renounced tasting; for the casks of wine were carried into his shop, and therefore, delivery of them having been made, the risk of the same no longer pertains to the seller, but to the buyer. For delivery is an argument of acceptance of the thing. Moreover, he marked the casks with a seal; concerning which indeed the Doctors doubt. For some say that this is done not that tasting be renounced, but lest other wine be introduced into the cask, or one cask be substituted for another; and therefore, the sale not yet being perfected, the risk is still the seller's. But others say that by the very fact that the buyer proceeds so cautiously and diligently in signing the casks, he is presumed to have tasted the wine or to have renounced tasting; since by the deed of thus preventing alteration and change of the wine, he shows that the wine pleased him, and that he has already approved it. And thus also it is said in L. 74 de Contrahenda emptione: "When the keys have been handed over, the possession of goods stored in warehouses seems to have been handed over, if the keys have been handed over at the warehouses: this being done, immediately the buyer obtains ownership and possession, even if he has not opened the warehouses; but if the goods were not the seller's, usucapion will immediately begin." - L. 1 de Peric. et comm. r. vend.; Troplong, della Vendita, n. 101 seqq.

Finally, since the merchant kept the casks with himself for a whole month and delayed in measuring and tasting the wine, who indeed can any longer doubt that the aforesaid merchant must sustain the damage of the sourness, since that defect of the wine could well have been contracted in his own warehouses in so long a space of time?

889. • It is twofold: 1. legal, which is determined by law; 2. natural or common, which corresponds to the value of the thing according to the common estimation of men.

But the natural price is 1. the highest, above which the thing is not customarily estimated; 2. the lowest, below which the thing is generally not estimated; 3. the middle, which is placed between the two.

890. Principles. - I. The legal price, or the price constituted by civil authority, must be held as adequate to the value of the thing, and therefore must be observed under the burden of restitution. The reason is that it belongs to the civil authority to establish whatever pertains to public commerce, since it can make laws for the common good. - Thus all.

Yet sometimes it is lawful to exceed the legal price, namely 1. if it is not observed by the greater part of men, while the Prince is silent; 2. if, circumstances being changed, the rate becomes unjust; 3. if the goods are notably more precious than usual, or worse.

II. When the legal price is lacking, only that is to be held as just which is determined as such by common estimation, if there is question of merchandise which has valuation among the multitude; because the adequate price of things of this kind is deduced from their utility for common uses. Moreover, the valuation of such utility cannot be had better than by common estimation. - Thus all.

But if the things do not have a common estimation, as are gems, precious little pictures, etc., more probably they are to be estimated according to the judgment of experts in that matter, with the circumstances attended to, and with regard had to the novelty, antiquity, rarity, etc., of the thing. The reason is that in matters of this kind they are reputed suitable judges, just as the common people are in common matters. Yet the opposite opinion appears as probable, because in that case the just price seems to be that concerning which the contracting parties agree. Thus with respect to each opinion St. Lig. n. 807. - In practice those are not to be disturbed who in good faith and freely, according to their own judgment, agree in such things. - Thus Salmant. - Gousset, n. 842. A fortiori that price is to be reputed just concerning which each party agrees, if the price is wholly unknown, because each is then exposed to danger. - St. Lig. n. 802 at the end.

891. Questions. - Q. 1. Whether the seller can sell a thing more dearly on account of the special affection which he experiences toward it, or the advantage which he derives from it?

Resp. to the 1st. Affirmatively. The reason is that the affection of an owner toward his own thing is truly appreciable by a price, since the deprivation of the thing is greater for him. - Thus commonly. - St. Lig. n. 807.

Resp. to the 2nd. Affirmatively, even a fortiori; since the deprivation of a special advantage renders the thing much more precious to the seller, and it is equitable that the price increase by reason of the greater loss which he suffers. - St. Thomas, II-II, q. 77, art. 1 and following, and others very commonly.

892. • Q. 2. Whether the seller can sell a thing more dearly on account of the affection or special utility of the buyer?

Resp. Theologians commonly deny it, because the greater utility or affection is not the seller's, and therefore cannot be sold by him; otherwise he would sell what is not his. - Thus St. Thomas, q. 77, art. 1: If someone is helped much by another's thing which he has received, but the one who sold is not harmed by lacking that thing, he ought not to over-sell it; because the utility which accrues to the other is not from the seller, but from the condition of the buyer; and no one ought to sell what is not his. - St. Lig. n. 806 and Carriere, n. 692, are in agreement.

Yet some affirm it, on the ground that the seller procures that advantage for the buyer; but this reason seems altogether weak, as is clearly plain from the doctrine of St. Thomas.

893. • Q. 3. Whether it is lawful to buy more cheaply in favor of a seller seeking a buyer?

Resp. Affirmatively. The reason is that unsolicited things become cheap, and the price of a thing decreases when the thing is of little use to the buyer and he buys in favor of the seller. - Thus commonly with St. Lig. n. 802.

Q. 4. Whether it is also lawful to buy more cheaply where goods are sold because of poverty?

Resp. Affirmatively, probably. The reason is that an unsolicited thing decreases in price according to common estimation. But the need of the seller does not bring it about that the common estimation is changed. Yet others probably deny it.

894. • Q. 5. Whether it is lawful to sell more dearly because of delay of payment of the price, or to buy more cheaply because of anticipated payment?

Resp. Affirmatively, at least probably, provided the legal rate for a mutuum, or the reason of some title, is not exceeded. The reason is clear from what was said above concerning usury, n. 863 and following ¹.

¹ Namely, the lack of the price during the time in which payment is deferred is a burden appreciable by price. But the words of mutuum or of the thing or money lent are employed abusively according to those things which were said at length above. For the contract from which profit is sought from these things is to be judged to be of a different nature.

Q. 6. Whether notes and credits also can be bought more cheaply because of anticipated payment?

Resp. 1. Affirmatively altogether, if they are uncertain or of difficult payment, because then they become notably cheap.

Resp. 2. Affirmatively probably, even if they are certain and of easy payment. The reason is 1. because money is not bought, but an action to it, and therefore that price is judged just which is commonly paid for such notes. - Thus St. Lig. n. 829, etc.; 2. because they are equivalent to money lent; therefore, from the same reason as in a mutuum, it is lawful to receive a moderate profit according to the legal rate. - Thus now the common practice.

895. • Q. 7. Whether someone can buy for much less credits of payment very difficult in themselves, if because of a circumstance special to himself they become easy of payment?

Resp. Affirmatively, more probably. The reason is that the facility of obtaining payment does not depend on the thing which is sold, but on the buyer himself; moreover the value of any thing is determined by common estimation, not by the particular circumstance of the buyer. - St. Lig. n. 829.

Q. 8. Whether you can sell at the current price a thing which you know will soon be worth less?

Resp. Affirmatively, more probably and more truly. The reason is that the present price is just and has not yet been changed, provided, however, that this knowledge is private; for if it were common, the price would already be changed. Yet sometimes you could sin against charity. - St. Thomas. - St. Lig. n. 824. - Hom. apost. n. 188.

896. • Q. 9. Whether you can sell at the current price a thing mixed with another cheaper thing?

Resp. A distinction must be made, namely 1. if the mixture is harmful or renders the thing notably worse or less useful, you sin against justice, as is clear; 2. if your thing is of extraordinary goodness, you can probably sell it, mixed with the cheaper thing, at the common price; 3. if by skill you so mix the cheaper matter with the better that it is better tempered, you can sell it at the customary price. But in practice this should not easily be permitted because of the danger of hallucination. - St. Lig. n. 820-823.

897. • Q. 10. Whether merchants are bound to restitution who by fraud or a lie induce buyers to buy their goods at a higher price than they would have bought them, although they do not exceed the highest price?

Resp. 1. As to fraud, affirmatively. The reason is that fraud is an efficacious and unjust cause of the damage which the buyer suffers; moreover, everyone has a strict right not to be induced by fraud or deceit to suffer some damage. Therefore...

Resp. 2. As to a lie, per se the same would have to be said, since it also is of itself an unjust cause of damage. Nevertheless, ordinarily lies or even perjuries by which merchants affirm that goods cost them so much, or that such a price was offered to them, are not to be held as frauds really causing damage; the reason is that these things are so frequent among them that almost no one gives them faith. Yet an exception must be made if, at any time, because of special trust in the seller, the lie must be judged the cause of the contract. - St. Lig. n. 805. - Lacroix, n. 956. - Reuter, n. 223.

898. • Q. 11. Whether or how merchants sin who, when asked concerning the price of goods, notably exaggerate it?

Resp. 1. If they truly intend to sell at this price, they sin against justice by unjustly coveting another's property; and they are bound to restitution if in fact that price is paid to them.

Resp. 2. But if they intend only to give the buyer a place for offering his own price, so that thus they may come to the just price, they are excused, because it is known and customary for merchants to speak thus, so that they may lead buyers to the just price.

Q. 12. Whether they sin against justice who, before delivery, diminish or adulterate a thing sold at the lowest price?

Resp. Affirmatively, because they act against the pact entered into with the buyer. For although it is lawful to sell at the highest price, nevertheless it is not lawful for a merchant who sells at the lowest or middle price secretly to procure for himself the middle or highest price by diminishing the quality of the merchandise, or by subtracting from the measure or from the weight; otherwise agreements would be altogether useless.

899. • Q. 13. Whether European merchants sin against justice who sell among the Indians, at the maximum price, knives, mirrors, and other things of this kind, which among us are held to be of a cheaper price?

Resp. Negatively, because although these things are cheaper in our regions, nevertheless they are commonly esteemed highly by Indians or Chinese, etc.; moreover the common price is determined from the common estimation of the men of the region. Therefore... - Carriere, n. 699.

900. • Q. 14. Whether they sin against justice who buy precious things at a cheap price when they are exposed for sale among dealers in old things?

Resp. Negatively, because those things are judged to have lost their old price and to receive another by custom, or by the agreement of the contracting parties. Whence things of this kind receive the greatest latitude by reason of price. - St. Lig. n. 807. - Thus sometimes books are bought for a few coins which could have been sold for five or ten francs. The same must be said concerning the purchase of old furniture, which are called in French de rencontre, because these are commonly held to be of lesser value. - Carriere, n. 695, 699.

901. Resolves. - 1. Merchants who sell in small quantities can sometimes sell more dearly than those who sell in great quantity; because they must spend greater labors and expenses, and greater time, in preserving them and distributing them to buyers. Thus innkeepers, stable-keepers, etc., who sell oats, hay, straw, and other things more dearly, are excused from injustice. - St. Lig. n. 809.

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.

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.

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).

513. The matter of sale is merchandise for a price. Merchandise is everything which can be measured by a price of money and alienated. Whence under this name come all things which are placed in commerce (a. 1598), and are not prohibited from being sold by particular laws, whether corporeal goods, or even incorporeal rights, such as credits, promissory notes, rights against a third party, or a right in an opened inheritance (that is, after the death of the deceased), even litigious rights according to the rate of probability of obtaining the thing (a. 1689-1701); not, however, the right of mere use and habitation (a. 631 and 634).

But a) in modern law sale is declared null:

1. if the inheritance of a living person, even one consenting, is sold (a. 1600), lest, namely, abuses, frauds, killings, or even desire of death follow;

2. if the thing sold was another's, not the seller's. In this case, if the seller knew, but the buyer was ignorant, that the thing was another's, the former, on account of fraud, will be bound to repair the damage inflicted (a. 1599);

3. if the thing had totally perished at the moment of sale. But if it had perished in part, the buyer can at will either withdraw from the contract, or demand the surviving part of the thing for a price to be determined according to the proportion of the whole price (a. 1601).

Those rules have force in the forum of conscience.

b) Besides, from natural law a sacred thing cannot be sold as sacred, or a spiritual thing as such: for thus it is not estimable by a temporal price. This sin is called simony.

514. The matter of purchase is the price for merchandise. Price is the value of a thing expressed in money, or the expression of saleable value through a sum of money, and therefore it is the measure of the quantity of the value of the merchandise itself. Therefore a just price is that which is adequate to the thing, or commensurate with its value; by it there is effected an objective equivalence between what is given and what is received. For a thing is worth neither more nor less than its just price.

Value is of one kind as useful value, of another as economic or saleable value. Saleable value supposes useful value, which is diverse in diverse things and does not have a univocal measure. Useful value, namely, is from the intrinsic dignity of the thing and the intensity of individual necessity; but saleable value is the aptitude which a thing has so that it may be exchanged in commerce with others (ruilwaarde), or the estimability of the utility and facility which a thing has for satisfying needs, that is, the appetite and common desires of pleasure, utility, necessity: aptitude for satisfying common necessities.¹

¹ Economists dispute about the causes of value. Some, as many liberals, hold value as merely subjective, namely from the utility and estimation of the contracting parties. Others derive it from the very intrinsic utility of the thing, either absolute or relative to the buyer, with simultaneous attention to the abundance or scarcity of merchandise and money, and to the proportion between things offered and things sought. Others, as many socialists, reckon the value of a thing from the labor alone which in itself is necessary in making, preserving, or also transferring it.

Value, and therefore price, does not depend on the subjective estimation of the seller (since he ought not to be judge in his own cause), nor on the subjective advantage of this or that buyer in particular, nor on the intrinsic perfection or natural dignity of the thing itself considered in itself; for wheat is sold more dearly than mice, gold than a dog, a gem than fleas, a house than a horse, or even than a slave. But it depends on the objective utility of the thing with respect to human uses, and indeed not absolutely, but according as men are able to estimate that use, and this utility is appraised and measured by common estimation: for a gem for ornament is worth more than a great quantity of wheat for consumption. - The foundation of the whole matter seems to be the reality of the social order. But the necessity of exchanging things, goods, and services according to certain and determined qualities is the objective reason of equality and economic value.

Value depends on the utility of the thing, that is, on its fitness for human uses of convenience, pleasure, necessity; and this is estimated more or less a) from the labor expended, costs, industry, and dangers, in themselves and commonly necessary for producing, preserving, and transforming things; b) from the abundance and scarcity of things, and the frequency or rarity of buyers or sellers; and c) from the intensity of common desire or the common will of acquiring and selling.

Whence price can vary and be increased or diminished from various causes:

a) on the part of merchandise, on account of abundance, which diminishes the value of merchandise, and scarcity, which increases it: for that is esteemed more which is sought by more persons and which is found with greater difficulty or in lesser supply, but that is esteemed less of which there is greater supply and which is less sought;

2. on the part of buyers: a) from their frequency. If there are many, merchandise is sold more dearly than if they are rare: for the more buyers there are, the more things are esteemed, since frequency of buyers induces scarcity of merchandise; b) from their capacity and the quantity of money of which they can dispose;

3. on the part of sellers, for those who sell by office sell more dearly than those who sell by accident. For it is estimable by price that some persons continually take care of seeking out, preserving, and distributing things, and are compelled to omit other ways of making gain. And likewise expenses, dangers, and damages which commonly occur increase the price: commonly, I say, for from the fact that one merchant suffers a singular loss in his merchandise, for example, by shipwreck or fire, the price is not thereby justly increased for him;

4. from the mode of selling. For things are sold more dearly, or on the contrary at a cheaper price, according as they are sold a) by office, or by accident; b) by retail, or together in a great quantity: for this frees merchants from many cares and makes them ready for acquiring new things; c) in one's own shop, or under the hammer, by public auction; d) in a shop sought out, or brought by free offer: for merchandise offered spontaneously becomes cheap, since this mode of selling indicates moderate utility and means on the part of buyers.

By all these the just price can be determined.

From these things it can be understood:

1. That the principle is false: a thing is worth as much as it can be sold for, or as much as can be had from buyers. This is true only within the latitude of the estimation of the just price, namely in such a way that one can seek up to the highest just price, but not beyond the highest.

2. "That those rules of merchants are false by which they are wont to justify the prices of their merchandise: that they bought for so much, that they made such expenses, that they underwent dangers, unless these are of the kind which commonly occur in the purchase of such merchandise. For some merchants are foolish and imprudent, and rash, who either easily suffer themselves to be deceived, or make useless expenditures, or rashly expose themselves to dangers. There is added that, even if the merchant proceeded rightly, nevertheless because of a supervening abundance of the same merchandise, it happens that the price is diminished, and therefore he cannot sell for as much as they cost him: just as also when scarcity supervenes unexpectedly, the price increases, and he can sell for more than he bought" (Sylvius, on q. 77, a. 1, q. 2).

c) That an individual merchant cannot, from the fact that he suffers a singular loss in merchandise through misfortune, theft, or fraud, exact even above the highest just price: for a thing is worth as much as it is commonly estimated, not as much as it cost a private person. But if the misfortune were common to many merchants, so that it induced a loss of merchandise, then the price would increase.

d) That the practice of merchants is of itself inequitable when, selling at the lowest price or below it, they do not hand over a full measure or hand over merchandise not whole but adulterated. Nor can this be called licit as an occult compensation against buyers, because they have not harmed the sellers, unless they have unjustly compelled them to sell at a cheaper or the lowest price.

e) That those are unjust who are wont to give gifts to servants, and afterward secretly compensate themselves by increasing the price beyond the highest just price, unless, however, the practice is known to the masters and they do not contradict it.

f) If certain things are very highly esteemed among uncivilized nations, it is not unjust to sell them there at a very high price: common estimation in some region renders the price just.

Finally, others, as many Catholics, judge that value depends on the intrinsic utility of the thing together with labor, and besides on the more or less vehement desire of buyers to procure the thing for themselves on account of its utility, pleasure, or necessity.

The principles to be established refer to the thing to be sold, to be handed over, and to be secured.

1122. PRINCIPLES. I. So that there may be a valid and just contract of sale, its object must be a thing placed in human commerce, proper to the seller, determined, and physically or morally that which is sought.

1. It is required that it be placed in human commerce. Therefore any thing estimable by price can be sold, whether corporeal or incorporeal, as rights from a chirograph, credits, etc. (n. 852).

By special laws the sale of poison, of writing provoking to sedition, etc., is not licit. Such a sale, when the required circumstances are lacking, is illicit, as is clear. Recall the things said n. 1035, 2.

2. That it be proper to the seller. For the sale of another's thing is invalid with respect to transfer of ownership; yet with respect to a buyer of good faith it produces various juridical effects: for example, when the thing has been handed over, it confers on him possession apt for prescribing, and other benefits of a possessor of good faith (cf. n. 849, 937).

3. That it be determined, at least from the circumstances, so that the thing sold is truly individual and distinct from every other.

Hence, if wares are sold according to their weight, number, and measure, the sale is not perfected unless the quantity in weight, number, or measure has been determined. Therefore the thing stands at the peril of the seller. But if the sale is made by aversion, en bloc, when namely the whole merchandise effects as it were one determined body and is sold for a certain and defined price, the sale is perfected from the agreement itself, and from that point of time it stands at the peril of the buyer.

4. That it be physically or morally that which is sought. Otherwise there would be a substantial error, or at least such an error as would furnish a right to rescission. Recall the things said n. 1045.

The thing remains morally the same as that concerning which agreement was made if it is equally good, equally useful to the buyer. Then the contract is not made invalid, because the buyer is not frustrated of the end intended by himself.

1123. The obligations of the seller and the diligence of the buyer chiefly refer to THIS FOURTH CONDITION of the saleable thing. For the thing to be sold will then be physically or morally the object of a just contract if, with respect to substance, quantity, and quality, no fraud, no error, no vice, at least appreciable, intervenes.

Therefore let the following rules be given, for a more subtle explanation of the matter:

FIRST RULE. If the vice is concerning SUBSTANCE, for example if tin is sold for silver, water for wine, etc., the contract certainly is null, and the seller is held, at the will of the buyer, either to rescind the contract or to restore the excess of the price; and moreover to compensate the damages following from his deception, provided they were in some measure foreseen. Likewise, if quality has passed into substance, for example if the buyer expressly said: "I do not want wine, if it is not old" (III, 819).

Advert that here it is a question of a thing substantially vitiated relatively to human use and to the end for which it is bought. Whence it is probably not unjust to sell quid pro quo, as apothecaries are accustomed to do, provided that what is handed over is certainly of equal utility and the price is diminished; - likewise, to sell at the common price a thing which in itself is more perfect, but has another thing of worse condition mixed in; suppose better wine, which after mixture with water does not become worse than common wine; provided the buyer does not buy it for preserving, because wine mixed with water is easily corrupted (III, 820; H. Ap., X, 185).

