Vow and Contract

INTRODUCTION

We hold these truths to be self-evident: that all men are created equal: that they are endowed, by their Creator, with certain unalienable rights, that among these are life, liberty and the pursuit of happiness. That to secure these rights, governments are instituted among men . . .

Almost all Americans are familiar with these words from the famous 1776 Declaration of Independence. Few, however, know the legal and political significance of them. Today most assume that the language and ideas expressed in the Declaration are a product of the “natural law,” that is, “human reason applying the test of good and bad to human conduct.”¹ But the truth is that the Declaration’s text and claims were rooted in
God’s revelation, the Bible.

First of all, America’s founders believed in the Genesis account of the origin of man: “All men are created.” They did not hold to either ancient or current scientific theories that man “evolved.” Their belief in the Biblical account of man’s origin had direct political and legal significance. Man’s Creator made each man “equal” and “endowed” him with “certain unalienable rights.” In other words, America’s founders believed in God-given rights, not man-invented or state-granted rights. Their devotion to liberty rested upon their faith in their Creator, the God of the Old and New Testaments,² not in any philosopher or statesman, and certainly not in the State.

This devotion was strengthened further by their knowledge that the rights given by the Creator were “unalienable,” that is, they were irrevocable, not subject to modification, and not capable of being given away. The Virginia Bill of Rights, written one month earlier, spelled this truth out in unmistakably clear language: “That all men have certain inherent rights, of which, when they enter into a state of society, they cannot, by any compact, deprive or divest their posterity.” Those who
signed the Declaration agreed that even the People could not give up their God-given rights because God had given man authority only to “secure” them through properly constituted civil governments.

This concept of limited civil authority came directly from John Locke’s Second Treatise on Government which, in turn, rested upon earlier writings, especially Lex Rex published in 1644 by Samuel Rutherford. Rutherford’s view that the purpose of civil government was to secure man’s God-given rights rested squarely upon the Biblical passages that recorded the establishment of the constitutional monarchy in ancient Israel. While the elders of that nation had asked for “a king to
judge us like all the nations”,³ God gave them a covenant king bound by the laws of God.⁴ Thus, God in his mercy saved the people from a king who would take from the people all that they desired.⁵ Thus, Samuel, after anointing Saul king, “told the people the manner of the kingdom, and wrote it in a book . . ..”⁶

The Declaration of Independence followed this Biblical pattern, as did the early state and United States Constitutions all written in the last quarter of the eighteenth century. David Hoffman, a leading legal scholar and educator of the early nineteenth century, acknowledged America’s indebtedness to Biblical Israel when he attributed her constitutional history to the “theory of the social compact disclosed in the pages of the Old Testament.”

Thus, as Samuel had done for the people of Israel, the Congress did for the American people; they wrote the manner of the new nation in the Declaration of Independence. It was a nation founded upon “the laws of nature and of nature’s God.” The Congress chose these words because they were well understood by all Americans to mean God’s will as revealed in nature and in the Scriptures.

A COMMITMENT TO ECONOMIC LIBERTY

It was, also, a nation whose leaders committed themselves to the security of the people’s God-given rights. To that end, Congress specifically named the three major rights that God had given to man: “Life, Liberty, and the Pursuit of Happiness.”

From beginning to end the Bible affirms life:

And the Lord God formed man of the dust of the ground, and breathed into his nostrils the breath of life . . ..⁷

And he showed me a pure river of water of life . . . proceeding out of the throne of God and of the Lamb.⁸

Between these two events the Bible teaches that all life is a gift from God.⁹ Consequently, the Bible attests to the sanctity of all human life.¹⁰ Moreover, it reveals the fragility of life¹¹ and, therefore, the need for its protection by the civil authorities.¹² In sum, it emphasizes that because life is God-given, it is an unalienable right not to be taken by any man except as forfeited by a man who has committed a crime deserving of capital punishment.¹³

As the Bible affirms life, so it affirms liberty. At the beginning the Bible contains the account of how God created Adam and Eve with the freedom to obey or to disobey His commandments in the garden.¹⁴ In its closing verse the Bible holds out an invitation to everyone: “And the Spirit and the bride say, Come. And him that heareth say, Come. And him that is athirst come. And whosoever will, let him take the water of
life freely.”¹⁵ In between, both the Old Testament and the New Testament repeat the message of liberty:

The Spirit of the Lord God is upon me . . . to proclaim liberty to the captives, and the opening of the prison to them that are bound.¹⁶

Stand fast therefore in the liberty wherewith Christ hath made us free.¹⁷

So, the Liberty Bell in Philadelphia has inscribed upon it these words from Leviticus 25:10: “Proclaim liberty throughout all the land.” The liberty proclaimed is not given by man, for the Bible states that no man can confer liberty on another man without putting that man in bondage.¹⁸ The spirit of God is the sole given of liberty,¹⁹ and therefore, those freedoms
that God has given are inalienable rights toward all men.

