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A Tale of Two Legal Systems: Common Law and Statutory Law

It was the best of the laws, it was the worst of the laws, it was built on freedom, it was built on power, it was the spontaneous order of organic social institutions, it was the deliberate order of ideology and coercion, it was a stream of jurisprudence guiding us to justice, it was a tangle of statutes pushing us to restriction.

In short, law, either jurisprudence or legislation, can only be understood by comparison, and adapting the introduction of A Tale of Two Cities, we see two systems, common and civil law, and gaps in freedom between them.

To understand what makes civil law less free than common law, we must begin with Isaiah Berlin’s “Two Concepts of Liberty,” which defined his understanding of negative and positive freedom.

Berlin defines negative freedom as “simply the area within which a man can act unobstructed by others,” meaning that if someone is prevented by others to act, then he is unfree. Of course, external intervention against man’s freedom to act is coercion, as it incorporates actual or potential violence, as both Murray Rothbard and F.A. Hayek pointed, and as such, negative freedom doesn’t need enforcement, but simply to be respected, for the abuse of coercion degenerates into oppression, and

the criterion of oppression is the part … to be played by other human beings, directly or indirectly, with or without the intention of doing so, in frustrating my wishes. By being free in this sense I mean not being interfered with by others. The wider the area of noninterference the wider my freedom.

In contrast, positive liberty comes “from the wish on the part of the individual to be his own master … in not being prevented from choosing,” similar to negative liberty, but meaning that “freedom can be made to mean whatever the manipulator wishes”—either “self-abnegation in order to attain independence,” meaning discipline, or “self-realization, or total self-identification with a specific principle or ideal in order to attain the selfsame end,” meaning what Hayek called constructivist rationalism, expanding one’s conception of freedom through political imposition. 

These definitions guide the ends of both legal systems, which, as sets of rules for social cooperation, determine man’s limitations in society in their use of the scarce resources at their disposal. In common law and other jurisprudence-based systems, negative freedom is indeed the basis on which individual subjects are bound by rules, for their actions are, on principle, free, given they don’t interfere with others, and when they do, the subsequent conflict arising from the collision of subjective perceptions of negative freedoms is to be resolved by an impartial third party: judges.

In Austro-libertarianism, the natural law is a preexisting guideline for social interaction, from which rational individuals derive their property rights by extending the reasoning of their bodily self-possession to the resources they find, homestead, and transform into capital and consumption goods through their work.

Under this framework, reasonable individuals, involved in a conflict, can engage in argumentation, and end their conflicts by mutual understandings or voluntary agreements that only need external voluntary enforcement by a judge in case one of them disrespects the agreement. Or as David Dürr puts it:

Law gives answers even though there are no statutes or no precedents at all, and … the final “source” of law is the conflict at the occasion of which the law is called upon…. The conflict creates its own legal solution.

This is the view prevailing from Roman to common law: law, discovered via conflict resolution, is an evolving institution where those who resolve disputes, such as judges, derive legal principles by reasoning through facts and apply previously discerned rules in a process similar to the formation of tradition, involving the accumulation of useful past knowledge, which makes jurisprudence what Carl Menger and F.A. Hayek considered the result of free human flourishing, that is an organic social institution, or an example of spontaneous order.

However, this could not be said of legislation, which uses political power to design society, expanding whimsical conceptions of positive liberty over the whole polity, or as Frédéric Bastiat puts it in The Law:

Men, therefore, are nothing but raw material. It is not for them to will their own improvement. They are not capable of it … it is only the legislator who is. Men are merely to be what he wills that they should be … the legislator is to begin by assigning the aim of the institutions of the nation. After this, the Government has only to direct all its physical and moral forces towards this end. All this time the nation itself is to remain perfectly passive … it ought to have no prejudices, affections, nor wants, but such as are authorized by the legislator.

Legislation, as civil or statutory law, is founded upon legal positivism, which postulates that rules are only enforceable when set in in a written code readily available to the general public and produced by the sovereign, who has power over society.

This philosophy, legitimized under various political formulas, such as social contract theory, empowers the state to restrict freedom through rules and to build plunder structures with institutionalized violence.

Frank van Dun, in “The Logic of Law,” explains that legislation, under social contract theory,

requires every person who enters into the State to give all his possessions, all his rights, indeed himself, to all the other parties to the contract … that human nature should be changed, because an autonomous collective made up of natural human persons would inevitably be a Hobbesian “war of all against all”. To meet that condition, it was necessary that a political genius (Rousseau’s “legislator”) should succeed in turning (“educating”) natural men and women into artificial citizens of the right kind … made to identify fully with the State.

