(Please note: this lecture was originally meant to be published in a collection of lectures. That did not happen. The footnotes have not been checked so the text should be used with caution.)
F.W.MAITLAND AND THE RIDDLE OF THE MODERN WORLD
I am greatly honoured to be giving this lecture in memory of F.W.Maitland and to be doing so in his old College and in the presence of distinguished friends and colleagues. In this short address I can only briefly hint at a side of Maitland's work which may not be familiar to all of you.
We all know of Maitland as a great historian, perhaps the greatest England
has produced. What I shall suggest here, and try to demonstrate at greater length
elsewhere, is that Maitland is also one of the greatest political economists
of modern times, on a part with such writers as Montesquieu, Adam smith and
Tocqueville. I believe that he never ceased the enquiry started in his Trinity
Fellowship Dissertation entitled 'A Historical Sketch of Liberty and Equality
as Ideals of English Political Philosophy from the Time of Hobbes to the Time
of Coleridge'. Particularly in his last years he came as close as any thinker
can do to explaining the mechanism which overcomes the contradiction at
the heart of modern civilization.
The Riddle of the Modern World has many aspects and in order to simplify them here I shall just draw attention to one previous attempt to solve the question of how and why modern liberty, equality and wealth had emerged. Alexis de Tocqueville had suggested that something strange had emerged in the 'modern' parts of the West, namely in England and particularly America, an this in this their civilization had deviated from the 'normal tendency' which had gripped all other ancien regime societies. He had noted that there was a developing tendency in much of Europe from about the fifteenth or sixteenth centuries for the central power to abolish all the intermediary bodies, that is to withdraw any franchises previously given to towns, local assemblies and parliaments. Any corporate group which derived its power from the State became a threat to the State and was undermined. In modern terms, Civil Society had been abolished by its enemies. In the end one had the State and the Individual - with very little in between. There were very few ways in which individuals could associate without incurring the jealousy of the State.
Tocqueville also saw that one country seemed to have developed along a different path. He laid a great stress in his work on America on the free associations which the Americans constantly set up. These associations were the essence of their religious, social and economic dynamism. Without them, wealth and liberty would vanish. Thus Tocqueville had isolated the structural mechanism which linked social and legal forms through to religious and economic liberty. What he lacked was the training and deep knowledge of medieval European law to see what the 'point of departure' of this key difference was. He traced it back to England, but was unable to pursue the matter further. It is with Maitland that we receive an answer.
That the Roman corporation was not the root of modern freedom.
Maitland started his account with the universal need for some kind of group above the level of the individual. 'Every system of law that has attained a certain degree of maturity seems compelled by the ever-increasing complexity of human affairs to create persons who are not men, or rather (for this may be a truer statement) to recognize that such persons have come and are coming into existence, and to regulate their rights and duties.' The essence of what has to be set up, the corporation or embodiment, he describes as follows. 'The core of the matter seems to be that for more or less numerous purposes some organized group of men is treated as an unit which has rights and duties other than the rights and duties of all or any of its members... lawyers from the thirteenth century onwards have been wont to attribute to the corporation a "personality" that is "fictitious" or "artificial".'
The corporation thus has considerable power. The crucial question is where it derives its power. In relation to English boroughs Maitland early argued that 'Incorporation must be the outcome of royal charter...The king makes something. He constitutes and erects a body corporate and politic in deed, fact and name (in re, facto et nomine).' This leads to what is known as the 'Concession Theory'. That is to say 'The corporation is, and must be, the creature of the State. Into its nostrils the State must breathe the breath of a fictitious life, for otherwise it would be no animated body but individualistic dust.' Thus 'the corporation does not grow by nature; it must be made, by the act of parliament, or of the king, or of the pope...'
The absolutist element in this State derivation is spelt out by Maitland with clarity, for 'what was understood to be the Roman doctrine of corporations was an apt lever for those forces which were transforming the medieval nation into the modern State. The federalistic structure of medieval society is threatened. No longer can we see the body politic as communitas communitatum, a system of groups, each of which in its turn is a system of groups. All that stands between the State and the individual has but a derivative and precarious existence.' Thus, paradoxically, rather than strengthening the individual in relation to the State, the corporation became an indirect way of weakening the subject. France provided a very good example, as Montesquieu and Tocqueville had earlier realized. In France, 'I take it, we may see the pulverising, macadamising tendency in all its glory, working from century to century, reducing to impotence, and then to nullity, all that intervenes between Man and State...In this, as in some other instances, the work of the monarchy issues in the work of the revolutionary assemblies. It issues in the famous declaration of August 18, 1792: "A State that is truly free ought not to suffer within its bosom any corporation, not even such as, being dedicated to public instruction, have merited well of the country." That was one of the mottoes of modern absolutism: the absolute State faced the absolute individual.' It is this view of the tendency to absolutism, and the way a Roman concept of corporations aided it, that explains remarks Maitland made in a letter to Henry Jackson in 1900. 'The subject of my meditation is the damnability of corporations. I rather think that they must be damned...' He ends the letter by looking forward to a great work. 'Then for the great treatise De Damnabilitate Universitas.'