James Madison captured this thinking of America’s forefathers best in his 1784 Memorial and Remonstrance. He wrote as follows:

Before any man can be considered as a member of civil society, he must be considered as a subject of the governor of the universe, and if a member of civil society, who enters into any subordinate association, must always do it with a reservation of his duty to the general authority, much more must every man who becomes a member of any particular civil society so it with saving allegiance to the universal sovereign.

As important as liberty and life are to man and to America’s founders, the Bible gives an equal place to “happiness.” The Psalms, alone, pronounce happiness upon the man who pursues the right way to enjoy life and liberty.²⁰ Jesus Christ, in His Sermon on the Mount, lays claim on happiness for all those who follow His example of humility, mercy and peace.²¹

At the heart of the Biblical call to happiness is man’s freedom to choose. God does not force man to be happy, He did not create him that way. Nor can the state or any other human institution require their subjects or members to be happy. The Bible commands each individual man to choose to do what is right and receive the blessings that God has for him.²² Therefore, the civil ruler, according to the Bible, is to preserve for his subjects every opportunity that God has provided for “the pursuit of happiness.”²³

One of the great opportunities for happiness for man, the Bible records, is to “eat and drink, and enjoy the good of all his labour . . ..”²⁴ This opportunity to enjoy material prosperity comes from God who gives to each man his portion to enjoy.²⁵ This gift of God, in turn, comes to those who carry out the dominion mandate as God pronounced in the beginning when He created man:

And God blessed them, and God said unto them, Be fruitful and multiply, and replenish the earth, and subdue it, and have dominion . . ..²⁶

To exercise the dominion mandate God pronounced man free to use his gifts, his opportunities, and his resources to acquire, possess, and sell property. This great freedom was at the heart of the Declaration’s “Pursuit of Happiness” as the more detailed statement of the Virginia Bill of Rights, written one month earlier, gave evidence:

That all men . . . have certain inherent rights . . . namely, the enjoyment of life and liberty, with the means of acquiring and possessing property, and pursuing and obtaining happiness and safety.

Other early state contributions affirmed that economic liberty occupied a central place in the God-given right to pursue happiness. For example, the preamble of the constitution of the state of Pennsylvania, adopted on August 17, 1776, restated the purpose of government and the source of man’s rights: “[A]ll governments ought to be instituted . . . to enable the individuals who compose it to enjoy their natural rights, and the other blessings which the Author of existence has bestowed
upon man.” Further, it acknowledged that the goodness of “the great Governor of the universe” had allowed the people of Pennsylvania to organize a government best suited to “promote the general happiness of the people of this state, and their posterity.” Following immediately on the heels of this preamble, came this first paragraph of the peoples’ Bill of Rights:

That all men . . . have certain natural, inherent and inalienable rights, amongst which are, the enjoying and defending life and liberty, acquiring, possessing and protecting property, and pursuing and obtaining happiness and safety.

Approximately one year after the people of Pennsylvania adopted their constitution, the people of Vermont adopted a constitution containing the same references to God in its preamble and the same language in its first article. About four years later the people of Massachusetts “acknowledging . . . the goodness of the great Legislator of the universe” formed a new constitution of civil government dedicated to the security of men’s “natural, essential and unalienable rights; among which
may be reckoned the right of enjoying and defending their lives and liberties; that of acquiring, possessing and protecting property; in fine, that of seeking and obtaining their safety and happiness.”

On the basis of this documentary evidence one may confidently conclude that America’s founding statesmen based their political and legal ideas upon their belief in God and committed the new nation to securing those rights that God had given to all men. Moreover, one may with equal assurance conclude that America’s founding fathers believed that the “pursuit of happiness” included the economic life and liberties given by God to man and ranked that right equally with the physical,
mental, and spiritual life and liberties given by God to man.

LAWS IMPAIRING THE OBLIGATIONS OF CONTRACTS

Having ranked economic freedom at the head of the list of God-given rights, America’s founders carefully included in the early state and United States constitutions protection against the means so often used by despotic government to deprive the people of their lives and of their liberties. Thus, the constitution of Maryland, adopted on November 3, 1776, protected a citizen from being deprived of his “property” as well as of his “life” and “liberty” except “by the judgment of his peers, or by the law of the land.” Indeed, the Bill of Rights of the United States Constitution, adopted in 1791, contained the same “due process” protection for “property” as it did for “life” and “liberty.”

Because the civil authorities held the judicial power, namely, the authority to punish evildoers upon proof of wrongdoing they often misused the courts to take away arbitrarily a man’s life, liberty, and property, contrary to the law of the land. It was not surprising then that the Maryland and the United States Constitutions included due process protection that applied equally to all three God-given rights. Such a clause “in one form of language or another,” was inserted into “all the state
declarations of rights adopted prior to the Constitution of the United States.”²⁷

In addition to the misuse of judicial power, civil rulers often misused their legislative power to deprive the people of their God-given rights. In response the United States Constitution denied to the states the power to “pass any bill of attainder, ex post facto law, or law impairing the obligation of contracts.”²⁸ Each of these prohibitions was designed to protect the people from the exercise of legislative power that did not rightfully belong to the states. Each was also designed to protect each of the three God-given rights named in the Declaration of Independence.

