The Elements of Commercial Law

Front matter

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Introduction

1. Origin of commercial law.

2. Legal decisions.

3. Kinds of law, written and unwritten.

4. What is a contract?

5. Sealed and unsealed contracts.

. 1. Commercial law pertains to commerce; in other words, it treats of contracts. To a very considerable extent, commercial law is the outgrowth of customs. By these are meant such ways of doing things as are generally practiced among men and which are declared by the courts to be proper and legal.

2. Customs, however, are not the only basis or foundation of commercial law. The judges often declare rules or principles created by themselves. In administering justice, necessity requires them to do this when no rules exist that can be properly applied. Besides judge-made law there are statutes that either repeal or modify other laws, or embody new rules of action.

3. Thus commercial law springs from two sources : customs with additions made by the judges, and statutes enacted by the legislative department of government. The law originating in customs is called the common or unwritten law, and the laws enacted by legislatures are called statutes or the written law.

4. A contract is an agreement to do, or not to do, a particular thing. As a legal term, it is of reicent use. Indeed, most of the principles of commercial law are of modem origin,

5. The most general division of contracts is into simple contracts and specialties. A specialty is in writing, to which a seal is added after the name of each contracting party. A simple contract includes all kinds that are not thus sealed.* They may be verbal or written contracts. They are often called parol contracts. Perhaps this term is more frequently used by the courts than any other. In some cases the law requires that contracts must be sealed, but much more frequently contracts are either verbal, or written without the addition of a seal. Formerly, when people could not write, much more attention was given to the use of a seal, than is given to it at the present time. Nevertheless, there are some peculiarities relating to sealed contracts, especially in the way of evidence. For example, a cause or consideration for making a sealed contract need not be

♦See Sec 2, p. 20.

INTRODUCTION. 9

proved, because the law assumes that a consideration was given. A person who wishes to enforce or compel another to perform a verbal or unsealed contract must show that there was a consideration for making it.