Trading

Definition of Trading.—Trading (negotiatio) in the strict sense is the purchase of an object with the intention of selling it unchanged at a profit. If any one of the conditions mentioned in this definition are lacking, there is trading in a wide sense. (a) Thus, trading includes purchase, and hence he who sells the produce of his own farm or vineyard is not strictly a trader; (b) there must be an intention of reselling the thing bought, and hence there is trading only in a wide sense if one buys an article for one’s own use but, finding it unsuitable to that use, sells it to another person; (c) the object must be sold unchanged, that is, in the same form in which it was received, otherwise there is not strict negotiation, as when one buys colors and canvas and makes them into a picture; (d) the object must be sold at a higher price than was paid for it, and hence it is not trading in the strict sense to let a customer have an article for just what it has cost oneself.

The Morality of Trading in the Strict Sense.—(a) In itself, trading has the appearance of evil, inasmuch as money-making may be an encouragement to avarice. But in reality profit as an end is morally indifferent, neither good nor bad, and all will depend on the ultimate reason for which one engages in business. He who makes the whole purpose of his existence the acquisition of gain is a materialist, but he who has some higher end, such as public benefit or private maintenance, is virtuous in his aims. (b) For clerics, trading is forbidden by Canon Law (Canon 142), and the reason is that clerics should be free from the distractions and dangers of commerce, so as to devote themselves entirely to their own spiritual duties (II Tim., ii. 4).

The Prohibition against Trading.—(a) Meaning.—Trading as here understood is purely gainful merchandizing (i.e., buying an article at a lower price in order to sell it unchanged at a higher price) or industrial merchandizing (i.e., buying an article in order to sell it at a profit after it has been changed by hired labor). Hence, there is no canonical trading in commerce which lacks one of the conditions mentioned, for example, if one buys goods for one’s household or community and, on discovering that a superfluity has been purchased, sells at a profit what is left over (see 2134, 2135). Trading includes not only a business conducted personally or for personal profit, but also one conducted through agents or for the benefit of others, such as the poor or pious causes.

(b) Obligation.—The violation of this law is grave in itself, but a serious sin demands on the part of the subject that there be real trading (i.e., a number of acts morally united and proceeding from a purpose to continue in lucrative merchandizing), and on the side of the object that there be a large amount involved. Hence, it would be venial to engage in lucrative trading with a large profit once, and with a small profit twice or thrice.

(c) Excuses.—Necessity (e.g., if a cleric needs the money to live or to maintain his state, or if a business has fallen to him by inheritance and cannot be given up without loss) justifies trading, if there is permission.

Are other works also prohibited? - This precept, insofar as it is negative, prohibits not only all servile works, but also civil works, namely market-trade and public negotiation of merchandise, and three forensic things: namely suit, judgment unto death, and oath. Thus the common opinion of theologians from C. 1, 3, and ult., de Feriis. And St. Pius V, C. Cum primum, 6 Kal. Apr. 1566, § 7, commanded that all on feast days "abstain from every illicit and servile work, that markets not be held, and that profane negotiations and the noise of judgments be quieted." L. 284.

By market-trade is understood the public exercise of commerce, or a market, with noise, as are annual or weekly fairs, etc. Public sales of merchandise are prohibited by reason of scandal; "hence, as usage bears, goods can be sold behind closed doors," Scav., ed. 12, Mediol. 1874, l. 2, nn. 95, 239. But in this matter custom must be observed, both universal and also particular to places; for this can abrogate a human law in whole or in part, and here has already abrogated the law in great part. Hence, on account of generally received custom, fairs established for a certain day are excepted if they fall on a feast day. Benedict XIV so declared, C. Ab eo tempore, 5 Nov. 1745.

Likewise, from received custom, food, drink, shoes, candles, cloth for making clothes, and other things of this sort are licitly sold and bought in public shops. Yet merchants ought to close their shops, so that they may show that they distinguish Sunday from other days; but here also the custom of places and necessity, varied for various places, claims very much for itself. Public auctions are also tolerated in some places after the divine offices have been performed, because on other days there would be fewer attending, etc. Likewise it is tolerated that merchants of things of small moment carry, show, and sell goods from one place to another.