SECOND RULE. If the vice is concerning QUANTITY, that is, concerning number, weight, or measure, the damage must be repaired; but the contract has force, except in the case in which deceit gave cause to it (cf. above n. 1047, 3).

Yet if the seller could not obtain the just price, for example on account of an unjust legal rate or an unjust monopoly of buyers, it is not improbable that the seller can diminish from the measure only so much as is required so that he may perceive the lowest just price; for thus he justly frees himself from unjust vexation. Yet hallucination in this matter is to be guarded against (III, 822; H. Ap., X, 186).

THIRD RULE. If the vice is concerning QUALITY, for example if wine is corrupted, cloth burned, one must distinguish, with account had of the circumstances. For the seller is either questioned in species or in general, or is not questioned. 1. When questioned in species whether the thing has a certain defect, the seller is held to manifest whatever vice; otherwise the sale is null, on account of error which, by reason of the circumstances, easily becomes substantial; or at least the sale is rescindable at the will of the buyer, on account of the deceit which the seller used. 2. When not questioned, or questioned only in general, he is held unequally according as the vice is patent or occult, notable or light (III, 823).

a) If the vice is patent, so that it can generally be known by anyone with common diligence, for example if a horse is one-eyed, he is not held from justice to manifest the defect; for then the thing itself speaks. Therefore he can leave the buyer, with the peril of erring, to his own judgment.

Except if the ignorance of the buyer is manifest, for example because he is inept, a child, etc.; for then, in relation to him, the vice is truly occult (H. Ap., X, 187).

b) If the vice is occult and at the same time notable, that is, if the vice, not knowable by common diligence, renders the saleable thing harmful, useless, or notably less useful for the end for which, in present circumstances, it is commonly accustomed to be bought, - the seller is held from justice to disclose it; for otherwise the buyer is not considered to consent to the purchase, or at least to the price of the purchase. Wherefore, either the contract is rescindable at his will, or at least it must be reduced to equality.

But when a vice is to be held as notable must be determined from various circumstances of time and place, from custom, and from the Law itself, which recounts various vices of this kind.⁰¹ But if the seller protests that he does not wish to render account of any defect, but wishes to sell the thing as it is, he is held to nothing; for then the contract is considered aleatory. Hence, deservedly tolerated is "the custom which prevails somewhere, especially in great markets, that animals be sold in this way, even if the vices are most occult. The reason is that, for taking away lawsuits, on account of the common good, this can be sufficiently rendered honorable by custom; provided, it must be understood, that the thing is not sold beyond at least the highest just price for which the thing is worth, with account had of that occult vice" (III, 823; Spanish Code, 1493).

c) If the occult vice is light and of small moment, the seller is not held from justice spontaneously to declare it, provided he preserves a proportioned price. For then buyers are not reasonably unwilling, because otherwise negotiation would become too difficult, with detriment of society.

For the rest, no buyer is for that reason induced into error, since an artful manner of acting of this kind is sufficiently known to all; as it is known to all that merchants are accustomed somewhat to paint their wares and to expose the better ones exteriorly (Linz. Quart. Schr., 1885, p. 101).

Note. Sometimes, when an obligation of justice does not exist, there can be an obligation of charity of warning the buyer, lest by carelessness or ignorance he be the author of damage to himself or to others, for example that wine not be preserved long if it is not apt for this, etc.

1124. II. The seller is held to hand over the thing sold; that is, to remit it into the power and discretion of the buyer. But this obligation can cease from a legitimate cause, for example because the buyer does not pay the price to be paid before handing over, or because there supervenes a reason of doubting whether he can pay.⁰² But the obligation of handing over imports the obligation of preserving the thing well meanwhile.

Moreover, the seller is held to hand over to the buyer the thing and its accessories: 1. in the place and manner concerning which agreement was made in the contract; 2. at the prefixed time; otherwise the buyer has a right to rescission of the contract and to reparation of damages, unless the delay proceeded from the deed of the buyer, or from fortuitous chance, or greater force; 3. in the state in which it was at the time of sale; otherwise what was agreed upon would not altogether be handed over; 4. according to the measure expressed in the contract.⁰³

The fruits of the thing sold and not handed over belong to him who is held to bear its peril (III, 798). Cf. the things said n. 1119 and the things to be said n. 1131.

How the matter must be arranged if one or another of the aforesaid conditions is lacking must be taken from civil Law.

1125. • III. The seller is held to furnish the buyer security of the thing, that is, to make him secure concerning peaceful possession of the thing and concerning its utility.⁰⁴ The reason is that, from the very nature of the contract, the seller does not acquire a right in the price unless he has placed the merchandise in the power and discretion of the buyer. But this is not done, at least perfectly, when the buyer, on account of causes existing before the sale, is disturbed in possession of the thing through eviction; or when, on account of occult vices, he finds it inept for its natural end, or the end expressly declared to the seller; which vices in Law are called redhibitory vices (III, 800). These things must be explained more fully.

1126. Questions. QUAER. 1. What is EVICTION, when and how is the seller held concerning it?

Eviction is the legitimate disturbance of the buyer in possession of the thing bought, which either totally or partially is vindicated by the true owner, or by another having right in it. Thus, for example, Paul sells his field to Peter; James proves that this field is his own, or is burdened by a hypothec, and the judge decrees that the said field must be returned to James: in this case eviction is had with respect to the buyer, who is despoiled of the thing bought by himself.

The seller is held concerning eviction if the cause of eviction, existing at the time of sale, was not declared to the buyer. But the seller can stipulate that he not be held concerning it. Yet this is not admitted in favor of a seller of bad faith, because "pacts which contain a shameful cause are not to be observed."⁰⁵ But if "by the malice or fault of the judge, or by the force of another, or by negligence of the buyer, the thing is evicted, the seller is held to nothing; for fortuitous peril belongs to the buyer" (III, 800, fin.).

By the law of nature, a seller of good faith is held to return the price accepted, insofar as he has been made richer. A seller of bad faith is held to preserve the buyer altogether unharmed.

By Positive Law, a seller of bad faith is always held to render the buyer unharmed. The same obligation also lies on a seller of good faith, except nevertheless the case in which the contrary was agreed. But no reparation of damages is owed to a buyer of bad faith.

QUAER. 2. What are REDHIBITORY VICES, and how is the seller held concerning them?

Redhibitory vices are called occult defects, not known to the buyer, existing at the time of sale, which wholly impede the natural use of the thing, or the use declared to the seller, or so diminish it that the buyer would not have bought it, or would have bought it for less, if he had had knowledge of them. Of this kind are, for example, mange of sheep, asthma of horses, rancidity of pigs, etc.

The seller is held concerning redhibitory vices, even if he was ignorant of them. He is obligated, at the will of the buyer, either to rescind the contract or to restore part of the price, according to the estimation of experts. Yet there is a great distinction between a seller of good faith and a seller of bad faith, as you will easily gather from the things said n. 936 and n. 941.

Note. The obligations of the buyer, with respect to merchandise, we shall explain below (n. 1131).

1127. NOTIONS. I. On price in general. The price of a thing is the expression of its saleable value through a certain sum of money. It is said: of saleable value, that is, of the aptitude which the thing has for being exchanged with others in human commerce.

Price, in general, ought to have three conditions: 1. that it consist in money; otherwise it would be exchange; - 2. that it be serious, that is, not simulated, nor derisory; otherwise it would be donation; - 3. that it be determined by the contracting parties, at least radically, or by someone to whom determination has been committed (III, 794).

II. On just price. A just price is that which is rightly estimated to equal the value of the saleable thing. - One is legal, which is taxed by law or by a magistrate. Another is vulgar or natural, or here and now current, which, the circumstances having been considered, is determined by common estimation. Another is conventional, which is determined by the free pact of the contracting parties.

Now: 1. A legal price excludes every variety, because it is defined by law. But the law itself can cease, or a just reason here and now excusing can be given.

2. But a vulgar price admits variety, because the judgments of men vary concerning the value of the same thing. Thus the price is accustomed to grow by reason of the abundance of buyers, or abundance of moneys, and scarcity of wares; on the contrary, it is accustomed to decrease by reason of scarcity of buyers or moneys, and by reason of abundance of wares. Hence, a vulgar price, within the limits of the just, is distinguished in such a way that it is: a) highest or rigorous, above which the thing is not accustomed to be estimated; b) lowest or pious, below which the thing is generally not estimated; c) middle or moderate, which stands between each.

How great that breadth of vulgar price is can scarcely be defined. - Yet commonly it is admitted that the price of cheap and necessary things has less breadth than that of precious and superfluous things. Thus, for example, wine or something similar which is worth five lire can be sold for six or bought for four; or if it is worth ten, it can be sold for twelve and bought for eight; if it is worth one hundred, it can be sold for one hundred five and bought for ninety-five. But a house or villa which was sold for 20,000 can after a year be bought for 12,000, and conversely (III, 803, 804).

3. Conventional price has for its object precious things, paintings, gems, horses, etc.; extraordinary things, singing, music, etc.; or things whose value is commonly unknown. Whence it too can admit variety, according as fluctuation of estimation happens on the part of experts or lovers.

1128. PRINCIPLES. I. One must stand of itself from commutative justice by the legal price. For to civil authority belongs the right of establishing whatever regards public commerce. Individual sellers besides, since the rate is determined in their favor, acquire strict right that another not entice buyers by selling the thing for a lesser price (III, 803).

Yet sometimes it is licit to exceed the legal price, namely: a) if it is not observed by the greater part of the people, with the prince knowing and not punishing; - b) if, circumstances having changed, the rate becomes unjust; c) if an excellent thing is sold, because the prince, in taxing the price, regards only the value of ordinary merchandise. Indeed, it is licit to sell for a lesser price if the rate was established lest things be sold more dearly.

Note. A magistrate who knows that the legal price is going to be increased can indeed provide for himself without evident injustice, but cannot warn others (Lehmkuhl, I, 1328).

II. When legal price is lacking, one must stand by the vulgar price, so that to sell above the highest and to buy below the lowest is unjust. The reason is that that is the just price at which the thing is commonly estimated among men; but if this is not preserved, equality is lacking, which pertains to the nature of commutative justice (cf. Salmant., c. 2, n. 94).

Lesion, in the external forum, does not give place to rescission of sale: in France, unless the deception is beyond half of the just price; in Spain, unless it is beyond the fourth part,1 and only in a double case: when namely the contract was entered upon either by a tutor or by a mandatary who represents an absent person; elsewhere, for example in Germany,⁰¹ otherwise. Yet in the internal forum, any notable lesion obliges to restitution. If the lesion happened in good faith, the one injuring is held at least to restore that in which he has been made richer, that is, in which he spared his own goods, lest he become rich from another's goods (cf. n. 935).

From these things conclude: Since the just vulgar price rests on common estimation, those do not act unjustly who, for gold or ivory which are offered by barbarians, give glass or cloth, or other things common among us. For these cheaper things have great value for barbarians.

III. Conventional price, according to diverse adjuncts, will be just or unjust. And indeed:

1. If each of the contracting parties is ignorant of the true value of the thing, for example judges a precious gem to be glass, the contract is invalid, as resting on substantial error; whence the price must be restored.

2. If each doubts concerning the true price, the purchase will be just, so that, if the buyer afterwards resold the thing more dearly, nothing is to be allotted to the former seller. For both, by agreeing about the price, expose themselves to equal peril.

3. If only one knows the true price of the thing, the purchase will be unjust if experts would commonly easily recognize the value of the thing: for then, with respect to this thing, there is present a price quasi-vulgar among experts. - Except if recognition of the value of this thing is to be attributed to the singular expertise, and therefore industry, of the buyer.

1129. Corollaries. I. It is licit to use industry for selling at the highest vulgar price or buying at the lowest. But it is never licit to use fraud or deceit (Ami du Cl., 1904, p. 476; 1906, p. 765): for anyone has a strict right not to be positively deceived. But once the price within the limits of the just has been determined by agreement, neither can recede from it, since each has assumed the peril upon himself (Lehmkuhl, I, 1327).

Hence: 1. The seller sins against justice if, before the agreement has been made, he deceitfully induces the buyer to pay a greater price than otherwise he would justly have given;3 likewise if, after the agreement has been made concerning the lowest or middle price, he secretly obtains for himself the highest, by deceiving the buyer in the counting of money, in weight, or in measure (Konings, n. 964).

2. The buyer similarly sins against justice if he knowingly buys below the lowest price, by asking the ignorant seller to condone what it is worth beyond this; because such condonation, since it proceeds from ignorance, is null. - But otherwise if, when questioned concerning the value of the thing, he simply remains silent and pays the lowest price; because thus he uses neither force nor deceit (III, 819).

3. The practice of certain merchants is to be reproved, who expose their wares for sale at a very cheap price so that they may turn buyers away from other merchants, but afterwards diminish the weight or measure, etc. Indeed such sellers become guilty of injustice toward other merchants, and are held to restitution for damage inflicted on them; because each has a right not to be impeded by deceit or fraud from hoped-for gain or from gain to be made legitimately (Lugo, disp. 26, n. 135).

But advert for practice: a) Commonly faith is not given to the lies of sellers affirming and swearing that they obtained the saleable thing for themselves at such a price, or sold it to others at such a price, so that thus they may draw the buyer to the highest price; nor to the lies or perjuries of buyers affirming that they bought the thing for so much from others, or that others offered it to them for so much, so that thus they may bring the seller to the lowest price. b) Yet if it were established to someone that faith is given to his lies, etc., and that these truly are the cause of a greater or lesser price, then he would not be excused from the fault of deception and injustice (III, 805). - Cf. Linz. Quart. Schr., 1910, p. 593; Gopfert, II, n. 115, Reclamewesen.

II. He who privately knows that the price of merchandise is going to be increased or diminished soon can sell or buy it at the current price, after the example of blessed patriarch Jacob, provided fraud and lesion of charity are absent. For the future value is not to be regarded, but the present value, which indeed is not varied from some particular knowledge, but from common estimation. Cf. St. Thomas, 2. 2, q. 77, a. 3, ad 4.

We said: a) Provided fraud is absent; for a sale or purchase would be unjust if someone, for example, through public journals, were to spread false rumors about the price soon to be diminished or increased, etc., as is frequently in use today, especially concerning public censuses. - b) Let lesion of charity be absent; for sale or purchase would be illicit if the other contracting party would be cast into grave necessity; or also, if the thing which could easily be sold to several, or bought by several, is sold to one only, or bought by one, who therefore is going to suffer the whole damage alone; or if, when it can be sold to him who is going to consume it immediately, it were sold to another who is going to preserve it. Therefore, excepting cases of this kind, charity does not seem to press. For strictly speaking, he does not injure charity who uses his right, justly taking counsel for his own affairs, although another by accident suffers damage from this (III, 824; H. Ap., X, 188).

III. When an extrinsic title stands, it is licit to sell above the highest price or buy below the lowest. The reason is that that extrinsic title, which is joined to the thing to be sold or bought, causes the accustomed value of the thing to increase or decrease.

1. The extrinsic titles on account of which it is licit to SELL above the highest price are the following:

a) Profit certainly or probably ceasing from alienation of the thing, or damage emerging, or any other inconvenience of the SELLER estimable by price; for a seller of this kind sells not only his bare thing, but also his benefit, or the damage which he suffers. - But advert that the buyer must be forewarned concerning these titles, as also concerning the following, so that he can, if he wishes, provide otherwise for himself.

b) Special affection which the seller reasonably experiences toward his own thing; for from this arises, in selling, an inconvenience estimable by price. But here advert that the special affection of the buyer is not, as the affection of the seller is, a title of selling for more; because, as is commonly taught with St. Thomas (2. 2, q. 77, a. 1), no one can sell what is not his own (cf. Lehmkuhl, I, 1330). Yet several moderns contradict, on account of the received custom, they say, of increasing the price of a thing which is going to bring special benefit to the buyer (Scavini, II, 393; Gousset, I, 840).

c) The mode of selling; for if things are sold in small quantity and by retail, a greater price can be exacted, on account of the greater cares and expenses which then are usually expended for preserving them. Besides, if they are sold at auction, with public power approving this, whatever price is determined by the bidders without fraud is considered just (III, 807-809). Cf. below n. 1134.

2. The titles on account of which it is licit to BUY below the lowest price are numbered as three:

a) Damage emerging from the present purchase, or profit ceasing, or any other inconvenience of the BUYER estimable by price. Whence, with right preserved, you can buy more cheaply a thing from which little utility will come to you. But the seller is to be warned of this from charity.

b) Voluntary offer; hence you can buy for less wares voluntarily offered by sellers running through streets and houses. For the adage bears: Voluntary wares become cheap; and this more probably, says St. Alphonsus, by a third part; and the reason is that this voluntary offer commonly argues either fewness of buyers and abundance of wares, or danger of a hidden defect, etc. But if things become saleable and are offered on account of poverty, it is probable that, also in this case, not otherwise than voluntary wares, they become cheap; and therefore can be bought more cheaply, provided it is not a question of things which are commonly bought and offered, as grain, oil, and similar things. Yet he who buys more cheaply from a poor man pressed by necessity easily sins against charity, if he buys the thing for his own utility, not for the favor of the poor man.

c) The mode of buying; for wares can be bought for less: if they are bought together in great quantity, since the seller by this mode is freed from many cares, expenses, and inconveniences; - or if they are sold at auction, on account of the reason stated above; - or finally if they are exposed for sale among dealers in old things; because things of this kind, even if perhaps precious, are considered to have lost their original price, and to receive another from custom or the agreement of the contracting parties; or at least they suffer the greatest breadth of price, as we already noted (n. 1127). See with respect to these things the Holy Doctor (III, 801, 802; H. Ap., X, 174).

1130. Questions. QUAER. 1. Whether DELAYED or ANTICIPATED payment of the price is a legitimate cause of selling for more, or buying for less?

Resp. Affirmatively, if there intervenes a title excusing from usury, as profit ceasing, damage emerging, peril in exacting the price. Thus it is certain that a thing can be sold more dearly if the price is to be handed over at the time when the thing is going to be worth more, provided it would have been preserved by the seller until that time. On the contrary, it can be bought more cheaply if it is to be handed over at a time when it is going to be worth less (III, 810; H. Ap., X, 178).

Indeed, today this seems to be admitted simply, without inquiry being made about other titles. The reason is both because common estimation thus bears, and because, while the use prevails, not reproved by the Church, of perceiving the legal or vulgar rate from a loan, anticipation or delay of payment is truly estimable by price. And on account of this same reason, chirographs and credits can be bought more cheaply if they are paid by anticipation (III, 829). Public censuses and other titles, concerning which great negotiation takes place today in the mercantile forum (a la bourse), can similarly be bought and sold at the current price, even if that price does not correspond to the inscribed price. For from common estimation, titles of this kind are equated with ordinary wares, whose price grows or decreases according to the diversity of circumstances.

QUAER. 2. Whether chirographs and credits, on account of difficulty of OBTAINING payment, can be bought for less?

St. Alphonsus responds (l. c.): "He who is not the cause of that difficulty licitly buys for less, according as the difficulty or uncertainty of payment is lesser or greater; because with such peril and difficulty they are worth less. - Likewise, a credit uncertain or of difficult exaction can licitly be bought for less, even if it is easy for the buyer to exact it entirely: because price is taken from common estimation, not from the particular circumstance of the buyer."

1131. The obligations of the buyer, once the price has been established, refer both to the price and to the merchandise itself.

1. WITH RESPECT TO THE PRICE. a) He is held to pay the price in that place and time at which the thing is handed over to him, unless it was otherwise agreed, or unless, no caution having been furnished by the seller, there is reason to fear lest he himself be cast down from possession of the thing. b) He must pay interest of the price if by pact it must be paid, or if the thing sold and already handed over is fruitful, or if he himself was in culpable delay. c) He is held to pay also all the expenses of sale and carrying away, except the case of a contrary pact.⁰²

2. WITH RESPECT TO THE MERCHANDISE. a) He is held to assume it into his own power at the established time, or according to the nature of the thing or the custom of the place by determining the time; otherwise, as we have just hinted, he is held toward the seller concerning all expenses made for the sake of preserving the thing, as well as concerning the damage which thence comes to him. b) Indeed, sometimes he is held, at the will of the seller, to rescind the contract (cf. n. 1047).

