History of Sales Law
Un. Sales Act 1-8
Un. Sales Act 9-16
Un. Sales Act 17-22
Un. Sales A. 23-32
Un. Sales A. 33-40
Un. Sales A. 41-46
Un. Sales A. 47-56
Un. Sales A. 57-62
Un. Sales A. 63-68
Un. Sales A. 69-75
Un. Sales A. 76-79
Comment, Sec. 1-2
Statute of Frauds I
Statute of Frauds II
Chose in Action
Chose in Action II
Chose in Action III
Chose in Action IV
Chose in Action III
Bill Long 12/9/05
The Concept Expands
As the quotation from Holdsworth just indicated, the common law had a great fear of third parties coming in to stir up litigation. The fear would be that if you could assign your cause of action to a person, even one who lived in or had an interest in your property, that all kinds of evil things would happen. Listen to the words of Lord Coke, from the early 17th century:
"And first was observed the great wisdom and policy of the sages and founders of our law, who have provided, that no possibility, right, title, nor thing in action, shall be granted or assigned to strangers, for that would be the occasion of multiplying of contentions and suits, of great oppression of the people, and chiefly of terre-tenants, and the subversion of the due and equal execution of justice..." Lampet's Case, 10 Co. Rep. 46b, 48a (1613).
So many things leap off the page from this quotation, but I will only mention two. First, note the adamancy with which Coke dismisses the concept of assignment of a chose in action. Coke assumes that an assignment of such a chose would result in "great oppression of the people." Second, whenever a jurist starts talking about the "due and equal execution of justice" you can tell that those are "throw away" words. I am not saying that Coke isn't sincere in his belief; I am saying that what is justice in one age will make a person in a new age scratch her head and say, "Huh?" "Justice?" For Coke it is the epitome of justice that one's chose in action not be assigned. To those of us who know (and sometimes work for) collection agencies--which are assigned the task of collecting the debt--we are pretty convinced that what they do is not only legal but actually necessary to good functioning of our contemporary society.
The danger was defined as "maintenance" or "champerty." The standard definitions of each of these are as follows:
"Maintenance is "(a)ssistance in prosecuting or defending a lawsuit given to a litigant by someone who has no bona fide interest in the case." Black's Law Dictionary 965 (7th ed. 1999). Blackstone pejoratively defined maintenance as "an officious intermeddling in a suit that no way belongs to one, by maintaining or assisting either party with money or otherwise." William Blackstone, Commentaries, vol. 4, ch. 10. Champerty is "an agreement between a stranger to a lawsuit and a litigant by which the stranger pursues the litigant's claim as consideration for receiving part of any judgement proceeds." Black's Law Dictionary, supra, at 224.
I would like to speak further about these concepts, but not here.
Expanding the Category
It was the medieval development of chose in action in personal and real property actions that formed the basis for its extension in the 16th through 18th centuries. Two principal expansions of the concept occured in this time. First, during the sixteenth century choses in action were extended from a right to bring an action to include the documents which were necessary evidence of such a right (Holdsworth at 1011). A 1535 case held that a bond was a chose in action, and this opened the floodgates. By the time the commercial empire of England began to expand in the 17th and 18th centuries, courts would find such documents as negotiable instruments, stock, shares, policies of insurance and bills of lading to be choses in action. Williston, in his 1909 treatise construing the Uniform Sales Act, gives a full listing of American cases which held various documents to be choses in action. It includes bonds, mortgages, bills and notes, and shares of stock. However, he also notes that the sales of a partner's interst in a firm is not a chose in action. Williston on Sales (1909) at sec. 67. Thus, when modern textbooks give a quick definition of a chose in action as something on which suit can be brought and give an example such as an insurance policy, the book is correct, but that one sentence masks hundreds of years of interesting history.
The second way the concept of chose in action expanded at common law was through the inclusion of patents and copyrights. From Holdsworth:
"It is clear, however, that there was a tendency in the sixteenth century to regard any intangible right which was not clearly an incorporeal hereditament [leading examples of "IHs" are 'tithes, advowsons, pensions, annuities, rents, franchises'], and any non-assignable right, even though it was only temporarily non-assignable, as a chose in action. It seems to me that it was due partly to this tendency that such incorporeal property as patents and copyrights came in the eighteenth century to be classed as choses in action. Probably if these forms of property had arisen at an earlier stage in the history of the law they would have been regarded as franchises, and therefore as incorporeal hereditaments" (33 HLR at 1013).
Even though copyrights and patents were then included in the growing and unwieldy list of choses in action, not everything related to these was so included. For example, Williston points out that an oral agreement for the sale of an interest in an invention, before letters-patent had been obtained, was not a chose in action (Supra, at sec. 67).
Thus by the time we get to 1800, the nature of the concept of chose in action has expanded considerably from its initial signification as an action to recover on a debt at common law. It included not only the ability to sue on real actions, but it embraced various documents evidencing such a right as well as copyrights and patents. However, the bedrock principle of English law seemed to be that choses in action were personal rights, and could only be enforced by the person who possessed the right. Since 1800, however, the concept of the inalienability of a chose in action collapsed, but only in the contract-based areas of the law. It remains to be seen if tort-based claims will soon also start to become alienable.
The next (and last) essay brings us right up to today on those two concepts.
Copyright © 2004-2007 William R. Long