Introduction

The Case

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

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

Caveat Emptor

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

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

The Aftermath of Chandelor In US Law

Useful Links

Attachments

• Chandelor_v_2.pdf: Chandelor_v_2.pdf

Abstract

The Characters

The Case

The Holdings

The Aftermath

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

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

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

While scholars are not certain as to when the theory of Caveat Emptor came into being, most agree that Chandelor v. Lopus is the original example of the doctrine under English common law. The decision essentially made the fairness of commercial transactions a matter that contracting parties were to handle by themselves. The court’s decision set the standard for minimalist judicial intervention in the commercial sphere and demonstrated a commitment to non interference with individual contracts.

The Characters

Chandelor: Occupation: Goldsmith. In early European societies goldsmiths were organized into guilds and were one of the most important and wealthy occupations in a city. Membership in guilds was compulsory, and established both quality and price control on its members. The guild also included a system of training and education for its artisans. In society, 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 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.

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 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.

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.)

As Applied in the Common Law:

As applied in the larger common law Chandelor stood for the notion that unless a merchant specifically warranted an object as sound, the buyer must accept the risk that it may not be. As a policy measure, buyers were encouraged to seek express warranties and were theoretically in a position to do such with their buying power. In actuality the ruling made sellers hesitant to expressly guarantee their wares- a problem that led to the eventual curtailment of this policy in American Jurisprudence.

The Aftermath 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. It has been largely heralded as the birth of “Caveat Emptor” the Latin phrase meaning “let the buyer beware.” Under the English common law, this legal doctrine held the buyer of goods responsible for purchasing defective merchandise, unless the seller had definitively warranted their condition, or had attempted to actively conceal defects. While Chandelor stood for the idea of Caveat Emptor in the English Legal, Seixas v. Wood is considered its American counterpart. Here 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). While the Chandelor case made it of no consequence that the defendant fraudulently held his item as a bezar stone, its progeny has been fairly adamant in stating that knowingly mischaracterizing a sale will be a cause of action in the courts. 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, Chandelor’s legacy largely put buyers in a considerable quandary. Sellers had little incentive to give warranty express warranties as this would expose them to legal risk. Additionally, buyers were less and less able to properly inspect the inner workings of increasingly complex and advanced merchandise. The seminal American case which began a real scaling back 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, the idea still claims considerable weight with transactions where the goods are easily inspected. For example, in most American jurisdictions, the rule of Caveat Emptor still specifically applies with 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 Caveat Emptor- to ensure that buyers inspect and are diligent in their purchases.

Mikhaile

Lopus v. Chandler