Preliminary matters. - On the nature of the just price and its division.

961. Nature. - Commutative justice demands that in an onerous contract, such as especially is the contract of purchase-sale, equality be entirely preserved between that which is handed over and that which is acquired; for in an onerous contract the contracting parties do not wish to donate, but to exchange and to acquire the equivalent of that which is ceded.

Therefore the just price in buying and selling will be: that sum of money which constitutes the equivalent of the vendible thing, or: that sum of money which adequately corresponds to the value of the vendible thing.

But the value of a vendible thing is not something merely subjective, as if it depended on the arbitrary will of the buyer and seller; rather it is something objective, so that it must principally be taken from the nature itself of the vendible thing, insofar as this is considered, not precisely in its physical being, i.e. according to its substance or physical perfection, but in its usual being, i.e. according to its necessity, utility, or pleasurableness in the common use and society of men. For temporal things have been made by God for the use of men, and to the same end they also are bought and sold by men; so that of themselves they must be said to be worth as much as, with attention to the diversity of times, places, etc., they serve the common use of men.¹ But how much these things serve human use, and how much therefore they are worth, this is left to be defined, not again by the private prudence of the seller and buyer, but either by the judgment of legitimate authority, or by the common opinion of men; so that finally it is permitted to establish briefly thus: The just value of a vendible thing is that which, with attention both to the usual nature of the thing and to the diversity of circumstances of time, place, etc., is defined either by legitimate authority, or, this failing, by the common opinion of men; and consequently: The just price of a vendible thing will be that sum of money which, with attention to the nature of the thing, etc., is taxed either by legitimate authority, or, this failing, by the common estimation, as the equivalent of the vendible thing. From this there now spontaneously flows the following very well-known division of the just price.

962. Division. - The just price is divided into legal and vulgar, or natural. The legal price is that which is established by legitimate authority for the common good of some region, province, or place. The vulgar price is that which is taxed by the common estimation of the inhabitants of the place where the vendible thing exists, (not however where the contract is made, unless the seller agrees that the thing be transferred thither. St. Alphonsus.)² But a twofold very notable difference is usually assigned between these prices, namely:

The first difference. - The legal price is defined punctually or arithmetically; but the vulgar price admits a certain latitude, since the common estimation of men is not wont to agree precisely in one point.² Whence also deservedly Authors subdivide the vulgar price, while remaining within the limits of the just, into the highest or rigorous vulgar price, the middle or moderate, and the lowest or pious. The highest is that above which, the lowest that below which, the thing is not commonly estimated; the middle is that which consists between the highest and the lowest. But how great is the distance or latitude between the highest vulgar price and the lowest, this can be judged rather from the usage of the market and the common sense of negotiators than defined by a fixed measure. Yet regularly the doctrine must be admitted which Moralists are wont to hand down here, namely: That in necessary things and those of more frequent sale, for example: in bread, oil, salt, etc., the lowest vulgar price is little distant from the highest, and thus, for example, if the middle price is 5, the highest will be 6 and the lowest 4, so that only the latitude of two degrees, 6-4, is to be admitted; if the middle price is 10, the highest will be 12 and the lowest 8, so that only the latitude of four degrees, 12-8, is to be admitted; if the middle price is 100, the highest will be 105 and the lowest 95, so that only the latitude of ten degrees, 105-95, is to be admitted; and likewise, with proportion observed, one must judge concerning the rest, yet always attending to the usage of the market or the common sense of negotiators, and moreover observing that the latitude of price is greater in superfluous and more precious things, for example: palaces, villas, etc., whose purchase-sale is infrequent, and greater still in things altogether rare and precious, such as singular gems, ancient pictures or statues, etc., whose value is held as estimated neither from law nor from common opinion. See St. Alphonsus,³ and the things to be said below.

The second difference. - The legal price is stable, so that of itself it remains and is in no way varied unless the law itself ceases, or unless there is given a just reason here and now excusing from the law; but the vulgar price with its latitude is variable, so that at any time it is subject to change, i.e. to increase or decrease, according to the diversity of circumstances which continually tend to vary the common estimation of men; and thus (to assign here the principal circumstances):

1° Price is accustomed to increase from common sense:

a) By reason of the multitude of buyers or the abundance of money, and the scarcity of merchandise; for that is commonly esteemed more which is sought by more persons and found with more difficulty.

b) By reason of the manner of selling goods by retail (retail); for that is appraised higher for whose conservation greater labors, cares, and expenses must of themselves be expended by merchants.

2° On the contrary the price is accustomed to decrease:

a) By reason of the scarcity of buyers or of money, and the abundance of merchandise; for what is less sought and is everywhere found is also estimated at less.

b) By reason of the manner of selling goods together in great quantity (wholesale); for that which of itself demands lesser cares, expenses, etc., of merchants is also commonly judged to be of lesser price.

Therefore, practically speaking, you will say most rightly that the vulgar price is that which, when the legal price is lacking, commonly runs in the present circumstances = the price running here and now (the current price).

With these things premised concerning the nature and division of the just price, now let us inquire a little more accurately, 1° by what price one must of itself stand from justice; 2° what are the titles on account of which sometimes accidentally it is licit to sell above the common highest price, or to buy below the common lowest price.

I. By what price PER SE must one stand from justice?

Let the following three rules serve for the solution of this question:

963. First Rule. - If a vendible thing has a legal price, that must be observed punctually from justice; so that the seller who exceeds the legal price acts unjustly and is held to restitution of the excess.

But for the right understanding and application of this rule, it must be carefully observed:

1° Taxation by law is made for merchandise of common goodness and quality; and therefore the rule concerning the legal price does not obtain if it is a question of merchandise which is notably more precious or worse than usual; but in the former hypothesis the seller can licitly increase the price, and in the latter he must decrease the price.

2° The legal tax must be just and still in force; and hence the rule concerning the legal price again will not obtain, a) if the tax of the law is no longer observed by the greater part of the citizens, with the magistrate silent; and b) if, circumstances having changed, for example on account of sterility, etc., the tax becomes unjust. Cf. St. Alphonsus.¹

3° The legal tax is ordinarily constituted in favor of buyers, so that ordinarily even the seller alone is bound by that tax, and the buyer consequently can licitly buy below that tax, provided he remains within the limits of the vulgar price.

4° The legal tax in these our times is very rare, and scarcely occurs, except in certain places as to bread, or in a city, besieged in time of war, as to things necessary for life. For many political writers judge that nowadays, when there is so great a facility of transporting merchandise by railroad, etc., and so great a competition of merchants is found, it is regularly no longer expedient that the prices of things be taxed legally. Whence also the resolutions of Moralists concerning the legal price will more rarely come into use in our time.

964. Second Rule. - If a vendible thing does not have a legal price, from justice one must stand by the vulgar price running here and now; so that it is not licit to sell above the highest vulgar price, nor to buy below the lowest.² Whence he who sells above the highest vulgar price sins against justice and is held to restitution of the excess; he who buys below the lowest sins against justice and is held to restitution of the defect. Yet, fraud excluded, of itself it is licit to sell at the highest vulgar price, or to buy at the lowest.

It is said: Fraud excluded; for although of itself it is licit to sell at the highest or to buy at the lowest, nevertheless each one has the right not to be deceived by fraud; and therefore one will offend against justice and be held to restitution, even if the highest price has not been exceeded: a) if, once an agreement has been made concerning the middle or lowest price, he secretly obtains the highest for himself by deceiving the buyer in the counting of money, in weight, or in measure; and b) if before the agreement has been made he deceitfully induces the buyer to pay a greater price than otherwise he would justly have given.

Here however observe for practice: commonly faith is not given to the lies or perjuries of sellers, by which they affirm that they procured the vendible thing for themselves at so much, or sold it to others at so much, so as thus to draw the buyer to the highest price; nor to the lies or perjuries of buyers, by which they affirm that they bought the thing from others at so much, or that others offered it to them at so much, so as thus to draw the seller to the lowest price. For it is sufficiently known that sayings of this kind are common stratagems of negotiators, which do not deserve faith, and therefore do not constitute deception properly so called. Whence sellers or buyers of this kind indeed sin by lying or perjuring; but, since in reality by such lies they do not deceive the other, they do not on account of them offend against justice, and therefore will not be held to restitution, always supposing that they do not sell above the highest, or buy below the lowest. Yet if in a particular case it were clear to the aforesaid sellers or buyers that faith was being given to their lies, etc., and that these were truly the cause of a greater or lesser price, then they would not be excused from the fault of deception and injustice. - But as to the manner of acting of many merchants, who ask something above the highest price, so that they may bring buyers, who are accustomed to offer less, to the just price, it seems it must be said: such a manner of acting, as being commonly received, and of itself not mendacious, cannot be condemned of fault; provided however those merchants, where perhaps they obtained what they ask, remit to the buyer that which exceeded the just price.

965. Third Rule. - If it is a question of extraordinary things, whose price is taxed neither by law nor by the estimation of the common people, such as extraordinary gems or stones; singular ancient pictures or statues; rare and precious books; horses eminently beautiful; foreign birds, etc. (so-called rarities), which do not pertain to common human use and society, but to luxury, splendor, and the pleasantness of men, and among which dances, songs, the abuse of a woman, etc., can also be reckoned; the solution of the question concerning the just price is very often quite ambiguous. Indeed I, that I may openly profess what I think concerning this matter, think, saving a better judgment, that this can be established:

Such very rare things can justly be sold and bought at that price concerning which the contracting parties themselves, without fraud and freely, agree, in the following cases:

1° If the purchase-sale is made between parties who both wholly ignore the greater or lesser preciousness of such a singular thing; because in this hypothesis the contract entered is not a simple contract of purchase-sale, but at the same time a quasi-aleatory contract, in which each party commits himself to fortune. Thus, for example, Titius would not be accused of injustice who bought an illustrious ancient picture at a cheaper price from Caius, where both, ignorant of the preciousness of this picture, without fraud and freely agreed concerning such a price.¹

2° If the purchase-sale is made under the spear, i.e. in public auction; because public auction is an extraordinary title (as will be said below), on account of which whatever price, with fraud excluded, is determined by the bidders can be judged just.

Likewise I think it can be resolved relatively to the buyer, namely: that the buyer can justly buy such a thing, although precious and known by him as such, at a cheap price (for a trifle):

a) In the case in which that thing, for example an ancient and precious book, is publicly exposed for sale in the market among antiquarians, i.e. among those who are accustomed to sell antiquated things; because by this very fact that the thing is exposed in the market, it has as it were lost its ancient price, and receives its price from the judgment of buyers who come together to that market, in almost the same manner as we said above concerning things sold in a public auction.

b) In the case in which that thing is now actually destined to a vile use, for example if an ancient book now is being carried to be sold for tearing up, or some picture is now handed over to children for play and soon perhaps will be torn up; for in these circumstances that thing is judged again to have lost its price, and consequently to be able to be bought at that price for which it is commonly worth for that vile use. Thus also it is everywhere asserted by Authors that a buyer, when among common things destined to vulgar use he finds a thing which by chance he knows to be precious, for example a medicinal herb among common herbs destined for the fodder of horses and cows, can justly buy those common things at the price for which they would vulgarly be bought by others for such a use.

c) In the case in which that thing, for example a singular picture, from the common judgment of experts is vile, and the buyer from private study recognizes in it a certain preciousness; for in this hypothesis, since the thing is not accustomed to be esteemed at more by the experts themselves of such a region, it must be ascribed to the fortune and industry of the buyer alone that from this he has known how to procure an advantage for himself.

d) In the case in which that thing, even from the judgment of experts, does not have a stable and real value, such as, for example, a picture of a celebrated master, Raphael, Rubens, etc., is judged to have; but only an altogether volatile and relative value, or the value, as they say, of affection, founded namely in the particular affection of one or another buyer seeking that thing to complete, for example, his singular Museum of such rarities; for no reason appears why the buyer must bring his particular affection into the reckoning for determining the price.

966. • But with the cases assigned thus far excluded, the question concerning the just price of singular things which have neither legal nor vulgar price is greatly controverted among Moralists:

St. Alphonsus¹ with Lugo, Lessius, and others defends as more probable: that in the purchase-sale of a singular thing that price must be observed from justice which is taxed by the persons of such a region skilled in that matter; because justice seems to require that even in these things equality be observed, if it can be observed; but it can be observed where there are experts able to appraise these things. Whence in the purchase-sale, for example, of some singular gem, the judgment would have to be investigated from the jewelers of such a place; in the purchase-sale of a rare picture the judgment of painters, etc. Yet the patrons themselves of this opinion admit that the just price of things of this kind suffers a very great latitude, since a picture has been seen to be taxed by many experts at $500 for which 100 would not be given if it were sold; so that the price of the thing which is here and now to be sold must be taxed, with all concurrent circumstances.

On the contrary Card. Toletus¹ with Navarro, Valentia, Medina, and others defends: that singular things pertaining to the adornment or delight of life, since they do not have a legal or vulgar price, have only the price which they call conventional, i.e. that concerning which the contracting parties, apart from fraud, freely agree; and thus there would not be injustice if someone, for example, received $4000 for an ancient statue, or another similar thing, provided the thing is such as it is sold; in other words: provided there is not error concerning the substance, so that, for example, that which is sold as a gem is not glass. And to this opinion, as to the substance, there also adheres the more recent Anonymous Author in the Book whose title is: Examen Raisonne,² etc. Indeed St. Alphonsus himself³ asserts concerning this opinion that it is rightly called probable by the Salmanticenses.

Therefore, with the described diversity of opinions standing, it will be permitted for practice to say that those are not to be disturbed who in good faith and freely agree according to their own judgment in such things.

II. What are the titles on account of which accidentally it is licit to sell above the highest vulgar price, or to buy below the lowest vulgar price?

Where there will be added a threefold special question: a) concerning goods voluntarily offered; b) concerning anticipated or delayed payment; and c) concerning particular knowledge of a price soon to be diminished or increased.

967. • The titles, extrinsic to sale, on account of which accidentally it is licit to sell above the highest vulgar price, principally are:

1° Damage emerging from the present sale: namely if the seller, from the fact that he sells his thing to the buyer, suffers a damage which he would not suffer if he did not sell the same; for example, if you sell to another an instrument necessary or very useful for the exercise of your art, which afterwards you will not be able to buy except at a higher price.¹

2° Profit ceasing from the present sale: namely if the seller, from the fact that he sells his thing to the buyer, loses profit which he would obtain if he did not sell the same; for example, if now you sell grain to another which you were going to reserve for the time in which grain will be worth more.

3° Peril or some other inconvenience, estimable by price, arising from the present sale; namely if the seller, from the fact that he sells his thing to such a buyer, is truly exposed to the peril of never receiving the price from the same, either in whole or in part; or to the peril of not receiving the price from the buyer except with extraordinary expenses.

But for the just practical use of these titles it must be carefully observed that Moralists commonly require: a) that the seller forewarn the buyer concerning titles of this kind, insofar as he can, if he wishes, procure that thing for himself by another way; and b) that the seller, by force of such titles, not sell the thing for more than the titles themselves are worth by prudent estimation. Indeed not a few still require, c) that the seller sell the thing at the instance or in favor of the buyer; and hence, according to them, the seller could not justly sell for more if he sells only to provide for his own necessities, although from this sale he would suffer emergent damage or ceasing profit; because in the case the seller himself, and not the buyer, seems to be the cause of such emergent damage, etc. "But," says St. Alphonsus,² "the opposite seems more probable to me; ... because the buyer, by accepting the contract, now himself is the true cause of the seller's damage."

4° Special affection of the seller toward the thing itself sold; for the privation of a thing toward which the owner is singularly affected, for example because he received it from a Prince or from his ancestors, is deservedly judged estimable by price; and therefore in the case the seller will licitly be able to exceed the vulgar price by as much as that affection is reasonably estimated. Yet here again, as we noted above concerning other titles, it is required that the seller forewarn the buyer concerning his special affection, etc.

Moreover, it is necessary that you by no means confuse with the aforesaid title of the special affection of the seller the special affection of the buyer; for according to the opinion very common among Theologians, especially the older ones, the special affection (I do not say of many buyers, but) of the present buyer as an individual is not a title by which alone it is licit to sell a thing dearer; because on this title alone the seller would unjustly exact a price for that which is not his.¹ "If someone," says St. Thomas,² "is helped much by the thing of another which he has received, but he who sells is not damaged by being without that thing, he ought not to sell it at a higher price; because the utility which accrues to the other is not from the seller, but from the condition of the buyer. But no one ought to sell to another what is not his, although he can sell to him the damage which he suffers." - And indeed this opinion is admitted as certain by any Theologian even more recent, indeed also by any fearful seller, whenever the discussion is about the case in which the present buyer is specially affected toward the thing sold by reason of necessity or want (on account of necessity or present embarrassment); since everyone understands how injurious it is to wish to grow rich precisely from the head of the necessity or want of one's neighbor. But whenever it is a question of a case in which the buyer is specially affected toward the thing, not by reason of necessity, but only by reason of utility, convenience, or delight, which the thing will procure for him, the same opinion scarcely seems to harmonize with the usage, sufficiently common nowadays, by force of which sellers commonly in such a case exact an increase of price from the buyer. Whence a doubt arises: whether this usage can be tolerated, or rather, with prudence leading, must be reproved as an abuse and corruption? Indeed I judge, with some more recent Doctors, that this sufficiently common usage can be tolerated, at least in the hypothesis that the thing toward which the buyer is specially affected by reason of utility, etc., is judged from today's vulgar estimation to have a certain greater real value, although relative, for example that the field of Titius has a greater real value relative to the neighboring estate of Caius. Indeed I would think that this usage in this hypothesis cannot be said to be diametrically opposed to the opinion of St. Thomas related above, since it supposes that the utility accruing to the buyer arises from the singular condition of the buyer; and therefore also grounded, it seems to me, is the resolution which the learned Kenrick,¹ having first alleged and admitted the opinion of St. Thomas, hands down in these words: "if from the circumstances it is clear that the thing is commonly esteemed at more on account of that special utility which it will bring to the buyer, it will be licit to ask a greater price. Thus sometimes a small field, which of itself is worth little, and provides almost no utility to the owner, is of great value to the owner of the neighboring estate: and therefore it is justly sold for that price which seems fair to most, that matter being considered."

Besides, in general it will still be useful to have noted that nowadays, on account of the changed circumstances of the times, the special affection of the buyer by reason of utility, etc., occurs more rarely, one or another singular case excepted, at least nakedly and simply, i.e. without another accompanying title. For now there is so great a competition in commerce, so great a facility of acquiring merchandise of any species, so frequent and variable an alienation of the same things, for example of the same fields or houses, that either special affection toward such a determined thing is scarcely given, or at least there is a plurality of buyers.

5° Finally, the fifth title for justly exceeding in sale the highest vulgar price is the manner of selling under the spear, or public auction; for in such an auction whatever price is freely and without fraud determined by bidders is judged just, as will be explained more broadly in Art. II, where sale in species is treated.

968. • Besides the five titles assigned thus far, by many Authors there are still assigned: scarcity of things, multitude of buyers, abundance of money, manner of selling in small quantity, etc. But circumstances of this kind, strictly speaking, are not titles of exceeding the vulgar price; rather they are only causes on account of which the vulgar price increases from common estimation, without ceasing to be vulgar. Whence the seller, demanding a greater price in the aforesaid circumstances, in reality does not sell above the vulgar price; but observes the price here and now vulgar, or here and now running. See above n. 962.

969. • The titles on account of which accidentally it is licit to buy below the lowest vulgar price especially are:

1° Damage emerging from the present purchase. 2° Profit ceasing from the present purchase. 3° Peril or some other inconvenience, estimable by price, arising from the present purchase, for example the peril of never receiving from the seller the thing sold, for which the price has already been paid by the buyer. 4° Sale under the spear, or public auction; to which here sale made by dealers in old things seems able to be assimilated, since things exposed among them are judged to have lost their ancient price, and to receive another price from custom or the agreement of the contracting parties.

The further explanation of the aforesaid titles will be open by itself to anyone from those things which were noted in Point I concerning the same titles, considered relatively to the seller.

970. • But with the titles assigned on account of which accidentally it is licit to buy below the lowest vulgar price, there are again joined by various Authors: scarcity of buyers, abundance of merchandise, manner of selling in great quantity, etc.; but these or similar circumstances indeed cause the vulgar price to decrease from common estimation, but by no means constitute a title of buying below the lowest price running in the aforesaid circumstances. See above n. 962.