Houses, horses, oxen, and other merchandise are licitly sold and bought, whether present or absent, whether in small or great quantity, even if a notable time is spent in this, provided these things are done between private persons; both because the usage of the God-fearing so bears, and because the Church prohibited only sales in public shops, by reason of scandal. From the custom of the wise, all contracts are licit if they are made without instruments and the authority of a judge. Indeed St. Alphonsus notes that custom bears that they may be celebrated not only privately, but even through instruments, provided they do not require judicial noise, for example, testaments, instruments of betrothals, sales, etc.; "although," the holy Doctor adds, "notaries in some places are accustomed for this to ask general license from the Ordinary, which for the rest is commonly granted." L. 286, 289; Benedict XIV, de Syn., l. 7, c. 3, nn. 2, 3.

What is commerce? - It is properly when someone procures a thing for himself with the intention that, by selling it entire and unchanged at a higher price, or by exchanging it, he may gain profit. L. 831; St. Thomas, 2. 2, q. 77, a. 4, ad 2; Lugo d. 28, n. 20.

How many kinds of commerce are there? - There are three: economic commerce, artificial commerce or handiwork, and commerce properly and strictly such. Molina, d. 339, n. 2, says this: "A threefold kind of buying and selling is commonly distinguished. For one kind is that by which each person buys those things which are necessary for the sustenance of himself and his family, while superfluous things are sold.... Another is that by which something is bought so that, changed by industry, it may be sold.... To this kind pertains not only if someone buys wool so that from it he may make cloth, which he sells, or iron so that he may sell swords which he makes from it; but also if he buys birds or horses so that, after he has raised them and accustomed them to something, he may sell them. To this kind of commerce also pertains that by which a thing not bought, but from one's own goods or lands, changed into a better form, is sold. Finally, another buying and selling is that by which something is bought so that, unchanged, it may be sold more dearly for profit; and this is commerce in the most proper sense."

Whether commerce is licit? The first species of commerce is licit. "This," says Molina, l.c., "is as it were natural, and of itself is good and licit. Indeed it is ordered not to profit, but to suitable sustenance, and it pertains to householders and statesmen, not to merchants taken strictly." The other species of commerce is also licit. "This," says Molina, l.c., "is not mere commerce, because the thing thus bought is rendered better through industry and art." Wherefore there is sold not only the thing bought, but at the same time one's own industry and one's own work. Men of this kind are called rather workmen and artisans than traders or merchants.

Therefore there is no injustice in it, no illicitness, since it is very useful to private and public good. The third commerce also is of itself licit, since it too is very useful to private and public good, and from no other source does it necessarily, or of itself, contain any injustice or dishonesty. For as regards justice, it suffices that one in buying and selling remain within the limits of the lowest and highest price; and moreover the prices of things are accustomed to be diminished and increased according to the various circumstances of times and places. There is added besides the labor of these merchants, and likewise the enormous expenses to be made by them, so that they may always have necessary goods prepared for all. But the profit which is intended can be intended in an ordered and moderate way for a good and even pious end, and therefore neither from this head is there necessarily and of itself any baseness. St. Thomas, 2. 2, q. 77, a. 4.

Is trade lawful for clerics? - Trade properly so called is interdicted to clerics constituted in sacred orders, and to all religious, so that they sin gravely if they devote much labor to trade. Trent s. 22, c. 1 de R.; C. 15, 16 de Vit. et honest. cler.; C. 1, 3, 6 Ne cler. vel monach.; L. l. 3, n. 381; S. Th. 4, d. 16, q. 4, a. 3, q. 3.

Trade properly so called is when someone buys a thing with the intention that, by selling or exchanging it whole and unchanged at a dearer price, he may gain. Can. 3, caus. 14, q. 4; S. Th. 2. 2. q. 77, a. 4. Properly so called, or lucrative; for there is usually also distinguished economic trade, by which things necessary for sustenance are bought and superfluous things are sold; and artificial trade, by which something is bought so that, changed either naturally or by one's own industry, it may be sold. Neither of these is prohibited in itself. But if things are changed by another's industry, or by hired workers, or if things are sold in a public workshop, this too is unbecoming to the clerical state. For this artificial trade denotes a gain-seeking mind, equally as lucrative trade does, in either case. Cf. Bizzarri ed. 1885, p. 238.