Under these premises, the state uses Berlin’s conception of positive liberty, directing its coercion with statutes to achieve specific goals for the community and the individuals within that it wishes to fully command, creating a key difference between the development of common law (discovering rules as solutions to conflict) and of civil and statutory law (imposed legislation), described by Bruno Leoni as follows:

Individual freedom in all countries of the West has been gradually reduced in the last hundred years not only, or not chiefly, because of encroachments and usurpations on the part of officials acting against the law, but also because of the fact that the law, namely, the statutory law, entitled officials to behave in ways that, according to the previous law, would have been judged as usurpations of power and encroachments upon the individual freedom of the citizens.

Leoni also points out that state officials increase their powers through the enactment of statutes by the legislature, which is legitimized in its role by

the deeply rooted political beliefs of our age that because legislation is passed by parliaments and because parliaments are elected by the people, the people are the source of the legislative process and that the will of the people, or at least that part of the people identifiable with the electorate, will ultimately prevail on all subjects to be determined by the government.

In another essay, Stephan Kinsella adds:

When legislation is thought of as the primary source of law, citizens become more accustomed to following orders, and thus become more docile, servile, and less independent. Once people lose their rebellious spirit, it is easier and more likely for the government to become tyrannical.

Kinsella’s statement reminds us that legislation and the social contract formula divide society into those who legislate and those who are subject to legislation, although it implies that legislation-based systems could provide more certainty than jurisprudence when it comes to rules for social cooperation, as they theoretically offer abstract plans for the future. This is reminiscent of Hans-Hermann Hoppe’s rationalization for the existence of rules, but Kinsella quickly rebuffs this argument by stating:

Legislation tends to interfere with agreements that courts would otherwise have enforced and thereby makes parties to contracts less certain that the contract will ultimately be enforced.

However, legislation should not be derided as not law, as Kinsella also points out, for “the basic idea of legal positivism—that it is possible to identify something as a law, even if it is unjust—seems … to be obviously correct,” because “to determine what the law is, one must see what rules are enforced,” highlighting legislation’s nature as imposition, for it still is law, although not voluntary, and thus not particularly fair. Justice, instead of “rendering to each his right,” as defined by Ulpian and then Thomas Aquinas, is a power base construct, also subject to the same uncertainties of other social interactions, with added elements of constant fear and conflict to maintain it.

At last, major points from Carlo Lottieri’s essay “Classical Natural Law and Libertarian Theory,” also helps us distinguish different freedom levels in jurisprudential law and legislation. Jurisprudential law, reacting to conflicts, is based on factual reality and its development builds historical knowledge from past experiences, from which derived legal principles can be applied to present cases in analogous contingencies, leading to similar solutions, in an empirical process Ludwig von Mises called thymology (meaning it is the most realistic solution found for a dispute). Legislation, politically imposed with social technology, is instead created from the ruling elite’s will, set to achieve results according to the interests they dilute for the mases with power-justifying formulas.

Thus, civil law, as well as statutory law and administrative regulation, does not relate to practical realities, but is what Hayek called a deliberate order, arranged to guide social relations to particular goals but not belonging to the same order as contracts or judicial processes, which exist per the will of the parties and their agreement to be subject to external enforcement. However, in its current form (vindicating Rothbard’s advocacy for the organic development of historical customary law), civil law can solely be considered law, for it regulates conduct for social existence, not for its fairness.

Legislation opposes jurisprudential law, as the former is top-down imposed, from the ruling class to the people, whereas the latter is bottom-up built, from individuals freely resolving conflicts, reasonably deducing rights in factual solutions to enforce agreements and to keep track of past solutions to be again applied in the future.

For Lottieri, the “belief in a living law” is “continuous and close interaction with reality,” meaning “the legal order has some ‘essential’ elements, but it changes through time, and for this reason it requires constant and challenging work to adjust rules and behavior.” Living law describes jurisprudence, where past decisions can be used centuries later, and then be overruled by newer ones deducing better rules from more reasonable fact interpretations.

In short, jurisprudence is defined as man freely reasoning the natural rules of social cooperation through trial and error, and legislation, founded upon legal positivism, invariably needing state power, can only be defined as Jeremy Bentham’s “will of the sovereign,” expanding as the state grows in size and power, diminishing freedom for civil society and individuals until they find themselves under Leviathan’s might.

And unlike what jurists like Adrian Vermeule or Cass Sunstein, who think Leviathan, with its many statutory laws and administrative regulations, can be redeemed through Catholic moral teachings or liberal democracy, we should know it won’t, for “Cthulhu may swim slowly. But he only swims left.”