Note. - For the completion of the doctrine concerning the just price there remains for us a threefold question to be solved, already indicated at the beginning of this section, namely:

971. • Query 1° Whether it is licit to buy more cheaply voluntary goods, i.e. goods voluntarily offered by the seller seeking buyers?

Resp. Since a voluntary offering of merchandise, from things commonly occurring, argues either scarcity of buyers and abundance of merchandise, or danger of a latent defect or of a cloaked excellence, etc.; hence the common opinion has prevailed that the common proverb is just: Goods voluntarily offered become cheap; and this more probably, says St. Alphonsus,¹ by a third part. - But this resolution is valid not only in the case in which the voluntary offering of merchandise is made by the seller by reason of acquiring profit, as is wont to be done by sellers going through the streets and houses with their merchandise; but probably also, with strict justice considered, it seems able to be admitted (although it ought not to be advised) in the case in which a voluntary offering is made by the seller by reason of poverty by which he is pressed (provided it is not a question of such things which are commonly bought and offered, as grain, oil, and similar things); for the want of the seller does not effect that the price is changed. Yet we said notably: with strict justice considered; for, as St. Alphonsus¹ deservedly observes, the buyer will easily sin against charity if he buys more cheaply a thing voluntarily offered by a poor man pressed by necessity, not solely in favor of the poor man, but for his own utility, for example because he himself needs that thing, etc. The Lydian stone, by which it is necessary to examine the honesty of such contracts, is not, as the most wise Pontiff Benedict XIV insinuates, rigorous justice alone, but in addition Christian charity.

972. • Query 2° Whether because of delayed payment a THING CAN BE SOLD ABOVE THE HIGHEST VULGAR PRICE, - OR because of anticipated payment BOUGHT BELOW the lowest?

Resp. Delayed or anticipated payment is considered by very many Theologians as a virtual loan; so that one selling on credit or with delayed payment (on credit) can by this very fact be judged as it were to lend money to the buyer for the time of credit or delayed payment; and similarly, one buying with anticipated payment can by this very fact be judged as it were to lend money to the seller for the time of anticipation. And therefore the doctrine concerning a loan is usually applied by the same Theologians to delayed or anticipated payment, which is reduced here to a few points:

a) It is illicit to receive an increase of the principal, i.e. more than was given in loan, immediately from the loan, or by force of the loan alone. Consequently it will also be illicit to receive profit, or to sell more dearly precisely on account of delayed payment, or to buy more cheaply precisely on account of anticipated payment.

b) On the contrary it is licit to receive some proportionate increase on the occasion of a loan on account of a just title extrinsic to the loan, namely on account of emergent damage, ceasing profit, or peril of the principal. Consequently it will also be licit, proportion being observed, to sell a thing more dearly on the occasion of delayed payment, or to buy more cheaply on the occasion of anticipated payment, on account of emergent damage, ceasing profit, or some other peril estimable by price, provided the buyer is warned of these in the first hypothesis, and the seller in the second hypothesis, according to the things said above in n. 967. - Moreover many¹ still defend as probable relatively to delayed or anticipated payment, that it is also licit on the occasion of delayed payment to sell more dearly, and on the occasion of anticipated payment to buy more cheaply by the title of custom and vulgar estimation of the place, namely: if in such a place there is in force the custom of selling on credit, and, this custom standing, goods are commonly estimated at more, since for buying thus a plurality of buyers is wont to come together, and in that plurality there is the peril lest the price more often be lost; or similarly, if in such a place there is in force the custom (rare indeed) of buying with anticipated payment, and, this custom standing, goods are commonly estimated at less, since then regularly there occurs a scarcity of buyers and a plurality of sellers. - But observe that this resolution of many, strictly speaking, turns outside the question proposed above; since in the supposition of this resolution the price of the merchandise increases or decreases from vulgar estimation; so that in the proper sense it is not sold above the highest vulgar price, or bought below the lowest, as is understood of itself from the things handed down above, n. 962.

c) Finally, by some more recent authors there is defended a thesis, formerly more rarely heard in the schools, but nowadays, as they say, on account of so great a change (comparatively to former times) of the use of money in commercial and industrial business, becoming more prevalent, namely: that, the titles assigned thus far excluded, neither does it seem illicit, on the occasion of a loan of money, and therefore also on the occasion of delayed or anticipated payment, to receive some proportionate increase by the title of the use of money granted to another; since the very use of money, according to them, in the present state of commerce and industry, can be judged estimable by price, except only the case in which it is a question of the poor, to whom money is lent for consumption and to relieve their want. - But whatever may be the case concerning the value of this opinion, it will surely be permitted without hesitation to defend as probable: that, the titles alleged above excluded, on the occasion of a loan of money, and therefore also on the occasion of delayed or anticipated payment, some proportionate increase can justly be received from the non-poor according to the rate of civil law, or, this failing, according to the vulgar rate.

973. • Query 3° Whether he who by PRIVATE knowledge knows that the price of merchandise is shortly to be increased or diminished can nevertheless sell or buy at the price running here and now?

With the warning premised that here it is not a question of the case in which someone secretly knows that the price of a thing is soon to be diminished on account of an intrinsic defect of it already existing, for example, the price of some debt soon to be diminished because the debtor is already unable to pay; but only of the case in which someone privately knows that the price of a thing is soon to be diminished or increased on account of some extrinsic cause, for example, that the price of public securities (bonds) is soon to be diminished or increased by reason of certain events certainly or probably future:

Resp. Affirmatively, provided fraud is absent and injury to charity. For, as St. Thomas rightly notes,¹ "The seller who sells a thing according to the price which he finds does not seem to act against justice if he does not disclose what is future." For one must regard not the future value, but the present value; and the present value is not varied by some particular knowledge. For the same reason it will also be licit for the buyer to buy merchandise at the current price, although he privately knows that the price is soon to be increased; and thus, for example, according to the testimony of Genesis,² Joseph, knowing the future sterility on account of which the value of grain was to be increased, bought a great abundance of it at the current price and stored it away.

I said: a) provided fraud is absent; for it cannot be doubted that such sale or purchase is unjust if it is caused by fraud or deceit, for example by spreading through public newspapers or a telegraphic report false rumors of a price soon to be diminished or increased, etc., as nowadays, alas, is practiced rather frequently, especially relatively to public securities.

I said: b) provided injury to charity is absent; for sometimes it would more or less be repugnant to charity to buy or sell in such a way, namely: if the other party were thereby thrown into grave necessity, or even if the thing could easily be sold to many or bought from many, and is sold to one or bought from one, who therefore alone will suffer the whole damage. Nevertheless, excepting singular cases of this kind, charity does not seem to urge. Indeed it is of more abundant virtue, says St. Thomas,¹ if the price is diminished; but, strictly speaking, he who uses his right, justly providing for his own affairs, does not injure charity, although another by accident suffers damage from this.²

974. Practical observation. - Finally concerning the matter of the just price it is useful still to note that regularly, unless I am mistaken, the confessor will not wander from the right way who, in so manifold a variety of cases pertaining here, attends chiefly to that which, according to the judgment of prudent men, is wont to be done in contracts in which no fraud and bad faith intervenes.

292. Merchandise, or the object of sale, can be any thing estimable in money and belonging to the seller, unless a special prohibition of positive law is present.

It is said, 1. "any thing estimable in money," whether that thing be corporeal or incorporeal, such as a right of nobility. It is not lawful to buy or sell spiritual things for a temporal price, for this would be simony. The thing must be valued in money, because otherwise there is no longer a sale properly so called, but an exchange. Hence if someone gives, e.g., ten sheep for a horse, it is an exchange rather than a sale. These three contracts must be accurately distinguished: exchange, purchase-sale, and currency exchange. For if one thing is delivered for another, there is an exchange; if a thing is delivered for money as a price, there is purchase-sale; if one kind of money is delivered for another, there is currency exchange.¹³⁴

It is said, 2. "belonging to the seller." Therefore the sale of another's thing is invalid; compare, however, civil laws which sometimes establish otherwise, as was said above, n. 213, concerning a possessor in good faith. Those laws can be observed also in the forum of conscience. It is not required, however, that the seller actually possess the thing; it suffices that he have it in expectation, e.g., grain which is still growing in the blade. But nearly all modern laws prohibit an heir from selling a future inheritance, because such a contract is considered shameful, as inducing a desire for the death of the testator.¹³⁵

It is said, 3. "unless a special prohibition of positive law is present." For certain things cannot be sold while preserving the common good, e.g., certain weapons, poisons, or even precious paintings, etc.

¹³⁴ To these contracts of exchange and currency exchange, as also to the very common instrument which is called a cheque or bill of exchange (Wechsel), the same principles are to be applied which hold for purchase and sale.

¹³⁵ German Civil Code §§ 310, 312.

293. Obligations of the seller.

1. The seller must not demand an unjust price, concerning which there will be discussion below.

2. By natural law the seller is always bound to disclose to the buyer the substantial defects of the thing to be sold. The reason is that otherwise the consent of the buyer will be invalid, and consequently the entire contract invalid. Positive laws in some cases admit the so-called redhibitory action (Wandelungsklage) if a defect of the thing was concealed. Those are considered substantial defects (Hauptmängel) of the thing which render it notably useless for the primary purpose known to the buyer. But with regard to accidental defects a distinction must be made: if the buyer expressly asks concerning these defects, the seller is bound to answer according to the truth, or at least to decline an answer by saying, e.g., I sell the thing in the state in which it now is. For then the buyer can provide for himself; if he does not do so, he will have to bear the loss. But if the buyer does not expressly inquire concerning these defects, then the seller cannot by frauds induce him into error and thus cause him great damage; therefore he is bound to disclose entirely hidden defects which notably diminish the thing, but he need not indicate defects which any prudent person can easily detect.

St. Thomas teaches excellently concerning this matter:¹³⁶ "Concerning a thing which is sold, a threefold defect can be considered. One is according to the species of the thing, and if the seller knows this defect in the thing which he sells, he commits fraud in the sale; hence the sale is rendered illicit.... Another defect is according to quantity, which is known by measure; and therefore if someone knowingly uses a deficient measure in selling, he commits fraud and the sale is illicit. Hence it is said:¹³⁷ 'Thou shalt not have divers weights in thy bag, a greater and a less; neither shall there be in thy house a greater bushel and a less,' and afterward it is added: 'For the Lord abhorreth him that doth these things, and He hateth all injustice.' The third defect is on the part of quality, as if someone should sell a sick animal as healthy; if someone knowingly does this, he commits fraud in the sale, whence the sale is illicit. And in all such things one not only sins by making an unjust sale, but is also bound to restitution." As is evident from the example adduced of the sick animal, the Angelic Doctor speaks of a quality redounding upon the substance; but if there is question of a truly accidental quality, there is no grave obligation of restitution.

3. The seller is bound to deliver the thing physically, or at least morally, the same as that which the buyer intends to acquire. I say, however, at least morally the same; for even if the thing given is physically not altogether that which the buyer thought he was acquiring, nevertheless, if morally it is the same, i.e., almost equally good and useful to the buyer and worthy of the price offered, then there is at least no grave injustice.¹³⁸ E.g., when guests ask for Moselle wine in an inn and the innkeeper gives them wine almost equally good which, however, was not grown on the banks of the Moselle, he does not seem gravely to injure justice, provided, however, that he does not exceed the just price.

4. The seller is bound to deliver the thing sold to the buyer in the state in which it was at the time of the sale. Civil laws are wont to establish, or the contracting parties specially determine, whether the seller or the buyer receives the fruits of the thing before delivery; who ought to bear the expenses of custody; for whom the thing perishes, etc. All these statutes are to be observed faithfully.

¹³⁶ S. theol. 2, 2, q. 77, a. 2.

¹³⁷ Deut. 25:13.

¹³⁸ S. theol. 2, 2, q. 77, a. 2 ad 1.

294. Scholion. On diminution of weight or measure. St. Alphonsus¹³⁹ asks: "Whether one is excused [from injustice] who uses a diminished measure in order to obtain a just price which otherwise he would not obtain because of an unjust rate or an unjust monopoly of buyers? Lugo, Laymann, Palaus, and Sporer with Soto, Valentia, and Toledo, and the Salmanticenses with Rebello, Salas, and Dicastillo affirm this as very probable. The reason is that then he justly redeems himself from vexation." These things, however, are to be understood with a grain of salt and in our times can very rarely be reduced to practice; for it is said in Sacred Scripture: "A deceitful balance is an abomination before the Lord."¹⁴⁰ Especially, the excuse often brought forth by merchants is not sufficient, namely, that they cannot withstand "competition" if they do not diminish weight and measure. For no injury is inflicted upon them by the buyers. Nor may they say that the weight, even thus diminished, corresponds to the just price. For although this is true absolutely, nevertheless it is false after agreement has once been legitimately made concerning such a price and such a weight.¹⁴¹ They can, however, defend themselves against other "competitors" by accusing them of illicit machinations, or unfair competition (unlauterer Wettbewerb, concurrence déloyale). Such diminution of weight or measure is lawful only: a) if universal custom so bears and this can easily be known by the buyers; b) if buyers by unjust means, e.g., by so-called "syndicates" or boycott, compel sellers to a truly unjust price, because then the sellers can defend themselves.

Rules to be attended to by the confessor. Almost innumerable are the frauds which are wont to be committed in the sale of things. To discern whether from those committed there arises a grave obligation of restitution, the confessor should attend to three things:

a) whether the damaging is truly, formally, and efficaciously unjust, and this in grave matter;

b) whether the thing sold is at least morally the same as that which the buyer thought he was acquiring;

c) what the custom in force is in such a sale.

¹³⁹ Theol. mor. l. 3, n. 822.

¹⁴⁰ Prov. 11:1.

¹⁴¹ Thus also Billuart, De contract. diss. 5, a. 3.

Obligations of the buyer. The buyer must fulfill all those things which in the contract of sale have been justly stipulated concerning the mode and time of receiving the merchandise and paying the price; but especially he is bound to pay the just price.

295. Notion and quality of price. Price is the value of a thing expressed in money. But whence the value of a thing is to be taken is not an easy question: whether from common estimation (exchange value, Tauschwert) or from its own intrinsic utility (use value, Gebrauchswert).¹⁴² This second opinion, which St. Thomas, following St. Augustine, defends, seems to be preferred; he says: "The price of saleable things is not considered according to the degree of nature ... but according as things come into the use of man."¹⁴³ For the rest, the two opinions are not so different. For that which is commonly esteemed more dearly also has greater internal utility. I say, however, internal utility; for whether the price can be increased because of the external utility of the thing, because the thing is accidentally very necessary to the buyer, will be said below. But whatever may be true of this question, all teach that the price must be just, i.e., must at least morally equal the value of the thing. Hence St. Thomas¹⁴⁴ says: "Purchase and sale seem to have been introduced for the common utility of both parties, when, namely, one needs the thing of the other and conversely. But that which has been introduced for common utility ought not to be more a burden upon one than upon the other, and therefore the contract ought to be established between them according to equality of the thing. But the quantity of a thing which comes into the use of man is measured according to the price given, for which purpose coin was invented. And therefore, if either the price exceeds the quantity of the value of the thing, or conversely the thing exceeds the price, the equality of justice is destroyed. And therefore to sell a thing more dearly or buy it more cheaply than it is worth is in itself unjust and illicit."

Accidentally, the price can sometimes be increased beyond the intrinsic value of the merchandise, if, namely, the seller suffers particular damage from the sale. On the contrary, "if someone is greatly assisted by the thing of another which he has received, while he who sells is not harmed by being without that thing, he ought not to sell it at a higher price, because the utility which accrues to the other is not from the seller, but from the condition of the buyer. But no one ought to sell to another what is not his own, although he can sell to him the damage which he suffers. Nevertheless, he who is greatly assisted by a thing received from another can of his own accord give something additional to the seller; this pertains to his honorable conduct." Thus again St. Thomas,¹⁴⁵ whom St. Alphonsus follows;¹⁴⁶ and therefore, according to these Doctors, the just price is to be taken: 1. either from the intrinsic value of the thing; or 2. from the emerging loss or gain ceasing which arises to the seller from the sale. This opinion seems altogether to be followed. Therefore the opinion of a few theologians who teach that the price upon which the contracting parties freely agreed is just must be rejected. For if this opinion were absolutely true, then wide doors would be opened to frauds of every kind. E.g., someone selling an estate so situated that another person altogether needs it could licitly sell it at an excessive price; or someone could sell to an ignorant Indian colored glass for a great weight of gold.¹⁴⁷ Certainly in these and similar circumstances it is lawful to demand the highest price. Hence in practice those are not to be disturbed who indeed sell more dearly things which furnish a special utility or pleasure to the buyer, provided they neither demand a wholly excessive price nor abuse the buyer's necessity.

¹⁴² Cf. Vermeersch, De iust. q. 8, n. 339ff.

¹⁴³ S. theol. 2, 2, q. 77, a. 2 ad 3.

¹⁴⁴ Ibid., a. 1.

¹⁴⁵ Ibid.

¹⁴⁶ Theol. mor. l. 3, n. 806ff.

¹⁴⁷ Cf. below, concerning the just price.

296. Distinctions of price. A threefold price is wont to be distinguished: a) legal, b) common, c) conventional.

a) On the legal price. The legal price is called that which has been directly and precisely established by public authority or law, so that it is not divided into highest, middle, and lowest, as will be said below concerning the common price.

It is wont to be employed, e.g., in railway tickets, postage stamps, foods served in certain public places, medicines sold by pharmacists, the hiring of public carriages, certain government monopolies, during wartime or a great dearness of provisions, etc.

Principle. The legal price must be observed in conscience,¹⁴⁸ and indeed from commutative justice, unless it is manifestly unjust.

The reason is that this price is legitimately established for the common good by public authority, which is especially able to judge concerning the equitable price of things and which has high dominion over the goods of subjects. Consequently this price is truly just, while every other discordant price becomes unjust. Hence one who notably injures such a price is bound to restitution. E.g., a driver of a public carriage¹⁴⁹ who demands from inexperienced persons a greater fare than the rate determined by law is bound to restore. When the legal price is established not only in favor of buyers but also in favor of other sellers, namely, lest disorderly competition arise among them, an obligation of restitution can arise not only from increasing but also from diminishing the legal price, because by such diminution unjust damage is caused to other sellers. Thus the common opinion.

Note. Just as epikeia can sometimes be employed concerning other positive laws, so also concerning the legal price, especially: a) if many transgress the legal price with the legislator knowing and remaining silent; b) if the merchandise offered is of a better condition than that whose price is determined by law; c) if the legal price becomes manifestly unjust.

¹⁴⁸ Thus St. Thomas (S. theol. 2, 2, q. 77, a. 2 ad 2), St. Alphonsus (Theol. mor. l. 3, n. 803), and the common opinion. The Salmanticenses treat this question excellently (Curs. Theol. mor. tr. 14, c. 2, n. 110ff.).

¹⁴⁹ Commonly, carriage driver, coachman (Droschkenkutscher, cocher). Although in this case it is rather an excessive price of hire, nevertheless the same principles hold for hiring and sale.

297. b) On the common price. The common price is called that which is determined by the common estimation of men according to the diversity of places and times, commonly the market price, Marktpreis, prix du marché.