The solution lies elsewhere: the development of the Trust idea.
If, then, it was not the Roman Law corporation that led towards the vibrant world of American associationalism, where did the key lie? Here, in the last five years of his life, Maitland started to see the answer. It was an accidental, unexpected and chance one. It lay in the development of a device that was a bi-product of many forces, in particular the inadequacies of Roman law and the structural tensions in English society in the thirteenth century. His excitement on discovering this key to the riddle is palpable. In a letter to John Gray in 1902 he wrote of 'a matter of great historical importance - namely the extreme liberality of our law about charitable trusts...I think that continental law shows that this was a step that would not and could not be taken by men whose heads were full of Roman Law.' The individual was acting like a king. 'Practically the private man who creates a charitable trust does something that is very like the creation of an artificial person, and does it without asking leave of the State.'
In the few years before his premature death he came to believe that the Trust concept was probably the most important of all English legal contributions. He wrote 'The idea of a trust is so familiar to us all that we never wonder at it. And yet surely we ought to wonder. If we were asked what is the greatest and most distinctive achievement performed by Englishmen in the field of jurisprudence I cannot think that we should have any better answer to give than this, namely, the development from century to century of the trust idea.' These words were echoed in a letter to John Gray in November 1903, 'Some one ought to explain our trust to the world at large, for I am inclined to think that the construction thereof is the greatest feat that men of our race have performed in the field of jurisprudence. Whether I shall be able to do this remains to be seen - but it ought to be done.' Increasingly ill, Maitland was unable to perform the task and died within three years. But he has given us glimpses of how he would have approached the subject and why he thought it so very important.
Maitland pointed out that the English Trust emerged out of a dilemma. 'The Englishman cannot leave his land by will. In the case of land every germ of testamentary power has been ruthlessly stamped out in the twelfth century. But the Englishman would like to leave his land by will. He would like to provide for the weal of his sinful soul, and he would like to provide for his daughters and younger sons. That is the root of the matter. But further, it is to be observed that the law is hard upon him at the hour of death, more especially if he is one of the great. If he leaves an heir of full age, there is a relevium to be paid to the lord. If he leaves an heir under age, the lord may take the profits of the land, perhaps for twenty years, and may sell the marriage of the heir. And then if there is no heir, the land falls back ("escheats") to the lord for good and all.' To get round the problem, the 'landowner conveys his land to some friends...' 'They are to hold it "to his use (a son oes)". They will let him enjoy it while he lives, and he can tell them what they are to do with it after his death. I say that he conveys his land, not to a friend, but to some friends. This is a point of some importance. If there were a single owner, a single feoffatus, he might die, and then the lord would claim the ordinary rights of a lord...Enfeoff five or perhaps ten friends...("as joint tenants"). When one of them dies there is no inheritance; there is merely accrescence. The lord can claim nothing.' This idea came out of Anglo-French law, 'it is not in Roman books that Englishmen of the fourteenth century have discovered this device.'
The desire of the landowners to avoid the strict implications of primogeniture and royal power would have failed if it had not coincided with the developing interest of one of the very strongest of royal officials, the Chancellor, to provide a new legal flexibility to supplement the Common Law through the system of equity. 'The Chancellor began to hold himself out as willing to enforce these honourable understandings, these "uses, trusts or confidences" as they were called, to send to prison the trustee who would not keep faith. It is an exceedingly curious episode. The whole nation seems to enter into one large conspiracy to evade its own laws, to evade laws which it has not the courage to reform. The Chancellor, the judges, and the Parliament seem all to be in the conspiracy. And yet there is really no conspiracy: men are but living from hand to mouth, arguing from one case to the next case, and they do not see what is going to happen.' These trustees were not a perpetual corporation. They were not set up or "incorporated" by the State. Yet they had 'a jointness about them so that they could act as one body.' They were a 'fictitious person', recognized by the law, but nothing to do with the State.