Constituted in sacred orders; for the common opinion is that trade is not prohibited to clerics in minor orders. But it is doubted whether it is forbidden to beneficed clerics in minor orders. Molina, etc., deny it. But the opposite is better to be held with the common opinion, which Lugo, etc., hold. L. l. c.

If they devote much labor to trade; for a cleric does not sin gravely by exercising trade two or three times when it is not shameful and not in a great quantity, because the laws speak of one exercising it. Hence, even if he trades only once or again in grave matter, Cajetan, Salas, etc., probably hold that he does not even sin gravely. L. l. 3, n. 831. For trade to be forbidden to clerics, there is required the mind of buying more cheaply so that it may be sold more dearly; hence it is lawful for them to sell more dearly so that they may buy more cheaply. L. l. c. 336.

Benedict XIV, Bull Apostolicae servitutis, February 25, 1741, established that the penalties inflicted against cleric-traders must also be extended to clerics illicitly trading in any way under the name of a layman, just as if they illicitly exercised those same businesses by themselves and in their own name. These penalties are of ferendae sententiae as regards clerics and monks. But as regards missionaries of the East Indies and of America, to whom trade and commerce are more gravely interdicted, these penalties are incurred by them by the fact itself from the Constitution of Urban VIII Ex debito, February 22, 1633; Clement IX, Sollicitudo pastoralis officii, June 17, 1669; and Resolution of the S. O., March 6, 1817. Cf. 1218.

Clement XIII, Bull Cum primum, September 17, 1759, again prohibited clerics from trading through interposed persons, and especially from exercising active exchange through others, namely from acting the parts of a money-changer; adding that if necessity of the family is present, or if a business comes to him by some title from laymen, a cleric still cannot trade without permission of the Apostolic See in Italy, and outside Italy, without permission of the Bishop. Moreover he adds that if a doubt arises concerning some contract, whether it can licitly be entered by a cleric, "the most expeditious way is to write to the S. Congregation of the Council, which will decide the doubt." L. l. c. 832, 833. But from received customs, if a cleric has succeeded his father in businesses of this kind together with his brothers, he is permitted to exercise them through others. Likewise no permission is needed if someone trades in order to procure the necessities of life for himself, and not only for his state.

It is certain that it is not lawful for clerics or religious to lease the things of laymen for the sake of making gain. The reason is that although this is not properly trade, but only a certain species of trade, nevertheless it is forbidden by the Council of Chalcedon, C. Pervenit 1, caus. 21; C. 1 Ne cler. vel mon. And therefore from another's farms it is not lawful to fatten sheep, swine, etc., so that they may afterward be sold, unless somewhere a contrary custom flourishes. To lease; for he who succeeds to the lessee will be able to retain it. Fagnan on C. 1, n. 81 Ne cler. vel mon.

By no law is it forbidden to clerics to give a loan to others, and consequently to buy obligations of companies, or even shares, provided however that the companies set no illicit end before themselves, that they do not involve themselves in the administration and trade of those companies, and that they abstain from any trade of those obligations and shares. S. O., April 15, 1885.

Neither by an obligation nor by a share can one be said to exercise commerce and trade through an interposed person. For the company itself, whether industrial or even trading, certainly does not exercise industry or trade by mandate or in the name of such a bondholder or shareholder, but altogether independently of him. The bondholder and shareholder only cooperates by helping with his money given. La-Croix l. 3, p. 2, n. 1005, 1006; Molina d. 339, n. 2; Lugo de Inst. d. 26, n. 29; Resp. Mor. l. 3, d. 20; L. l. 3, n. 834, 835; Benedict XIV de Syn. l. 10, c. 6; S. Th. 2. 2. q. 77, a. 4 ad 3; E. M.

The obligation of a company is a title for receiving a certain fixed emolument from money given to the company as a loan. Wherefore through an obligation someone becomes a creditor of the company. A share of some company is a title by which someone, on account of the sum contributed to the company, has a right to receive a variable, proportionate emolument. Through a share someone becomes a partner of the company, but not for that reason an administrator.

It is likewise prohibited to all clerics to exercise the offices of president, moderator, secretary, treasurer, and similar offices in money chests, rural banks, savings banks, and other similar works for the temporal assistance of the faithful. S. C. Consist., November 18, 1910.