The people of Maryland led the way to forbid the enactment of bills of attainder, a major threat to the God-given right to life. Such bills were acts of legislatures that declared a particular person guilty of a felony of treason and condemned that person to death. They were used by English kings to get rid of their political opponents without having to go through the regular judicial procedure that guaranteed such safeguards as trial by jury and the right to counsel. American constitutions
declared that their legislatures had no authority to exercise judicial power. That belonged exclusively to the Courts.

The people of Delaware took the lead to outlaw ex post facto laws, a major threat to liberty. Such laws were enacted by tyrannical legislative bodies to make an act illegal and then to apply that law retroactively to people who had engaged in the activity at the time when it was perfectly legal. At the heart of the prohibition against ex post facto laws was the preservation of the essential condition for true liberty, advance notice of a new law so that the people have an
opportunity to make an intelligent choice.

Congress, itself, took the lead to prohibit “laws impairing the obligations of contracts.” Within a few years after the American Revolution, several state legislatures had enacted statutes that relieved debtors of their obligations to creditors. So in 1787 Congress provided in the Northwest Ordinance, the charter for all states to be formed out of the territory northwest of the Ohio River, that no state legislature could pass any law “that shall, in any manner whatsoever, interfere with or affect private contracts, or engagements, bona fide, and without fraud previously formed.”

By the time the constitutional convention met in September 1787, America’s leading statesmen recognized that even this guarantee was not sufficient. So they inserted two very significant limitations upon state legislative power over private contracts into Article I, Section 10 of the United States Constitution.

Of first importance was the prohibition against any state legislature’s making “anything but gold and silver coin a tender in the payment of debts.” By this clause the Framers hoped to relieve all creditors from legislation that would substitute a currency of depreciating value or any other like thing as a means for discharging debt. Madison captured the reason for this clause in The Federalist Papers, #44:

The loss which America has sustained since the peace, from the pestilent effects of paper money on the necessary confidence between man and man . . . constitutes an enormous debt against the states . . ..

How a debt could be discharged was to be left to the parties to the contract except insofar that the national Congress may discharge debts under its bankruptcy power.

Not only had states modified private contracts through the issuance of paper money, they had changed the rules governing private contracts to favor debtors who desired relief from their obligations. The Constitution was written to prohibit any state legislature from enacting any “law impairing the obligation of contracts.” As historian Charles A. Beard has observed, Chief Justice John Marshall, “who ought to have known what the framers of the Constitution intended better than any man on the supreme bench,” believed that “legislation affecting adversely the obligation of future contracts was just as unconstitutional as legislation attacking contracts already made.”

James Madison echoed John Marshall when he wrote in defense of the prohibition against “laws impairing the obligation of contracts” that such laws were “contrary to the first principles of the social compact.” He believed that the provision was a “constitutional bulwark in favor of personal security and private rights” designed to protect “the business of society” from “sudden changes and legislative interferences in cases affecting personal rights.”

In other words, the prohibition against “laws impairing the obligation of contracts” was designed to keep individuals free to enter into those relationships, business and otherwise, that each individual desired for his own personal happiness. The civil government was to be excluded from dictating a public policy of “happiness” upon the people. If someone wished to spend his hard-earned money upon a house, instead of a cow, that was his business, not the business of his elected
representatives. If he wanted to pay $100 for a horse that was, in the estimation of most, worth only $75, that was also his business. The legislatures of the states were limited in their authority: They could outlaw no bargain so long as it was made without fraud and for a lawful purpose. The people had the God-given right to decide whether to enter into a bargain for goods and services and to set the price and terms thereof. That was their liberty of contract and that liberty was the heart of the Declaration affirmation of the “pursuit of happiness.”

LIBERTY OF CONTRACT

The freedom of each individual to set the terms of a contract without interference from the state legislatures has survived for over two hundred years, but not without serious compromise. While a housewife may still find different prices for the same grocery items at different stores, she has to pay for her electric or garbage service at a price fixed by the state. While a man may hire a household servant or a yard man and the two may freely agree to the hours of work per week and the
hourly wage, he cannot do the same in his business where he is regulated by maximum hour and minimum wage laws. In fact, it is accurate to say that most businesses must comply with numerous state laws regulating their hiring practices and their buying and selling.

Because of the proliferation of such state interventionist policies into the economic lives of all Americans, it is difficult to conclude that the Declaration’s framers’ goals of securing the God-given right to pursue happiness is any longer alive. Indeed, efforts abound to seek state laws or court rulings to impose particular groups’ version of happiness on the rest of their fellow citizens. For example, emboldened by their success to force employers to pay women “equal wages for equal work,” many feminist organizations now clamor for “equal wages for comparable work.” While their earlier effort has largely succeeded in equalizing pay for males and females who do the same job, their latest claim would require civil government authorities to determine how much a particular kind of job was worth.