The growth of this device proceeded apace, both nourishing and being protected by the growth of 'equity'. The royal power as well as the lawyers turned a blind eye to this development, which seemed at first so innocuous. When it became clear that it was developing into a major threat to royal power and finances, Henry VIII tried to crush the Trust. But it was too late and the trust continued on its way. By the late sixteenth century an alternative set of methods to form meaningful, enduring, associations of citizens in pursuit of a common goal - for it was widening out from just passing property across the generations - had been developed. It was becoming particularly important for the setting up of charities and good works.
Maitland drew attention to some of the benefits of this development, in particular as a supplement to the idea of corporations or universitas. He described the situation thus, describing the period roughly from 1500 to 1900. 'For the last four centuries Englishmen have been able to say, "Allow us our Trusts, and the law and theory of corporations may indeed be important, but it will not prevent us from forming and maintaining permanent groups of the most various kinds: groups that, behind a screen of trustees, will live happily enough, even from century to century, glorying in their unincorporatedness. 'The trust deed might be long; the lawyer's bill might be longer; new trustees would be wanted from time to time; and now and again an awkward obstacle would require ingenious evasion; but the organized group could live and prosper, and be all the more autonomous because it fell under no solemn legal rubric.' The diversity and vagueness of what a trust could be helped it in its flourishing diversity. Whatever was useful and broadly 'charitable', in the words of mutual benefit to those involved (other than the trustees) and not illegal, could be pursued.
The Trust was, as Maitland realized, something very peculiar, somehow bridging the gap between status and contract, between people and things. Although it forms people into powerful groups, 'It has all the generality, all the elasticity of Contract.' A sleight of hand had to be performed which puzzled continental lawyers and is difficult to explain. 'I" do not understand your trust," these words have been seen in a letter written by a very learned German historian familiar with law of all sorts and kinds. Where lies the difficulty? In the terms of a so-called "general jurisprudence" it seems to lie here:- A right which in ultimate analysis appears to be ius in personam (the benefit of an obligation) has been so treated that for practical purposes it has become equivalent to ius in rem and is habitually thought of as a kind of ownership, "equitable ownership." Or put it thus: If we are to arrange English law as German law is arranged in the new code we must present to our law of trust a dilemma: it must place itself under one of two rubrics; it must belong to the Law of Obligations or to the Law of Things.... It was made by men who had no Roman law as explained by medieval commentators in the innermost fibres of their minds.' Maitland explains roughly how the Chancellor somehow managed to muddle the two. 'We know what happened. No sooner had the Chancellor got to work than he seems bent on making these "equitable" rights as unlike mere iura in personam and as like iura in rem as he can possibly make them. The ideas that he employs for this purpose are not many; they are English; certainly they are not derived from any knowledge of Roman law with which we may think fit to equip him. On the one hand as regards what we might call the internal character of these rights, the analogies of the common law are to be strictly pursued.' And above all, what was set up was an entity which has been created by ordinary citizens and not by the State. In other words, a personal right had been turned into a property right. This was totally against the spirit of Roman Law. 'In truth and in deed we made corporations without troubling king or parliament though perhaps we said that we were doing nothing of the kind.'
The effects of this were diverse. One was in contributing to political freedom. Here Maitland assumes the voice of a continental lawyer, who speaks as follows. '"There is much in your history that we can envy, much in your free and easy formation of groups that we can admire. That great 'trust concept' of yours stood you in good stead when the days were evil: when your Hobbes, for example, was instituting an unsavoury comparison between corporations and ascarides, when your Archbishop Laud (an absolutist if ever there was one) brought Corporation Theory to smash a Puritan Trust, and two years afterwards his friend Bishop Montague was bold enough to call the king's attention to the shamelessly unincorporate character of Lincoln's Inn ... your thoroughly un-Roman "trust concept" is interesting to us.'
His ideas here are fascinating, but I can only list them. The right to political associations, for example in the Trades Union movement or other political leagues. The de-centralization of power to local and regional bodies, for example the 'County'. The growing concept of all political power as a 'Trust', held for the people. The idea of the British Empire as a huge Trust, held for the people's who were ruled. In other words the very essence of modern democracy stemmed from this concept.