It does not consist in an indivisible point, but admits a certain latitude and has three degrees, according to which it is highest, middle, or lowest. How great the distance is between the highest and lowest price cannot be determined by one rule, but depends upon many circumstances, especially upon the scarcity of the merchandise and the multitude of buyers. Generally, however, it can be said that the highest price of some thing is that above which no upright merchant would sell it; and the lowest price is that below which no upright buyer would buy it. At least that excess in price which permits rescission of the contract according to civil laws¹⁵⁰ must also in the forum of conscience be considered an excess beyond the highest price. There are, however, civil codes, e.g., the German Code, which never permit rescission of a sale for this reason alone, that an excessive price was agreed upon. Nevertheless, it is not lawful to conclude: Civil law does not consider such a price so excessive that it rescinds the contract of purchase and sale; therefore such a price is just also in the forum of conscience. For the Angelic Doctor¹⁵¹ teaches: "Human law could not prohibit everything which is contrary to virtue; but it suffices for it to prohibit those things which destroy the society of men, while it regards other things as though lawful, not because it approves them, but because it does not punish them. Thus, therefore, it regards as though lawful, imposing no penalty, that without fraud a seller sells his thing at a higher price or a buyer buys more cheaply, unless the excess is immoderate; because then even human law compels restitution, for example, if someone is deceived beyond half the quantity of the just price. But divine law leaves nothing unpunished which is contrary to virtue. Hence according to divine law it is regarded as illicit if the equality of justice is not observed in purchase and sale." St. Alphonsus¹⁵² observes that in things of small value there is less latitude between the highest and lowest price than in precious things. He establishes this norm: If a thing is worth 5, it can be sold for 4 or 6; if it is worth 10, it can be sold for 8 or 12; if it is worth 100, it can be sold for 95 or 105. But then he adds: "An estate which perhaps was sold for 20,000 can after a year be bought for 12,000." Certainly these things can be held as a directive rule because of the very great authority of the Holy Doctor, but they neither ought nor can always be applied strictly and mathematically in practice.

¹⁵⁰ In France (art. 1674), if the deception exceeds half the just price; in Spain (art. 1291), beyond one fourth. Cf. Austrian Civil Code § 1060; Italian Civil Code art. 1529; Code of Canon Law, canon 1684, § 2.

¹⁵¹ S. theol. 2, 2, q. 77, a. 1 ad 1.

¹⁵² L.c., n. 804.

298. Principle 1. In the absence of a legal price, the common price is to be followed, so that to sell beyond the highest price and to buy below the lowest is unjust.

The reason is that the common price is determined by common estimation and consequently is considered just. For private judgment is often blind, fallacious, and corrupted by cupidity; but common judgment is ordinarily more prudent and less liable to error. Therefore, when there is no more certain rule, namely, a just positive law, common judgment concerning the price of some thing is to be followed. Thus it is also expressly established in ancient Roman law: "The prices of things are determined not according to the affection or utility of individuals, but commonly," i.e., they are estimated commonly.¹⁵³ But that which notably exceeds this common price is unjust. I say, however, common and not private estimation, because private estimation cannot change the common price, at least not without limit.¹⁵⁴ Hence if in some region a certain thing is commonly esteemed highly which in another place is esteemed little, a high price can be demanded in the first place. E.g., if the common estimation of some barbarian people values red cloth more than ivory, an educated man can buy ivory by giving red cloth.

¹⁵³ L. 33, D. book 9, tit. 2.

¹⁵⁴ Cf. below, n. 299.

299. Principle 2. There are extrinsic titles on account of which it is lawful to sell above the highest and to buy below the lowest common price.

With regard to a dearer sale, the principal titles are: 1. gain ceasing and emerging loss, to which the other titles can be reduced, namely: 2. a special affection of the seller for the thing to be sold; 3. the mode of selling. With regard to a cheaper purchase, however, the principal titles are: 1. emerging loss or gain ceasing from the present purchase; 2. a spontaneous offer; 3. the mode of buying.

Concerning gain ceasing and emerging loss for the seller, what was said above, n. 295, from St. Thomas applies. A few things concerning the other titles:

A special affection of the seller for the thing to be sold is a sufficient reason for demanding a price greater than the ordinary price, which is wont to be called the price of affection. E.g., one who takes great delight in a talking parrot can demand a greater price if another wishes to buy that bird. The common opinion teaches with St. Thomas and St. Alphonsus¹⁵⁵ that it is not lawful to demand a greater price for a thing to be sold because the thing brings a special utility or pleasure to the buyer and not to the seller. The reason is that then the seller would demand a price for some thing which is not his. For that special utility or pleasure of the buyer is not the property of the seller. Hence, e.g., it is not lawful to sell above the highest price a field which is very necessary to the neighboring buyer.¹⁵⁶ But there are certain more recent theologians, Gousset,¹⁵⁷ Schwane,¹⁵⁸ Marres,¹⁵⁹ Waffelaert,¹⁶⁰ Génicot,¹⁶¹ and Tanquerey,¹⁶² who regard the contrary opinion as probable, saying that conscientious men also act thus in practice. Nevertheless, they are wont to limit their opinion somewhat. Therefore Noldin¹⁶³ says: "All affirm that this has force only when the buyer seeks from the thing to be bought nothing except convenience or pleasure; but that he commits injustice who demands a greater price because the other needs this thing: for mere need and necessity, which compels another to buy the thing, is not estimable by a price, nor is the needy person considered to donate the excess of the price." But even with this limitation the proposed opinion seems to be slightly probable. For the reason adduced above from St. Thomas retains its force. Hence in these circumstances it is indeed lawful to sell the thing at the highest price but not at an excessive price, unless, however, such a price is considered as a gift and not as a true price.

The mode of selling sometimes permits a much greater price to be demanded, e.g., if a thing must be sold retail in a small quantity (Detailverkauf), or if it is sold at auction. Especially in the latter case any price, whether the lowest or the highest, is permitted, as will be explained more fully below, n. 302. Furthermore, if payment of the price is deferred, the thing can be sold more dearly; but if payment is anticipated, the thing can be bought more cheaply.

The titles legitimating purchase below the lowest price are:

Gain ceasing or emerging loss which arises to the buyer from the purchase. E.g., the buyer does not need the thing but nevertheless buys it from mercy toward the seller. In this way, however, he loses the interest on the money which he otherwise would have had. Consequently, he can buy more cheaply in order to compensate himself.

The spontaneous offer of a thing to be bought is also assigned by St. Alphonsus¹⁶⁴ as a title for buying it more cheaply, according to the adage: "Merchandise spontaneously offered becomes cheaper by one third."¹⁶⁵ For it is often a sign that things exist in great quantity, while, on the contrary, buyers are few. But if things are offered because of the poverty of the seller, the buyer would certainly act against charity if he wished to depress the price, unless, however, emerging loss would arise to him from the purchase.

The mode of buying sometimes permits a notable diminution of the price, e.g., when a great quantity of merchandise is bought, when a thing is bought at auction or from dealers in secondhand goods, etc.

You will ask: Is it lawful to sell things below the lowest common price in order to attract buyers (Reklameverkäufe, ventes de réclame) if other sellers suffer damage from it? If frauds are not employed, e.g., by adulterating merchandise or diminishing the measure, this is lawful, or at least is not contrary to justice, because everyone is free to sell his thing for a small price; otherwise, however, it is not lawful, since then unjust means are employed to cause damage to others. In our times great merchants disposing of ample capital often depress the price of merchandise immoderately in order to drive away weaker rivals. This mode of acting can injure charity, although means injuring commutative justice are not employed.

¹⁵⁵ Cf. the places cited above, n. 294.

¹⁵⁶ Cf. Lehmkuhl, Cas. consc. I, n. 790ff.; Mausbach, Moraltheol. II, 2, § 39.

¹⁵⁷ Theol. mor. I, 840.

¹⁵⁸ Lehre über die Verträge § 19, n. 6.

¹⁵⁹ De iust. l. 4, n. 188.

¹⁶⁰ Tract. de iust. I, n. 613.

¹⁶¹ Theol. mor. I, n. 633.

¹⁶² De iust. n. 749.

¹⁶³ De praeceptis n. 598.

¹⁶⁴ Theol. mor. l. 3, n. 802.

¹⁶⁵ Cf. Cajetan, Comm. in 2, 2, q. 77, a. 1.

300. c) On the conventional price. The conventional price is called that which is determined by the free agreement of the buyer and seller.

Principle. In the absence of a legal and common price, a thing can be sold at any conventional price, provided, however, that neither fraud nor fear is employed.

Hence, e.g., precious paintings, extraordinary gems, ancient manuscripts, etc., do not have a fixed price, but can be sold at any price, however high. But what is to be said if a precious thing, whose true price was unknown to both contracting parties or at least to the seller, was bought for a low price? E.g., someone buys at a low price a painting which is afterward recognized to be a genuine work of Raphael. The response is made with a distinction. If both seller and buyer were ignorant of the true price of the thing, then that price upon which agreement is made will be just. Thus St. Alphonsus.¹⁶⁶ The principal reason seems to us to be that then the buyer begins to possess the thing in good faith and consequently has all the privileges which civil law grants to a possessor in good faith. But civil laws are wont in this case to admit the conventional price as the just price. But if the seller indeed was ignorant while the buyer knew the true price, then again a distinction must be made. If the thing was bought from dealers in secondhand goods or other merchants who, by force of their office, are bound to know the true price of the things offered, then any stipulated price is just. The reason is threefold: a) just statutes of civil codes are wont to permit this; b) the common judgment of the people so bears; c) no injury is done to the seller, since he can and ought to know the true value of the things offered by him. But if the thing was bought from a private person who through his simplicity did not know the true value, then the better and more probable opinion teaches that the purchase thus made is unjust and induces an obligation of restitution. The reason is: a) because then the buyer abuses the simplicity of the seller, who does not consent because of an enormous error;¹⁶⁷ b) because there is no proportion between the merchandise and the price, as is supposed.

But if the true value of the thing is so hidden that according to the common course of affairs it cannot be estimated even by experts in the art, and it was discovered by the buyer only through an extraordinary cause, then the conventional price seems just and the buyer is not bound to restitution. E.g., someone discovers that a treasure is hidden in some field, or that beneath the colors of one image there is found another very precious image. In these and similar cases the fortunate discoverer can also be a fortunate buyer, who probably is not bound to give more than the common price. The reason is that the just price is to be determined according to common and not particular estimation. But according to common estimation these things have only the conventional price actually given by the buyer.¹⁶⁸

Theologians also commonly teach that in a sale by auction any price offered and accepted is just, civil law also so establishing, unless, however, fraud has been employed, as will be said immediately.

¹⁶⁶ Theol. mor. l. 3, n. 802, fourth point to be noted; Noldin, De praeceptis n. 499, teaches the contrary.

¹⁶⁷ Cf. Billuart, De contract. diss. 3, a. 7; Berardi, Praxis Confess. II, n. 646; Gury, Cas. consc. I, n. 930.

¹⁶⁸ Noldin, l.c.; Billuart, l.c.

301. Scholion. On counterfeit money. Not only the counterfeiter of money himself, whether metallic or paper money, and his cooperators, but also all who knowingly use counterfeit money in paying a price are bound to restitution. The reason for the first is evident of itself; the reason for the second is that counterfeit money is not a just price. Nor is one excused from restitution who spends counterfeit money of this kind after he himself received it in good faith in payment of a debt. For from the fact that he himself was deceived he does not have the right to deceive an innocent third person. Restitution is to be made to the person to whom the counterfeit money was given. But if he suffered no damage from the fact that he too spent this money, restitution is to be made to the person who actually suffered the damage; if this person is unknown, restitution is to be made to the poor or to pious causes. Nor is it lawful to give counterfeit money that may have been accepted as alms or as a gift, because then cooperation occurs in the spreading of such counterfeit money among the people.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

XXXIX. The Fathers of Salamanca, tract 14, chap. 2, point 9, § 1, no. 84, ask whether sellers and buyers sin against justice while they deceive one another with lies and perjuries, in order that the price may be increased or diminished within the appointed degrees. They deny it: because these, they say, are the common lies of sellers and buyers, and men commonly know that these are the stratagems of traders, to whom they give no credence; and if they incautiously give them credence, let them impute it to themselves, since they are easy of belief.

I SAY first, that a free man cannot be sold. Therefore if he is sold in bad faith as a slave, the seller is bound to the buyer for the price, and for all profit ceasing and loss accruing, and the sale is void of itself. If, however, he sold in good faith, thinking him to be a slave, the sale is void; yet he is not bound for the damages. See Molina tract. 2. de Iust. disp. 340. Lessius lib. 2. cap. 14. dub. 13. num. 19. Tannerus disp. 4. quaest. 7. num. 55.

HERE a doubt arises: Whether he to whom you have given your thing to sell can retain something of the price; as if you give him a horse, saying: sell it for at least forty gold pieces, and he sells it for forty-two, can he keep those two gold pieces; or if I have given a garment saying, if they give you ten gold pieces, give it; and he received twelve.

I SAY that he is bound to give the whole to the seller, because he acquires no right in the price, neither by reason of the thing sold, which is another's, nor by reason of the labor, which I suppose is not esteemed so much, even though it be agreed that a reward for his labor be paid.

IT IS ALSO DOUBTED: whether anyone can buy a chirograph containing a credit for a lesser price than the writing attests, on account of the anticipated payment; as if I hold a chirograph for a credit of one hundred gold pieces against John at S. Martin's: whether Peter can now anticipate in the month of June and buy the chirograph for ninety-five gold pieces.

I SAY first that it is usurious, on account of the deferral alone, apart from a cause of profit ceasing or loss accruing, to buy such credits for less. So the Doctors commonly hold, with D. Bonavent. in speculo animae, cap. 2. §. the second branch of the principal vice of avarice, etc.

I SAY second: if the chirograph contains a credit that is difficult and liable to litigation, you may buy the credit for less on account of these difficulties, in the judgment of a prudent man. Also by reason of profit ceasing, or loss accruing, you may buy these credits at a lesser price. So Valentia quaest. 20. puncto 2. §. concl. 5. Lessius lib. 2. c. 21. dub. 18. num. 65. Navar. cap. 17. num. 231. Tanner. dub. 4. quaest. 7. num. 46. Medina Cod. de restit. quaest. 38. D. Antonin. 2. tit. 1. cap. 8. §. 3. and 4. Molina disp. 361.

THE REASON is, because those difficulties diminish the price of the credit, and the labors spent in overcoming those difficulties demand a price. The same reason holds for profit ceasing.

THE WHOLE difficulty is, what is to be done when none of these applies.

THE FIRST opinion grants that they may be bought for less for these reasons. First, because such chirographs are esteemed by the judgment of prudent men at less than the value of present money; but the just price is that which is judged by the judgment of prudent men, as Couar. lib. 2. var. cap. 3. teaches, and others cited in Fagundez lib. 5. cap. 16. num. 11. and Tannerus above. Bellarmine is cited among them.

FURTHER, because he who buys those chirographs buys a right to recover the money they contain, leg. minus, ff. de regulis iuris. This right, throughout the whole time it is not paid, is useless and sterile to the buyer.

THIRDLY, otherwise the purchases of personal rents would be iniquitous, which are received in many places. Others subscribe with Diana part. 1. tract. 8. resol. 49.

THE SECOND opinion wholly denies that in that case credits can be bought for less. So Medina Cod. de restitut. quaest. 38. Sotos lib. 6. de Iust. quaest. 4. art. 3. ad 3. Sylvester V. usura, 2. quaest. 14. Gabriel. 4. dist. 15. q. 11. dub. 14. Lessius lib. 2. cap. 21. dub. 8. num. 21. Rebell. 2. part. de oblig. iust. lib. 5. quaest. 13. Angelus V. usura 1. num. 63. Molina Tom. 2. disp. 361. Fagundez lib. 5. cap. 16. num. 13. Tanner. loco cit. Valentia supra, Sot. lib. 6. quaest. 4. art. 1. Bassaeus, V. emptio, num. 18. though he does not refuse the opposite.

THE REASON is, because there is no foundation for this gain, and it opens the way to disguised usuries; for that right does not bring, as is supposed, any loss in that deferral of the real acquisition of the thing.

AS FOR the works to which we are bound by justice, I have already shown in the disp. de Iudice that they cannot be sold. See Molina Tom. 1. disp. 89. and Lessius lib. 2. cap. 14. dubio 8.

SIMILARLY, the works to which we are bound by vow are unsellable, because by these the one vowing is bound toward God by a kind of justice.

SAY the same of the works owed to a Prince, or Prelate, by virtue of obedience. They can, however, receive stipends for their sustenance, as D. Bonavent. notes, ad 3. Lucae on the words: Contenti estote stipendiis vestris.

SIMILARLY, neither can they receive payment for works commanded by the Church. See Molina disp. 91.

AS FOR prostitutes, although they receive a price validly and justly, and without obligation of restitution, it is indeed a payment for labor, yet they do not receive it licitly. Wherefore it is a sin, not against justice, but against the sixth precept, not to commit fornication, as D. Bonav. notes, in 4. dist. 15. p. 2. art. 2. quaest. 1. ad 4. Fagundez l. 5. cap. 18. num. 21.

AS FOR works of mercy outside the appointed time, when we are compelled by precept, such as teaching even Theology, serving the infirm, etc., they can be sold; for not all things spiritual are invisible, but those which are from the Holy Spirit. These, to be sure, are sold simoniacally.

AS FOR sacred things, they cannot be sold. See Fagundez l. 5. cap. 19. but we treat of this below, Tract. de votis, disput. 12. quaest. 3. They can, however, be sold by reason of the material, as Tanner. num. 55. Azor. T. 3. l. 8. cap. 5. quaestio 1. notes, according to the C. Ligna, de consecrat. dist. 1. can. Aurum, and can. Apostolicos, and can. Sacrorum, 12. quaest. 2. on which matter I spoke briefly, tom. 4. disp. 17. quaest. 10. ad proposit. 22.

AS FOR entering Religion, although to receive something for entering religion on account of a price is simoniacal, nevertheless a price for food and clothing can be received. See Less. l. 2. cap. 35. dub. 12. num. 71. Suarez T. 1. de relig. l. 4. cap. 17. with D. Thom. in 4. dist. 25. quaest. 3. art. 3. quaest. 1.

THE REASON is, because what is sold is the temporal, not the spiritual, nor is there any decree forbidding it. If, however, the monastery is wealthy, then the interpreters of law commonly cry out that it is simony; and it is gathered from the chapter Tua nos, de simonia; and the C. veniens ad nos, and the chapter dilectus 2. of the same title.

There REMAINS labor in spiritual works. Many distinguish labor as intrinsic and extrinsic. The intrinsic is that which is morally included in the sacred action, as the labor of a priest in singing Mass, of a preacher in preaching. The other is extrinsic labor, for instance in going to a remote place to preach or celebrate. So Fagundez l. 5. de contract. cap. 21.

D. BONAVENT. in speculo animae, cap. 2. says that to sell something spiritually annexed is simony. But it is lawful to receive, or give, for labor and sustenance according to good customs.

The spiritual ANNEX making it simoniacal the holy Doctor seems to understand as that which is itself also spiritual, as appears in 4. dist. 25. dub. 5. litt. or something intrinsically joined, as the sacrament of order joined to it, which is the very consecration intrinsically joined to the spiritual, or when a prebend is sold, or if the spiritual annexed to the spiritual is sold; as preaching. So p. 1. Censit. sect. 30.

WHEREFORE he does not seem to understand labor in the way those cited above understand it, such that to sell the labor I expend per se in singing Mass, or preaching, would be simony; but I judge that labor is unsellable which is spent on devotion, attention, or intention; but the labor which I expend per se, not only in undertaking a long journey, but in standing in the church, singing, and crying out, I judge to be priceable; and in this sense (as I believe) D. Thom. spoke in 4. dist. 25. quaest. 4. art. 2. Durand. there, quaest. 3. Sylvester v. Simonia, quaest. 9. Malder. de simonia, tract. 9. cap. 3. dub. 6. Filliuc. cap. 1. quaest. 11. Reginald. l. 23. disp. 228. Sotus l. 9. quaest. 6. art. 1. Less. T. 1. l. 2. cap. 35. dub. 8. Suarez T. 1. de Relig. l. 4. de simonia, cap. 21. num. 10.

Others, however, assert it more clearly, whom Malderus cites loc. cit. and Bonacina de simonia, quaest. 6. p. 5. saying that the labor per se enjoined on a spiritual work can licitly be priced, and for the greater labor a greater price demanded, for instance, if the priest is fatter, or the preacher feeble. Nay, Valentia says something more, disp. 6 quaest. 16. p. 1. citing Gabriel, Caietan, Soto, and others; and Tanner. 2. 2. dist. 5. quaest. 8. dub. 3. num. 76. and Suarez loc. cit. num. 17. with whom Diana adheres, p. 1. tract. 16. resol. 29. Bassaeus v. Emptio, num. 5. warning that the price of a thing cannot be increased on account of the spiritual annexed, for instance of a chalice, etc. or of a field on account of the right of patronage, though he does not wholly refuse the opposite.