While “comparable worth” legislation was defeated in several state legislatures in 1985, the Congress has had several such bills before it. In testimony before the House Post Office and Civil Service Committee, Phyllis Schlafly noted that Comparable Worth advocates habitually devalue “the physical and working-condition factors” in order to enhance the societal value of jobs requiring college or other special educational training. Thus, in a recent comparable worth study conducted for the state of Washington, nurses were ranked above electricians and truck drivers because the demand for “knowledge and skills” in nursing was weighted more heavily than the “working conditions” for truck drivers and electricians.

Such comparable worth evaluations are designed to freeze the wages of “overpaid” employee categories and to raise the wages of the “underpaid.” Whether or not one is “underpaid” or “overpaid” would not be determined by any objective standard, but by a civil government bureaucrat or judge who, in turn, would rely on a study that can hardly be termed “scientific.” How does one rate the “mental demands” on a nurse as contrasted with an electrician or truck driver. Such an
assessment is best left to the economic marketplace where each individual may determine for himself how much he is worth.

Comparable worth legislation is not designed to eliminate sex discrimination from the employment marketplace, but is designed to eliminate altogether the free marketplace of employment. For example, in Illinois nurses have sued the state claiming that they should be paid equally with the electricians and sanitary engineers. Eleven female prison guards have intervened in opposition to the lawsuit because they work in a “male-dominated” job that has been rated “overpaid” by the study relied upon by the nurses. Presumably, if the nurses win the law suit, they the pay for prison guards, including the eleven intervenors, would be frozen until the pay for secretaries, for example, was raised to a higher level than prison guards. Such a lawsuit would be unthinkable if America was truly committed to securing the liberty of contract originally guaranteed by Article I, Section 10 of the United States Constitution.

But that constitutional guarantee was first eroded by the United States Supreme Court in 1827. In that year, the Court upheld by a vote of four to three a New York law that required all future contracts to be subject to its bankruptcy law that allowed a debtor to be discharged from all of his obligations. Chief Justice John Marshall dissented. In doing so he wrote a powerful opinion setting forth the principle of liberty of contract that undergirded the Constitution’s contract obligation
clause.

First, the Chief Justice rejected the argument that the right to contract, and therefore the obligations created thereby, were “the creature of society.” To the contrary, he asserted that such right and obligations “exist anterior to, and independent of society.” Next the Chief Justice asked if that right and those obligations were lost when a man entered into a civil society. He answered that question in the negative by reminding his reader that the only purpose for entering society was to obtain a more effective remedy for the breach of contracts because the only purpose of civil government was to secure man’s God-given rights, including “the right to barter.” Finally, the Chief Justice concluded that the civil government could not “exercise” the individual’s God-given right to contract, because by the law of nature the obligation of contracts can only be “conferred by the act of the parties”:

This results from the right which every man maintains to acquire property, to dispose of that property according to his own judgment, and to pledge himself for a future act.²⁹

While Chief Justice Marshall’s views about the liberty of contract did not prevail in the interpretation of the contract obligation clause, they did by and large prevail in the state legislatures for about fifty years. Beginning in the late nineteenth century and the early twentieth century, however, Marshall’s views on liberty of contract reemerged in the United States Supreme Court, but erroneously under the due process clause of the Fourteenth Amendment. In 1897 a unanimous Court
concluded that the “liberty” guaranteed by the due process clause included:

Not only the right . . . to be free from the mere physical restraint of his person . . . but the term is deemed to embrace the right . . . to be free in the enjoyments of all his faculties . . . to pursue any livelihood or avocation and for that purpose to enter into all contracts which may be proper, necessary, and essential . . ..³⁰

In support of this conclusion the Court cited an earlier opinion that linked the liberty of contract to the Declaration of Independence:

The right to follow any of the common occupations of life is an inalienable right. It was formulated as such under the phrase “pursuit of happiness” in the Declaration of Independence.³¹

Because the Court failed to place this liberty where it belonged in the constitutional guarantee prohibiting the “laws impairing the obligation of contract,” the liberty of contract that it endorsed was soon lost. By the 1940’s the Court had retreated from its effort to protect contract rights under the due process clause and had consigned “economic liberty” to the role of a second-class citizen in the constellation of constitutional rights. Only one reason accounts sufficiently for this state of
affairs: The Court abandoned the original constitutional assumption of a God-given right of individuals to contract and substituted a new assumption of a civil right of individuals to contract so long as it was exercised consistent with “public policy.”

This erosion of the liberty to contract has not only taken place in constitutional law, but also it has occurred in the common law. For example, every state in the union has enacted the Uniform Commercial Code that declares unenforceable any “contract or any clause of the contract to have been unconscionable at the time that it was made.” According to one New York court, this statute “enacts the moral sense of the community into the law of commercial transactions.” Such a statute
enables a judge or a jury to substitute what he or they would have agreed to pay for good or services for that agreed to by the buyer and seller even though there has been no proof of fraud or other wrongdoing. In other words, the law authorizes the civil government to set the price terms of the contract according to its own view of the “morality” of those terms.

THE SANCTITY OF PROMISES

State intervention into the setting of the terms and prices of contracts has become a double-edged sword. Not only have such policies as maximum hours and minimum wages, comparable worth, and unconscionability undermined the liberty of contract, they have threatened to subvert the sanctity of one’s own promises. Without assurance that people will be held to perform their contract promises, the stability and confidence of commercial relationships will be lost. Recent efforts that
have substituted a situation ethic for God’s absolute standards in the performance of contract promises, if allowed to continue and to multiply, could send America’s business world into a chaos of uncertainty and confusion.