An excommunication has accrued to the constitution Apostolicae Sedis, reserved to no one, against missionaries giving work to business and trade, and against their immediate superiors who have not punished delinquents, according to the constitution of Urban VIII Ex debito, February 21, 1633, and Clement IX Sollicitudo, July 17, 1669, from the Declaration of the Supreme Pontiff. Sacred Congregation de Propaganda Fide, March 29, 1873; Holy Office, December 4, 1872.

Clement IX has these things in the place cited, sec. 3: "To all and each ecclesiastical persons, both secular and regular, of whatever state, grade, condition, and quality, and of any Order, Congregation, and Institute... and to any of them who shall have been sent for the time to the islands, provinces, kingdoms of the East Indies... and to the parts of America, both southern and northern, by the Apostolic See, or by the Congregation of Our venerable brothers, Cardinals of the Holy Roman Church, placed over the business of the Propagation of the Faith, or by their Superiors under the name of missionaries, or under any other title, or who in any way shall be staying in those parts, under penalties of excommunication latae sententiae, and deprivation of active and passive voice... and also loss of all goods and profits, to be incurred by that very fact... by the tenor of the present letters We strictly prohibit... that they, under any pretext, title, color, device, cause, occasion, and form, even once, by themselves or through ministers or other subsidiary persons, directly or indirectly, both in their own name and in the name of their respective religions... or of any others whatsoever, and otherwise in any way and however, should thrust themselves into or mix themselves with such secular trades and businesses. And from now... after the case has happened, We apply, by the series of these letters, any goods and profits whatsoever which have proceeded from trades and businesses of this kind... to the use and advantage of the poor, hospitals, seminaries, etc.; delinquents are bound to consign goods and profits of this kind to the Ordinaries of the places... who ought to distribute and spend them as above, and not for other uses.... Sec. 4. Moreover by the same censures and penalties We bind, and declare to be bound, immediate Superiors, and Provincials and Generals of the aforesaid Orders or Congregations, who have not punished their respective subjects committing delicts in the foregoing... in any way even for one single time, at least by removing them from the places of the delict committed by them. But from the sentence of excommunication of this kind no one from the aforesaid delinquents can be absolved by Superiors or another or any others whatsoever, even supported by any authority, except those constituted in the article of death, unless profits of this kind have first been restored."

Kingdoms of the East Indies, parts of America: the praised Declaration of the Holy Office and Sacred Congregation de Propaganda Fide also comprehends Chinese missionaries. Holy Office, January 17, 1883. Or who in any way shall be staying in those parts: "the same prohibition and penalty, according to the mind of Clement IX, affects not only European missionaries, but also any ecclesiastical men whatsoever, who under the name of missionaries or under any other title shall have been sent for the time, or shall in any way be staying in those parts." Holy Office, January 17, 1883. Business is to buy something so that it may be sold dearer unchanged, e.g., oil, grain, books, etc. But trade also comprehends those things which, naturally changed, are customarily resold, e.g., must which, having become wine, calves which, having become oxen, swine which, having been fattened, are resold. Naturally: for if they are resold changed by the art and industry of men, it is craftsmanship, which does not pertain here, e.g., if from bought wool you make garments, from iron arms, from wood vessels. But if these things also are furnished in public workshops, with workers hired, they are something gainful, and differ little from business, nor consequently are they regularly exercised without lethal fault. L., book 3, n. 836. In any way and however they thrust themselves into or mix themselves with it; even once; even giving work to trade and business for others.

No one from the aforesaid delinquents, i.e., from those who give work to business or trades, or thrust and mix themselves into them. Therefore Superiors, even with profits not restored by delinquents, can be absolved, nor does the delay of delinquents harm them. Unless profits, etc. Therefore, with profits of this kind restored, someone can be absolved by another than the Supreme Pontiff. Condonation of profits is to be obtained only from the Holy See. But restitution is to be made "to the Ordinaries of places, or their Vicars in spiritual things, or Officials, or Apostolic Vicars or Pro-vicars." These must "distribute and spend the restored profits for the use and advantage of the poor, hospitals, ecclesiastical seminaries and workers (yet not of the religions... of those who have committed a delict in the foregoing or concerning them, but of other non-delinquents...), and not for other uses." Sec. 3; E.M.