But if payment may be received only for the extrinsic, per accidens occurring labor, as Fagundez says n. 3., such as a long journey to Mass, or fasting for many hours; alas, how many simoniacs shall we stuff into that class? D. Bonav. teaches, ad cap 2. Ioan. that Christ cast out those selling oxen, that is, those who sell the labor of preaching for a temporal price.

AS FOR secular offices: whether they can be sold, many indeed deny; because such offices are the object of distributive justice, and are to be conferred on the worthier. So Medina C. de restit. quaest. 4. de usuris, Adrian. in 4. quaest. de usura Torrianus 2. 2. T. 2. disp. 23. dub. 2. num. 5. and to this end the sole law contributes, Cod. ad Legem Iuliam de ambitu, which forbids anyone to be promoted to public office for a price and by ambition.

Castaneus smiles upon this, p. 1. Catal. gloriae mundi, consider. 60. elsewhere fol. 38. The Gloss on the C. sicut 1. quaest. 6. Bouët. decis. 149. Caietan. in offi.. Avendan. resp. 9. col. 2. Fagundez l. 5. cap. 13.

Others, however, allege that Princes can sell those offices, provided they dispense them moderately, and to worthy men, and for the utility of the Republic, so that some great sum may be raised which would otherwise not be had. So teach Less. l. 1. cap. 32. dub. 4. num. 29. Aragon. 2. 2. quaest. 63. art. 2. Villalobos T. 1. tract. 8. difficult. 7. Ioan. de Cruz in directorio, p. 2. punct. 7. quaest. 7. art. 2. dub. 10. con. l. 3. Ledefma in summa, T. 2. tract. 7. cap. 1. concl. 15. Salon. 2. 2. T. 1. quaest. 63. art. 2. controu. 8. Ibidem Sylvius, Tanner. disp. 5. quaest. 7. p. 2. §. 5. ad 3. Malderus 2. 2. tract. 9. cap. 1. Bassaeus num. 8. dub. 5. Rebell. l. 9. quaest. 18. sect. 2. num. 24. and others in Diana tract. 5. Miscell. resol. 108. he adds Azorius T. 3. l. 8. cap. 7. quaest. 3. Filliuc. t. 1. tract. 24. p. 2. cap. 2. Corduba summa quaest. 117. Fagundez adds l. 5. cap. 23. Valentiam disp. 5. quaest. 7. p. 2. §. 5. ad 3.

D. Thom. also grants it licit in his reply to the Duchess of Brabant, opusculo 21. Sylvester, v. dignitas, num. 4. Baldus l. Barbarius, lectura 1. num. 6. ff. de offic. Praetoris, Vallascus in praxi de partitionibus, cap. 13. num. 67.

D. Thom. APPENDS, however, certain inconveniences, on account of which he does not readily adopt this.

AS FOR S. Bonav., I judge him to be for the second opinion; for in speculo animae, cap. 2., toward the end, §. Item, ut dictum est, to prove simony illicit, he argues, because we are not lords of spiritual things; but concerning temporal dignities he does not say in that entire division of sins that their sale is illicit; nay, he seems to infer that it is licit from the opposite reason adduced, and because there, where he sets forth all the species of sins as in a mirror to the soul itself, he deliberately omits this sale.

FURTHER, he seems to be of this opinion also in 3. dist. 40. dub. 2. litt. at the words: Non concupisces domum proximi tui, where he puts forward this argument: What Peter may acquire, he may desire: and answers that it is licit to desire moderately what is licit to buy, and at once adds concerning honors and dignities, insofar as they are useful temporally, whose pursuit belongs to avarice, he says, they may be moderately desired; and he infers that they may also be bought.

THE BEST reason is that included in D. Bonav., while he supposes these things buyable by public and ancient custom. For thus Princes and Kings sell offices, having even jurisdictions annexed, and indeed usefully, not only for the treasury, but also for the peoples: these, fearing to lose those dignities which they had bought at such a price, are held the more to their duty. It is confirmed because, as S. Bonav. tacitly indicates in that Opuscle in which he sets forth all sins to a nicety, and adduces the laws, he professes to find no law against this. I do not indeed judge that all Princes are destitute of counsel, or of counselors; but I hold as most certain that they act on these matters most prudently with the counsels of wise Theologians, especially because even the most holy Princes exercised these things in practice with the same upright men. Nor do these things harm distributive justice, for they can be sold to the better men.

By the counsel indeed of Justinian's wife a law was made that henceforth the offices of the judiciary should not be sold in amb. So that judges be made without any suffrages, as Cassanaeus, cited above, relates. And S. Louis, King of France, ordained the same, as Gaguinus relates, l. 6. cap. 2. And Pius V. by his motu proprio Etsi Romani, and Sixtus V. Cum pro suprema, forbid the procurement and assertion of any dignities having that right for a middling price, under penalties of confiscation of goods, etc. See Diana p. 3. tract. 5. resol. 108. Miscellan.

I CONFESS the matter is ill done, since what should be done by virtue is treated with money, as Cicero says, whom Baldus cites in the Leg. Barbarius.

I say, these things were said with the best zeal, lest justice be sold, Leg. Quisquis, C. si certum patet; they enacted this cautiously as regards the power of judging, on account of the great peril of avarice; for those who buy praetorian offices so dearly wish to stuff the crimes of their subjects into them, as I have often seen in the praetorships of rhetors, where all offices are for sale. Yet if this is done cautiously and prudently, the dangers will be removed.

A QUESTION, namely, concerning those who hold such offices with the power of transferring them to another, for instance to a kinsman or friend; whether they can also sell it.

Titius, a merchant, during the time of the spiritual exercises discloses the following things to his confessor: (a) that, in order to transact many kinds of business, he had made very many journeys by railway without asking for a ticket; or, when he had asked for a third-class ticket, he made the journey in first class; (b) that he had sold things at a price far exceeding their value, because, as he says, other merchants did the same; (c) that in transacting business he made a great profit both by exaggerating and by telling slight lies. Hence it is asked:

1. What are the roots of restitution?

2. What is the rule for determining a just price?

3. What is to be said of the case?

1. See the answer to this question above, p. 270.

2. The answer to this question is given above, p. 304.

3. The case. Titius, a merchant, confessed that he had very often in the course of business traveled on the railway without paying his fare. The convenience offered by the railway has its money value, and that value belongs to the owners of the railway. Anyone who uses that convenience without paying for it and against the will of the owners takes what does not belong to him and is guilty of theft. Titius must therefore make restitution to the company for what he has stolen from it. The same doctrine per se must be applied to his traveling first class with a thirdclass ticket, except that Titius may be excused from making restitution if and when he did this because there was no accommodation in the third class, for in such circumstances railway officials frequently put passengers in a higher class than that to which their ticket entitles them.

Titius also confessed that he had sold things for prices far above their value because others did the same. If the prices obtained were far above the highest just price, Titius sinned against justice and must make restitution. Nor does the practice of others justify him in doing what is unjust. If he can not make restitution to those whom he has injured because of their being unknown to him, Titius may make it by selling more cheaply to future buyers.

Titius also exaggerated the value of his wares and told fibs to catch a bargain. He did wrong to tell fibs, and if by doing so he got more than a just price for his goods, he must make restitution for this also. If he did not get more than the highest just price, he did not sin against justice, and he is not bound to make restitution.

Titius, a grain merchant, asks the judgment of his confessor concerning the lawfulness of a certain manner of acting by no means infrequent among merchants. According to Titius, therefore, merchants frequently buy and sell grain at a certain price fixed for a certain future day, without, however, in any way intending to deliver the grain, but only to pay the difference between the fixed price and the price at which grain is sold in the market when the day has arrived. Then, by no means infrequently, several merchants enter into a certain agreement so that, when the determined day approaches, if they wish the market price to rise, they buy a very large quantity among themselves in the said manner; if they wish the price to fall, they sell a very large quantity in the same manner at a reduced price. The effect of this manner of acting is that the price in fact rises or falls according to their will. Indeed, when by this manner of acting the price has fallen, they buy a very large quantity of grain at the reduced price, not fictitiously but in reality, and, when the price has risen on account of such buying, they sell it again, obtaining a very great profit. Hence it is asked:

1. What conditions are required in order that a wager be honorable?

2. Do those who conspire to raise or lower the price of some thing sin, and in what manner?

3. What is to be said of the case?

1. What conditions are required that betting may be permissible?

The bet must not be an incentive to sin; the object of the bet must be uncertain for both, at least in the sense that neither may influence events in his own favor, and both must understand the bet in the same sense and be prepared to stand by the issue of the event. Moreover, what is staked must be at the free disposal of him who bets.¹

1 Manual of Moral Theology, vol. i, p. 560.

2. Do those who conspire together to raise or lower the price of a commodity commit sin, and how?

If a fair and reasonable price can not be got for a commodity by leaving the sale to competition, there is no harm per se in conspiring together so that a fair price may be obtained. This holds of combinations of both buyers and sellers of the commodity; the buyers may combine to lower the price, the sellers to raise it, until a fair, and reasonable, price is secured. If prices are already fair, and reasonable, it is at least uncharitable to strive by combination to influence the market in one’s own favor to the damage of others; it will be against justice if by combination prices are altered so as to be unfair and uncharitable.²

2 The same work, p. 536.

3. The case. Titius, a corn merchant, asks if it is wrong to deal in “futures,” “time bargains,” or “differences.” In itself such dealing is betting on the future price of some commodity; it is not clear that it does harm to genuine buying and selling of commodities, and so it will not be wrong if the conditions laid down above for the lawfulness of betting are fulfilled. “Bull” and “Bear” transactions, as they are called, are designed to influence the market in favor of the operator, and they are immoral except as means of self-defence against aggression. To endeavor by artificial means to lower the market price when it is fair and reasonable, with the intention of buying in at a low rate and afterward selling at a higher, is wrong and unjust. Apart from this, there would be no harm in buying at the current rate when prices are low with the intention of selling out at a profit when they rise.¹

1 Manual of Moral Theology, vol. i, p. 560.

Capital, according to Karl Marx, comes to the world “dripping from every pore from head to foot with blood and dirt.”¹ It is, according to its very nature, nothing else than the unpaid-for, stolen labor of the workman; or, as Lassalle calls it, “the property of others” (Fremdtum). In order to substantiate this death-verdict on capital, Marx avails himself of his peculiar theory of value which we have discussed in detail in an earlier chapter (p. 46 sqq.).² He distinguishes two kinds of value—value in use and value in exchange. Value in use consists in the utility of an object to satisfy human wants; value in exchange consists in the ratio in which commodities are exchangeable for one another. Value in use, it is true, forms the basis of value in exchange, in so far as only useful things can have exchange-value. But in other respects value in exchange is entirely independent of value in use. The exchange-value is determined by the labor embodied in an object.

¹ Capital, vol. I. p. 726.

² There are some who wish to retain the materialistic conception of history without accepting Marx’s theory of value. But then they cease to be adherents of Marxian socialism. It is indeed inadmissible to represent the matter as if Marx had argued thus: Surplus-value is unjust, therefore capitalist society must be abolished. This is not Marx’s view of the matter. His real argumentation is rather as follows: Surplus-value is essentially based on exploitation, and by its very nature tends to an increase of exploitation by which society will finally be divided into a mere handful of billionaire capitalists and a countless herd of proletarians, and then the collapse will ensue. In this sense Marx undoubtedly considered his theory of surplus-value as a fundamental tenet of his system. His conception of capital, capitalism, accumulation of products, is based entirely on the doctrine of surplus-value, which in turn necessarily presupposes his theory of value. Also Engels, as we have seen above (p. 35), plainly tells us that by the materialistic conception of history and by the doctrine of surplus-value, socialism has received its scientific character.

Let Marx explain his idea himself.¹ He says: “Let us take two kinds of merchandise, e.g., wheat and iron. Whatever may be their ratio of exchange, it can always be expressed by an equation in which a certain quantity of wheat equals a certain quantity of iron, e.g., one bushel of wheat=x pounds of iron. What is the meaning of this equation? It means that an equal amount of something common to both is contained in two different things. Both are equal to some third quantity, which in itself is neither the one nor the other. But each of the two, in as far as it is value in exchange, must be resolvable into this third element.”

¹ Capital, vol. I. p. 3.

But what is this third element common to both? “This common element cannot be any geometrical, physical, chemical, or other natural quality of the merchandise. Its material qualities come into consideration only in so far as they contribute to its utility. On the other hand, precisely the abstraction from the value in use evidently characterizes the ratio of exchange of different commodities. Within the limits of this ratio one kind of use-value is worth as much as any other provided it is present in the right proportion.” What then is that remaining element? “If we abstract from the use-value of merchandise, it retains but one quality, the quality of being the product of labor. But also the labor product has been changed in our hands. If we abstract from its use-value, we abstract also from its material composition and form by which it is useful. It is no longer a table, or a house, or yarn, or any other useful object. All its external qualities are, as it were, blotted out. It is also no longer the product of the work of the joiner, or carpenter, or spinner, or of any definite productive labor.” “Nothing has remained but the same ghostlike actuality, a mere crystallization of human labor without distinction, i.e., of the expenditure of human labor capacity without regard to the manner of expending it. These objects now represent only the fact that in their production human labor has been expended, human labor has been stored up.”¹

¹ Capital, vol. I. p. 4.

“A value in use or an object has value only because human labor considered in the abstract is embodied or materialized in it. But how are we to measure the amount of its value? By the amount of ‘value-creating substance,’ i.e., labor, contained in it. The quantity of labor itself is determined by the time employed, and the labor-time again is measured by the unit of certain periods, as hours, days, etc.”

“Now it might seem that if the value of any commodity is determined by the amount of labor expended in producing it, this commodity would be the more valuable the lazier and clumsier its producer, because he would need more time to produce it. The labor, however, which forms the substance of value must be equal human labor, an expenditure of equal labor capacity. The sum total of labor capacity in the whole society . . . is taken here as one and the same human labor capacity, although it consists of countless individual labor capacities. Each one of these individual capacities is the same as any other in so far as it has the character of average labor capacity and as such produces an average amount of social labor and needs therefore in the production of any commodity only the average labor-time or the socially necessary labor-time. Socially necessary labor-time is the time required to produce a certain value with given normal social conditions of production, and with the average social degree of skill and intensity of labor.”²

² Ibid., p. 5.

How Marx has utilized the principle that exchange-value is something intrinsically independent of use-value and consists only in ‘crystallized labor-time” for the explanation of capitalistic “surplus-making,” we have already shown (p. 46 sqq.). The Marxian doctrine of surplus-value and of the process of accumulation is inseparably connected with his theory of value. If the latter is false, then all the consequences deduced from it are null and void. Therefore we must examine this theory more closely.

For his fundamental principle that the exchange-value of an object is not determined by its use-value, but exclusively by the labor expended upon it, Marx can appeal to the authority of the greatest political economists, Adam Smith, Ricardo, and others. Socialism in this as in many other regards, is only the lineal descendant of liberalism; it only draws the logical inferences from the principles of liberalism. Not until Marx, Lassalle, and other socialists had taken hold of this principle to use it as a deft weapon against private capital did any misgiving arise concerning it; then authors began to abandon it or at least to restrict it very materially.

In reality this principle is untenable. To understand this we need but inquire into the notion of value. It is one of those simple and primitive notions which are evident to every man and become obscured only when we attempt to analyze them. An object is said to be of value to us if it in any way appears desirable. Value therefore includes an objective and a subjective element. In order to be of value to us an object must be good in itself or at least it must appear to us as such, and moreover it must have some relation of adaptation to us, i.e., it must appear as in some way conducive to our preservation and perfection. In other words, value is the capacity of any thing to serve the needs and desires of man and therefore to be estimated as desirable.¹

¹ Cf. Devas, Political Economy, p. 4.

Also purely spiritual goods are of value. The kingdom of heaven is far more valuable than any earthly goods, and therefore the prudent man is like unto a merchant who sacrifices all his earthly possessions to acquire the pearl of great price spoken of in the Gospel. In a similar manner life and health are more valuable than money and estates.

Of economic value we speak in a more restricted sense. It is the business of economics to provide those material goods which are needed for the support, continuance, or enjoyment of man’s material and intellectual life on earth. Therefore the economic value of these goods is the capacity they are estimated to possess of satisfying the above-mentioned needs.¹ Our striving after well-being impels us to aim at increasing the values at our disposal and to prevent their decrease.

¹ Ibid., p. 5. Cf. also Philippovich, Grundriss der polit. Oekonomie

(1901), p. 6.

In economic goods a twofold value may be distinguished: value in use and value in exchange. Also Marx rightly makes use of this distinction which we find already adopted by Aristotle and his commentators. Aristotle² distinguishes a twofold use of earthly goods: the one is proper to an object according to its peculiar character (χρῆσις οἰκεία); the other is common to it with all other objects (χρῆσις οὐκ οἰκεία). The philosopher illustrates this distinction by the example of a shoe. A shoe has a twofold use: the first is peculiar to it in contradistinction to other objects, and consists in this, that it can be used for the protection of the foot; the second consists in this, that it may be exchanged for other goods. This second use is common to the shoe with all other objects of merchandise. It may therefore be called common use or secondary use.³ Value in use is therefore a far more comprehensive notion than value in exchange. Exchange-value is also a kind of use-value, but not every value in use constitutes an exchange-value. Air and light are of continual value in use, but they are of no value in exchange.

² Polit. I, 9. St. Thom. in I, Pol. l. 7. Silv. Maurus in I. Polit. c. 6, n. 2.

³ This distinction of use-value is much clearer, simpler, and more objective than those which we generally meet with in the works of modern political economists. Many call use-value the fitness of an object for the use of the possessor himself, and exchange-value the fitness of the object to be given in exchange. But exchange itself is a use of the object by the possessor. Consequently the first member of the definition contains also the second. Others call use-value immediate value, and exchange-value mediate value. Others again reject this distinction altogether, and divide value into subjective and objective. As often as we shall, according to the ruling custom, distinguish between use-value and exchange-value, we shall understand by use-value the fitness of an article for all kinds of use, the use of exchange alone excepted.

What constitutes value in exchange? or in other words, what is required to make any object of value in exchange? First of all it must be capable of becoming private property. Exchange or barter is a kind of contract whereby one man yields up to another some economic good and receives some equivalent in its stead. This contract presupposes private property in some form or other.

Moreover, in order to be of value in exchange an object cannot be at the disposal of everybody in any desired quantity. Thus water is of great value in use, but in ordinary circumstances it is of no value in exchange, because it is free to all and because it is therefore useless to appropriate it, since no one will barter anything for water. But within the restrictions here mentioned every object which is of value in use is also of value in exchange. But how is this exchange-value to be determined? This can be done by comparing different objects with regard to. the utility derived from them. The greater and more urgent the need which is relieved by some object in use, the smaller the quantity in which it is found, and the greater the trouble to be undergone in obtaining it, the greater also the value which we attribute to it. But in most cases this determination of value does not depend on the judgment of the individual, but on the general estimate formed by society. This estimate is not immutable, it changes according to time and place. African negroes attach great value to many things which Europeans look upon as trifles, whilst some things which are of the utmost value to civilized man are of no importance to savages.

If Marx had confined himself to the distinction of these two kinds of value, no serious objection could be raised against him; but he has completely rent them asunder. Value in use, according to him, is no factor in the determination of value in exchange. He asks, why can I exchange, e.g., a bushel of wheat for x boxes of shoe-blacking or y pounds of silk or z ounces of gold, or why can I consider these quantities of the substances indicated as being of equal value? And he answers: “In the ratio of exchange the exchange-value of different objects [appears] as something entirely independent of their values in use.”¹ Therefore, according to Marx, value in use has no determining influence on value in exchange. But this assertion of his is unproved and incorrect, and involves him in contradictions.

¹ Capital, vol. I. p. 4.

1. It is unproved. The chief argument which Marx adduces for his opinion is the following: Value in exchange must be something common to all merchandise; but this common element cannot be anything else than the human labor embodied in it, taken in the abstract. Therefore the labor contained in an object forms its exchange-value.

We grant that exchange-value is something common to all merchandise, because the various objects of merchandise may be compared with each other according to their value in exchange. But we deny that this common element consists only in the labor contained in them. Marx does not produce any arguments for this opinion, but only mere assertions.