Equally important, as Maitland realized, were the effects of the possibility of having non-incorporated bodies in the field of religion. Maitland shows how the trust became a key defence of religious nonconformity and the sects. Any religious organization needs to form itself into some kind of permanent group. For instance, it needs a place of worship. Since such buildings had to be funded and maintained, how was this to happen? The State, associated with a Catholic or Anglican settlement was hardly likely to give them corporate status. What the Methodists, Baptists, Quakers and others did was to set up trusts. Groups of trustees ran their affairs and were recognized by the law. As Maitland pointed out, it is likely that without this legal loop-hole, the whole of nonconformity would have been crushed. Religious liberty and the trust were deeply tied together.
This is how Maitland himself draws the lines. 'All that we English people
mean by "religious liberty" has been intimately connected with the
making of trusts. When the time for a little toleration had come, there was
the Trust ready to provide all that was needed by the barely tolerated sects.
All that they had to ask from the State was that the open preaching of their
doctrines should not be unlawful.' All that was required by the State was minimal.
For 'if the State could be persuaded to do the very minimum, to repeal a few
persecuting laws, to say "You shall not be punished for not going to the
parish church, and you shall not be punished for going to your meeting-house,"
that was all that was requisite. Trust would do the rest, and the State and
das Staatskirchenthum could not be accused of any active participation
in heresy and schism. Trust soon did the rest. I have been told that some of
the earliest trust deeds of Nonconformist "meeting-houses" say what
is to be done with the buildings if the Toleration Act be repealed. After a
little hesitation, the courts enforced these trusts, and even held that they
were "charitable". And now we have in England Jewish synagogues and
Catholic cathedrals and the churches and chapels of countless sects. They are
owned by natural persons. They are owned by trustees.' Maitland illustrated
this with the case of the Wesleyans, whose chapels were set up as trusts. 'Now-a-days
we see Wesleyan chapels in all our towns and in many of our villages. Generally
every chapel has its separate set of trustees...'
Linked to religious liberty was economic liberty. In terms of economic development, a device was needed which would allow people to come together to co-operate in some venture of a new kind. This was the era when new insurance facilities were needed. It was a time when traders and manufacturers needed to form themselves into joint-stock arrangements. The law of trusts made all this possible. In all these cases the entity was recognized by the law, yet did not draw its strength directly from the Crown. It was a free association of individuals, who had bound themselves together.
Again, let us look at Maitland's account of some of the effects. Two examples Maitland describes in some detail may be given. He traces the history of the development of a late seventeenth century coffee house owned by Edward Lloyd, embodied in the mid eighteenth century in a small trust fund and later, in 1811, a trust deed with eleven hundred signatures. So was developed the great insurance firm of Lloyds. Maitland could easily have added numerous other examples of banks or mutual (or building) societies. But his second example was the London Stock Exchange. He describes how it grew from people meeting in an eighteenth-century coffee house into a group of trustees. By the later nineteenth century it was vast and wealthy. In 1877 some people recommended that after all these years as a trust it should be incorporated. 'And so the Stock Exchange was incorporated? Certainly not. In England you cannot incorporate people who do not want incorporation, and the members of the Stock Exchange did not want it.'
One of the advantages of the fact that many of the pivotal economic institutions in England from the sixteenth century developed as trusts would have been appreciated by Adam Smith. New economic enterprises, for example long distance trade, or marine insurance, or making a new product, are risky. The individual needs protection, some limitation of liability, mutual assurance. Yet if the protection is given by the government, it very often takes the form of a monopoly. As Smith pointed out, this could easily turn out over time into something that would inhibit creative development. But it was of the essence of trusts that they were not monopolistic. If someone else wanted to set up a marine insurance company or a building society the trustees could not prevent them. It provided a protection for the members without inhibiting new comers. It was thus the ideal situation for competition with protection, for uniting individuals in a way that did not inhibit other individuals. It is difficult to see how the wealth of industrial England could have been created without it.
A third equally important area which Maitland touched on was in relation to social liberties. He noted that a foreigner thinking of England would have noted 'you have been great makers of clubs.' The one club Maitland took as a example was the Jockey Club. 'I believe that in the eyes of a large number of my fellow-countrymen the most important and august tribunal in England is not the House of Lords but the Jockey Club; and in this case we might see "jurisdiction" - they would use that word - exercised by the Verein over those who stand outside it. I must not aspire to tell this story. But the beginning of it seems to be that some gentlemen form a club, buy a race-course, the famous Newmarket Heath, which is conveyed to trustees for them, and then they can say who shall and who shall not be admitted to it.' He also referred to 'your clubs and those luxurious club-houses which we see in Pall Mall.' But there were numerous others. Clubs were also closely related to intellectual activities, for example the Royal Society, British Academy and numerous working men's clubs were of enormous importance in furthering science and learning. He noted that 'many learned societies', including the one he had founded, the Selden Society, were run by trustees, as were key institutions such as the London Library. While it struck Tocqueville that America was notable for its associations, it has struck many that one of the great peculiarities of England is its creativity in the field of inventing quasi-groups: it is charitable, social, scientific and literary, 'clubs' and associations.