1. “An Apostolic Vicar (Kouytcheou) deposits money sent to him with a certain merchant dwelling in his province, and from time to time takes and spends part of that money as necessities require; and thus at the end of the year more or less money remains in the hands of the merchant, who uses that money in order to exercise his commerce, and receives profit from it, and wonders that the Apostolic Vicar receives no part of the profit accruing.

The Apostolic Vicar asks that it be lawful for him to enter into partnership with that merchant, so that he may be a participant of profit or loss, according to the proportion of the money deposited by the Apostolic Vicar with the aforesaid merchant.

R. As regards entering into partnership, in the negative; and let the Apostolic Vicar of Kouytcheou consult Benedict XIV in his Constitution Apostolicae Servitutis, and de Syn. dioeces., l. 10, c. 3, and let the Decree of 13 Aug. 1834 be given, namely: That missionaries, etc., can consult for the security of subsidies owed to them and for the good of the mission itself by receiving by way of exchange goods bought with money owed to them, and selling the same goods brought to them, and making their own the price to be drawn from the sale of the same.” S. O., 29 Jan. 1851, A. S. S., v. 24, p. 707.

2. Caesar, a priest, gives an immense sum of money to his brother Caesarinus, so that he may open a shop for selling medals, sacred images, rosaries, and other objects of devotion. Caesarinus alone gives his name to the shop and manages the care of the business. But at the end of the year he gives to Caesar an account of receipts and expenditures, and with him divides the profit, the proportion being observed between the money of his brother and his own work. — Does Caesar act licitly?

R. In the negative. For he truly exercises trading through an interposed person, prohibited by Benedict XIV, Const. Apostolicae servitutis, 25 Feb. 1741, and by Clement XIII, Const. Num primum, 27 Sept. 1759. Cf. Benedict XIV, de Syn., l. 9, c. 9, nn. 4, 5.

3. Bernardus, rector of a seminary, buys grain in twice the quantity which he needs for a year. For he says: The price of grain is now, beyond custom, very low; after six months it will be very high, and then I will sell the surplus with profit. But if I foresee that next year the price is to be increased, then I will keep what remains for the future year. — Is this rightly done?

R. If he buys with the direct intention of selling more dearly, he acts illicitly; for it is an act of true trading. But if he buys on account of the danger which can occur next year, so that he may provide for the household affairs of the seminary, and, that danger ceasing, afterwards resells the surplus, he acts licitly; for it is not an act of trading, but of domestic economy. Cf. Lugo, de Iust. et Iure, d. 26, s. 3, n. 32.

4. Olivarius, a priest, seeing that the value in Europe of notes of the banking market of South America is always diminishing greatly day by day, writes to his friend dwelling in South America, who owes him two thousand lire, that he should spend them in buying goods of that region, which afterwards he should send to him. For by selling these goods himself in Europe, he will be able without detriment, and perhaps even with profit, to recover his whole money. — Does Olivarius act licitly?

R. In the affirmative. For he does not intend profit by buying cheaper so that he may afterwards sell dearer, but the recovery of his own money without detriment. Cf. Lugo, de Iust. et Iure, d. 26, s. 4, n. 33.

5. Onuphrius, a priest, lends money to his brother Angelus. Onuphrius receives annual profit according to the legal rate. But Angelus expends it in trading. — Does Onuphrius act licitly?

R. In the affirmative. For he himself is not the trader, but his brother. He himself is a simple lender of money, which is not prohibited to him.

6. “You have set forth to the S. C. de P. F. that entrance into those regions of Tibet, whether subject to the great Lama, is altogether forbidden, under penalty of expulsion, to all foreigners, and especially Europeans, unless for the cause of trading. Your Amplitude understanding this, fearing lest the Apostolic mandate which you have undertaken, namely of evangelizing that savage and superstitious people still sitting in darkness and in the shadow of death, should remain incomplete, since no other means, as you assert, was available: you thought it opportune to enter the borders of that kingdom as a trader, under which pretext you contend that you would propagate the Catholic faith more easily and safely. Wherefore, in order to avert from the minds of the infidels every suspicion concerning the true state and condition of Your Amplitude and of the other companions, you strive to demonstrate to them not only by words that all of you are nothing else than a certain society of merchants devoted to earthly profits; but so that they may be further confirmed in an opinion of this sort, it pleased you to establish here and there some storehouses or shops for keeping and selling goods; and, what is remarkable, to have completed all these things without consulting the Apostolic See, to which at last you had recourse, that you might be instructed concerning the liceity of the aforesaid trading. The Eminent and Reverend Fathers of the Congregation of the Supreme Inquisition, your requests having been seriously and maturely weighed, responded: that it is not lawful under any title for missionaries to exercise commerce.

