Introduction

The legacy of Chandelor v. Lopus demonstrates evolving notions of warranty and contract legal theory under the English Common Law. Specifically, the case represents the scope of medieval concepts such as caveat emptor and warranty, and traces the movement of claims that originally sounded in tort through their assimilation into contract law.

The Case

Chandelor v. Lopus, 79 Eng Rep. 3. (1603) In the Exchequer- Chamber

The defendant(Chandelor) was a goldsmith and had a special knowledge in precious stones. This Defendant owned a stone which he affirmed to the Plaintiff Lopus was a bezar stone and sold it to Lopus for 100 pounds. Lopus subsequently found that the stone possessed no healing powers and sued Chandelor before the King’s Bench. Defendant pleaded not guilty, however a judgment was entered for the plaintiff in the King’s Bench.

The court in the Exchequer Chamber reversed the decision on a procedural point claiming that the plaintiff (Lopus) had not alleged or proven that the defendant had actually warranted the stone to be a bezar. The court claimed that “the bare affirmation that it was a bezar-stone, without warranting it to be so, is no cause of action: and although [the defendant] knew it to be no bezar-stone, it is not material; for everyone in selling his wares will affirm that his wares are good, or the horse which he sells is sound; yet if he does not warrant them to be so, it is no cause of action, and the warranty ought to be made at the same time of the sale.” Chandelor v. Lopus, 79 Eng. Rep. 3. Anderson, J., dissented in part yet affirmed the outcome. He argued that the deceit in selling the stone as if it were a bezar stone, when it was not, was indeed a sufficient cause of action for the plaintiff.

The Holdings

1) The court held that the quality of the bezar stone, which the seller had not expressly warranted, is a risk the buyer must assume and

2) That there was no fraud in selling the stone as a bezar, so long as the seller did not expressly warrant it to be one.(The court found the mere affirmation that the rock was a bezar was not enough for it to be a promise or a warranty.)

The Historical Context of Chandelor v. Lopus

In order to fully understand the legal theory at work in Chandelor, it is important to have a brief understanding of the contractual formats and remedies available for plaintiffs as well as their limitations. The language used to enforce what we would consider contractual agreements, was very specific at the time and the manner in which a complaint sounded would dictate jurisdiction and largely the outcome.

Historically, before the introduction of Assumpsit, contractual actions in English law were Debt, Detinue, Account and Covenant, which were all based on non parol formalize contracts.(James Barr: The History of Parol Contracts Prior to Assumpsit) The most important contractual theory for our immediate case was the action in Covenant. As it applied to merchant transactions and everyday commerce, Covenant was the most common contractual complaint. “Before 1200, there was a royal writ in the form of praecipe to enforce covenants, and the formula settled in the 13th century was ‘order the defendant to keep the covenant’ made between him and the plaintiff,” however by “1321… royal judges had decided that the only acceptable evidence of a covenant in the royal courts was deed-a written document under a seal.” (J.H. Baker, An Introduction to English Legal History pg. 318)

In addition to the procedural requirements which made covenant a difficult claim to prove, claimants were also limited by the remedies offered by the action. The formulaic remedy, ordered the defendant to keep the covenant contemplated, therefore requiring specific performance. (Ibid) While covenant proceedings shifted in later years allowing more liberal remedies, at the time of Chandelor, their rigidity made them a difficult form of action for medieval claimants. As applied to the facts of the Chandelor case, it is evident how specific performance was not ideal. In the arena of merchant transactions, where one simply wanted a refund, specific performance was not the choice remedy and left the medieval plaintiff with few options.

Warranty, Tort and Covenant Parallels

Because of the procedural requirements of actions sounding in covenant, and other restrictions of contractual claims, actions upon contracts had to subvert the hurdles put in place by the pleading standards of the day. The requirement of written deed was one of the most onerous restrictions for access to the King’s Courts (although remedy laid in many municipal courts without deeds) as most transactions were done without them and merchants had little incentive to add them when faced with liability. As a result, plaintiffs shifted their claims in attempts to circumvent the procedural restrictions of covenant.

In contractual cases of misfeasance, or where an undertaking was made, and performed poorly the courts began to uphold these actions as a tortuous action of trespass, which did not need to be proven by deed. “The cases of 1374 and 1388 show that, although action layed for the wrong, the undertaking was recognized both as covenant and as being part of the cause of action…where trespass was brought for an act of misfeasance, and no one suggested that there should be a deed. ” (Baker,331) Where plaintiffs would be barred from bringing claims under the older contractual notions of covenant, the court’s shift turned on the separation of these claims into parts sounding in contract and others sounding in tort. Where a plaintiff complained not of the failure to perform a contract, but its impartial or poor performance an action of trespass was available for the suffering of the plaintiff due to his poorly performed result. (Brown, 332) This action concurrently evolved with the contractual action of Assumpsit, which eventually provided remedy for poorly performed undertakings.

