Christian Wolff: Natural right 6 - How to read contracts?

After various types of contracts, Wolff considers the more general problem of how to interpret them, that is, how to decide what the persons making the contract have wanted to say with the words in it. In other words, the question is of the intentions behind the linguistic expressions.

Wolff at once notes that interpreting contracts involves something very different from interpretation in general. Usually, it is all just about clarity. If the words have a fixed meaning and the writer or speaker is known to express their intentions sufficiently, no further interpretation is required. If the words or their meanings are not clear, we can then just simply ask the writer or the speaker to explain them further, since they know best what they intended to say.

In case of contracts, Wolff points out, there is something that interrupts this simple scheme: obligations. Now the person promising to do something is not the best person to ask what they meant by their words, since they might wish to deny some obligations they had promised themselves to. Similarly, the person who the promiser is obligated to is also not fit for interpreting the words, because they might want to have the promiser provide them more than was accepted.

The interpretation of contracts, Wolff concludes, should then happen through certain rules that can be accepted by all parties involved. In the best case, he adds, these rules could be demonstrated as being the correct ones. When the rules and the corresponding right interpretation have been decided, the obligations are now determined.

To make interpreting easier, Wolff notes that people making the contract should speak in such a manner that they can understand one another. More particularly, they should use the words in such a manner that makes their speech understandable – Wolff calls this using the proper meaning of the words. More generally, they should use all terms in the received sense and they should not knowingly and willingly depart from this. From the standpoint of interpretation, Wolff continues, the words should be presumed to be received in their proper meaning and terms in their received sense, unless some urgent reasons to the contrary appear. In other words, interpretations should mostly follow the common use of words.

Wolff takes into consideration that the contracts are sometimes interpreted much later than they have been made. In such cases, he notes, the interpretation should use meanings that the words had at that earlier time. Then again, he adds, the interpretation should not follow what he calls the etymological meaning of the words, that is, the supposed original meaning of the words, from which the later meanings have evolved.

Wolff observes that if the persons making the contract have expressly said how the contract should be understood and the contract has only common words with clear meanings, the interpreter should follow the common meaning of the words closely. More generally, if it becomes evident, what sense of the words agree with the intentions of the people making the contract, it is not allowed to suppose any other intentions behind the words. If the contract contains some technical terms, they should be generally interpreted by definitions common in the discipline in which they are used.

Wolff also considers homonymy, where the same word has different meanings, and amphiboly, where the same expression consisting of many words has different meanings. Obviously, homonymy and amphiboly cause difficulties for interpreting contracts. Wolff notes that in some cases different occurrences of the same word or expression might have to be interpreted in different manners. Generally, he adds, if homonymy or amphiboly make the intention of the contract obscure, the meaning agreeing best with the topic in question should be preferred.

A strict rule Wolff endorses is that any interpretation leading to something absurd should be rejected. This rule is to be followed, even if it would mean ignoring the proper meaning of the words. In particular, contradictions should be avoided.

Contracts are often long pieces of text, and while some passages might be transparent, others might still be obscure. In such cases, Wolff notes, the obscure parts are to be interpreted in a manner that agrees with the clearer passages. More generally, he continues, the different parts of the text should be usually interpreted in such a manner that they agree with one another, unless it is evident that e.g. later parts of the text change what was said in earlier parts.

Since the contracts are the expression of the volitions of the persons making it, interpreting them often involves studying the intentions of those persons. Thus, Wolff says, if we know the reason why the persons behind the contract wanted to say what they say in the contract, the words of the contract are to be interpreted in such a manner that they agree with this central reason. If there were many different reasons that all in conjunction made the persons to do the contract, the interpretation should agree with the sum of these reasons. Then again, if we know many alternative reasons that could have been behind the contract, the interpretation should agree with these reasons in separation.

Wolff notes that contracts often have what could be called favourable and burdensome parts. Favourable in contract is, Wolff defines, what cares for the common good of all sides of the contract, while burdensome is what burdens one side more than the others – an example of latter would be penalties attached to a contract. In interpreting the favourable parts, Wolff insists, words should be understood in the most extensive sense they can be, unless this interpretation would lead to some absurdities or unless a stricter reading would be more useful for all participants of the contract.

On the other hand, Wolff thinks, when interpreting the burdensome parts of the contracts, words are to be taken in a stricter sense, although even a figurative understanding of the words is admitted, if this helps to avoid great burdens. In the particular case of punishments, this rule implies that placing guilt upon a person would require stricter definitions, so that there would be more reasons not to punish anyone. Similarly, if a person has promised something quite liberally, a more lax interpretation is to be avoided if such would burden the person who promised too much.

Another general rule Wolff suggests is that interpretation should be made in such a manner that the speaker or writer would have interpreted it, if they were present and knew all relevant circumstances that had become common knowledge after the contract has been made. Thus, if the sufficient reasons behind the persons making the contract were known, the same interpretation could be extended to cases which literally are not included in the terms of the contract, but would agree with these sufficient reasons.