Contract law in the western world has been based for years upon a Biblical foundation. Hugo Grotius, a Dutch jurist of the 17th century, wrote:

On this subject we are supplied with noble arguments from the divine oracles which inform us that God, himself, who can be limited by no established rule of law, would act contrary to his own nature if he did not perform his promises. From whence it follows, that the obligation to perform promises, spring from the nature of the unchangeable justice, which is an attribute of God, and common to all who bear his image in the use of reason.³²

From this premise Grotius concluded:

It is a most sacred command of nature and guides the whole order of human life, that every man fulfill his contracts.³³

An eighteenth century Swiss jurist, Emerich de Vattel elaborated upon this conclusion as follows:

It is shown by the law of nature, that he who has made a promise to any one, has conferred on him a true right to require the thing promised . . ..³⁴

Vattel further observed:

There would be no more security, no longer any commerce between mankind, did they not believe themselves obliged to preserve their faith and to keep their word.³⁵

Early American lawyers like Henry Wheaton, compiler of several volumes of United States Supreme Court cases in the early nineteenth century, relied upon Grotius and Vattel as authoritative on the common law of contracts. Indeed, the common law was considered by one of Wheaton’s contemporaries, Jesse Root, to have been “derived from the law of nature and of revelation – those rules and maxims of immutable truth and justice, which arise from the eternal fitness of things . . ..” In light of such strong evidence that the law of contracts in early America owed its origin to God’s law in nature and in the Holy Scriptures it is most fitting to review that law here.

In the book of Ecclesiastes, God has warned man to pay to God that which he has vowed.³⁶ That law was revealed by God through Moses in Deuteronomy 23:21:

When thou shalt vow a vow unto the Lord thy God, thou shalt not slack to pay it: For the Lord thy God will surely require it of thee; and it would be sin in thee.

The sanctity of a vow to God is absolute. Neither fraud nor foolishness justifies its nonperformance.³⁷ Therefore, the writer of Proverbs has warned that “it is a snare to the man . . . after vows to make inquiry.”³⁸ Even so, if a man keeps a vow even to his own hurt, God has promised to bless him richly.³⁹

These Biblical commands concerning man’s vows to God are not limited to man’s relationship to God. Rather, the sanctity-of-promise principle has been extended to man’s relationship to his fellow man:

You should be careful to perform what goes out from your lips, just as you have voluntarily vowed to the Lord your God, what you have promised.⁴⁰

This law of promise may be illustrated through several examples of mutual agreements entered into by men as recorded in the book of Genesis.

Abraham and Abimilech exchanged promises to resolve a dispute over a water well. They swore not to deal falsely with each other and sealed their agreement with an oath.⁴¹ Isaac and Abimilech later affirmed this agreement in like manner after Abraham’s death.⁴² Abraham extracted an oath from his servant before sending him off to fetch a bride for Isaac.⁴³ Before Jacob fed Esau, Esau promised to sell his birthright.⁴⁴ In the book of Joshua, Rahab and the Israelite spies exchanged promises as consideration for her hiding them from the Jericho king’s men⁴⁵ and Joshua and his men honored their promise to protect the Gibeonites from the latter’s enemies.⁴⁶ Believers and unbelievers alike relied upon the “law of nature and of nature’s God” that obligated a man to perform his promises to his fellow man.

At the heart of God’s law governing the sanctity of promise is God’s faithfulness to perform his promises. Because man is created in the image of God, God expects man to be no less faithful than He. Yet because of sin man has not met that high standard as Numbers 23:19 attests:

God is not a man that he should lie; neither the son of man, that he should repent: Hath he said, and shall he not do it? Or hath he spoken, and shall not he make it good?

This record of broken promises led God to authorize civil rulers to protect those men who keep their promises from the harm caused by those who break their promises, if the activity in which they are engaged is subject to the jurisdiction of these authorities. Thus, Chief Justice John Marshall in 1827 acknowledged that the civil ruler had a duty to furnish a remedy for such breaches of contract. Indeed, the several early state constitutions guaranteed

That every freeman for every injury done him in his goods, lands, or person by any other person, ought to have remedy by the course of the law of the land, and ought to have justice and right for the injury done him freely without sale, fully without any denial, speedily without delay, according to the law of the land.⁴⁷

The “law of the land” referred to in these early constitutions was the common law. The common law of contracts reflected the Biblical principle of the sanctity of promise. Fordham University law professors, John Calamari and Joseph Perillo, have acknowledged that the “natural law” of sanctity of promise was rooted in the belief that “failure to perform a promise made by a free act of the will was an offense against the Deity.”

Again, Chief Justice John Marshall captured well the sanctity-of-promise principle in his opinion striking down an effort by the Georgia legislature to reacquire land that an earlier corrupted legislature had sold. The Chief Justice ruled that such sale even though obtained through fraud and bribery could not be rescinded if a good faith purchaser had obtained title to the land sold. Therefore, he found the Georgia statute rescinding that sale an unconstitutional “law impairing the obligations of contract.”