“And certainly, although it is known to the Eminent Fathers that Your Amplitude was moved from zeal with which you burn for propagating the Catholic faith, nevertheless it ought to be clear to you that the sanctions of the Sacred Canons, the Decrees also of universal Councils, Apostolic Constitutions, and the responses of the Sacred Congregations to the requests of Apostolic Vicars are altogether contrary to your aforesaid manner of acting; nor can the goodness of the end legitimize illicit means for obtaining the same, for evils are not to be done that goods may come. Besides, the divine Religion of Christ must not be propagated by fictions and simulations, as heretics try to propagate their venerated dogmas. For our Lord Savior, about to convert the human race, sending his Apostles and Disciples, said to them: Going into the whole world, preach the Gospel to every creature. Teach all nations, baptizing them in the name of the Father, and of the Son, and of the Holy Spirit. Behold, I send you as lambs among wolves. Be therefore prudent as serpents and simple as doves. These are divine admonitions, for faithfully executing which preachers of the Gospel ought to apply all efforts. Although the pretext of commerce seems to you most apt for propagating the faith, nevertheless it must never be applied in the conversion of souls, as indecent and very unbecoming to apostolic men, after the example of Christ and the Apostles, who never used these fictions, by which they would seem to serve God and mammon at the same time. For examples are not lacking in which infidels, as soon as they see those who say that they are ministers and legates of the Most High God devoted to temporal affairs, despise the same, thinking that they use the pretext of religion in order to emerge from the straits of poverty. In this way they everywhere lose that veneration and love which they need before other things for gaining souls to God, and acquire for themselves the ignoble name rather of merchants of monies than of curators of souls.

“Therefore, lest you seem to contradict not only the sanctions of the Sacred Canons, but also the Apostolic Constitutions (of Urban VIII, Ex debito Pastoralis officii, 22 Feb. 1633; of Clement IX, Sollicitudo Pastoralis Officii, 17 June 1669; of Benedict XIV, Apostolicae servitutis, 23 February 1751; of Clement XIII in his Encyclical Cum primum, 16 Sept. 1759; and of Pius VI in the response to the Archbishop of Theodosiopolis, 18 March 1782), it is necessary that you abstain in the future from the exercise of commerce, whether through yourself or through others, directly or under any title or color, lest you remain entangled in the most grave penalties laid down in the Sacred Canons and especially in the above-cited Constitutions.

“These things having been premised, do not wonder if you sometimes understand that the S. C. has more often dispensed with some persons from the prohibition of trading of this sort. For all concessions made by the aforesaid S. C. de P. F. to some Apostolic Vicar, or to Chinese priests lacking ecclesiastical patrimony, regard only certain particular cases, indeed most urgent ones. But concessions of this sort were never made so that missionaries could use the exercise of commerce as a means for propagating the Catholic faith, as Your Amplitude greatly desires to obtain.

“Therefore, any trading whatever being excluded, you are able to permit only medicinal substances, to be furnished for the use of the sick gratuitously, or at least without any profit, by missionaries skilled in this art. In the rest, strive that, in the more prudent and better way that you can, the poor who have chosen a dwelling for themselves around the hospices of the missionaries may be evangelized; and as for their children who attend the schools of the aforesaid missionaries, take care that with human letters they may also be imbued with the rudiments of the Catholic religion. These foundations having been laid beforehand, the edifice of religion, with God helping, will rise to the highest things; for neither he who plants is anything, nor he who waters, but God who gives the increase.” S. C. de P. F., 4 Feb. 1860, to the Apostolic Vicar of Lahassa.