Medieval Warranty

The same judicial logic played a role in the development of warranty law under the English legal system and the parallels between these actions for misfeasance and the earliest claims of deceitful warranty are clear. Under this line of thinking breach of warranty claims where the plaintiff was deceived into the bargain were not considered contractual actions since the contract or agreement underlying the warranty had already been performed. Rather they were considered as tortuous trespass for “cheating,” and “not a mere broken word.” (Ibid)

The first tort actions of deceit were for breach of express warranty where the defendant knew the warranty was untrue. These actions first appeared in the last quarter of the 14th century. (Kevin M. Teevin, A History of Anglo American Common Law of Contract pg. 135) Much like the procedural requirements of actions in covenant, “sales of unfit goods were not a deceit unless there was an express warranty, and this lack of actionability was reinforced with the emergence of the doctrine of caveat emptor.” (Ibid)

Caveat Emptor

Caveat emptor, meaning “let the buyer beware” was an indigenous development unique to the common law. The term was first used when Fitzherbert wrote about the purchase of a horse in 1534: “if he be tame and have been rydden upon, then caveat emptor.”(Ibid,138)

Due to an increasingly impersonal market place, sellers were often unable to be contacted for complaint if a sale did not satisfy a buyer. The result was the rule caveat emptor which stood for the principle that unless expressly warranted, a buyer would be responsible for purchasing unfit goods. This policy helped to streamline complaints that could be brought to the common law courts, and also to expedite commercial transactions which were becoming increasingly faceless. The court in Chandelor, demonstrated the depth of the caveat emptor line of legal thinking. The case demonstrated that “if there is no warranty… an action on the case does not lie, even though [the buyer] is deceived.” (Chandelor v. Lopus) The court was clear to draw a distinction between the embellishment of a saleman in hawking their wares and the formalized expression of warranty.

Also clear in this case was that the defendant’s scienter would only be of consequence when there was a direct and express warranty. Although the defendant in the case knowingly claimed the falsity of the bezar stone’s value, the court found the lack of an express warranty dispositive. While the salesman in Chandelor claimed the bezar stone contained magical powers, this assertion was not considered a warranty as it was not evidenced in writing nor were there affirmations strong enough to qualify it as such. The judges noted the importance of the case, in that judicial economy would be wasted by making a cause of action liberally available based on bare affirmation on the part of the seller. This is one of the reasons the court is clear in separating mere puffery in selling an item, from what would be construed as an express warranty.

Chandelor's Aftermath and Convergence with Contract Law

In the aftermath of Chandelor, the cases for deceitful express warranty were allowed without regards to the seller’s scienter. Judge Holt quickened the demise of this requirement by extending liability without scienter to cases of implied warranty. He announced a contractual approach in Crosse v. Gardner by allowing actions on the case based on implied warranty of title; where the seller’s bare affirmation that the goods in his possession were actually his would stand as a warranty.

While the earliest warranty cases were tortuous actions (Chandelor being one of which as it was a trespass action)the claim was actually becoming contractual in nature since the question now was whether the defendant was deceived out of his bargain rather than whether the defendant was dishonest.(Teeven, 137) This resembled more of the contractual theories of the time since liability was absolute and by the time of Mansfield a change in the notion of deceit on warranty was clear.

Mansfield saw little difference between breach of warranty sounding in tort and one in contract. The reasoning behind this was that the tort action of deceit on a warranty had been available only for the reliance of the plaintiff entering into a contract with the defendant and the deceit action on a warranty was contractual in theory since the scienter requirement was dropped. The parallel advance of warranty law and contract law converged under Mansfield, as in 1778 in the case of Stuart v. Wilkins, Mansfield declared that an express warranty of quality was enforceable in Assumpsit concluding that a warranty extends to all faults known and unknown to the seller. (Ibid, 138)

Chandelor Extended: The Characters

Chandelor: Occupation: Goldsmith. In European societies at the time of the Chandelor ruling, goldsmiths were one of the most important and lucrative trades in society. They were organized into guilds which established both quality and price control on its members. The guild also included a system of training and education for its artisans. In effect Goldsmiths often acted as bankers, since they dealt in gold and had sufficient security for the safe storage of valuable items. Their work included not only with gold but close association with most precious stones and metals. Chandelor’s occupation as a goldsmith is important for a couple of reasons. Primarily, it establishes his competitive advantage in knowledge of precious stones over Lopus, demonstrates the relative power of his trade, and also serves to demonstrate the common critique that caveat emptor proved most beneficial to the upper class. This critique, as well as large gaps in the ability to garner information about a product have largely led to the demise of Caveat Emptor in modern commercial transactions.

Jan van Eyck’s Portrait of the Dean of the Goldsmiths’ Guild in Bruges demonstrates the lofty social status of Goldsmiths during this time.

Lopus: Occupation: Unknown. As telling as Chandelor’s profession was for historical context, it is equally interesting that the record mentioned no descriptive detail about Lopus, neither citing any experience with precious stones nor describing his trade. Despite extraordinary efforts I have found no such information on him.