For Marshall, the liberty of contract guaranteed by this clause was “hand-in-glove” with the sanctity of obligation created by an individual’s exercise of his liberty. This was so because the making of the contract, itself, created legal obligations that, in turn, vested “absolute rights” that no legislature could annul.

For many years Marshall’s view of the sanctity of contract obligations prevailed in the courts. That principle was reflected in the common law rule that no man could be excused from fulfilling his promise on the ground that it was impossible to do so. For example, in a 1647 English case, a man had promised to pay rent under a lease of some income producing property. During part of the lease period the property was occupied by a hostile invading army so that the renter was expelled
from the land and kept from using it. Nevertheless, the court held that the renter was liable to pay his rent: “Though the whole army has been alien enemies, yet he ought to pay his rent.” The court reasoned that the lessee’s obligation was an absolute one and he was “bound to make it good.”

Clearly, this rigorous common law rule was based upon the Biblical principle that, while no one was required to make any promise,⁴⁸ if he did promise he must perform that promise even if it hurt.⁴⁹ As the writer of Ecclesiastes put it: “Better is it that thou shouldest not vow, than that thou shouldest vow and not pay.”⁵⁰

In twentieth century America the absolute common law rule has been replaced by one that allows a promisor to escape having to perform his promise if he is able to prove that unexpected circumstances made his performance “commercially impracticable.” According to a leading court opinion, this “doctrine ultimately represents the ever-shifting line, drawn . . . hopefully responsive to commercial practices and mores, at which the community’s interest in having contracts enforced
according to their terms is outweighed by the commercial senselessness of requiring performance.” In other words, the law of contract promise in America is no longer governed by the absolute sanctity of promises as decreed by God’s law, but by the situational ethic of fallen and sinful man.

A case decided by the United States District Court in Pennsylvania provides an excellent illustration of what happens to contract promises under the new rules that depart from the sanctity-of-promise principle.⁵¹ In that case, ALCOA contracted with Essex Corporation to convert alumina into molten aluminum at a price fixed by a formula tied to the wholesale price index for industrial commodities. After a few years, the price formula did not work in the way that the parties had expected because of an unanticipated sharp increase in oil prices and because of unanticipated pollution control costs. Consequently, ALCOA’s electricity cost soared so that it began to suffer tremendous losses estimated to be over $60 million if ALCOA had to perform its contract obligation.

The federal district judge decided that ALCOA did not have to perform its promise. He modified the contract to take into account the unforeseen inflationary circumstances that had made ALCOA’s agreement no longer profitable. While the court claimed that it had followed a rule that would not allow anyone to break a contract promise just because it had become unprofitable, nevertheless the only justification given by the court for allowing ALCOA to break its promise was that
ALCOA’s “expected profit” had turned into a “serious loss.” To the court, this meant that the enforcement of its contract obligation “would be commercially senseless and unjust” and would frustrate “ALCOA’s ‘principle purpose’ in making the contract,” namely “to earn money.”

Under doctrines such as these, courts will inevitably favor the large business interests over the small, the powerful over the weak, and the more economically significant over the less. Only firm adherence to the sanctity-of-promise principle will keep the judge, the lawyer, and the businessman on the straight and narrow path of true justice. For as God revealed to Moses in Deuteronomy 1:17: “Ye shall not respect persons in judgment; but ye shall hear the small as well as the great; ye
shall not be afraid of the face of man; for the judgment is God’s . . ..”

But the interests of the powerful and rich will not always be favored when the sanctity-of-promise principle is compromised. As the rich and powerful now have the “commercial impracticability” rule, the poor and powerless have the “unconscionability” rule. That rule may be invoked on behalf of consumers who have made purchases under the influence of a powerful sales pitch and of their own foolishness. In a recent New York case, for example, a welfare family purchased for $900 a freezer, the normal retail price for which was $300. Because they bought the freezer on credit, the total purchase price soared to $1,234.00.

After paying a little over $600, the purchaser defaulted, and the seller sued for the remaining balance. The court ruled that the seller “had already been amply compensated,” found the price terms “unconscionable,” and allowed the purchaser to keep the freezer without having to pay any more money to the seller. In support of its ruling, the court decided that the seller’s profit margin was “too high” and that his credit charges were disproportionate to the value of the freezer. Moreover, the court reasoned that the seller, although guilty of no fraud and coercion, had taken advantage of “[t]he very limited financial resources of the purchaser.” In other words, the court found that the purchaser’s promise to pay was “negated by gross inequality of bargaining power” between an ordinary businessman and a welfare recipient.

Under such applications of the doctrine of “unconscionability,” courts will inevitably favor the poor over the rich, the powerless over the powerful, and the fool over the intelligent. Yet God revealed to Moses in Exodus 23:2-3 that showing partiality to the poor was a serious miscarriage of justice:

Thou shalt not follow a multitude to do evil; neither shalt thou speak in a cause to decline after many to wrest judgment; neither shalt thou countenance a poor man in his cause.

