Law, Common and Civil

Most developed countries today have law derived from one of the traditions of Western Europe. Non-European countries that were colonized by the English typically make use of some variety of the English "common law," a body of law based historically on judicial precedents handed down in the royal courts of England from the late twelfth century onward. Major common-law countries include the United States, India, and Australia.

Non-European countries that were not colonized by the English generally have borrowed from one of the "civil-law" traditions of continental Europe. "Civil law" is not a simple category. Scholars distinguish between several civil-law "families," of which the most important are the French (or Romance) family and the German family. Civil-law systems also developed from roughly the twelfth century onward. But instead of being based on judge-made precedents, they grew out of a complex mix of ancient Roman law, canon law (the law of the medieval Christian church), and local custom.

The differences between the these two traditions are largely the differences between a law historically made by judges, on the one hand, and a law historically made by professors, on the other. The medieval civil law was primarily the creation of university professors, who began writing orderly treatises on Roman and canon law as early as the twelfth century. During the early modern period, the traditions of the civil law were presented in systematic form in the texts of jurists such as Jean Domat (1625–1696). By the late eighteenth century, those systematic treatises were used as the basis of codes, systematic and principled treatments of a particular area of the law. Today virtually all civil law traditions are largely based on such codes, the descendants of the premodern treatise-writing tradition. The French civil-law tradition, most famous for the Code Civil (1804), has been particularly influential in Latin America and in parts of the Middle East, including Egypt. The German civil law tradition, most famous for the German Bürgerliches Gesetzbuch (1900) and the Swiss Bürgerliches Gesetzbuch (1912) has been particularly influential in East Asia (Japan, Korea, China) and Turkey.

The common law, by contrast, was created by judges rather than by university scholars, and its treatise-writing tradition has always been relatively weak. Although there have been some important common-law treatises—notably that of the English jurist Sir William Blackstone (1765–1769)—common-law systematic legal scholarship has never attained the depth or enjoyed the influence of civil-law scholarship. The has resulted in the basic contrast between the common and the civil law: on the one hand, we find a relatively unsystematized, precedent-based, judge-centered tradition (the common law); on the other, strongly systematized, treatise- and code-based traditions (the civil law).

This contrast should not be overdrawn. Judicial precedents are often invoked in the civil-law world. Moreover, in both common-law and civil-law worlds, there is plenty of law that is based neither on precedent nor on the classic type of civil-law code. Instead, much of the law in every part of the world is made by legislatures that display scant concern for the traditional forms of code-based and precedent-based law. Nevertheless, there remain differences between the two traditions that may be of significance for our understanding of the history of world trade.

Some of the differences are methodological, having to do with the degree of systematization and certainty in the law. Because civil-law systems have always been more systematic than common-law systems, they aim for a higher degree of predictability and certainty. A classic civil-law code such as the German Bürgerliches Gesetzbuch purports to resolve all possible legal questions in advance, through the rigorous application of a few basic principles of law. The common law, by contrast, leaves many questions unresolved. Common-law judges are subject to a "case or controversy" requirement, which permits them to decide only the dispute before them. This means that no common-law decision can ever offer a complete systematic review of the law in any area. Indeed, important legal questions can sometimes go unanswered for long periods, leaving common lawyers in a limbo of uncertainty.

There are also institutional differences, differences in the relationship of these traditions to state power. The rules of civil law are largely drafted by professors and civil servants, who are typically members of the state bureaucracy. The rules of the common law, by contrast, are largely created by judges who regard themselves as providing a check on executive power.

Finally, there are also differences in the substance of some legal rules. In particular, the common-law tradition embodies a more lenient attitude toward commercial morality. For example, the common law of contracts has a strong caveat emptor ("let the buyer beware") norm, imposing relatively few duties on sellers. The civil law, by contrast, generally holds both sellers and buyers to strong duties of "good faith." The common law also traditionally permits contract parties to breach with relative ease, paying money damages in lieu of performing their contractual obligations. Civil-law systems are more willing to require parties to perform. In these and other ways, the civil-law tradition seems to hold actors to a more exacting standard of commercial morality, whereas the common-law tradition seems to tolerate a relatively "freer" free market. The same contrast can be seen in areas such as employment law. The common law has a relatively strong "employment-at-will" norm, generally putting fewer restrictions on the power of employers to discharge their employees. Continental legal traditions, by contrast, generally make it more difficult to discharge workers. Here again, we can see that the civil-law world generally imposes stricter limits on market behavior than does the common law.