Continuing with the negative case, Wolff adds that if some case would literally agree with the terms of the contract, but would somehow contradict the intentions of a person in the contract, the interpretation should restrict the meaning of the words. Similar exceptions to terms of a contract can be made, according to Wolff, when following the strict meaning of the words would contradict natural law or would be too burdensome to some person involved in the contract.

An interesting case occurs when two contracts contradict one another and some exception has to be made. Wolff notes that because a contract contains promises and therefore causes obligations, it can be handled similarly as laws. Thus, following what he has said in a previous part of his study on natural law on collision of laws, he notes that if one contract e.g. permits or even orders something that another contract forbids, the forbidding contract is to be preferred. More generally, contracts involving stronger obligations trump contracts with weaker obligations. Thus, a contract with an oath or a penalty attached to it is to be preferred to a contract without them. If no reason for choosing one contract over the other is found, the decision can be made by agreement of all persons involved or even by lot.

Christian Wolff: Natural right 6 – Feudal relations

In the second chapter, Wolff continues with a special case of the dominum utile, namely, feudum or fief – we are now speaking of legal relations that work as the basis of feudalism. What differentiates feudum from other kinds of dominum utile is that both participants of the feudal contract – the owner and the vassal – agree to provide to one another fidelity, in other words, some duties that are further determined in the contract: for instance, the vassal might agree to provide military service to the owner, while the owner might then agree to protect the vassal.

Otherwise, the properties of the feudum are simply those of a dominium utile, for example, the vassal can use the feudal thing as they want, as long as they don’t do anything to harm its very substance, which is the property of the owner. The vassal can improve the feudal thing, unless even such changes have been explicitly denied.

The paragraphs above would really be all that can be said of a feudum in general, that is, Wolff says, its substantial determinations. Yet, when agreeing on the feudum, the owner and the vassal can add further conditions that lead to further rights and obligations. For instance, the owner can set a price or an annual payment for feudum or it could be contracted only for some period of time or e.g. for a certain family line (Wolff mentions the possibility that the feudum could be inherited by both sons and daughters or even only by daughters, but in every specific example he speaks only of sons, which was, of course, historically the most common option).

A feudal contract is usually valid, when the owner and the vassal agree on its conditions. Yet, Wolff adds, they may also agree that a certain formal document called the letter of investiture is written. He thinks that such a written document agrees well with the law of nature, since it makes the conditions of the contract explicit.

A condition Wolff considers most extensively is whether the feudal contract allows the vassal to transfer the feudum to someone else, that is, to donate or to sell it, and if it is allowed, whether the consent of the owner is required for this. In case this is allowed, the feudum must be similarly structured as it originally was, except if the feudal contract adds some additional conditions to these (for instance, the owner might demand a further payment from the new vassal). Still, if the original contract determined e.g. a certain type of service from the original vassal, the new vassal must also provide it to the owner.

Usually the owner does not need to ask the vassal, if they want to transfer their ownership to someone else – the feudum just remains valid, with the same conditions as originally. Still, the owner and the vassal can also agree, Wolff notes, that the owner cannot donate or sell the feudal thing at all or not without the consent of the vassal. If such a condition holds and the owner still does transfer their ownership to someone else, the vassal is not obligated to provide any services determined in the feudal contract to the new owner.

What kind of things can then be given as feudum? The historically most obvious example is, of course, some piece of land, but Wolff thinks that the feudal thing can be anything that is not consumed by its use, like a piece of furniture. Things consumed by use – say, a portion of wine – cannot be made a feudal thing. Yet, even such consumables can be indirectly made into a feudal thing, Wolff suggests, that is, by making a right to such consumables into a feudum. As an example Wolff gives what is called feudum de caneva (literally, a fief from cellar), where the vassal gains a right to e.g. use a certain portion of wine from the owner’s provisions during the vassal’s life.

Making a feudum of a right to some consumable things is one way to involve these consumables into a feudum, but Wolff notes also a more direct manner. That is, if a person gives some consumable – usually, a portion of money – to another, who provides as a surety something else (say, a house), we can think of the money, or whatever the consumable is, as something not consumable. With such surety in place, the owner of the money can then give the right to use the money to another person, in the sense that this other person can attempt to use the money to make more money through business deals or by loaning it with some interest. This is then a new kind of feudum, which Wolff calls both feudum pecunia (literally, fief on money) and quasi feudum, implying that this is a sort of extension of the proper sense of feudum.

Assuming it hasn’t been explicitly forbidden in the feudal contract, the vassal can create to their feudum a new feudum, which is then called subfeudum, Wolff points out: so, if the vassal has a right to use a certain piece of land, they can then hand a right to use a part of this land to someone else. What holds for any feudum obviously holds for any subfeudum, but the latter always has the further condition that the subfeudal contract someone makes with the vassal cannot contradict anything in the original feudal contract that the vassal made with the owner. The process can obviously go indefinitely further and a subfeudum can have a subsubfeudum etc.