Bezar Stone: A Bezoar stone is a mass formed in the stomach of animals that does not pass into the intestine. These stones were largely found from wild goats in Arabia and caused from toxins the animals were introduced to. The stones were largely believed to have special curative powers and were thought to be able to counteract any poison.

Intestinal products such as this were revered as pricey Bezar (Bezoar more commonly) stones.

The Aftermath of Chandelor In US Law

While Chandelor was decided on procedural grounds, subsequent reliance on it as precedent has focused on the fact that the defendant was not allowed a cause of action against a vendor who sold him unfit merchandise. For the purposes of modern American contract law,it has been largely heralded as the birth of “Caveat Emptor”

While Chandelor stood for the idea of Caveat Emptor in the English Legal history, Seixas v. Wood is considered its American counterpart effectively incorporating the precedent, however not with its unique importance in the development of the English Common Law of Contract. In Seixas, a merchant sold wood to the plaintiff which had been advertised as braziletto wood. Despite this advertisement, the merchant inadvertently sold the defendant peachum wood instead. The court relies heavily on Chandelor in finding that in the absence of the merchant’s fraud, the plaintiff had a duty to inspect his purchase and to obtain an express warranty from the seller. Seixas v. Wood, 2 Cai. R. 48 (N.Y. Sup. Ct. 1804). Laidlaw v. Organ, a decision written in 1817 by Chief Justice John Marshall, is believed by scholars to have been the first U.S. Supreme Court case which laid down the rule of caveat emptor in U.S. law.

As applied in American Law, Chandelor’s legacy largely put buyers in a considerable quandary. Sellers had little incentive to give express warranties as this would expose them to legal risk. Additionally, buyers were less able to properly inspect the inner workings of increasingly complex and advanced merchandise. The seminal American case which began the demise of the Caveat Emptor doctrine was Hawkins v. Pemberton, 51 N.Y. 198 (1872). Here, the defendant sold bottles labeled “blue vitriol” to the plaintiff and had simply bought the bottles from a supplier and never checked their contents before reselling. The item actually turned out to be of inferior quality and although the defendant attempted to argue that Seixas held as there was no express warranty, the court held that “the rule [in Seixas] has been thoroughly overturned since the courts held that any positive affirmation or representation as to the character or quality of an article sold may constitute a warranty.” Hawkins v. Pemberton, 51 N.Y. 198 (1872). In 1906 the Uniform Sales Act was introduced and adopted by half of the States in the union. It worked to codify the holding in Pemberton, stating that “any affirmation of fact or promise by the seller relating to the goods is an express warranty if the natural tendency of such affirmation or promise is to induce the buyer to purchase the goods, and if the buyer purchases the goods relying thereon.” Article 2 Section 12 Uniform Sales Act.

While the complexities of modern commercial transactions led to the demise of Caveat Emptor in most transactions, vestiges of it can still be seen with regards to investments and real estate. The concepts in these trades are moderated by consumer protection and disclosure statutes, but absent actual fraud, these transactions demonstrate the clearest application of the policy behind American ideas of Caveat Emptor- to ensure that buyers inspect and are diligent in their purchases.

Useful Links

Kevin Teevin's A History of Anglo-American Common Law of Contract http://books.google.com/books?id=ZOCSQxC0GgwC&pg=PA135&dq=first+actions+of+deceit+last+quarter+of+the+14th+century&ei=sczqSayqOILszASfzqjzCw#PPA138,M1

James Barr: The History of Assumpsit, Select Essays in Anglo-American Legal History, by various authors, compiled and edited by a committee of the Association of American Law Schools, in three volumes (Boston: Little, Brown, and Company, 1909). Vol. 3. http://oll.libertyfund.org/?option=com_staticxt&staticfile=show.php%3Ftitle=2086&chapter=158768&layout=html&Itemid=27

James Barr: History of Parol Contracts Prior to Assumpsit. Select Essays in Anglo-American Legal History, by various authors, compiled and edited by a committee of the Association of American Law Schools, in three volumes (Boston: Little, Brown, and Company, 1909). Vol. 3. http://oll.libertyfund.org/?option=com_staticxt&staticfile=show.php%3Ftitle=2086&chapter=158776&layout=html&Itemid=27

John Salmond: THE HISTORY OF CONTRACT. Select Essays in Anglo-American Legal History, vol. 3 [1909] http://oll.libertyfund.org/?option=com_staticxt&staticfile=show.php%3Ftitle=2086&chapter=158778&layout=html&Itemid=27

Attachments

• seixas_v._wood.pdf: seixas_v._wood.pdf

• Hawkins_v._Pemberton.pdf: Hawkins_v._Pemberton.pdf

• Laidlaw_v._Organ.pdf: Laidlaw_v._Organ.pdf

• Chandelor_v_2.pdf: Chandelor_v_2.pdf