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History of Sales Law

Introduction I

Introduction II

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

Warranty--Remedy

Warr--Remedy II

Warr--Remedy III

Warr--Remedy IV

Warr--Remedy V

USA of 1906, Sections 1-2

Prof. Bill Long 11/22/05

Understanding the Contract/Capacity to Contract

The USA of 1906 provides us some of the conceptual framework and language to understand the development of drafts of the UCC in the 1940s and 1950s. The purpose of this essay is to work through some of the language of the first two sections of the USA in order to begin to understand it. I will be relying on the first edition of Williston on Sales, since this was written almost contemporaneously with the USA. Working through a substantial (1300 page) treatise from 100 years ago is a wonderful discipline for a law professor. It forces you to review your understanding not only of the law today but the law as it was then, thus forcing you ask the question of how the gaps were filled in during the "in-between" time. I will focus here on three things: (1) the language of sec. 1 on contract to sell; (2) the objective theory of contracts; and (3) capacity to contract (sec. 2) especially for married women.

The Contract to Sell

Section 1 of the USA distinguishes between contracts to sell and sale of goods. The former is a contract in which the seller agrees to transfer property in goods for the price (traditionally known as an 'executory contract') while the latter is the agreement whereby the goods are transferred (the 'executed contract'). Williston notes that Roman Law provided the background for the term "contract of sale" to be brought into the common law, which the Sale of Goods Act of 1893 used, but Roman Law spoke of bargains indifferently as a "contract to sell, a contract of sale, or a sale." The Romans didn't have a distinction which we have between contracts that immediately transfer title and those which do not. The USA seeks to be more precise in its language and awareness of American realities. Hence the best language is "contract to sell" and "a sale."

The Objective View of Contract

Important for Williston and the USA of 1906 is a view of contract that had only gradually taken hold in the 19th century, which he calls the "mutual assent" theory of contract. He says that the mutual assent theory honors the intention of the parties, but this intent "does not mean secret intention nor generally even intention manifested to third persons, but only the intention manifested to the other party." He quotes with approval the MA case, Mansfield v. Hodgdon, which provides that if the offereor understood "the transaction to be different from that which his words plainly expressed, it is immaterial, as his obligations must be measured by his overt acts" (p. 4). In other words, the meaning of the contract is to be found in the words on the page, and not what may have been in the mind of the contracting party.

He gives the following "extreme" example of this notion of contract. Is the offeror liable in the following scenario? Offeror gives an offer to offeree through a telegram sent. The telegraph company, however, changed some of the terms of the offer. Offeree received the telegram and assented to the terms of the offer as presented. Is there a contract? Yes, for Williston, and the terms are what appeared on the miscommunicated telegram. It is the clear sense of the words on the page which communicate the essence of a contract. His justification? "By selecting the telegraph as an agency of communication the offerer makes himself responsible for the offer actually delivered." This view of contract will prevail well into the 20th century.

Capacity to Contract--Married Women

There is no equivalent to Sec. 2, on capacity to contract, in Article 2 of the UCC. This issue is now normally handled by separate state statutes on the subject. But, at common law, and in Williston's treatment, five groups of people were not able to contract fully. In the language of the common law, they suffer from "disabilities." They are: (1) infants; (2) lunatics; (3) drunkards; (4) married women; and (5) corporations. Williston considers these disabilities in nearly 40 articles in his book, and a close reading of them is a fine introduction to the history of the common law. For example, under "infants," he talks about contracts that infants might make (void or voidable?), acts of disaffirmance, acts of ratification, necessaries, lying about one's age, lying about the quality of the goods allegedly sold, rights of third parties, etc. Close study of this section, then, opens up lots of other areas of law.

But more interesting to me was his six article discussion of the limitations on married women with respect to contractual matters. What I wasn't particularly aware of was the distinction at common law between the "almost absolute denial of property rights to a married woman under the common-law system" and the modification "in equity by the doctrine of separate estate" (p. 48). In other words, equity sought to "soften" a harsher system in which all property and rights was transferred from the wife to the husband by granting a married woman a "separate estate" from her husband. But this "softening" of equity was reversed, as time went on. Williston only hints at it, but a law review article I read gives the following information (Hazel D. Lord, "Husband and Wife: English Marriage Law from 1750: A Bibliographic Essay, 11 S Cal Rev. L & Women's Stud. 1 (2001)).

Some judges shared the opinions of critics who felt that the discretionary powers of women over her separate property was undermining the subordination of women in marriage. They developed a doctrine which I hadn't heard of to limit women's rights called "restraint upon anticipation." This doctrine barred a woman from making "improvident dispositions" of their separate property which she might otherwise have done by pledging her separate property as collateral or assigning future income from it. Now we have just learned a new (and technical) use of the word "anticipation." The first definition of the term in the OED defines "anticipation" as "the using of money before it is at one's disposal," such as in the 1858 sentence: "she [the married woman] is restrained from anticipation by the settlement." In other words, the doctrine of "restraint on (or upon) anticipation" disallowed her from renting out her property or in any way using it so that she would be able to derive future income from it.

Conclusion

This little detour on the way that equity was constrained after it supposedly granted women additional rights really doesn't relate much to the understanding of sales law today, but it adds a fascinating little insight into a brief chapter in the history of limitations placed upon married women, before the Married Woman's Property Act of 1882 and the Married Women Act of 1949. We have, however, made a first and good step into understanding the USA.

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Copyright © 2004-2007 William R. Long