Front Page Titles (by Subject) Grotius: Contract and Natural Law - Literature of Liberty, October/December 1978, vol. 1, No. 4
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Grotius: Contract and Natural Law - Leonard P. Liggio, Literature of Liberty, October/December 1978, vol. 1, No. 4 
Literature of Liberty: A Review of Contemporary Liberal Thought was published first by the Cato Institute (1978-1979) and later by the Institute for Humane Studies (1980-1982) under the editorial direction of Leonard P. Liggio.
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Grotius: Contract and Natural Law
“Grotius and Stair on Promises.” American Journal of Jurisprudence 22 (1977): 160–167.
In the seventeenth century, both Hugo Grotius and the Scottish jurist James Stair attempted to establish the binding force of promises upon natural law foundations. Two questions arise: (1) How do we explain the binding force of promises and contracts in general? and (2) How do we explain the mechanism by which an individual binds himself?
In De Jure Belli et Pacis (1625), Grotius carefully distinguishes the varying degrees of obligation created by three kinds of statements that declare a person's intentions. First, when someone simply announces that he intends to perform an act in the future, Grotius sees no obligation arising since the speaker is free to change his mind. Second, if the speaker stipulates his intention (pollicitatio) not to change his mind, he incurs an obligation under natural law to do the act. Finally, a statement declaring that one intends to perform an act, does not intend to change one's mind, and also intends to confer a right upon someone, is what Grotius calls a perfecta promissio. This, however, fails to create an enforceable right unless the intended beneficiary accepts the perfecta promissio.
Grotius's analysis of the obligatory force of promises is apparently intended to apply also to contracts. By contrast, for a promise to create an obligation, in his Institutions of the Law of Scotland (1681), Stair requires the promissor to confer a power of exaction on the promissee. But with contracts, i.e., pacts, the parties must reach a consensus in the sense that they manifest an animus obligandi (intention to obligate) concerning the agreement. The similarities between Stair's and Grotius's work suggest that Stair was influenced by Grotius.
How do Stair and Grotius attempt to ground the obligation to keep promises and contracts in natural law? For Grotius, “... the maintenance of society which accords with human intellect is the origin of just [right] properly so called,” and the obligation to keep promises is included in jus. Stair argues that the law of nature consists of those principles implanted in man by God. From these principles comes the freedom to dispose of oneself as one wills, except insofar as one is bound to obey God or has obligated himself to pursue a specific course of action. In short, Grotius accounts for the binding nature of promises and contracts by arguing that the preservation of society requires that they be kept.
In accounting for how an individual actually binds himself through a promise or a contract, Stair and Grotius postulate (according to the author) a mechanism of the same kind:
Man is enabled to bind himself because his own will, under certain conditions, fetters the power of free disposition which he enjoys over himself and his resources, and gives to another the power to constrain him to act in a particular way. This mechanism is not natural in the sense that it is a product of the social instinct or that it conforms to principles implanted by God; it is natural in the sense that it is rational. Reason suggests that the only means by which an individual may bind himself is through his will. By his will he is able both to impose an obligation on himself and create a right in another. This may be explained in terms of a transfer to another of a portion of the individual's power of free disposition over himself.