“The common element in all kinds of commodities cannot be a geometrical, physical, chemical, or any other natural quality of the goods themselves. Their physical properties come into consideration only in as far as they go to constitute their utility, or use-value. On the other hand, the exchangeableness of commodities is evidently characterized by abstracting from their usefulness. In regard to exchange the use-value of one object is just as much as the use-value of another, provided it be forthcoming in due proportion. As to their use-value, goods, in the first instance, differ in quality; but as to their exchange-value they differ only in quantity, and contain not a particle of use-value.”¹

¹ Capital, vol. I. p. 12.

This passage contains only assertions in lieu of arguments; nay, false statements presented to us as “evident.” And yet upon these statements depend all the subsequent conclusions. We are surprised, in fact, that Marx so confidently affirms without proof that apart from labor there is no common element in different goods. Aristotle, to whom he repeatedly appeals, could have taught him better. This great philosopher teaches expressly that there is a common element in all commodities, according to which they can be compared with one another and estimated. This common measure or standard of exchangeable goods, according to the philosopher,² is usefulness, that is, their fitness for supplying the wants of mankind.

² Δεῖ ἄρα ἑνί τινι πάντα μετρεῖσθαι . . . τοῦτο δ’ ἐστὶ τῇ μὲν ἀληθείᾳ ἡ χρεία, ἣ πάντα συνέχει.—Ethic. v. 8.

The commodities to be exchanged may be ever so different in other respects, they all agree in this one point that they satisfy some human need, that in some way or other they are useful and desirable. This furnishes a point of comparison and a standard of measurement.¹

¹ Hohoff (Warenwert und Kapitalprofit, p. 5) writes as follows: “Commodities become commensurable only by abstracting from their use-value. Linen, iron, wheat, the Iliad, illuminating-gas, arsenic, Eau de Cologne, and Asafœtida, etc., cannot be compared to another and measured by one another regarding their utility or use-value.” And why not? In their specific use-value they differ indeed, yet they all agree in this, that they are useful to man, that they supply some human demand, in this respect they can be compared, estimated, and measured according to a fixed standard.

2. But the assertion of Marx that labor alone constitutes exchange-value is not only gratuitous: it is also untrue. Unwittingly Marx himself has penned his own refutation. He says: “ Within the same ratio of exchange-value, the use-value of one object is as great as that of another, if it is only forthcoming in the same proportion.” Why must the use-value be forthcoming in the same proportion? Evidently because in the determination of the exchange-value the usefulness of an object is by no means indifferent, but a decisive element. Moreover, how is it that, even according to the concessions of Marx himself, useful objects only can have exchange-value for society? Certainly because use-value or utility is an essential element in exchange-value. If one, for instance, with the greatest expenditure of labor manufactured boots from pasteboard, he yet could not find customers to buy them; they would have no exchange-value, because they would be useless; in other words, because they would have no use-value. Use-value is, therefore, an essential element of exchange-value.

But there are objects of use-value which have no exchange-value. Air and light, for instance, are useful though not exchangeable commodities. Very true; but what follows from this fact? Only this, that mere usefulness does not suffice to constitute exchange-value; that other conditions must be added; but it by no means follows that those things which have exchange-value do not owe this value at least in part to their usefulness. What would Marx say to the following argument? There are men who are not artists; therefore the notion of man does not belong to the notion of an artist. The conclusion drawn by Marx is not more logical. In order that a useful object may have exchange-value it must be fit to pass into the exclusive possession of an individual, and must not be forthcoming in such quantities that all can have of it whenever they please. But this supposed, the exchange-value of an object depends chiefly upon its use-value, or utility. In the primeval forests of South America wood has no exchange-value, either because there is no one to use it, or because every one can have it for nothing, like air and water. But suppose a merchant brings several shiploads of different kinds of wood to a European harbor, what will then be the standard of its value? Is it the amount of labor, the amount of expense and time, which the transportation has cost? Certainly not; otherwise all different species of wood conveyed from South America would sell at the same price, which is not the case. The better and more durable material will sell at a higher rate. Fine cedar or mahogany, abstracting altogether from the labor expended on it, has a much greater exchange-value than pine or birch.

By a thousand such instances we might show that the value or price of an article is determined in the first place by the general estimate of its usefulness. Good wine sells at a higher rate than bad wine, although the vintner may have expended the same amount of labor on the preparation of both. Why do our mine-owners sell coal from the same mine at different prices? Because the quality is different. In short, it is the quality, or the different degrees of objective goodness, that generally determines the exchange-value of objects independently of the amount of labor consumed upon them.

It would be carrying coal to Newcastle to attempt any further proofs of this truth. Nor can it be objected against the examples alleged that in all cases labor is necessary to give the object real value, for we do not deny that labor has a certain influence upon the exchange-value; but we do say that labor alone does not constitute exchange-value. For the rest, labor generally comes into account only in so far as it tends to give greater usefulness to a thing. Besides, there are in nature also objects which require no labor in order to be made useful, but which may be directly appropriated and exchanged for other commodities. Such are, for instance, coal-oil, wild fruits, etc.¹ Thus also in the products of human labor the exchange-value is determined in the first place not by the “socially necessary labor-time,” but by their artistic qualities or other intrinsic perfections. If two authors, after an equal amount of labor and preparation, publish their works, which of the two will have the larger sale? His, no doubt, which appears to the public more perfect in contents and expression. What determines the value and price, of paintings at an exposition? Surely not the “socially necessary labor-time,” but their intrinsic perfection, the fruit of genius rather than of labor. Why will a painting or even a pencil-sketch of Raphael or Dürer fetch such fabulous prices? Why are old manuscripts, rare prints, ancient medals and coins, and other things of that kind paid for so lavishly? Is it on account of the labor represented in them? Is it not rather their rarity, their perfection, their importance for the history of civilization, or something of that sort?

¹ Cf. Von Hammerstein, S. J., Stimmen aus Maria-Laach, vol. x. p. 426; Hitze, Kapital und Arbeit (1880), p. 9 sqq. According to St. Alphonsus Liguori (Theol. moral. l. 3, n. 801 sqq.) it is the common doctrine of Catholic theologians that the price or exchange-value of an object depends not only on the labor expended in its production, but also on many other circumstances, on the utility of the commodity, on supply and demand, etc. Thus St. Thomas (S. theol. 2. 2. q. 77, a. 2 ad 3) declares that the price of an article of merchandise is determined not by the degree of perfection of its nature, because sometimes a horse is dearer than a slave, but by the utility which man derives from the object in question.

3. Marx involves himself in contradictions. According to Marx’s theory of value the rate of profit, i.e., the relation of surplus-value to the total capital invested in any enterprise, must needs vary according to the “organic composition of the capitals.” The value of raw materials and machines, the amount of materials used, and the wear on the machines differ considerably in different undertakings.¹ It is therefore to be expected that at the same rate of surplus-value every branch of industry should show a different rate of profit. But what is the case in reality? Here we find it to be a general law that capitals of equal magnitude yield equal profits regardless of their composition. Marx himself concedes the fact and acknowledges that it appears to be in flagrant contradiction to his law of value. But now how does he set about harmonizing facts and theory? Spirited controversies were carried on for years, within and without socialist circles, as to how Marx would unravel this Gordian knot, a feat which he had reserved for the third volume of his “Capital.” The volume has finally been published by Engels, and lo! Marx simply abandons his law of value. He confesses quite candidly that the rate of profit is independent of the composition of capitals, and that mercantile commodities are sold not according to their value— i.e., the labor contained in them—but partly below, partly above their value.¹

¹ Capital, vol. III. part I. p. 132.

¹ Ibid.

Therefore Marx in the first instance bases his law of value upon experience, and acknowledges finally that his law is contradicted by experience. Of course, he endeavors to prop up his tottering law of value by the assertion that the sum total of prices paid corresponds to the sum total of values.² This contention is ably refuted by Boehm-Bawerk, who remarks that the purpose of the law of value can be no other than to formulate and explain the actual ratio of exchange of the various commodities. We wish to know why, e.g., a coat has as much value in exchange as twenty yards of linen, and according to what standard the exchange is effected. This is the purpose assigned to the law of value by Marx himself. But the ratio of exchange comes into question only in reference to single commodities.³ But if it is granted that the ratio of exchange of single commodities is not determined by their value (the labor contained in them), then also the law of value is abandoned, and it is an arbitrary and useless assertion to maintain that the law of value remains in force for the sum total of commodities exchanged.

² Ibid., p. 140.

³ Boehm-Bawerk, Zum Abschluss des Marxschen Systems, p. 116 sqq.

4. If, therefore, the exchange-value of commodities is not determined exclusively by labor, but, above all, by their utility and applicability in the satisfaction of human needs, then also the entire theory of surplus-value, of the nature of capital, of the accumulation of capital, etc., must needs collapse, for all these are but deductions from the theory of value. We agree with Marx when he says: “The wages of labor are not what they seem to be [to many], namely, the value or price of labor itself; they are but the value or price of labor capacity.” For, the contract between employer and laborer is ordinarily no more than a contract of hire. The laborer hires out his labor capacity, and in return receives the price of hire, in other words, the price for his hired-out labor capacity. But when Marx maintains that the exchange-value or the value of hire of human-labor capacity is determined by the cost of its production, he is but drawing a false conclusion from his theory of value. For, even supposing that two laborers need equally as much for their own support and for their families, still their labor capacities may differ widely as to their exchange-value, in so far as one man is more experienced, talented, skilful, and reliable than the other. A skilled worker will find employment sooner and receive better pay than the raw novice. As in all commodities, so also in labor capacity the value in exchange is determined in the first place by utility and practical applicability.

Just this very example, the difference in exchange-value of different labor capacities according to the utility of each, deals the death-blow to the Marxian theory of value. In accordance with this theory the exchange-value of labor capacity should be regulated by the cost of producing and sustaining it. This, however, is not the case. Why is a higher salary awarded to a capable, experienced, reliable manager, engineer, physician, or foreman than to an ordinary workman? Why do the perquisites of “star” actors, musicians, and singers often reach such enormous figures, whilst others in the same walk of life must be satisfied with a mere pittance despite their painstaking labor? Does the “star” actress, perhaps, need so much more for her sustenance than another? Or can talent, genius, beauty of voice and action, and similar qualities be reduced to the standard of “average labor-time,” so that their cost may be figured out?

The collapse of Marx’s theory of value necessarily implies also that of his other assertion, that the laborer needs but a part of his actual labor-time in order to produce an equivalent for the price of his labor capacity—the necessary labor-time—and that during the rest of the time he is doing “surplus work” for the benefit of the capitalist. The untenability of this assertion becomes still more evident, if we consider that according to Marx “the value of labor is determined not only by the labor-time necessary for the sustenance of the individual laborer, but also by that required for the sustenance of his family.”¹ Who on earth has told Marx that every wage-earner imparts to the manufactured commodities not only as much exchange-value as is required for his own support and that of his family, but also something over and above, which is freely appropriated by the capitalist as surplus-value?

¹ Capital, vol. I. p. 359.

In fine, the entire socialist theory of value is so absurd that we are forced to ask ourselves, how could a man of Marx’s talent and capacity hit upon such a theory and make it the foundation of his whole system? The only explanation to be found in this is that in a very one-sided manner he took into consideration only the condition of industrial wage-earners, generalized that which is applicable to them under certain circumstances, and by purely ideological processes developed it into a comprehensive theory, into a so-called “scientific” system.

To meet a possible objection we would here remark that even in the socialist state the exchange-value of goods would still remain, and could not, even in socialistic circumstances, be determined by the labor spent in its production; for not only in commerce with foreign nations, but also in the division of produce among individuals, the exchange-value of goods would have to be taken into account, and even in this case it would be determined chiefly by the standard of usefulness. If two laborers in the socialist state would perform the same amount of work, it would be unjust to give to one as a remuneration a case of Johannisberger or Riidesheimer, and to the other the same amount of bad Mosel wine, or cider, on the plea that both the productions cost the same amount of labor. So also in the socialist state more labor could be procured for a bushel of good wheat than for the same amount of bad wheat, although the expenditure of labor upon the bad wheat may be just the same as upon the good. The same may be said of all similar commodities.

From many sides there are indications that the gospels of revolt are being found wanting by experience and that a reaction in favor of older and saner doctrines has set in. As an example of this movement we propose in this paper to take the doctrine of the just price of services and commodities. It will be sufficient for our purpose to indicate the salient features of the revolt and the return to the sounder views which were once prevalent. We may thus perhaps be able to help things to move in the right direction.

Until comparatively modern times it was held universally that societies of men are chiefly held together by the virtues of justice and charity. Justice especially was considered the solid foundation of States, without which it was impossible for them to prosper or even to remain stable and permanent. Whatever may have been the practice in particular cases and at particular times the ideal at least was always upheld that justice must regulate the dealings of rulers with the governed, and the mutual relations of the governed among themselves. The doctrine concerning the nature of justice was that of Aristotle, who taught that it consists in a mean between two extremes, like other moral virtues. Just as liberality is a mean between the two vices of stinginess and prodigality, so justice is a mean between excess and defect. Justice, however, differs from other virtues in this— that while the mean in other virtues is a mean between two vicious habits in the virtuous man, justice has also for its mean the debt due to somebody else. Other people have certain definite rights — the right to live without let or hindrance, the right to protection at the hands of the public authority, the right to have and to enjoy what belongs to them — certain definite rights arising from contract. Justice requires that those and all other rights should be respected, that what is due to another should be rendered unto him. Not more than is due nor less, but just what is due. Justice, therefore, consists in an equality, a balance between what a person has a right to and the satisfaction of that right on the part of others. As long as each one gives to all others what they have a right to, justice is observed, no one has a legitimate ground of complaint, all are satisfied and contented, the State rests in security on the peace and concord of its citizens.

The justice that governs the relations of individuals among themselves was called corrective justice by Aristotle because it corrected unjust inequalities by making restitution for violations of right. It was called commutative justice by the schoolmen because it had to do chiefly with buying and selling and other contracts or exchanges. Justice regulates such transactions, and consists in this— that if a man buys a house he is in possession of the same value after the completion of the bargain as he was before. If justice has been observed he has not given too much for the house nor too little. The mean has been observed, and justice has been done. ‘“ But when,” says Aristotle, “by buying and selling, men have got neither more nor less than they had at first, but exactly the same, then they say that they have their own, and have neither lost nor gained. And hence corrective justice is a mean between the gain and the loss which are produced not willingly, but unintentionally, and is such that each party has the same both before the transaction and after it.”¹

¹ Ethics, V., 4.

Of course the great philosopher was not so foolish as to suppose that nothing whatever is gained by the contract. If that were the case there would be no motive for making the exchange at all. As he shows elsewhere,² Aristotle was fully aware of the two kinds of value which every commodity has in society, the value in use and the value in exchange. A man who sells wine which he does not want, and which he cannot use for money which he does want, makes a gain as to the value in use; but if he only got the just price he only got the equivalent of his wine as far as the value in exchange is concerned. In order that exchange may be possible and that commodities may have exchange value, some sort of society must have been constituted. As Aristotle says: ‘“ Now it is plain that barter could have no place in the first community, that is to say, in the household; but must have begun when the number of those who composed the community came to be enlarged; for the former of these had all things the same and in common; but those who came to be separated had in common many other things which both parties were obliged to exchange as their wants arose.’³

² Politics, I., c. 9.

³ Politics, I., c. 9.

Value in exchange, then, is given to commodities by the fact that there are other men who are willing and able to give other commodities of value for them. How much they are willing to give will not depend upon the value in use which the commodity may have for themselves or its present owner, or for any particular individual. If one be starving a loaf of bread will be worth more to him than all the gold of Midas, but its value to him will not measure its value in exchange. This value in exchange will be determined by what the members of the community at the time are prepared to give for a loaf of bread. It will be determined by the social estimate of its utility for the support of life and its scarcity. It will not depend upon its intrinsic perfection, else a mouse would be more valuable than the corn which it eats. It will depend on its capacity to satisfy the wants and desires of the people with whom commercial relations are possible and practicable.

All this, which is according to the express teaching of the great Greek philosopher, shows that Aristotle considered it a matter of justice to keep to what we call a fair and reasonable price in buying and selling. Then, as now, traders were apt to evade this ethical law, and on that account trade and traders were held in small esteem by respectable men. Plato only admitted them into his Republic because he knew that they were necessary, but in an interesting passage he tells us what should be done to prevent traders doing injury to the commonwealth and to prevent their sordid occupation injuring their own characters. “ And therefore,” he says, “in respect of the multifarious occupations of retail trade, that is to say, in respect of such of them as are allowed to remain, because they seem to be quite necessary in a State — about these the guardians of the law should meet and take counsel with those who have experience of the several kinds of retail trade, as we before commanded, concerning adulteration (which is a matter akin to this), and when they meet they shall consider what amount of receipts after deducting expenses will produce a moderate gain, and they shall fix in writing and strictly maintain what they find to be the right percentage of profit; this should be done by the warders of the agora, and by the warders of the city, and by the warders of the country. And so retail trade will benefit every one, and do the least possible injury to those in the State who practise it.”⁴

⁴ Laws, p. 491.

In the third book of his De Officiis,⁵ Cicero has a very interesting discussion on certain ethical questions connected with trade. He tells us that they were cases of conscience discussed among the Stoics. One is whether a corn-merchant who is selling his corn at famine prices, but who knows that abundant supplies are close at hand and will shortly arrive, is bound in conscience to make the fact known to the buyers. Another is whether the owner of an insanitary house which he wishes to sell is bound in conscience to make known the defective drainage to intending buyers. Cicero himself takes the strict view in both cases. He says: “That corn merchant, then, seems to me to be bound not to practise concealment on the Rhodians, nor this house-seller on the purchasers. For it is not practising concealment if you should be silent about anything; but when for the sake of your own emolument you wish those, whose interest it is to know that which you know, to remain in ignorance. Now, as to this sort of concealment, who does not see what kind of thing it is, and what kind of a man will practise it? Certainly not an open, not a single-minded, not an ingenuous, not a just, not a good man; but rather a wily, close, artful, deceitful, knavish, crafty, double-dealing, evasive fellow. Is it not inexpedient to expose ourselves to the imputations of so many vices, and even more?”

⁵ C. 12.

I quote these words not because I think Cicero’s opinion on this question the right one, but because the passage shows the attitude of a Roman gentleman and of one who took a keen interest in ethical questions with regard to fair dealing and the just price of commodities. If Cicero and those to whom he so confidently appealed had in their minds no definite standard of what was a just price to give for a commodity the whole passage is meaningless.

St. Thomas Aquinas and Catholic theologians generally have followed and appropriated the Aristotelian doctrine on justice and on the just price. In the question of the Summa,⁶ where St. Thomas professedly treats of the just price of commodities, he quotes both Aristotle and Cicero, and by giving as the reason for his decision the great and primary maxim of the natural law — Whatsoever you would that men should do to you, do you also to them — he shows that, according to his ideas, the question of the just price was one of natural law and natural reason. The words, indeed, were uttered by Our Lord, but that fact does not make them merely positive precept; much of Our Lord’s teaching is also that of natural reason. It may be added that common sense and English law both uphold the doctrine of the just price. Buyers of commodities who are fit to go to market know what the fair price is of the articles which they wish to purchase, and sellers know when they are giving fair value for the money which they receive. The Sale of Goods Act, 1893, sec. 8, sub-sec. (2) prescribes: ‘ Where the price is not determined in accordance with the foregoing provisions, the buyer must pay a reasonable price. What is a reasonable price is a question of fact dependent on the circumstances of each particular case.” This obviously supposes that there is such a thing as a reasonable price for goods —a price, that is, which right reason approves in the case. Price in other words is not something which is altogether indeterminate, subjective, and arbitrary. There is a price for everything that comes into commerce, not necessarily fixed and determined to the last farthing, but

⁶ 2-2, q. 77, a. 1.

ascertainable within fairly definite limits. It is the reasonable price, not too high nor too low, the mean between excess and defect, the just price, the fair equivalent in money for the goods. What that price is is a question of fact, says the law —a question of fact which depends upon the circumstances of each individual case, and which can be settled without much difficulty by a jury of honest and competent men.

All this is but the brief exposition of the teaching of Catholic moral theology on the famous question of the just price — teaching which St. Thomas and the scholastics derived from Aristotle’s doctrine on justice, and which they handed down to their modern successors. It was necessary to be thus explicit in order to have before our eyes a standard by which to judge the worth of the assertions of the liberal school of political economy.