What difference do these differences make? Most discussions have focused on the contrast between the methodological approaches of the two traditions. In particular, they have focused on the question of systematicity and certainty. The basic terms of the debate revolve around the so-called "England problem" of Max Weber (1864–1920), writing in the early twentieth century. Weber's account of capitalism emphasized the importance of calculability: he believed that market actors needed maximum certainty in order to plan their transactions. Accordingly, he regarded civil-law systems of the German type as essential to the making of a functioning capitalist order. England thus presented him with a puzzle. On the one hand, England seemed to offer the paradigm of a successful capitalist order. On the other hand, the English common law seemed to offer the model of a system that provided relatively little by way of legal certainty.

This "England Problem" has attracted more attention than any other topic in the literature. Some scholars have tried to resolve the Weberian puzzle by insisting that the common law is in practice less uncertain than it seems: judicial decisions, they argue, can be predicted with sufficient accuracy to meet the needs of business. Others have argued that Weber was simply wrong about the importance of legal certainty: business, they have maintained, can function even in the absence of perfectly predictable law.

Yet other scholars have rejected the Weberian approach entirely. Friedrich Hayek (1899–1992), in particular, did not view the question of methodology as fundamental at all. Instead, Hayek focused on the differences in institutional structure. The common law, in Hayek's view, with its tradition of an independent and powerful judiciary, was better suited to sustaining values of liberty than the civil law. The separation of powers was fundamental to the maintenance of liberty, and liberty in turn was fundamental to the making of a healthy commercial order. Hayek's claims have been revived recently by some U.S. legal scholars.

These debates have not been settled by any means, and there remain many unanswered questions. The differences in the substantive rules of the two traditions have received relatively little attention: We know much less than we would like about the history and impact of the relatively more lenient market morality that seems to characterize the common-law tradition. Historians may have been too slow to observe that the most important advances in early-modern commercial practice began not in England but in the Netherlands, a center of the study of civil law. Nor have historians carefully addressed the possibility that differences in legal tradition do not matter at all.

For purposes of the history of trade, it is especially important to observe that scholars have often framed their questions carelessly. In particular, the literature does not always carefully distinguish between capitalism and commerce. This is especially significant for purposes of understanding the history of long-distance and bulk trade, since these are areas in which disputes historically have been resolved by reference to commercial law. Commercial law is a body of law independent both of the core provisions of the common law and of the core provisions of the civil law. It is arguably the case that a sound legal history of trade should focus entirely on commercial law, paying little attention to either the common-law or the civil-law traditions.

SEE ALSO France;Theories of International Trade.

BIBLIOGRAPHY

Baker, J. H. Introduction to English Legal History, 3rd edition. London: Butterworths, 1990.

Hayek, Friedrich A. Von. Law, Legislation, and Liberty: A New Statement of the Principles of Justice and Political Economy, Vol. I. Chicago: University of Chicago Press, 1993.

Kronman, Anthony. Max Weber. Stanford, CA: Stanford University Press, 1983.

Mahoney, Paul. "The Common Law and Economic Growth: Hayek Might Be Right" Journal of Legal Studies 30 (2001): 503–524.

Merryman, John. The Civil Law Tradition, 2nd edition. Stanford, CA: Stanford University Press, 1985.

Van Caenegem, R. C. Judges, Legislators and Professors: Chapters in European Legal History. Cambridge, UK: Cambridge University Press, 1987.

Weber, Max. Economy and Society: An Outline of Interpretive Sociology. Eds. Guenter Roth and Claus Wittich. New York: Bedminster Press, 1968.

Zimmermann, Reinhard, et al. Good Faith in European Contract Law. Cambridge, U.K.: Cambridge University Press, 2000.

James Q. Whitman