Another area which Maitland rightly sees as important is what he calls 'social experimentation' and which we might roughly term innovation. He writes as follows:- 'First and last the trust has been a most powerful instrument of social experimentation. To name some well-known instances:- It (in effect) enabled the landowner to devise [leave] his land by will until at length the legislature had to give way, though not until a rebellion had been caused and crushed. It (in effect) enabled a married woman to have property that was all her own until at length the legislature had to give way. It (in effect) enabled men to form joint-stock companies with limited liability, until at length the legislature had to give way. The case of the married woman is specially instructive. We see a prolonged experiment. It is deemed a great success. And at last it becomes impossible to maintain (in effect) one law for the poor and another for the rich, since, at least in general estimation, the tried and well-known "separate use" has been working well. Then on the other hand let us observe how impossible it would have been for the most courageous Court of Common Law to make or to suffer any experimentation in this quarter.' Thus the device of the trust affected not only individuals, but categories - married women, the poor (through boards of guardians, poor law funds and charity) the young and so on.
Summarizing Maitland's illuminating insight into the solution to Tocqueville's puzzle concerning the origins of associations, we can say that in England from about the thirteenth century there began to develop a society which had various essential constituents. It had a powerful Crown and a ruling group in parliament. The centre was not weak - but it was limited in its power by two other levels. In the middle was a crowd of what would now be called Quangos - Quasi Autonomous Groupings. Autonomous in that they were not set up by the centre. Quasi because they had to reside within the law. The secret or anti-State organizations which have been the bane of most governments, masons, mafia, triads and a host of others, were not necessary. The rights of association, so important later for the trades union and the labour movement, allowed people to associate. They were encouraged to put their energies into constructive reform, rather than covert undermining.
Thus through the widening development of the concept of the Trust, there also, indirectly, developed a world of trust and openness, which is the basis not only of capitalism but also for modern science. This really is, if we combine Tocqueville and Maitland, one of the keys to the riddle.
Maitland does not often openly reflect on the effects of England's separate legal, political and social development. In some ways, it was all too obvious. He lived in London and Cambridge in the last half of the nineteenth century, at the heart of the most powerful empire the world had ever known, a country which was a pioneer of a new form of industrial-scientific civilization based on a parliamentary system which was being copied around the world. It was all part of the air he breathed. Yet he did make remarks which show his wonder at what had developed. 'The system which in 1601 prevailed in the southern half of a small island has thence spread outwards until it has become the greatest system that the world has known.' At the time that he wrote, it covered not only the whole of the British Empire, but also 'throughout the whole or nearly the whole of one immense country into which [Queen Victoria's] writ will not run', namely America, where Tocqueville had so carefully traced its effects. The liberty, equality, individualism and wealth of the world we know were all deeply influenced by those accidental developments.
What had happened was that through an accidental legal device, the Trust, a form of flexible grouping had been invented and proliferated. This may turn out to be one of the most important steps in human history.
In a trick which is so difficult to understand, a civilization has emerged which has separated off different parts of life, the institutions of power (politics), wealth (economics), knowledge and belief (religion), warmth and procreation (kinship). But the intolerable burden of living in such a world, the enormous inefficiency of a world of isolated, non-trusting, individuals who would be the only locus of contact between the separated spheres, is overcome by a new flexible institution, whose proto-type was the trust. This is something akin to the reciprocal altruism of the biologists, but with humans is much more than that, and develops into an extraordinary mixture of flexibility and commitment, of individual and community, of calculation (reason) and loyalty (emotion). This is what resolved the famous eighteenth and nineteenth century dichotomies; the oppositions between head and heart, mind and body, individual and society, Community and Association, Status and Contract, Mechanical and Organic Solidarity and so on. It was this resolution of the contradictions which gave Maitland hope, as his sickness increased and death loomed at the age of 56, that a new world which combined liberty, equality and wealth was both possible and might continue.