According to the teaching of this school a seller always tried to sell in the dearest market and a buyer tried to buy in the cheapest. The price below which the one would not sink and that above which the other would not rise was fixed by the subjective and individual valuations of the utility of the goods to the seller and buyer respectively. The actual price at which the goods were sold depended upon the play of supply and demand at the place and time in question. Competition among buyers and sellers and of buyers against sellers settled the actual price which the goods fetched. The law of supply and demand was a law of nature, as inevitable as nature’s physical laws, and it was as useless for the State to attempt to interfere with economic laws of this kind as with the law of gravitation. Workmen were a necessary factor of production, an essential portion of the productive machinery, and the price of their labor was regulated by the same great law as that which regulated the price of the raw material which they worked up into saleable goods. The business man here, too, bought in the cheapest market and sold in the dearest; the price in the one case was what he was compelled to give, in the other it was what he could get. The old scholastic theory of the just price of commodities was hopelessly antiquated and even ‘absurd. Even the historical school of economists followed the prevailing doctrine on this point. Dr. W. Cunningham writes: ‘In accordance with current modes of thought [the scholastic theologians] tried to determine an ideal standard which should be realized in particular transactions, and sought for a definite conception of a ‘just price’; the practical enquiries then resolved themselves into means for discovering the just price of each particular thing. From the modern point of view this whole quest was quite chimerical; prices are always fluctuating, and must from their very nature fluctuate. . . . We know, too, that the commodity used for money must vary in value from time to time, and that therefore there must be continual fluctuations not only in values but in prices as well. The attempt to determine an ideal price implies that there can and ought to be stability in relative values and stability in the measure of values — which is absurd.

“The medieval doctrine and its application rested upon another assumption, which we have outlived.

Value is not a quality which inheres in an object, so that it shall have the same worth for everybody; it arises from the personal preferences and needs of different people, some of whom desire a given thing more and some less, some of whom want to use it in one way and some in another. Value is not objective — intrinsic in the object — but subjective, varying with the desires and intentions of the possessors or would-be possessors; and because it is thus subjective there cannot be a definite ideal value, which every article ought to possess, and still less a just price as the measure of that ideal value.”⁷

⁷ An Essay on Western Civilization, by W. Cunningham, D.D., p. 78.

It is obvious that when Dr. Cunningham wrote this he had no true conception of what the doctrine of the just price was and is. All that that doctrine asserts is that there should be and that there is an equivalence in social value between a commodity and its price at a certain time and in a certain place; it says nothing whatever about the stability or permanence of price at different times and at different places. While maintaining that the just price does not depend on the valuation of the individual buyer or seller, the medieval doctors did not dream of making it intrinsic to the object. They quoted with approval St. Augustine, who centuries before had pointed out that though mice and fleas are more perfect things in the order of nature than bread and money, yet people set a higher value on the latter.⁸ They knew fully well that value is not intrinsic to the object in the sense intended by Dr. Cunningham, but that it largely at least depends on the wants and desires of men, though, of course, there should be something in the object to rouse those desires and satisfy those wants.

⁸ De civitate Dei, XI, c. 14

Even Professor Ashley falls into the same mistake. “ With us,” he says, “ value is something entirely subjective; it is what each individual cares to give for a thing. With Aquinas it was something objective; something outside the will of the individual purchaser or seller; something attached to the thing itself, existing whether he liked it or not, and that he ought to recognize.”⁹

⁹ Introduction to English Economic History and Theory, I., p.

Professor Ashley’s treatment of the doctrine of St. Thomas is sympathetic, but in his failure to grasp some of its essential features he shows how difficult it is without special training to understand scholastic theology. Still less can another assertion of these two scholars be admitted. In the last edition of his Growth of English Industry and Commerce, Dr. Cunningham has the following passage: —“ The whole conception of a just price appears to be purely Christian; according to Professor Ashley, who has written an admirable exposition of the whole subject, it is unknown to the civil law, and had as little place in Jewish habits as it has in modern society; but it really underlies a great deal of commercial and gild regulation, and it is constantly implied in the early legislation on mercantile affairs.” 10 Although in the text just quoted Dr. Cunningham asserts that the

140. 10 Loc. cit., I., p. 252.

whole conception of a just price appears to be purely Christian, yet in a note to the passage he admits that it is partly based on Aristotle. As a matter of fact it was altogether based on Aristotle. It is an axiom with the scholastics that Christianity contains no directly moral precepts which do not belong to natural law except those which relate to Faith and the Sacraments. They certainly regarded the doctrine of the just price as part of the doctrine on Justice, and Justice is certainly a virtue of the natural law. If St. Thomas quotes the words of Our Lord — Whatsoever you would that men should do to you, do you also to them — he merely makes use of these words to enunciate the first great principle of the law of nature, a principle known to Moses as it was to Confucius, the fundamental axiom of all sound ethics. Professor Ashley did, indeed, at one time think that the phrase — justum pretium — first occurred in St. Augustine, but in a note at the end of the volume he shows that he had detected his mistake before his book was published. The phrase occurs twice in the laws of Diocletian and Maximian, which were inserted in the Code,¹¹ and the idea as distinct from the exact phrase is one which belongs to justice and human reason, as Aristotle and Cicero show. Within the last few years many signs have appeared of what is really a return, I will not say, to the scholastic, but to the true doctrine of value and price. Dr. Cunningham himself gives evidence of this. In his Essay from which we quoted above he admits that “modern moral feeling does not sensibly differ from that of medieval times in the desire, if it were possible, to interfere with the action of any dealers who are able to enrich themselves through the necessities or the ignorance of others, and to gain at their expense.” 12 Still more satisfactory is what he has in the last edition of the Growth of English Industry: “ Common estimation is thus the exponent of the natural or normal or just price according to either the medieval or the modern view; but whereas we rely on the higgling of the market as the means of bringing out what is the common estimate of any object, medieval economists believed that it was possible to bring common estimation into operation beforehand, and by the consultation of experts to calculate out what was the right price.” 13 A belief, it may be added, which is shared by the framers of English law, as we have seen, and by business men to this day. Henry Sidgwick, in an article contributed by him to Sir R. H. Inglis Palgrave’s Dictionary of Political Economy, writes: —“So far as it has attempted to supply this need, the teaching of political economists has generally pointed to the conclusion that a free exchange without fraud or coercion is also a ‘ fair’ exchange. It is, however, doubtful how far this interpretation has ever satisfied the common moral consciousness, when cases are considered in which one party to the exchange is found profiting by the ignorance or distress of the other. At any rate it has been widely maintained that a strictly competitive exchange does not tend to be really ‘ fair’— some say cannot be really ‘ free’— when one of the parties is 12 Page 80, 18 Page 253,

¹¹ Codex, IV., 44, 2 and 8

under pressure of urgent need. . . . Many who are not socialists, nor ignorant of economic science, have been led to give some welcome to the notion that the ideally ‘fair’ price of a productive service is a price at least rendering possible the maintenance of the producers and their families in a condition of health and industrial efficiency.”¹⁴

¹⁴ S. v., Political Economy and Ethics.

The doctrines of the liberal school of English political economy were never so widely accepted on the Continent as they have been in England, and it is on the Continent that their narrow doctrine about price has been most vigorously and successfully assailed. M. A. de Tarde, an advocate of the Court of Appeal at Paris, published his interesting work L’Idée du Juste Prix in 1907. It is a history and criticism of opinions not from the theological but from the economic point of view, and perhaps, the more valuable to us on that account. Price, of course, is merely the measure in money of the value of a commodity, and M. de Tarde shows that the various theories of value, sometimes even in spite of the protestations of their exponents that ethics had no place in such questions, involved also an idea of justice. With the liberal school competition was supposed to settle what a fair equivalent for any commodity was in the circumstances, while Marx and the socialists maintained that the laborer has a right in justice to all the wealth that is produced, for all wealth is the produce of labor. Recent economic theory is adverse to both views, and shows a marked tendency to return to earlier theories. As M. de Tarde says:

“Mais, si le XIXᵉ Siècle paraît s’être inspiré, pendant longtemps, de ce libéralisme, et s’être abstenu de faire triompher dans la réalité un idéal défini de justice, cependant, l’état présent des doctrines et des moeurs semble faire retour à des conceptions plus proches, par certains côtés, de celles qui avaient cours à l’époque médiévale. Les dangers que la liberté de l’usure a causés dans l’Europe centrale et orientale, ont été assez grands pour induire la législation allemande et autrichienne à revenir en arrière et à faire renaître le délit d’usure. La législation anglaise les a suivies ces temps derniers. Les autres nations conservent précieusement leur limitation légale du taux de l’intérêt. Enfin, le récent code allemand de 1900 crée de toutes pièces une théorie générale sur la lésion par inéquivalence dans les contrats, qui consacre le fondement de l’idée d’un juste prix. Ces faits sont significatifs. La croyance que le prix le meilleur est le prix de concurrence, paraît fortement ébranlée. Tout le mouvement si puissant des conditions industrielles, tant ouvrières que patronales (trusts), proteste contre elle. Or, le régulateur de la concurrence supprimé, il faut faire appel à de nouveaux principes, et, dans ce désarroi, les doctrines idéales de justice paraissent devoir prendre une nouvelle force” (p. 66).

We quoted H. Sidgwick above as testifying to a common conviction that the workman has a right to a living wage which will keep him in decent comfort.

This, too, is a return to Catholic principles so beautifully set forth by Leo XIII in his encyclical on the condition of labor. On this point M. de Tarde says: “A l’opposée de la conception des économistes, celles de saint Thomas et celle des trade-unionistes anglais demandent le fair wage, le living wage. C’est de ce côté là que penche la conscience moderne” (p. 256). Perhaps the most interesting portion of his book is where M. de Tarde outlines the theory of price which is coming into vogue. According to this theory, value is not something which is inherent in an object, it is not crystallized labor, as Marx and his followers asserted. Neither is it, ordinarily at least, the result of agreement arrived at through the competition of buyer and seller. Values and prices are not settled by individuals, still less are they a compromise brought about by competition between the different values in use of buyer and seller. Exchange values are settled in society and by society; they express the social judgment as to the equivalence in social value between a commodity and its price. “Au contraire les jugements de valeur, qui influeront sur l’échange, seront plus habituellement d’une part, celui que l’acheteur suppose chez son vendeur; d’autre part, celui que son vendeur suppose chez son acheteur. Ce sont des jugements moyens de vendeurs et d’acheteurs qui sont pris en considération, c’est-à-dire des jugements basés sur des désirs moyens et des croyances moyennes. Ainsi, la valeur qui sert de fondement le plus souvent à la prétention de chaque échangiste, c’est la valeur collective, celle qui est commune à tout un groupe. C’est celle-là, notamment, que le vendeur prévoit et calcule avant de fixer son prix de vente, et, s’il a intérêt maintes fois à faire descendre ce prix jusqu’au minimum du coût, c’est qu’ainsi, en abaissant le jugement de valeur moyen sur lequel il table, il s’adresse à un plus grand nombre de désirs, il étend sa clientèle.”¹⁵

¹⁵ A. de Tarde, p. 247.

If we enquire how the collective judgment concerning the value of a commodity is formed, we are entering on a question of social psychology. Groups and societies of men have their special desires, prejudices, opinions, like individuals. They express their opinion in a variety of ways as to the value of a commodity, as to the price of a horse, for example. That collective judgment gives exchange value to commodities, and it is its measure.

The same view has recently been defended in Germany in a pamphlet published last year by Dr. Lifschitz. It is, of course, the doctrine of the common estimation, the cause and measure of value according to the scholastics. But it is noteworthy that it is not, as Dr. Cunningham said in the passage quoted above, the result of the higgling of the market; it exists already and is presupposed while the higgling takes place; it guides and directs it, as M. de Tarde, resting on experience and observation, explains. There is reason to rejoice at the return of sounder views which we have tried to show and illustrate, not simply because these views are those of the scholastic theologians, but because they are truer and more wholesome than those which they tend to supplant. One theory favored usury, sweating, commercial dis-honesty, and oppression of the poor; while another formed the central doctrine of modern socialism. The true doctrine of value and price rests on justice, the only firm foundation of States.

THE Profiteering Act gives power to the Board of Trade “to receive and investigate complaints that a profit is being or has been made or sought on the sale of the article which is, in view of all the circumstances, unreasonable;

“To declare the price which would yield a reasonable profit;

“And to require the seller to repay to the complainant any amount paid by the complainant in excess of such price” (Sec. 1).

Some very old doctrines of Catholic moral theology are implied in these passages of the Act. During the last century those doctrines were generally rejected by the dominant school of political economists, and in too many cases they were neglected in practice by sellers of commodities. Experience has shown once again that retribution lies in wait for those who violate the precepts of the moral law. We must either return to the teaching and observance of those precepts or we shall inevitably pay the penalty for transgressing them.

According to the time-honoured teaching of Catholic moral theology, there is a fair, reasonable, and just price for all commodities in common use. That fair, reasonable, and just price may be fixed by law, and, if it is so fixed, it is matter of conscience to keep to it in buying and selling as long as the law is not obsolete. If the price is not fixed by law, it is fixed by the common estimate of those who are acquainted with all the circumstances which affect the question. The common estimate is a moral estimate, and it does not determine the price with mathematical nicety and precision. Much depends on place and time and mode of sale, on supply and demand, as well as on the varying quality of the goods. There will generally be a higher price, more than which the article does not usually fetch. There will be a lower limit below which the price does not usually sink. And there is the mean price which lies anywhere between the two extremes. There will be no injustice done provided that the price keeps within those limits, but if they are exceeded injustice is committed and restitution must be made to the injured party. That, put very briefly, was the old Catholic doctrine of the just price of commodities.

But according to Dr. Cunningham, an authority on economics, during the last century and a half or so the world had outlived that old doctrine. It had come to see that there was no such thing as the just price of commodities. The price of things depended on supply and demand, and was fixed proximately by the higgling of the market or the competition between sellers and buyers. The sellers tried to get as much as they could for their goods, and the buyers tried to get them as cheaply as they could. That was business. It was all a matter governed by the laws of political economy, with which justice and morality had nothing to do. In this, of course, political economy was wrong. All man's actions are subject to the moral law of justice. We may indeed abstract from the moral aspects of buying and selling for the purposes of discussion, but the process is dangerous, as the instance before us shows. If political economists abstract from the law of justice, many dealers will make it an excuse for disregarding the law of justice in their transactions. It is notorious that this was done. Moralists might point out, as they did, that the higgling of the market, if buyers and sellers were honest and just, implied that there was a common standard of fairness and reasonableness by which to judge of the correct price of articles. Both buyers and sellers, if they were competent, had that standard in mind when they began to bargain. The higgling took place in order to adjust the precise sum of money which was an equivalent for the value of the article in the particular circumstances of the sale. But there were too many business people who turned a deaf ear to the moralists, and excused their profiteering with the plea that business is business.

If the Profiteering Act succeeds in forcing dealers to pay attention to the rules of justice as well as to the maxims of business, it will render a great service to the cause of morality as well as to the pockets of the consumers.

In his book on " Political Economy," C. Devas asserted that a jury of honest men could without difficulty settle what the fair price of an article should be. Section 2 of the Profiteering Act empowers the Board of Trade to set up such juries under the name of " local committees."

SOME progress has of late been made in the direction of moralizing wages. A still wider and more important question is the moralizing of prices. The practice of too many traders in all ages has always been to neglect ethical rules in business and get as much as they could for their wares. It is a peculiarity of recent times to deny that business is subject to ethical rules. We may take Mr. Joseph, Fellow and Tutor at Oxford, as an exponent of these modern economic views. In a recent book he tells us that economic value is a matter of economics, not of ethics. A bargain is settled on terms agreed on between buyer and seller. The buyer wants a commodity, the seller wants money. The buyer is prepared to give money for the commodity in proportion to the urgency of his want of it. One buyer wants the commodity more, another buyer wants it less, and the want of the same buyer varies at different times. A buyer who experiences a keener want is ready to give more money for what will satisfy his want. This is neither right nor wrong, it is neither just nor unjust, it is simply inevitable. It has no more to do with ethics and morality than the failure of the monsoon in India. A price is not unjust where no rule that it infringes can be produced. And in the absence of definite agreements and enactments we can produce no rule of universal application to which prices ought to conform.

That is the contention. Is it true? Mr. Joseph applies it to the wages of labour as well as to the price of commodities. We restrict ourselves here to the latter question.

It is certainly a question of economics. Economics are concerned with the production, distribution, and consumption of commodities. But it is also a question of morals, for the production, distribution, and consumption of commodities are human actions, and all human actions are subject to the moral law. It is possible to produce, distribute, and consume commodities, rightly or wrongly, and the moral law prescribes that those actions should be done rightly. Whether you eat or drink or whatever else you do, do all to the glory of God, says St Paul, and he is merely teaching a precept of natural ethics. All deliberate human action must be conformed to the supreme rule of all moral action; it must be conformed to the end of human existence and of human life.

But is there any definite rule of morality which tells us when buying and selling are conformed or not to the end of all human action? St Thomas and Catholic theologians answer this question in the affirmative, and their arguments show that they rest their conclusion on the law of right reason and nature. They use the arguments of Aristotle, Cicero, and other non-christian writers, and they confirm them by the teaching of Holy Scripture. I will try to state the Catholic doctrine as concisely as I can. A society is necessary in order that exchange of commodities may take place. Robinson Crusoe in his solitude had to satisfy his wants as far as he could by his own labour. He had to make his own clothes, obtain his own food, build his own hut. But when a number of families are grouped together the advantages derived from division of labour become apparent. One man takes to making clothes, another becomes the carpenter, another the smith, another an agriculturist, and so on. Money is soon invented and commerce arises. The different members of the society produce commodities not only for their own consumption, but for others. By exchanging their productions for those of others or by buying and selling they can satisfy their various wants. They produce with a view to this. They know beforehand what they can get for a garment, or a knife, or a measure of milk. The value of every commodity which is bought and sold is put on it by the community. What the fair and reasonable price of all that is bought and sold may be is matter of common estimation and common knowledge. This is a fact of experience and it is not limited to primitive village communities. It is valid for the complicated circumstances of modern English commercial life.

According to the Sale of Goods Act, 1893, if the price of what has been sold is not otherwise determined, the buyer must pay a reasonable price, obviously implying that it is not difficult to determine what a reasonable price is. The same was clearly implied by the Profiteering Act of 1919. Society, then, makes the buying and selling of commodities possible; moreover, it is the social estimate which gives commodities their exchange-value, and the social estimate is the measure of that exchange-value. The course of reasoning, indicated above, by which Mr. Joseph, like other modern economists, strives to settle the question of exchange-value, is beside the mark. It discusses the matter as if it concerned individual buyers and sellers, and comes to the conclusion that price is subjective and individualistic, whereas it is social in its origin, and depends on a social estimate for its very existence and measure. Every commodity, then, that is commonly bought and sold has a more or less definite exchange-value or price, and this is given to it, is put upon it by the common estimate in the place, time, and other circumstances of the sale.

Now, justice demands that everyone should have what belongs to him or its equivalent. And so in the contract of buying and selling justice requires that after the contract the parties should have the same exchange-values as they had before. Both, indeed, gain in usefulness from the contract. If a man buys a spade for ten shillings he does so because the spade will be of more use to him than the money. He gains, therefore, in use-value, but if he has not paid an unjust price for the spade he has the same exchange-value as before. This distinction is made by Aristotle, and it is fundamental in the whole question. It is lost sight of by Mr. Joseph and by other modern economists in their discussion of this question. The price, then, of commodities is not something arbitrary, subjective, and individualistic. It is fixed within certain limits, objective because social and not individualistic. Buying and selling, therefore, though a matter of economics, is also a matter of ethics, it is subject to the law of justice. St Thomas teaches that it is also subject to the law of charity. The law of charity to our neighbour is summed up in the maxim—Do to others as you would be done by. The rule was well known to the ethical writers of antiquity, and it is enunciated in the Old and New Testament. It is a fundamental rule of natural morality. Nobody likes, as a general rule, to give more for a commodity than it is worth. Do, then, as you would be done by, and do not sell a commodity for more than it is worth according to the common estimate.

There is, then, a fair, reasonable, and just price for things which are commonly bought and sold. Justice and charity are violated by demanding more or giving less than the just price. We should all be better, happier, and more contented if this moral rule were more strictly observed than it is in modern business relations.