S. Th. II-II, q. 77, a. 4.

537. Exchange (echange, troc; ruiling) is a consensual contract by which the contracting parties give to one another some thing, namely, merchandise, in order to have another (a. 1702 and 1703). It differs from sale: for in this latter, money is given for merchandise; in the former, merchandise for merchandise. It is ruled by the same laws as sale (a. 1707); nevertheless rescission is not conceded on account of lesion (a. 1706).

538. Trading is an action by which someone procures wares for himself with the intention of selling them with gain. It is distinguished into trading broadly and strictly so called, according as things are procured so that, transformed or changed, they may be sold more dearly, or whole, without any change, they may be sold more dearly (C. Com., a. 2). This latter, according to St. Thomas (a. 4), is of coins for coins (exchange), or of things for coins for the sake of seeking gain, so that the coin and gain are the end of the commutation.

Trading strictly so called of itself is not honorable, nor is it illicit, because it does not imply anything vicious, but something indifferent, although evil-sounding and blameworthy; because, so far as it is of itself, it serves the cupidity of gain and has a certain baseness insofar as it does not imply an honorable end. Hence, that it may be licit, it must be rendered honorable by ordering the gain to an honorable end, for example, to the sustenance of the household, the relief of the needy, public utility lest things necessary to the fatherland be lacking. Yet it is dangerous, because someone easily intends gain alone as an end, and it is often an occasion of deceit, fraud, and injustice.

Nor should it be said that it is against justice because someone sells more dearly than he bought, or buys more cheaply so that he may sell the thing more dearly than it is worth. For "not everyone who sells something more dearly than he bought it is trading, but only he who buys for this purpose, that he may sell more dearly. But if he buys a thing, not that he may sell it, but that he may keep it, and afterward for some cause wishes to sell it, this is not trading (strictly so called), although he sells more dearly. For he can do this licitly, either because he improved the thing in some respect, or because the price of the thing is changed according to diversity of place or time, or because of the danger to which he exposes himself by transferring the thing from place to place, or even by having it carried. And according to this neither the buying nor the selling is unjust" (ad 2).

The abuses which Pius XI recently denounced are to be attended to here, as we noted in n. 536, 4.

539. Observation. Let it be noted that trading strictly so called is forbidden to clerics and religious, because they must abstain from those things which have the appearance of evil, and because trading entangles one in secular cares and thus draws one back from spiritual things (can. 142 and 592).

Caius, the procurator of a certain religious Order, proposed to Julius, his confessor, certain scruples of conscience to be resolved. For since the Order needed money to build new monasteries, and the government stock which it possessed was not very profitable, Caius, having found an opportunity when its price had risen modestly, sold it and bought more remunerative shares, some in railways and others in a certain recently established company for providing all things (General Stores). Afterwards, however, he doubted whether these things were lawful for religious. Hence it is asked:

1. What is trading?

2. What kind of trading does ecclesiastical law prohibit, and to whom?

3. What is to be said of the case?

Trading in the strict sense is buying commodities with the intention of selling them at a higher price without changing their nature. Buying commodities for use or for consumption is not trading, nor is selling the produce of one’s own land or labor.

2. What sort of trading is forbidden by ecclesiastical law and to whom?

Ecclesiastics in sacred Orders and all religious are forbidden to trade in the strict sense. They are also forbidden to buy material and change it by hired labor for sale at a profit, and to buy animals and fatten them for sale on hired land, for such actions have the appearance of trading. Benedict XIV also declared that they are forbidden to trade by means of agents.

3. The case. Caius did nothing reprehensible in selling government stock at a profit when it rose in price, provided that it was not bought cheaper with the intention of selling afterwards at a profit when it should rise. Nor did he do wrong in investing part of the proceeds in railway stock which brought in a higher interest. There is more difficulty about his buying shares in the company which owned the stores. Most authors would say that this is not lawful, inasmuch as Caius thereby became a member of a trading company and traded by means of the servants of the company. However, unless he is a director of the company or otherwise takes an active part in managing its affairs, it is probable that he does not do wrong here either. Practically all that he does is to buy the right to receive a dividend on his shares if the company succeeds in business; there is no scandal, and no interference with his spiritual avocations. This is the opinion of several recent authors, quoted and followed by Génicot (II, n. 41), and others. We suppose of course that Caius has no reason to suspect that the company does business dishonestly.