From igeldard@capital.demon.co.uk Sun Aug 28 11:44:23 1994
Date: 28 Aug 1994 13:59 GMT
From: Ian Geldard 
Reply to: libernet-d@Dartmouth.EDU
To: libernet@Dartmouth.EDU
Subject: Anarcho-Capitalist Law



                 LEGAL SYSTEMS UNDER ANARCHO-CAPITALISM

                           By Gary Greenberg

                           Legal Notes No. 18

              ISSN  0267-7083         ISBN  1 85637 181 6

         An occasional publication of the Libertarian Alliance,
       25 Chapter Chambers, Esterbrooke Street, London SW1P 4NN.

                    (c) 1993: Libertarian Alliance.

   Gary Greenberg is a lawyer and longstanding libertarian activist.

This article is reprinted from the now defunct journal "The 
Abolitionist", December 1971, and is reprinted without permission as we 
have been unable to trace the copyright holder.

The views expressed in this publication are those of its author, and not 
necessarily those of the Libertarian Alliance, its Committee, Advisory 
Council or subscribers.

 LA Director: Chris R. Tame      Editorial Director: Brian Micklethwait

                     FOR LIFE, LIBERTY AND PROPERTY

--------------------------------------------------------------------------

INTRODUCTION

Among the objections raised against anarcho-capitalism is the claim 
(unfounded, of course) that there is no provision for a system of 
rational courts and objective law.  Underlying this attack is the 
mistaken belief that limited government somehow makes such provisions.  
Since rationality cannot be legislated nor mandated nor even (at least 
for the present) genetically implanted by the technicians of our brave 
new world, it seems evident that no political system is going to 
guarantee competent or rational judges or competent or rational 
legislatures which will enact rational and objective legislation.  The 
truth of the matter is that advocates of limited government at best can 
offer a written constitution to bind the government or the people 
whenever it suits their purpose.  At this point the advocate of limited 
government introduces his "deus ex machina": for a limited government to 
be established it would require a cultural change which would affect the 
quality of the ideas of the people, the legislature, or the judges.  Of 
course, that cultural trend might reverse itself the next day, but in 
any case what is conceded by the limited government advocates is that 
success requires great numbers of supporters among those in a position 
to affect public opinion.

This article deals with civil law as opposed to criminal law. Civil law 
deals with the violation of a person's rights where the violation 
results from mistake or accident and what a person's proper relation is 
to those who violates his rights under such means.  Criminal law is the 
field dealing with the deliberate intentional knowing violation of a 
person's rights and the proper relation of people towards criminals.

Civil law is divided into two general categories, Contract law and Tort 
law.  A contract is a promissory agreement between two or more persons 
which creates, modifies, or destroys a legal relation.  Contract law 
deals with such matters are how a contract is created, what the contract 
means and what happens when the provisions are violated.  Tort law deals 
with the problem of violation of rights not arising from a contract 
(e.g. trespass, assault, negligence).

Although Real Estate problems faill into eigher of those two areas (a 
deed is a contract, a trespass is a tort) later in the article I will 
touch on the issue separately due to the special significance such 
problems have for a capitalist society.

COURTS

A court is an institution that serves to determine whether or not it 
would be morally proper to exercise the use of force and whether such 
force ought to be accepted and respected by civilized persons.  The 
underlying basis for courts is that man is neither omniscient nor 
omnipotent.  Since it is possible for rational men to have differences 
of opinion where one or more of such persons does not have knowledge of 
all the facts, or where it is not possible to know all the facts, and 
since, further, it is desirable for civilized persons to know that some 
individual whom they neither know nor care about is properly engaging in 
the use of force, rational, civilized persons have an interest in seeing 
that there are institutions available which are impartial, fair to all 
concerned, and in favor of justice.

Therefore, the proper attitude of rational civilized persons toward a 
court which is impartial, fair and just is to respect its rulings and to 
give it their moral support.  Where such an institution has properly 
established for itself such a reputation, rational civilized people 
ought to respect its decisions whether the decision deals with them or 
some other person whose situation they know nothing about.  In no way 
does the existence of a government monopoly of the courts guarantee that 
such courts are deserving of proper respect, support or obedience.  The 
only test one ought to apply towards a court is in deciding whether the 
court is impartial, fair, just and respectful of human rights.  If the 
court exists independent of any government and satisfied the test, it is 
more deserving of a person's sanction than a court established by a 
government which does not meet such a test.

Naturally, my preceeding remarks raise such questions as: how does a 
court independent of government become established, what right does it 
have to many any judgments concerning people, and what protection does 
one have to ensure proper courts?

Firstly, a court may be any institution that proclaims itself a court.  
This could take the form of a one-time act such as an indidivual hired 
by two disputants to resolve the dispute, to a continuing institution 
that exists for solving disputes, such as the American Arbitration 
Society (which is in essence an anarchist court presently existing 
within the American business community).

Courts should be established by a group of individuals who rely on their 
reputation and earn their sanction from the public on the basis of their 
reputations.  Another possible method of earning sanction where the 
court has no reputation to rely on would be through the franchising of 
the sanction of professional associations of lawyers or scholars.  For 
example, the New York Bar Association (a lawyer's group) could publish a 
list of organizations whose integrity is respected by the NYBA.  Similar 
lists could be published by the National Association of Manufacturers 
orr the AFL-CIO, the Better Business Bureau, or any other group.  The 
important thing is to remember that appearing on a list does not 
guarantee validity; it is only a means for establishing respect among as 
many individuals as possible.  Organizations could also publish list of 
courts of which they disapprove.  The effectiveness of a court is 
ultimately based on a large scale acceptance or indifference.  Where a 
court has substantial opposition it will be ineffective and lose 
clients.