This principle of partiality was the same as the one governing the judge who is tempted to favor the powerful over the powerless:

Ye shall do no unrighteousness in judgment; thou shalt not respect the person of the poor, nor honor the person of the mighty: But in righteousness shalt thou judge the neighbor.⁵²

Not only do the modern doctrines of “commercial impracticability” violate God’s command to be impartial in judgment, they deprive the “excused” promise-breaker from the blessings that God has for promise-keepers. In Psalm 15, David gives testimony that anyone who “sweareth to his own hurt, and changeth not” shall abide with God in his “tabernacle” and shall dwell on God’s “holy hill.” So there are significant blessings that a man will receive if he keeps his promises. Moreover, David adds that the one who keeps his promises “shall never be moved,” because those who seek first God’s righteousness shall have every material need met.⁵³

In contrast, those who break their promises are “fools.”⁵⁴ While they may be relieved of a burden in the short-run, they will not profit in the long-run: “Ill-gotten gains do not profit.”⁵⁵ Indeed, while he seeks the quick and easy remedy of relieving himself of the immediate cost of his promises, he will inevitably lose the very prosperity that he desires.⁵⁶ A civil ruler has been established by God to do “good” to those under his authority.⁵⁷ If he is to perform his God-required duty, then he should enforce contract promises according to the absolute standards of the law of God.

PROMISES: LAW AND LOVE

Even though a man is bound by God’s law to keep all of his promises, the civil ruler has not been authorized to enforce all of them. Some are illegal and, therefore, unenforceable; and some are exclusively enforceable by God and, therefore, outside the civil rulers’ jurisdiction.

In his magnificent opinion affirming liberty of contract, Chief Justice John Marshall acknowledge that a civil ruler could prohibit certain contracts that are “deemed mischievous” and, therefore, illegal. At common law, such illegal and unenforceable contracts were agreements to pay a bribe, to pay for a murder, to engage in prostitution, to gamble, and the like. Such contracts were illegal because the object or purpose of the agreement could not be achieved without
violating God’s law.

Some objects, like bribery and murder, are explicitly forbidden by the Holy Scriptures.⁵⁸ Other objects, such as prostitution and gambling, violated the fundamental covenantal law of God. All of God’s laws governing sexual relationships are rooted in the law of the marriage covenant, that a man and a woman may engage in sexual intercourse only if they commit to the other for life.⁵⁹ Any other sexual relationship is, by definition, illegal.⁶⁰ Any law prohibiting gambling is rooted in the law of the dominion covenant, that man is to “subdue” and “rule” the earth and its creatures.⁶¹ A gambler turns the dominion covenant on its head by allowing himself to be “subdued” and “ruled” by the earth and its creatures,⁶² for he has chosen a life governed by “chance,” by the probabilities of an impersonal natural world, instead of one governed by Divine Providence. Therefore, any gambling contract is, per se, illegal.

As twentieth century America has abandoned the absolute sanctity of contract promises, it has moved away from an absolute standard governing the legality of contracts. In the 1960’s, 1970’s, and 1980’s state legislatures have repealed their laws prohibiting adultery and fornication. As a direct consequence their courts have begun to recognize as valid, contracts between males and females for sexual companionship and support even though they are not valid marriages. Judges in the
state of California have been on the cutting edge of this revolution. In the 1970’s, the California Supreme Court decided several cases involving nonmarital cohabitation agreements culminating in 1976 with the dispute between Lee Marvin, Hollywood actor, and his former live-in female partner. The woman claimed that she and Marvin, married to another woman, had agreed to live as husband and wife and, in consideration for her services as “companion, homemaker, housewife, and cook,” Marvin would provide her financial support “for the rest of her life.” Marvin denied liability on the ground that the alleged contract was an illegal one and, therefore, unenforceable.

The Supreme Court ruled in favor of the woman because the agreement was not explicitly for “sexual services” and, therefore, not a contract of prostitution. Instead, the Supreme Court decided that a man and a woman living together as husband and wife outside of marriage was a widely accepted practice, and consequently, no longer illegal:

The mores of society have indeed changed so radically in regard to cohabitation that we cannot impose a standard based upon alleged moral considerations that have apparently been so widely abandoned by so many.⁶³

The unstated assumption of this court opinion is that man may make whatever he wishes moral or immoral, that there is no objective moral standard governing his behavior. But men cannot make right what God has declared wrong even if all men everywhere agree to do so. Adam and Eve learned that lesson in the Garden of Eden.⁶⁴ While the consequences of decisions such as that rendered in the Lee Marvin case may not
be seen in the short-run, the “apparent benefit” of not allowing Lee Marvin to get away with it will certainly be lost after a season. The natural punishment for disobedience of God’s law will inevitably come.⁶⁵

Some state legislatures have chosen to disregard the self-executing nature of God’s law-order by instituting state lotteries and other gambling enterprises to raise revenues without having to raise taxes. Despite the initial quick pay-off, state legislative bodies that have not yet done likewise would do well to resist the temptation. They will in due time reap a harvest of righteousness.⁶⁶

Not only have legislators and judges substituted their own appraisals of right and wrong for those revealed and established by God, they have expanded their jurisdictions beyond that granted by God to them. At common law it has long been recognized that some areas of life are not subject to the enforcement power of the state. As Chief Justice John Marshall put it:

Obligations purely moral, are to be enforced by the operation of internal and invisible agents, not by the agency of human laws.⁶⁷

A legal system based upon the assumption that there is no God or that, if He exists, He has nothing to do with law and politics, will inevitably eliminate the areas of life where man is free from the coercive power of the state. No better illustration can be given than that concerning man’s obligation to the poor and needy.