Often a feudum runs in a family, so that when the original vassal dies, one of their descendants becomes the new vassal (usually the oldest son). Now, it may well happen that some family dies out, so that no one to have the feudum exists anymore. In such a case occurs what Wolff calls apertura feudi, which means simply that the feudal thing returns fully to its owner; in this case all possible subfeudum expire also. The same relation does not hold the other way around, that is, if the owner happens to die without any heir, the vassal does not become the owner – unless, of course, the feudal contract says so.

Wolff has already spoken of the possible selling or donating of a feudum, but a case of pawning requires more discussion. Of course, if the feudum cannot be sold or donated without the consent of the owner, it cannot also be pawned without this consent. The vassal can pawn the use of the feudum or its products, and this is what they must have understood to have implicitly pawned, if they pawn the feudum without the consent of the owner. Yet, Wolff adds, if the apertura feudi is near, that is, if the feudum is about to return to the owner, since the vassal has no heirs, pawning is forbidden even with the consent of the owner. Furthermore, even if the vassal has heirs and the owner does consent to the pawning, the heirs do not have to. Then again, only the right to use and the products of the feudum are pawned, and once the vassal has died, the heirs of the vassal are in no way obligated to provide anything else to the debtor of the vassal.

Another concept Wolff investigates is revocatio feudi, where the person who has the power to do so asks to retrieve the feudal thing. This does not usually mean the owner asking the vassal to return the feudum, since the owner does not have such a right, unless the feudal contract says that the owner can do so whenever they want. The more usual case is when the vassal has sold or donated the feudal thing without the consent of the owner or heirs, who then can ask the new holder of the thing to return it to them, once the vassal has died. In that case, the owner or the heirs need not refund the price of the feudal thing to its holder.

Another question Wolff considers is whether the vassal can refute the feudum, that is, to reject the right to use the feudal thing and to be freed of all the obligations involved in the feudal contract. In refuting the feudum, the vassal can either want to return the right to use the feudal thing to the owner or then to transfer it to someone else. In the prior case, the vassal can refute the feudum, unless this is against the rights of the owner, for instance, when the refutation is done, because the vassal wants to escape military service that the owner requires from the vassal according to the feudal contract. Furthermore, although the vassal has returned the right to the feudal thing to the owner in refuting the feudum, the heir of the vassal can later demand its return, when the vassal has died.

When the vassal refutes the feudum and intends to transfer the feudal thing to someone else, the important question is whether this intended new vassal is some heir of the vassal or just any outsider. In the latter case, the refutation of the feudum would simply mean its donation, which Wolff has already considered. In the previous case, the refutation can simply happen if the feudum is to go to the immediate heir of the vassal. Then again, if it should go to some other heir – say, a grandson, instead of the son – the immediate heir can insist the restoration of the feudum to them, once the original vassal has died.

An interesting case arises, when the vassal refutes the feudum and wants it to go to their immediate heir, who then at once wants to transfer the feudum to their heir. In that case, Wolff says, the important question is whether the vassal wanted the feudum to go specifically to the immediate heir or whether they just wanted to get rid of it. In the prior case, the feudum returns to the original vassal, in the latter case, it goes to the second heir.

The last thing Wolff investigates of feudum is the possible breaches against the obligations of the feudal contract. Obviously, any duties left unfulfilled mean a breach, such as if the owner does not provide the agreed protection to the vassal or the vassal the agreed military service to the owner. Wolff does note an exception to the latter case: if the owner is engaging in an unjust war, the vassal does not need to help them, even if the feudal contract would say so.

More serious breaches occur, if the substantial determinations of a feudum are broken, for example, if the vassal does not show any fidelity to the owner. This would happen, if the vassal does not want to avert damages to the owner or promote their advantage, when they can, and even more so, if the vassal causes damage to the owner or wants to do something against their health or in any manner conspires to do something like this. Thus, the vassal breaches the feudal contract, if they threaten the life of the owner, plan an ambush or enter into a destructive agreement with the enemies of the owner. They even commit a breach, if they desert the owner in battle or other hazard or do not help them.

Wolff notes some exceptions. If the vassal and the owner are in a common danger and the vassal prefers to save their own life over the life of the owner, no breach occurs. Similarly no breach happens, if the vassal kills the owner when the owner has first attacked the vassal with superior force and the vassal could not avoid being killed or mutilated, unless by killing the owner first.

Whatever the breach is, Wolff says, it does not lead to the vassal losing the feudum or to the owner losing their ownership, unless it is particularly agreed so. Even if such an agreement exists, the one behind the breach can still pay for their crime. In case of the vassal committing the breach, if they do not make any amends, the feudum would still continue in the sense that their heirs have a right to ask the feudum to be given to them, once the original vassal has died.