One of the important questions is: how does a court exercise 
jurisdiction over anybody?  The first method would be voluntary 
agreement between the disputants.  The serious problem arises when there 
is no agreement.

What happens when one disputant does not want to go to court?  To answer 
this we must first return to the purpose of a court: to determine 
whether it would be proper to exercise force.  Where a party has gone 
before a court and offered his willingness to abide by the decision, 
then the party has done everything he can to resolve the dispute through 
civilized and non-violent means.  If the other party refuses to 
participate in the proceedings then the court has a moral right to say, 
after hearing what evidence it has before it and deciding on the behalf 
of the complainant, that the complainant has taken all civilised steps 
available to resolve the dispute.  "We, the court, find that it is 
morally proper for the complainant to exercise force to affect the 
remedy."  The court may have an agent of retaliatory force connected to 
its operation or it may leave the complainant to his own devices (the 
morality of his devices would be subject to discussion under the 
criminal law section).  There would be private agencies of retaliatory 
force, and if they wanted to maintain the confidence, respect and 
support of the citizenry, then they ought to provide that it would not 
act unless the client can bring proof of a court decision in his favor.  
The agency might even publish a list of those courts who decisions they 
consider respected.  The failure of retaliatory organizations to have 
proper respect could result in popular armed opposition.

OBJECTIVE LAW

Objective law is a fundamental purpose of the legal institutions of a 
free society.  The preparation of objective law is a product of a the 
research and scholarship of the legal community.  The legislatures have 
picked and chosen from the work of the legal community.  The legal 
community has been at odds with the legislative branches of our 
government because of the failure of the legislatures to agree on the 
adoption of uniform codes of law so that the law would be the same 
everywhere.  As it is now, law varies from jurisdiction to jurisdiction.

Legal scholarship has existed independent of the government, and in any 
society which permits free speech and private research, such activities 
will go on.  The effect of the private court system would be to adopt 
the suggested codes produced by the private scholars, the most sensible 
of which being endorsed by the professional legal organizations.

The courts would make known what codes of law they would follow.  The 
result would probably be following similar rules of law, since the legal 
scholars would generally agree on what was the most acceptable law.  In 
those situations where there is not agreement, the situation could be no 
worse than where law is posited by the legislatures, as the legislatures 
would reflect such disagreements with some legislatures adopting one law 
and others acting contrariwise.

Other than the influence of legal scholarship there are other ways in 
which a "de facto" objective law system would develop.  We must 
recognize that the purpose of objective law is to permit people 
unschooled in legal matters to know that there is a rule of law which is 
applicable to the people you deal with so that disputes can be resolved 
in such a way that people do not feel cheated or taken advantage of.

Under anarcho-capitalism this end is achieved in various disciplines.  
For example, in the field of contracts one can easily agree within the 
contrat that any disagreement will be resolved within a particular 
court.  This owuld in effect be a system of objective law since you have 
agreed in advance to be governed by a particular rule of law with those 
with whom you deal.  So even if you have one rule of law governing your 
contract with Mr A and another rule governing Mr B's contract, you have 
a "de facto" rule of objective law since all parties know in advance 
what rules are governing their relations.

A practical example in today's society of how such a system can operate 
effectively would be the widespread use of private agencies by 
businessmen to reolve their differences and their acceptance of contrary 
decisions as a result of their rational self interest.  This works 
because many businessmen know they will lose a lot of business if they 
do not go along with this private court system.  This phenomenon arose 
as a result of the great inefficiency of the American court system.

In the area of torts most law suits deal with negligence problems and in 
a great percentage of the negligence cases you frequently have an 
insurance company interested in the outcome.  Since insurance companies 
are generally on the defendant's side, but frequently on the plaintiff's 
side there is a great interest on the part of insurance companies in 
seeing that there is an existing acceptable court system; they would 
probably contribute to the financing of the courts.  This interest would 
act as a counterbalance to the court's temptation to be plaintiff 
oriented in order to attract customers.  The court would have to incline 
towards neutrality and objectivity because on the one hand they have to 
attract plaintiffs to bring the suits and the plaintiff has to expect a 
fair shake.  And on the other hand the insurance companies (who would be 
most affected by a decision against the defendant) would have to expect 
a fair shake, or else they would reject the court's good faith and 
undermine the ability of the court to attract paintiffs who would expect 
to be paid by the insurance companies.  It should be added that these 
interests would frequently carry over into the field of contracts since 
insurance companies are frequently on both sides of contract actions.

COMPLETE OBJECTIVITY

Finally, I would like to reflect on real estate transactions, the main 
problem being: what manner of objective law would operate so that people 
could always know who owns what property?  This would be done through 
Title Insurance companies.  Title Insurance is probably the greatest 
stabilizing factor in real estate today.  Almost every sale of real 
estate is accompanied by a purchase of title insurance, in which the 
insurer guarantees the validity of the title.  In the absence of 
government, title insurers would develop a fair and objective system of 
title law and registration.  It is in their rational interest to do so 
since they represent buyers or sellers in any transaction and have an 
absolutely complete need for objectivity, since they must always know in 
advance what the law is and who the previous owners were.  Their 
absolute need for objectivity is the guarantee that the public would 
accept the title registration system as the best evidence of title.

TECHNOLOGICAL EXPERIMENT

There is one advantage to a private court system over a government court 
system that I have not heard mentioned before.  That is that private 
courts do not need anybody's permission to experiment with technological 
advances to improve the quality of the courts and trial system.  If the 
experimenters fail, they hurt only themselves and those who freely 
selected them; if they succeed, they have created something that other 
courts can take advantage of.
 
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