Front Page Titles (by Subject) CHAPTER IV: The Laws - Selected Economic Writings
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CHAPTER IV: The Laws - James Mill, Selected Economic Writings 
Selected Economic Writings, ed. Donald Winch (Edinburgh: Oliver Boyd for the Scottish Economic Society, 1966).
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[The subject matter of this chapter was of great interest to Mill as a Benthamite; it was here that Bentham and Mill saw the most farreaching possibilities for implementing their views (see e.g. Mill's remark quoted above, p. 19). The subject also interested Mill as a philosophical historian, and at one time he hoped to write a history of English law tracing ‘the expedients of the several ages to the state of the human mind, and the circumstances of society in those different ages, and to show their concord and discord with the standard of perfection’. (Letter to MacVey Napier, 5 Aug. 1818, in Bain, op. cit., p. 173.) Most of the chapter consists of a detailed critique of the shortcomings, in terms of completeness, exactness, efficiency and humanity, of the Hindu system of law. There is room here only for a short section dealing with the law of property.]
It is needless to remark, that the sources of acquisition, by occupancy, by labour, by contract, by donation, by descent; which are recognised in almost all states of society, are recognised in Hindustan. It is in the accuracy with which the intended effects of these incidents are defined, and in the efficiency of the means taken to secure the benefits they convey, that the excellence of one system above another is more particularly observed.
Though property, in the first stage of its existence, was probably measured by occupancy, and the one ceased with the other, the privilege was early conferred of alienating for a valuable consideration, or of transferring by purchase and sale. As this is a very simple compact, it appears to admit of little variety in the various stages of human improvement. In an age, however, in which the means of detecting fraudulent acquisitions, and of proving the good faith of contracts and bargains, are imperfectly known, purchases and sales, made in public, are alone considered valid. The laws of our Saxon ancestors prohibited the sale of very thing above the value of twenty-pence, except in open market; and it is with a pleasing kind of surprise we find, that similar circumstances have suggested a similar expedient to the people of Hindustan ... The right, however, conveyed by a bonâ fide purchase is not, among the Hindus, carried to that extent, which is found requisite in a commercial and highly civilized society. If the goods were not the property of the person by whom they were sold, the right of the purchaser becomes absolute only if he can produce the vendor ... This is quite sufficient to throw so much uncertainty into the great class of transactions by purchase and sale, as would prove, in a civilized state of society, a ruinous obstruction of business. A manufacturer purchases a quantity of the raw material, and works it up; he would lose, in a mischievous proportion, if the owner of that material could demand the identical substance, on tendering the half of its price. In many cases, the identical substance is exported; in many it is consumed; and cannot possibly be restored. Among children, and among rude people, little accustomed to take their decisions upon full and mature consideration, nothing is more common than to repent of their bargains, and wish to revoke them: Among the Hindus this has been found an affair of sufficient importance to constitute an entire head in the classification of their laws. A variety of cases are enumerated, in which, if dissatisfied with his bargain, a man may insist upon having it annulled; and in general any sale and purchase of things, not perishable, may be rescinded within ten days, at the will of either of the parties: another law, altogether incompatible with an age in which the divisions and refinements of industry have multiplied the number of exchanges. The regulation, which fixes the price of things, instead of leaving it to the natural and beneficient laws of competition, conveys not a high idea of the knowledge of the Hindus ...
The peculiar species of transfer which is known by the name of loan is an object of great importance in the jurisprudence of all nations ... In an improved state of society, where the efficiency of laws, the diffusion of wealth, and the accommodations of business, have created a mutual confidence, loans are generally contracted on the security of law, without the actual custody or deposit of the property on which they may be secured. It is only in that extremely confined and degraded species of lending, abandoned to pawnbrokers, that pledges form a regular and component part. In the more early and imperfect states of the social union, circumstances are very different. Law is both feeble and inaccurate, poverty reigns, violence prevails; and the man who is able to discharge his debts to-day may stript of all his possessions to-morrow. In these circumstances, the security of law upon the person or property of the debtor is seldom sufficient; and the deposit of some equivalent property, as a pledge, is the obvious, and, in point of fact, the common resource. The doctrine of pledges forms one of the most considerable branches of this part of the Hindu code ...
We have now reviewed the great peculiarities of the Hindu law, in regard to those transfers of property which partake of the nature of exchange, and in which some sort of an equivalent is given and received; it remains for us to consider those, in which the property passes from one owner to another without any return.
The most extensive class of this species of transactions are those occasioned by the death of the owner. Men had considerably strengthened the chain by which they were connected with property, before they ceased to consider death as the cause of a perfect separation, and as leaving their possessions free to the earliest occupier. A right of succession in the children suggests itself, however, at a very early period in the progress of civilization. It is recommended by so many motives, it so happily accords with some of the strongest impulses of human nature, and is so easily engrafted upon the previous order of things, that it could not fail to be an early institution. The children, being naturally the nearest to their parent at the moment of his death, were generally able to avail themselves of the right of occupancy, and to exclude other successors by prior possession. It was the usual arrangement in early stages of society, that the different members of a family should live together; and possess the property in common. The father was rather the head of a number of partners, than the sole proprietor. When he died, it was not so much a transfer of property, as a continued possession; and the co-partnership was only deprived of one of its members. The laws of inheritance among the Hindus are almost entirely founded upon this patriarchal arrangement ...
The idea of a joint interest in the property of the family, while it early established the right of succession in the children, served to exclude the right of devising by will. As the property belonged to the parent in common only with his offspring, it could not be regarded as just, that he should have the power of giving it away from them after his death. It is only in stages of society, considerably advanced, that the rights of property are so far enlarged as to include the power of nominating, at the discretion of the owner, the person who is to enjoy it after his death. It was first introduced among the Athenians by a law of Solon, and among the Romans, probably, by the twelve tables. The Hindus have, through all ages, remained in a state of society too near the simplicity and rudeness of the most ancient times, to have stretched their ideas of property so far. The power of disposing of a man's possessions, by testament, is altogether unknown to their laws ...