Throughout the Old and New Testaments, God has made it clear that those who prosper materially are obliged to help those who do not. As a consequence, God ordained certain rules governing a rich man’s dealing with the poor. First of all, he was not to loan to a poor man “at interest.” That practice was forbidden under the prohibitions against usury:

And if thy brother be waxen poor . . . then thou shalt relieve him: yea though he be a stranger or a sojourner . . . Take thou no usury of him, or increase . . . Thou shalt not give him thy money upon usury, nor lend him thy victuals for increase.⁶⁸

To most people today the word “usury” has come to mean “excessive interest.” But that is not its Biblical meaning. As Dr. Gary North has ably demonstrated: “Any increase taken from the poor in return for having made a loan” is condemned by the Bible as usurious. Interest in ordinary business transactions was allowed, however, as profit for the service of lending money to another who had need of it. Again, Dr. North has summarized this truth as follows:

There is no Biblical evidence, nor have Christian casuists generally argued, that the prohibition (against usury) restricted interest received on business loans, so long as the lender shared the risks of failure along with the borrower.⁶⁹

God’s solution to the illicit, high-interest, immoral loan-shark business was to command all men to reach out in love to the truly needy by lending to them without charging interest.⁷⁰ He did not authorize the civil ruler to interfere with the freedom of contract by setting an artificial limit to the percent of interest that could be earned by a lender. That, like all other terms of a contract, was to be set solely by the parties. “The rate of interest, like all prices,” was to be “a product of the law of supply and demand.”

If those with plenty refused to lend to the poor at all or only upon interest, could the civil ruler require him to do what God had commanded? At common law the answer to such a question would have turned on whether the obligation was a “legal” or “moral” one. The distinction between legal and moral obligations lay at the heart of several common law contract doctrines. For example, not all of man’s promises constituted enforceable contracts; only those that resulted in an agreement with consideration were recognized in the courts. Thereby, the law excluded from enforcement by civil rulers promises to invite someone to dinner or to engage in some other “social activity.” In essence, the rules governing contract relations were designed to exclude all exchanges of promise outside the world of commercial activities. The performance or nonperformance of such promises were left to the individual parties and to God.

A contract to lend money to a poor man was not treated by the Bible as an ordinary commercial transaction. Those who lent to the poor were commanded to do so out of love, not out of a desire to make a profit:

If there be among you a poor man . . . in the land . . . thou shalt not harden thine heart, nor shut thine hand from thy poor brother: But thou shalt open thine hand wide unto him . . ..⁷¹

Anyone lending to a poor man, therefore, should expect nothing in return even if the poor man may be morally indebted to pay the lender back. Such a lender is assured by God that he will receive his reward:

Thou shalt surely give him, and thine heart shall not be grieved when thou givest unto him: because that for this thing the Lord thy God shall bless thee in all thy works, and in all that thou puttest thine hand unto.⁷²

Not only does God promise to bless those who do give to the poor, He has promised to curse those who do not:

He that oppresseth the poor to increase his riches, and he that giveth to the rich, shall surely come to want.⁷³

He that giveth unto the poor shall not lack: but he that hideth his eyes shall have many a curse.⁷⁴

Given God’s built-in reward and punishment system, the poor are not without an enforcement system should the rich fail in their obligation to them. Any effort by civil rulers to enforce this obligation by taxation or other coercion necessarily violates the nature of the obligation. Lending or giving to the poor, being outside the sphere of ordinary commercial activity, is governed exclusively by the law of love. Therefore, man’s obligations to the poor are subject solely to the jurisdiction of God. All efforts to supply the needs of the poor through tax funded and state-operated welfare programs are illegal because unauthorized by God.

CONCLUSION

Man’s God-given ability to make and to keep his promises is the glue that cements all of his relationships in society. His unwillingness to keep his promises is a constant threat to societal well-being. God has, therefore, established laws that govern promise making and keeping and that allocate authority to enforce those laws. Unless man abides by both sets of laws, he will not obtain the happiness that he so desires:

And it shall come to pass, if thou shalt hearken diligently unto the voice of the Lord thy God, to observe and to do all his commandments . . . that the Lord thy God will set thee on high above all the nations of the earth: And all these blessings shall come on thee, and overtake thee . . . But it shall come to pass, if thou wilt not hearken unto the voice of the Lord thy God, to observe to do all his commandments . . . that all these curses shall come upon thee, and overtake thee . . ..⁷⁵